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User's Guide V1.1 Page 16 of 24 <br /> RESOLVING EXCESS CASH BALANCES <br /> Excess cash exists when awards have positive cash balances. Positive cash balances occur when GAPS <br /> payment requests are not disbursed within three business days after receipt. Payees should reconcile <br /> their grant awards on a regular basis. Excess cash balances can be resolved by: <br /> • Reallocating drawdowns among grant awards to meet immediate cash needs, or <br /> • Returning excess funds to the Department of Education <br /> To reconcile their books with GAPS, payees may access GAPS Activity Reports through e- Payments <br /> Web Site. <br /> EXCESS CASH BALANCES ON A CLOSED AWARD <br /> The Department of Education records a payee's net draws as its final expenditures for a closed award. <br /> Payees should make appropriate adjusting entries in GAPS so that the net draw amount for a closing <br /> grant award accurately reflects the payee's total expenditures. If the payee determines that it has an <br /> excess cash balance on a closed grant award, the payee should immediately return those funds to the <br /> Department. <br /> FAILURE TO RESOLVE EXCESS CASH BALANCES <br /> If a payee does not resolve excess cash balances, any of the following penalties may occur: <br /> • Future payment requests for a grant award with excess cash may be routed to an Office of the <br /> Chief Financial Officer, Department of Education representative for approval, <br /> • The payee may be transferred from the advance payment method to the reimbursement payment <br /> method, which requires that the payee request reimbursement for funds already disbursed. Under <br /> the reimbursement method, the payee is required to submit copies of the vouchered expenditures <br /> supporting the request for reimbursement. <br /> • The payee may be notified of any outstanding debt that will be offset until the debt is paid. When <br /> the payee is placed on administrative offset, the Department of Education will withhold a portion <br /> of the payee's payments and apply them toward the payee's debt. <br /> • The payee's funds may be suspended. <br /> Debts may be referred to the Accounts Receivable group within the Office of the Chief Financial Officer <br /> for billing and collection. Accounts Receivable establishes a liability and mails a bill. Accrued interest, <br /> penalties and administrative fees are added to the billed amount and instructions for returning funds are <br /> included with the bill. Payees should contact the Helpdesk if they need assistance or have information <br /> that may resolve the bill. <br /> If a bill is not paid, the debt will be reviewed for referral to the Treasury Department for offset or further <br /> debt calculation as mandated under the Debt collection and Improvement Act of 1996. At that time, <br /> collecting the debt becomes Treasury's responsibility. Once the debt is referred, arrangements for <br /> payment may only be made with Treasury. In addition to accrued interest, penalties, and administrative <br /> fees imposed by the Department of Education, collection fees will be charged. <br /> http: / /e- grants .ed.gov /gapsweb/help /intro.html 6/18/2002 <br />