SEFA Tutorial
Lesson 2: Agency Responsibilities for Federal Awards
Receiving Agency Responsibilities for Interagency Pass-through Activity
The receiving agency (the agency that receives federal funds passed-through from another agency) must record the transaction as determined by the disbursing agency. This means the receiving agency must accept the disbursing agency’s award details, calculations for allocations to federal and state awards and decision for whether the award represents pass-through or contractor payments. The receiving agency must record the interagency transaction in both USAS and the SEFA web application using the details provided by the disbursing agency.
The receiving agency is responsible for determining the dollar amount of any accruals at fiscal year-end. To calculate this accrual, the receiving agency must 1) determine the amount of expenditures that will be covered by federal funds and 2) record an accrual for the difference.
- If the federal funds received from the disbursing agency during the fiscal year were less than the eligible expenditures recorded by the recipient agency, the receiving agency must request an interagency transaction voucher (ITV) from the disbursing agency to record a federal revenue accrual.
- If the federal funds received from the disbursing agency during the fiscal year were more than the eligible expenditures recorded by the receiving agency, the receiving agency must:
- Initiate an ITV to record a federal expenditure accrual in the prior fiscal year
- Return the excess funds to the disbursing agency in the following (current) fiscal year
Example 1:
During the fiscal year, Sample Agency XXX provides to Sample Agency YYY the following details in writing about a pass-through award:
- Sample Agency XXX is transferring $110,000 to Sample Agency YYY
- The $110,000 includes:
- $100,000 federal pass-through funds
- $10,000 state pass-through funds
- Sample Agency YYY is Sample Agency XXX’s subrecipient for the federal program
- The federal program title is ZZZ Federal Grant
- The federal program ALN is 12.345
Sample Agency YYY must record the pass-through revenue received as a subrecipient, including:
- $100,000 federal pass-through revenue
- Program title: ZZZ Federal Award
- ALN: 12.345
- $10,000 state pass-through revenue
Example 2:
During the fiscal year, Sample Agency XXX distributes $200,000 of federal program funds to its subrecipient, Sample Agency YYY. At fiscal year-end, Sample Agency YYY has recorded $250,000 in eligible federal program expenditures. After fiscal year-end:
- Sample Agency YYY must request an ITV from Sample Agency XXX to record a PY federal revenue accrual of $50,000
- Sample Agency XXX must provide the requested ITV for the PY federal revenue accrual of $50,000
Example 3:
During the fiscal year, Sample Agency XXX distributes $200,000 of federal program funds to its subrecipient, Sample Agency YYY. At FYE, Sample Agency YYY has recorded $100,000 in eligible federal program expenditures. After fiscal year-end:
- Sample Agency YYY must initiate an ITV to Sample Agency XXX to record a PY federal expenditure accrual of $100,000.
- Sample Agency YYY must return the $100,000 to Sample Agency XXX during the CY.
For information about ITV requirements, see the ITVs through Reoccurring Transaction Indices (RTIs) section below and the RTI Tables on the AFR Reporting Requirements website.