I am auditor of a state government owned company. The state government gives huge funds for multiple projects to the company almost every year. What would be the points to check (in deep) to determine whether funds are being used appropriately, timely and not misutilized? Whether long term funds are being used for short term purposes? The company was in heavy loss in FY 2017-18. But there is no as such comparability between each FY. It is fluctuating.
Verify project still exists at start , mid project and completion actually occurred. Check authenticity of checks payable to and cashed by non related or interested vendor. i.e. no colusion amongst family to inflate or overstate expenses. Grant money should be in it's own account and not used to pay other expenses.
Verify money transfers in and out dates. do they make sense? Suspicious names or spellings? Family or fake employees. Just a few to start.
Do the expenses March amounts, types, vendors for each project? bank statements on each funded project. see company or other owners bank statements. NSF Fees
if company receives multiple Grant's for identical services its easier to mislead account charges and leave unfinished or inferior goods. These are somewhat common misuse of funds I've seen.
Take a complete listing of project which are eligible for grant and project initiated by company. Check if grant money has been used in any ineligible project. Verify source of funding for all project and trace fund from bank statement or third party confirmation.
Verify how operating exp of company are paid for, if they are paid through govt grant.