Purchase Thresholds, Closeout Time, and Period of Performance and Budget Period Overview
We have now covered a number of revisions to the Office of Management and Budget’s (OMB) Guidance for Grants and Agreements, including:
- Performance measurement
- Program design
- De minimis indirect cost rate
Next in our Breaking Down OMB’s Recent Guidance for Grants and Agreements Revisions Series, we are reviewing the increases of purchase thresholds and closeout time as well as clarifications to period of performance and budget period definitions.
Read on to learn more about each revision as well as to gain tips for maintaining compliance. And remember, all revisions will go into effect on November 12, 2020.
Purchase Threshold Increases and Allowances
A number of the revisions the OMB has made to this Guidance have been to simplify processes and procedures. To support this goal, the OMB has made revisions to various purchase thresholds.
The purchase threshold revisions include:
- Increase of the micro-purchase threshold from $3,500 to $10,000
- Increase of the simplified acquisition threshold from $100,000 to $250,000
- Allowance of non-Federal entities to request a micro-purchase threshold above $10,000 under certain conditions
Closeout Time Increase
Purchase thresholds are not the only things that the OMB has increased in this updated Guidance. In fact, another increase they have made in this Guidance will greatly aid recipients of Federal funds. Starting in November, the number of days for recipients to submit closeout reports and liquidate all financial obligations will increase from 90 days to 120 days, giving them 30 extra days to complete these reports.
Clarification of Period of Performance and Budget Periods
The OMB has adjusted time periods beyond just closeout time. They have provided further clarifications around the definitions of period of performance and budget period.
“Period of Performance”:
- Clarified the definition of period of performance to reflect that it covers the total estimated time interval between the start of an initial Federal award and the planned end date.
- Specified that period of performance may include one or more budget periods, but the identification of the period of performance does not commit funding beyond currently approved budget periods.
- Clarified that recipients are authorized to expend current funds awarded, including any funds carried forward or other revisions pursuant to 2 CFR 200.308.
- Ensured consistent use of the term “budget period” for the purposes of transparent reporting, as required by Federal Funding Accountability and Transparency Act of 2006 (FFATA).
How to Prepare for Compliance With These Changes
As with many of the revisions we have discussed, you are more likely to maintain compliance with the changes to purchase thresholds, closeout time, and period of performance and budget period if you are utilizing a configurable, flexible system to manage your grant portfolio.
For instance, with AmpliFund, you can easily update your budget caps and expense alerts if you plan to increase your purchase thresholds. Also, through our system, you can submit amendments directly to your funder to request a budget change, helping you more easily maintain compliance with the purchase threshold revisions.
AmpliFund’s configurable system also simplifies the process of updating things such as the reporting periods and close-out dates of your grants. This will be help with compliance if you are adjusting these in November per the new revisions.
You can access the full version OMB’s updated Guidance for Grants and Agreements here.
Stay tuned for Part Four of this series, covering data.
All editions of this series are now available on our blog:
Image source: NORTHFOLK