Reporting

You must know your organization's tax exemption status to know how to report sales tax paid.

If your organization is not tax exempt, you can use grant funds for sales tax. You would report the full vendor charge including any sales tax paid as the Vendor Total Amount in Smartsheet. Report $0 in the Sales Tax field of your reporting form.

If your organization is tax exempt, you can only charge sales tax to the grant if you have requested a sales tax reimbursement from the state and plan to use the reimbursed funds for the grant project.

You have three options for reporting sales taxes if you are a tax exempt organization: 

1. Pay the full amount including sales tax. Report the vendor amount in the Vendor Total Amount field. Report the sales tax paid in the Sales Tax field. This is the easiest choice because it matches invoices/receipts from vendors. The sales tax amount will not be deducted from your grant total.
2. Pay sales tax using another source of funds (not state grant funds). Report the vendor cost without tax and report $0 in sales tax.
3. Request a sales tax reimbursement from the state Department of Revenue and report the refund as income when you receive it. Report the full amount paid in Vendor Total and report $0 in the Sales Tax column. Once your organization is reimbursed by the state for sales tax paid, report that amount as income in your Smartsheet. This money must be used for your grant project.

If you feel like Sales Tax was entered incorrectly in the past, please let your Grant Administrator know and they will walk you through the process of making adjustments in Smartsheet.

Please see video training on sales tax reporting below. Review the slides for the sales tax reporting webinar. 

Grant Recipients should use the TOTAL amount they received in state directed grants to determine if they have reached the threshold to trigger the requirement to perform a single or program-specific audit prepared and completed in accordance with Generally Accepted Government Auditing Standards, also known as the Yellow Book Yellow Book audit. Please see 09 NCAC 03M.0205 for more information.

If your organization's fiscal year ended:

• prior to July 1, 2024, the threshold to trigger a audit requirement is $500,000 in total state funds, per the state administrative rules in place prior to July 1, 2024
• between July 1, 2024 and September 30, 2024 the threshold is $750,000, per federal requirements in place at that time
• October 1, 2024 or later, the threshold is $1 million, per current federal requirements

Any organization that receives, holds, uses, or expends State financial assistance in an amount equal to or greater the dollar amount requiring audit listed in federal code 2 CFR 200.501(a) should have a single or program specific audit completed annually. Audits must be submitted within nine months of the end of the recipient’s fiscal year.

Grant recipients may choose to do a program specific audit that would only include the directed grant funds to meet grant reporting requirements. A program specific audit is more cost effective.

If the organization already conducts a single audit, that may be submitted to meet the annual grant reporting requirement if the grant funds are included in the scope of the audit.

All audits should be done in accordance with the General Accepted Government Auditing Standards.

Please see the provided Compliance Supplement document (PDF) for more detail on how how audits should be performed for OSBM administered grants.

The North Carolina State Treasurer provides guidance to local governments on audits, including sample RFPs and a list of firms offering audit services.

See our Community Colleges and Universities Audit information for requirements specific to those entities.

See the slides from our Audit Requirements Webinar (video below)

Your grant is ready to be closed out once it meets the following criteria: 

• All grant funds must be expended and submitted to your reporting sheet and your grant balance on SmartSheet is $0.
• All interest earned must be expended and submitted to your reporting sheet.
• Any Yellow Book Audits and/or Quarterly Performance Reports that are due must be submitted to your reporting sheet.
  • Final Report – Use the Quarterly Performance Report form and indicate that all funds have been spent and the project related to the grant funds is complete.
• If you believe your grant is ready to be closed out and you have completed all of the above steps, please reach out to your grant administrator or NCGrants@osbm.nc.gov

Once the above has been completed, we will begin reviewing your grant for close-out. During our review, we may reach out to you with additional questions.

Please be prepared to provide supporting documentation upon request and review your reporting sheet closely to be sure you’ve submitted all necessary audits, expenses, and reports.

After your grant has been reviewed and approved, we will email a close-out memo via DocuSign to your organization’s designated contract signer to officially closeout your grant. If your contract signer does not receive the closeout memo within a few days of being approved for closeout, they may want to check their spam folder.

NOTE: You can always pull up a summary breakdown of your grant (which includes your grant’s remaining balance, totals for reported sales tax, interest, and expenses, and a list of Quarterly Performance Reports that are due) by navigating to the right side of your reporting sheet and clicking the Summary icon.  

Please see the training webinar on closing out your grant below. You may review the slide presentation from that training.