Federal Grant Compliance & Reporting Checklist: Stay on Track & Avoid Pitfalls

Winning a federal grant is a significant achievement for any nonprofit. But once the celebration is over, the real work begins: compliance and reporting. Failure to comply with federal grant regulations can lead to costly mistakes, penalties, or even loss of funding. Use this checklist to keep your organization on track.

Pre-Award Preparation

✅ Understand the Grant Terms – Review the Notice of Award (NOA), grant agreement, and applicable regulations (e.g., 2 CFR Part 200, Uniform Guidance).
✅ Identify Key Personnel – Assign responsibilities to finance, program, and leadership staff for oversight and reporting.
✅ Set Up Financial Systems – Ensure accounting systems can track and report on grant funds separately from other revenue.
✅ Develop Internal Controls – Establish policies and procedures to prevent fraud, waste, and mismanagement.
✅ Train Staff – Educate team members on grant compliance requirements and reporting deadlines.

Spending & Financial Management

✅ Maintain Proper Documentation – Keep records of all expenditures, including receipts, invoices, and payroll records.
✅ Follow the Budget – Ensure spending aligns with the approved grant budget and obtain prior approval for necessary modifications.
✅ Comply with Cost Principles – Expenses must be allowable, reasonable, and allocable to the grant.
✅ Manage Matching Funds & Cost Sharing – If applicable, track matching funds and ensure they meet eligibility criteria.
✅ Ensure Procurement Compliance – Follow federal procurement policies for competitive bidding and conflict-of-interest rules.

Programmatic Compliance

✅ Deliver Grant-Funded Activities – Ensure programs and services meet grant objectives and align with the approved scope of work.
✅ Monitor Subrecipients – If working with subgrantees, oversee their compliance with federal grant requirements.
✅ Follow Performance Metrics – Track and measure outcomes as required in the grant agreement.

Reporting Requirements

✅ Financial Reports – Submit timely reports, such as the Federal Financial Report (SF-425), detailing expenditures and cash on hand.
✅ Programmatic Reports – Provide progress updates, performance metrics, and narrative reports per the grant agreement schedule.
✅ Time & Effort Reporting – Ensure staff salaries charged to the grant are properly documented and supported by time records.
✅ Audit & Monitoring Readiness – Prepare for site visits and audits by keeping all grant records organized and up to date.

Closeout & Post-Award Compliance

✅ Submit Final Reports – Ensure all financial and programmatic reports are submitted on time.
✅ Complete Grant Reconciliation – Confirm all expenses align with the grant budget and properly close out financial accounts.
✅ Retain Records – Maintain grant documentation for at least three years after the closeout date (or longer if required).
✅ Assess Lessons Learned – Review grant performance, identify areas for improvement, and apply insights to future grants.

Final Thoughts

Federal grant compliance doesn’t have to be overwhelming. By using this checklist, your nonprofit can stay organized, meet reporting requirements, and continue to receive critical funding to advance your mission. Need help managing your nonprofit’s finances? Let’s connect! I work with Maine-based nonprofits to provide professional financial management without the full-time cost.