(Cary, N.C.) Internationally renowned business strategy expert Lea Strickland, MBA/CMA/CFM/CBM/GMC, was a featured panelist for the interactive discussion, “Compliance from Day One to Closeout – Fraud, Waste and Abuse” at the National Conference for the U.S. Small Business Administration’s Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs.
The compliance panel session, held November 4 in Reno, Nevada, drew a capacity crowd of 200 individuals representing government agencies, service providers, lawyers, state auditors, venture capitalists, lenders, and small businesses engaged in putting together grant proposals to secure state and Federal monies.
“With the down economy and the established SBIR and STTR programs, as well as the American Recovery and Reinvestment Act (ARRA) and its millions of dollars of stimulus funds, we’ve seen entrepreneurs and business people from every industrial sector under the sun scrambling to secure a share of money,” Strickland said, adding, “Unfortunately, too many don’t understand or address important compliance issues which can results in costly financial and legal ramifications down the road.”
The focus for the businesses, awarding agencies, state advisory groups, and even consultants has previously been on the proposal and getting the funds, Strickland said. Now with a number of fraud and other cases being highlighted in Congressional hearings, there is recognition that the compliance aspects in the proposal, at award, and all the way to the closeout of the project is something that has to be understood and implemented.
According to Strickland, whether it’s ARRA funds, SBIR/STTR monies, or other state and Federal grants, the lure of Phase I grants of $100,000 or more and the rush to develop a product and get it commercialized leads many businesses to ignore compliance issues. These issues include the actual technical capability of a business using its own employees to satisfy proof of concept staffing requirements; building financial and accounting systems robust enough to accurately track, control, and report use of funds in a timely fashion; being cognizant of the impact of terms and conditions of a grant award on the actual spending of the funds; the financial capability of a grant applicant to pay for business costs beyond using grant monies as its only source of funding; and the importance of intellectual property and research documentation and deliverables.
“If a grant proposal is Phase I noncompliant and the applicant does not address the issue, the application can go all the way through the funding process and even into product development before taxpayer fraud is discovered and the entire business fails due to compliance issues,” Strickland said. ”One court case shows that a research company submitted fraudulent proposals and accepted multiple awards for the same work, none of which was actually executed.”
Attendees approached Strickland after the panel discussion with concerns about fully understanding the requirements of the grants they were seeking, specifically with regard to paying enough attention to terms and conditions related to reporting and auditing and overall business management issues. “There were dozens of people having major ‘uh-oh’ moments after the session, realizing that avoiding oversights at the beginning could be critical to their success,” she said.
The four-day 2009 National SBIR/STTR Conference highlighted renewable energy and energy-efficient technologies, as well as many other emerging and existing technologies bringing together Federal agencies such as the U.S. Department of Defense, Health and Human Services, Department of Energy, Department of Commerce, Department of Education, Department of Transportation, National Aeronautics and Space Administration (NASA), the National Science Foundation (NSF), Environmental Protection Agency (EPA), Small Business Administration (SBA), Department of Homeland Security, and the Department of Agriculture as well as other small business experts in early-stage and advanced-stage ventures.
The panel discussion is one of several events Strickland has been involved with in recent months as regional and national organizations look for assistance in helping small businesses through challenging economic times.
For information on future events, workshops, and seminars featuring Lea Strickland, visit LeaStrickland.com, call (919) 234-3960, or e-mail Lea@leastrickland.com.
Lea Strickland, MBA/CMA/CFM/CBM/GMC, is an internationally renowned business strategy expert applying proven infrastructure management solutions to help businesses and organizations of all sizes build a baseline for success. Regularly leading workshops and presenting at a wide range of industry events, Lea is a sought-after public speaker and thought leader on how to effectively start and grow a business. She is a published book author; has been featured in national business media outlets; and is a contributing columnist to a number of national and regional magazines and websites.