Financial closeout requirements in the Uniform Guidance changed effective November 12, 2020. The revised guideline, applicable to all federal awards, can be found in Uniform Guidance, 2 CFR §200.344 - Closeout. This guideline provides up to 120 days after the period performance end date to submit the final financial report and to have liquidated all obligations through the Letter of Credit (LOC) drawdown process.
As announced at the Research Administration Town Hall on June 24, the National Institutes of Health (NIH) has recently issued NOT-OD-21-102, Reminders of NIH Policies Related to Closeout. This notice reaffirms their timelines and processes for handling the final closeout of their awards. NIH has since issued NOT-OD-21-149, Updated Process for Requesting Drawdowns Outside of the Liquidation Period, which provides the steps that must be taken if a final request for reimbursement is necessary outside of the 120-day period.
Other federal agencies may adopt shorter timelines to ensure that obligations are met within the 120-day Uniform Guidance structure. The Substance Abuse and Mental Health Services Administration (SAMSHA) has recently confirmed a 90-day window for final financial reporting and the liquidation of obligations. CGA will immediately begin establishing milestones for agencies with shorter closeout windows, and for any federal awards where indicated, to meet the condensed timeline.
A collaborative effort between CGA and department research administrators is required to ensure that all reports are submitted, and obligations are met within each applicable agency policy. The how-to guide, Final Financial Reporting, Invoicing and Closeout of Sponsored Awards, was recently updated to reflect updates to federal closeout requirements, including the following highlights.
Using Expense Accruals during Final Reporting
Contracts & Grants Accounting (CGA) currently sets the due date for all final financial reporting deliverables for 90 days after the end of the federal segment. This timeframe allows 30 days to process and request reimbursement for trail out expenses prior to the 120-day limit. The recently issued NIH notices further support the best practice to accrue all expenses that will not post to the General Ledger prior to the 90-day due date for submitting the final financial report.
Requesting No-Cost Extensions
The NIH also recommends that you request a No Cost Extension (NCE) if it is anticipated that additional time is necessary to post and liquidate all obligations. Good indicators that you may want to consider requesting an NCE to process final closeout activity include:
- If the award is considered complex and requires input and submission of invoices from multiple subcontractors;
- If the award has multiple contributing investigators, such as a program project grant (Pxx), Cooperative Agreement (Uxx), or similar;
- If subrecipients have been taking over 60-90 days from the budget period end date to submit their invoices;
- If project funds are still being obligated in the last few months of the award, and it is anticipated that the obligations will not be liquidated until the end of the actual period of performance.
If an NCE is deemed appropriate, timely submission of a request prior to the end of the project period is critical. Submit the request to the Office of Sponsored Research (OSR) following the guidance available on the OSR website.
Requesting Drawdowns Outside of the Liquidation Period
The steps to request exceptional approval for reimbursement via LOC drawdown are detailed in NOT-OD-21-149. When an unexpected expense posts to a federal award outside of the 120-day liquidation period, prior approval is necessary from the IC Grants Management Specialist to request reimbursement. All such requests must be coordinated through CGA and may require additional collaboration with OSR.
If you have any questions about final financial deliverable due dates for your awards, email [email protected]. For the fastest response, use the email link in the Award Details section of the award record in RAS. This link will automatically generate a ServiceNow ticket that indicates the CGA Team Member and award number in the subject.