SHORT-TERM INTERFUND LOAN – TEMPORARY FINANCING OF GRANTS

GENERAL

Some grants (often called "reimbursement-type" grants) require that grant expenditures be made before the grantor supplies the corresponding cash. If the grantor is not the Federal government, cash must be made available to finance the grant on the "front-end." To accomplish this "front-end financing," agencies may request the approval of a short-term interfund loan from the General Fund, or an Earmarked subfund, to be repaid when the grant reimbursements are received.

If a short-term interfund loan is approved and funds are transferred, repayment must be made prior to the close of the fiscal year.

The procedures outlined below apply to all short-term loans between subfunds, including the following:

  1. Recording the Loan

To request a short-term interfund loan, prepare an Appropriation Transfer, STARS Form 30 (see example).

  1. Transaction Codes

    1. 356 - Short-Term Interfund Loan - From:

      This transaction code is used to set up the loan in the lending subfund. It moves cash out of the lending subfund.
  1. 306 - Short-Term Interfund Loan - To:

    This transaction code is used to set up the loan in the borrowing subfund. It moves cash into the borrowing subfund.
  1. Subfund Codes
  1. From: Use the appropriate code to identify the lending subfund.

  2. To: Use the appropriate code to identify the borrowing subfund.
  1. Encumbrance Number

Enter the agency voucher number of the current document in the encumbrance number field on both the "From" and "To" transactions.

  1. Project Numbers

Enter STARS project number, if one has been assigned.

  1. Mini Codes and Object Codes

Mini Code is optional for these transactions. Object codes are not allowed.

  1. Repaying the Loan

To repay a short-term interfund loan, prepare an Appropriation Transfer, STARS Form 30 (see example).

  1. Transaction Codes
  1. 357 - Short-Term Interfund Loan Repayment - From:

    This transaction code is used to record the loan payment disbursement in the borrowing subfund.
  1. 307 - Loan Advance Repayment - To:

    This transaction code is used to record the loan payment receipt in the lending subfund.
  1. Subfund Codes
  1. From: Use the same subfund code as used in the "To" transaction on the initial short-term interfund loan request document.
  1. To: Use the same subfund code as used in the "From" transaction on the initial short-term interfund loan request document.
  1. Encumbrance Number

Enter the agency voucher number of the Appropriation Transfer STARS Form30 on which the original short-term interfund loan request was transmitted.

  1. Project Numbers

Enter STARS project number, if one has been assigned.

  1. Mini Codes and Object Codes

Mini code is optional for these transactions. Object codes are not allowed.

A monthly report of the status of short-term interfund loans (report CSA 486, Short-Term Intra-Agency Loans) is produced and distributed to (1) the affected agency, (2) the Budget and Control Board's Division of Budget and Analyses, and (3) the Central State Accounting and Central State Financial Reporting Division's (previously together known as the Central State Finance Division) of the Comptroller General's Office.

The Central State Accounting Division of the Comptroller General's Office and the Division of Budget and Analyses continually monitor the outstanding balances of short-term interfund loans.

 

RECORDING THE SHORT-TERM INTERFUND LOAN - APPROPRIATION/CASH TRANSFER STARS FORM 30

 

REPAYMENT OF LOAN – APPROPRIATION/CASH TRANSFER STARS FORM 30

 

IMPACT OF TRANSACTIONS ON GENERAL LEDGER

Transaction
Code

 

306

Short-Term Interfund Loan - To
Debit: GLA 101 Cash
Credit: GLA 207 Due to Other Funds

307

Short-Term Interfund Loan Repayment - To
Debit: GLA 101 Cash
Credit: GLA 131 Due from Other Funds

356

Short-Term Interfund Loan - From
Debit: GLA 131 Due from Other Funds
Credit: GLA 101 Cash

357

Short-Term Interfund Loan Repayment - From
Debit: GLA 207 Due to Other Funds
Credit: GLA 101 Cash

 

Trans
Code

Transaction
Code Title

General
Debit

Ledger
Credit

306

307


356

357

Short-Term Interfund Loan-To

Short-Term Interfund Loan
Repayment-To

Short-Term Interfund Loan-From

Short-Term Interfund Loan
Repayment-From

101

101


131

207

207

131


101

101