FaHCSIA applies a risk based approach to reporting requirements and the management of funding agreements in line with the Common Business Model for Grant Management approach. The use of performance based funding agreements enables FaHCSIA to manage risk, and includes assessing the risk of provider organisations as well as risks in the delivery of programs and services.
The principles of the FaHCSIA Common Business Model for Grant Management approach are to provide greater consistency in applying funding management processes. This is achieved with flexibility across programs and funding recipients/service providers, applying a differentiated approach to controls (i.e. funding agreements, selection, acquittals, monitoring and reporting), which are determined by the level of risk assessed for the program, provider and for service delivery within the Common Business Model for Grant Management framework.
The following are some of the possible risks that FaHCSIA staff would assess when determining whether an organisation is eligible to be funded:
- Governance: Does the governance structure of the organisation allow for sound and consistent business practice?
- Finance: Does the organisation have a good financial record?
- Performance: Does the organisation deliver the services it would be funded for?
- Reporting: Does the organisation have the capacity to provide financial and performance reports in accordance with the terms and conditions set out in the Funding Agreement?