Examples
Worked examples
- Is an instance
An NIH grant has 18 percent unobligated funds at end of year 1, automatically carried forward to year 2.
- Is an instance
A Horizon Europe consortium rebudgets unspent year-1 personnel funds into year-2 travel under the GA.
Counter-examples
Looks similar, but isn't
- Not an instance
Loss of unspent funds at closeout is the opposite of carry-forward.
- Not an instance
Supplemental funds awarded mid-grant are not carry-forward.
Editorial commentary
Carry-forward addresses the reality that grant spending rarely matches budget exactly. Under US federal expanded authorities, automatic carry-forward of unobligated balances is permitted for most NIH and NSF grants up to defined thresholds (typically 25 percent of the current-year budget), with notification rather than prior approval. Larger balances require formal carry-forward requests with justification. Horizon Europe permits intra-project rebudgeting that functionally achieves carry-forward.
What it means on the award ledger
Carry-forward does not create new money. On the award ledger, an unobligated balance at the end of Budget Period 1 is reclassified as available budget in Budget Period 2 rather than being deobligated back to the sponsor. The total sponsor obligation for the award is unchanged; only the timing of when the recipient may draw down and spend the funds shifts. This is why carry-forward is reported through the same financial and progress reporting cycle as ordinary spend, not treated as a separate transaction — a Federal Financial Report (FFR) or an NIH Research Performance Progress Report (RPPR) showing an unobligated balance is typically the trigger point where carry-forward becomes visible to the sponsor.
When it matters
Carry-forward decisions come up at three points in the award lifecycle: at the close of each budget period (does the unspent balance qualify for automatic carry-forward, or does it need a formal request); mid-award, when a sponsored-programs office is reconciling actual spend against remaining encumbrances to determine the true available balance; and alongside a no-cost extension decision, since a large carried-forward balance is often the evidence that supports an NCE request. Carry-forward and an NCE are not the same lever — carry-forward moves money into a later budget period within the existing award timeline, while an NCE moves the end date itself — but on a delayed project they are frequently used together.
What action it triggers
Below an agency’s delegated threshold, carry-forward is typically automatic: the recipient notifies the sponsor through routine reporting and proceeds, with no separate approval transaction. Above that threshold, or where an award’s terms do not pre-authorize expanded authority, the recipient’s sponsored-programs office must submit a formal carry-forward request with a written justification (why the funds are unspent, and how they will be used) before the balance can be rebudgeted into the next period.
Who decides
Within the automatic threshold, the recipient institution effectively self-administers carry-forward under the authority already delegated in the award terms — no case-by-case sponsor sign-off is required, though the sponsor retains audit and reporting oversight. Above the threshold, the federal awarding agency’s Grants Management Officer (or the equivalent programme/finance officer at a non-US funder) approves or denies the request.
FAQ
Is carry-forward the same as a no-cost extension? No. Carry-forward moves unspent funds into a later budget period of the same award timeline; a no-cost extension moves the award’s end date. See no-cost extension.
Does carry-forward always require prior approval? Not always — many US federal sponsors delegate automatic carry-forward up to a defined percentage of the budget, provided the award’s terms grant expanded authority. Above that threshold, formal approval is required.
References
- 2 CFR 200.308 (Revision of budget and program plans), 2 CFR Part 200 — Uniform Guidance; US NIH Grants Policy Statement on automatic carry-over; NSF Proposal and Award Policies and Procedures Guide.
Also known as
Carryover · Unobligated balance carry-forward
Machine-readable encodings
Use in your systems
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