Finding Text
2020-011 Timely Grant Draws
Material Weakness
Condition: Grant dollars were not drawn in a timely fashion during the year to cover current grant
expenditures. The Housing Authority’s grant funded cost reimbursable program was carrying in excess of
60 days operating capital in grants receivable.
Criteria: The Housing Authority does not have written policies to address the timeliness of grant draw
procedures. Grant funds should be drawn as grant expenditures occur. Carrying anything in excess of 60
days operating capital in grants receivable is considered untimely and indicates that the expenditures
carried within these grant funded cost reimbursable programs are being “floated” by the general fund. 2
CFR section 200.305 of the Uniform Guidance states that “For non-Federal entities other than states,
payments methods must minimize the time elapsing between the transfer of funds from the United States
Treasury or the pass-through entity and the disbursement by the non-Federal entity whether the payment
is made by electronic funds transfer, or issuance or redemption of checks, warrants, or payment by other
means.”
Cause: Lack of a written grant draw policy and procedures as well as a lack of staff “hands-on” training
in those necessary areas.
Effect: The Housing Authority’s general fund dollars and liabilities are being used to carry (“float”) these
grant program expenditures until the grant funds are actually received.
Recommendation: The Housing Authority should adopt written grant draw policies into its financial
policies and procedures manual. Financials should be reviewed monthly, and drawdowns made as needed.