Sneak Preview: OMB Planning To Issue Grant Closeout Guidance

May 6, 2016 | By Jerry Ashworth | Post a Comment

xgran_bookshot(The following was excerpted from a recent article in the Federal Grants Management Handbook.) The Office of Management and Budget (OMB), responding to a recent Government Accountability Office (GAO) report that found persistent federal grant closeout concerns, said it plans to issue guidance later this year based on a congressional requirement instructing four federal agencies to report undisbursed balances in expired grant accounts in their federal Fiscal Year (FY) 2016 Performance and Accountability Reports (PARs). It will also issue guidance to all federal agencies on the reporting of expired awards by July under the Grants Oversight and New Efficiency (GONE) Act (Pub. L. 114-117).

GAO recently reviewed undisbursed balances in the Payment Management System (PMS) grant accounts, administered by the Department of Health and Human Services (HHS), and used by other federal agencies. OMB is to monitor agency progress on tracking and reporting undisbursed balances, and in closing out expired grant accounts. GAO analyzed PMS data as of Sept. 30, 2015, and interviewed agency officials from OMB, HHS, the Departments of Commerce (DOC) and Justice (DOJ), the National Aeronautics and Space Administration (NASA) and the National Science Foundation (NSF). This review was a follow-up to similar reviews GAO had conducted on grant closeout in 2008 and 2012.

GAO found that about $994 million in funding remained in expired grant accounts in the PMS at the end of fiscal year 2014, which was about $200 million more than the amount reported in FY 2011. However, the number of expired grant accounts with undisbursed balances decreased to 8,832 in FY 2015, compared to 10,548 in FY 2011. Expired grant accounts are those that are more than three months past their grant end date and that have not had payment activity for nine months. In addition, GAO found that more than half of the expired grant accounts exceeded their expiration date by one to three years. Federal agencies are to return undisbursed funds in expired accounts to Treasury. The $994 million in funding represents a significant amount left in accounts and is an indicator of waste.

“Grant closeout is an important final point of accountability for grantees that helps to ensure they have met all financial requirements and have provided final reports as required,” the GAO said.

(The full version of this story has now been made available to all for a limited time on Thompson’s Grants Compliance Expert site.)

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