CDBG Section 2 -Financial Management

Financial Management Requirements for CDBG Grantees

Accurate financial record-keeping, including the timely deposit, disbursement and accounting of Community Development Block Grant (CDBG) funds is crucial to the successful management of a CDBG funded project. Grantees must take the following steps to prepare a financial management system to receive and utilize CDBG grant funds:

1. Appoint a person to be responsible for Financial Management,
2. Establish accounting records,
3. Set up bank accounts or separate ledger accounts, and establish receipting procedures, and
4. Establish procedures for approving invoices, submitting claims, and issuing payment to vendors.

Financial record-keeping is the primary responsibility of the Responsible Administrator. The Grantee is responsible for the review and approval of all expenditures and claims of subrecipients. It is the responsibility of the Grant Administrator to meet all CDBG administrative requirements in regard to the receipt, disbursement and accounting of federal funds and the records to be maintained. Failure to comply with financial management standards may result in monitoring and audit findings. Depending on the infraction, the Grantee may be required to pay back federal dollars.

This section contains information on financial management requirements for CDBG grantees. It addresses:

1. Applicable Requirements
2. Establishing a Financial Management System
3. Request for Payment
4. Timely Expenditure of Funds
5. Program Income
6. Revolving Loan Funds
7. Contract and/or Budget Revision Procedures
8. Procurement Standards
9. Audits
10. Grant Closeout Procedures

Exhibits

• Exhibit II-A: Request for Reimbursement (Public Facility and Economic Development Projects) (Word download)
  • Exhibit II-A.1: Instructions for Request for Reimbursement
• Exhibit II-B: Request for Reimbursement (Division of Housing Projects)
• Exhibit II-C: Checklist - Financial Management of Grants
• Exhibit II-D: Sample Response to Audit Report
• Exhibit II-E: Signatory Delegation
  • Exhibit II-E.1: Signatory Delegation Sample