Carryover (Carry-forward)
Carryover (carry-forward) is the process by which unspent and unobligated funds remaining at the end of a budget period may be carried forward to the next budget period (within a project period) to cover allowable costs in that budget period.
When allowed, the carryover of funds enables grantees to use unexpended prior year grant funds in the current budget period. Carryforward rules can be found in the award terms and conditions.
Carryforward usually falls into one of the following 3 categories. Check the notice of award to verify whether your project has a carryforward restriction. If unsure, work with your Sponsored Projects Officer to review the terms and conditions together.
AUTOMATIC - unspent funds automatically stay in the budget and may be spent in subsequent budget periods. No action is needed by the PI to use. This is typical for most federal research awards where expanded authorities (a waiver of certain prior approval requirements) apply.
RESTRICTED - you must ask for permission to use unobligated funds in a future budget period and may have to provide good reason why they were not used. The sponsor may approve or deny a carryforward request. The request will need to be made according to sponsor guidelines and timeframes.
PROHIBITED - any unspent, unobligated funds are forfeited at the end of the budget period. They cannot be used in the following budget period.
It is the responsibility of the PI to manage unspent funds at the end of a budget period. If a carry forward request needs to be made, it is done based on the sponsor requirements.
Most federal sponsors request an SF425 (federal financial report, prepared by Grants and Contracts Accounting) to go along with the request.
Whether the request will be granted often depends. Submiting the request completely and as early as possible greatly increases the chances of approval.
The PI and department administrator have the responsibility of tracking projects with carry forward restrictions closely. Subawards with carry-forward restrictions will also need to be monitored closely.
REMEMBER:
- Ensure all federal financial reports for the last (and all prior) budget period(s) have been submitted and accepted.
- Communicate with Grants and Contracts Accounting (GCA) to ensure that the federal financial report information matches the progress report and carryforward request information.
- Carry forward requests must be accurate down to the penny, as it impacts the financial reporting - inaccuracies result in our SF425 being rejected.
- Minimize carryforward to maximize funding.
- Make sure charges are posted accurately and timely.
- Utilize additional grant lines within an award to manage funding years and carryforward.
