Fall 2009 issue of Horizons

Raise Your Expectations CERTIFIED PUBLIC ACCOUNTANTS AND BUSINESS CONSULTANTS

The American Recovery and Reinvestment Act of 2009 and Its Impact In February 2009, the American Recovery and Reinvestment Act of 2009 was passed by Congress and signed into law by President Obama. The aim of the Recovery Act is to create more than 3.5 million jobs, computerize America’s health system, increase the affordability of college, increase construction and improvements on roads, bridges and mass transit, and provide tax credits to millions of families. In order to carry out these initiatives, Federal funds are being distributed to departments of the federal government, state and local governments, and universities throughout the country. As a result of the Recovery Act, many governments have received substantially more federal funding than in the past, both through supplementation of existing government programs and creation of new governmental programs. The intended use of this federal funding has remained consistent — for example: highway construction, airport construction and community development. However, the difference is how the Recovery Act funds must be spent and tracked and the resulting impact the funds have on the governmental sector. Many of the funds that are received due to the Recovery Act will be included By Katherine Arnold Background

with older projects already being received and will require the governments to take special steps to track Recovery Act funds separately. Other Recovery Act funds will be received as entirely separate projects and thus will be easily identified. As a result of these changes, the Office of Management and Budget has made significant revisions to the A-133 Compliance Supplement for 2009. The Recovery Act updates are included inAppendixVII of theCompliance Supplement March 2009 and focus on the importance of the Single Audit for the achievement of the goals of the Recovery Act. The Compliance Supplement can be obtained at www.whitehouse.gov/omb/ciruculars_ a133_compliance_09toc/. OMB also has established the recovery.gov Web site to provide information on Recovery Act requirements. Under the Recovery Act Title XV, Subtitle A, each organization that uses funds for an infrastructureproject must certify that the project has been subject to the full review and vetting procedures required by law and that it is an appropriate use of taxpayer money. This certification must be a legal document that includes a description of the project, total cost and the amount of Recovery funds used. The certification must be posted for public knowledge on the organization’s Web site and also must link to the recovery.gov Web site. If the certification is not completed, the organization may not use or receive Recovery Act funds. In addition, each recipient of Recovery Act funding is responsible for multiple reporting and tracking requirements. Quarterly reports must include the amount of recovery funds received, the amount of funds expended, a detailed list of projects for which the funds are being used, and a detailed list of subcontractors or subgrants awarded in accordance with the Federal Funding Accountability and Transparency Act of 2006. Among the more significant requirements associated with the Recovery Act are the following: Transparency Certification and Reporting

50 u fall 2009 issue