What is a "compliance audit" in the context of grant funding?

A "compliance audit" in the context of grant funding specifically refers to the evaluation of adherence to legal and regulatory requirements. It serves as a methodical assessment to ensure that the grant recipient is following applicable laws, regulations, and the stipulations laid out in the grant agreement. This type of audit is critical to maintaining accountability and transparency in the use of public or private funds, safeguarding the interests of both funders and the communities they serve.

Whereas a review of the project's financial history, an inspection of project facilities, and a survey of participant satisfaction may also form part of broader audit practices, they do not directly address the conformity aspects that a compliance audit specifically targets. Legal and regulatory compliance not only protects the integrity of the funding process but also ensures that public trust is upheld in the grant administration system.