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Posted by on May 18, 2012

Some Progress Seen But Grant Closeout Remains A Challenge

Nearly $800 million in undisbursed federal funds remained in expired grant accounts at the end of fiscal year 2011, according to a new report from the Government Accountability Office. And while some agencies have taken steps to reduce that amount and speed the grant closeout process, more work needs to be done.

In a May 2012 follow-up to a 2008 report, GAO repeated its basic recommendation: OMB needs to establish governmentwide guidance for grant closeout.

In the 2012 report, GAO noted that while the total amount of undisbursed funds in FY 11 essentially equaled the amount reported in its previous study, the percentage of total grant funding that those funds represented was lower – meaning that agencies were doing a better job of getting rid of those unobligated monies and closing accounts.

For example, in February 2011, HHS established an interagency workgroup—the Accelerated Closeout Team—led by the Office of Grants and Acquisition Policy and Accountability to coordinate a departmentwide response in strengthening financial controls and accelerating the number of grant and contract closeouts.

“Our analysis shows that there has been an improvement in closing out expired grant accounts with undisbursed balances in PMS since our 2008 report,” GAO said in the report. Nevertheless, GAO continues “The presence of tens of thousands of expired grant accounts in PMS with no undisbursed funds remaining raises concerns that these accounts are not receiving sufficient attention. Reducing the number of accounts with zero balances remaining would help ensure that administrative and financial closeout—the final point of accountability for these grants—is being completed. It would also minimize the amount agencies pay in potential fees for maintaining these accounts, which can accumulate over time.”

If you are interested in learning about effective grant closeout, Management Concepts’ two-day Closeout of Grants for Federal Personnel will be helpful. This course provides students with a framework and actionable process for overseeing and conducting grant closeouts. Visit www.managementconcepts.com/grants for more information.

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