NIH Grants Policy Statement
Revised October 2017. This document applies to all NIH grants and cooperative agreements for budget periods beginning on or after October 1, 2017.

16.5 Funding and Payment

The application budget, requests for funds, and financial reports (see Reporting and Record Retention in this chapter) must be stated in U.S. dollars. Cost increases for fluctuations in exchange rates are allowable costs subject to the availability of funding, as determined by the awarding IC. Prior approval of exchange rate fluctuations is required only when the charge results in the need of additional Federal funding, or the increased costs result in the need to significantly reduce the scope of the project. The non-Federal entity is required to make reviews of local currency gains to determine the need for additional federal funding before the expiration date of the Federal award. Subsequent adjustments for currency increases may be allowable only when the non-Federal entity provides the awarding IC with adequate source documentation from a commonly used source in effect at the time the expense was made, and to the extent that sufficient Federal funds are available.

Awards to foreign organizations and international organizations issued prior to October 1, 2012 are not paid through PMS. These grants normally will be paid by U.S. Treasury check by OFM, NIH on a predetermined quarterly advance basis, usually in four equal installments. If the amount advanced to an organization based on the predetermined quarterly advance is insufficient to meet the grant's cash requirements, the recipient must make a written request to the GMO for any additional funds needed. All payments will be in U.S. dollars. Foreign recipients are strongly encouraged to use U.S. banks to ensure that payments arrive on time. In special circumstances, foreign recipients may be eligible to receive funds by electronic deposit or wire transfer.

Awards to foreign organizations and international organizations issued after October 1, 2012, are paid through PMS. PMS is operated by the PSC in accordance with Department of the Treasury and OMB requirements as implemented by 45 CFR 75.305. These requirements are intended to minimize the time elapsing between the transfer of funds from the U.S. Federal government and disbursed by the recipient. Therefore, although the grant may be financed by advance payments, the intent is that recipients draw funds on an as-needed basis – specifically, no more than 3 days before the funds are needed.

Operational guidance for recipients is provided through a training CD from PSC. Inquiries regarding drawdown requests, cash management rules, and the disbursement of funds should be directed to PSC/PMS (see Part III).

The funding and payment information outlined in this subsection applies when the foreign organization is the recipient organization. When a foreign component participates in a consortium arrangement, the funding and payment information should be reflected in the formal written agreement. Recipients are required to maintain grant funds in an interest bearing account; however, interest earned in excess of $500 per year in the aggregate on advances of Federal funds must be returned in U.S. dollars by reimbursement check to OFM, and reflected on the annual FFR.

For more information on payment, see Payment Chapter.

Any questions regarding payments to foreign recipients may be addressed to the Grants Management Specialist noted on the NoA or PSC (see Part III for address and telephone and fax numbers).