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Business and Financial Policies and Procedures

8.4.2 Reconciliation of a Program Advance

Policy Statement

A reconciliation of a program advance tracks the disbursements of funds for accountability and tax reporting purposes. A reconciliation occurs when a program advance is either:

  • Replenished;
  • Verification of Non-Use of Funds;
  • Partially Closed; or,
  • Closed

A program advance must be reconciled at least every 90 days from the advance start-date or last reconciliation date to meet fiscal and calendar year tax reporting requirements; however, OBFS recommends monthly reconciliation.

When a program advance is not closed within 90 days of the closing of the study or within 90 days of the advance end-date (whichever is sooner), the unreconciled portion of the advance may be reported as taxable income to the custodian in accordance with IRS regulations and may also be deducted from the employee’s wages or subject to collection.

A program advance that is not in compliance may be suspended and cannot be replenished. Failure to close or reconcile a program advance, as required above, may result in an employee not being allowed future advances.


Program advances are not required to be closed and then reopened to meet fiscal and calendar year reporting requirements unless a study exceeds 18 months. Custodians should always attempt to reconcile as promptly as possible, observing the minimum reconciliation standards described above.

8.3.5 Close of a Cash Advance
8.4.1 Cash Advances for Human Subject Payments
8.4.3 Replenish a Program Advance to Pay Human Subjects

Last Updated: February 25, 2019 | Approved: Senior Associate Vice President for Business and Finance | Effective: November 15, 2017

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