Financial Resources

Methods of Payment

Direct Reimbursement

• The most preferred method of payment for USAID funds.
• USAID reimburses grantee for all expenses already made from grantees own resources.
• Grantee should submit to the Controller, RFMC, REDSO/ESA  a U.S Government Form SF-1034 (Exhibit c) supported by a certified expenditure report (Exhibit B 2).

Direct Payments

• USAID pays directly to the contractors, suppliers and other payee.
• This will only be done upon presentation of original invoice, evidence of receipt or delivery of goods.

USAID Letter of credit

• TO SUPPLIERS OR CONTRACTORS.
  • USAID may make direct payment on behalf of the grantee to suppliers upon receipt of supporting documents.
•  To Bank
  • USAID and a U.S bank enter into an agreement under which the bank is authorized to make payment to contractors & suppliers.
• ADVANCE PAYMENT
  • Periodic Advance Payment
  • Interim/Partial Payments
  • Progress Payments
  • Mobilization Payments

Advances

• These are payments made prior to the delivery of goods and services.

Eligible recipients

• Grantees under USAID Grants and Cooperative Agreements.
• Non-Profit Organizations.
• Host Country Government.

Advance payment requirments

• Adequate Financial Management capability.
• Acceptable system and procedures for accounting and controlling of USAID funds.
• Acceptable procurement, personnel and travel policy.
• Adequate staffing.
• Separate, non-commingled and interest bearing account. (Mandatory).

Amount to advance

• Immediate disbursing (cash) needs – NTE 30 days requirement.

Basis

• Analysis of recipient’s working capital requirement.
• Cash-flow projections.
• Reimbursement cycle consideration.

Advance request

• All request for advance should be submitted to USAID Controller, RFMC, REDSO/ESA.
• This should be done on U.S Government Form SF-1034 (Exhibit A 1).
• The request should be supported by certified statement (Exhibit A 2).
• Three months cash-flow projections.

Non-commingled account

• All USAID funds will be deposited into a separate non-commingled interest-bearing account.
• No other funds can be deposited into this account.
• All expenditure must be disbursed from this account.
• Any interest earned more than US$250 is remitted to USAID not less than annually.

Advance liquidation

• All USAID advance must be liquidated within 15 days after the end of each quarter.
• Grantees should submit to RFMC, REDSO/ESA an advance liquidation voucher on U.S Government Form SF-1034 (Exhibit B 1).
• The liquidation voucher should be supported by a certified expenditure report (Exhibit b 2).

Types of audit

• Statutory Audit - All recipients are required to conduct this audit annually.
• Recipient contracted audit (RCA) - Recipient develops statement of work and contracts a firm among the approved list of CPA firms.
• Mission contracted audit - Mission develops statement of works, contracts the CPA firms and pays for the audit.