Federal Budget Revisions and Prior Approval

When do federal grant budget revisions require prior approval? Request prior written approval for changes listed in 2 CFR 200.308(f), including changes in scope or objectives and key personnel identified by name or position in the award. Under paragraph (i), an agency may restrict cumulative transfers among direct cost categories when the federal share exceeds the simplified acquisition threshold and transfers exceed, or are expected to exceed, 10% of the last approved total budget, including cost share. Check the applicable award terms, agency rules, and cost-specific approvals before making a revision, including a transfer between direct and indirect costs.

The guide uses the current eCFR text of 200.308, checked on October 26, 2026. The 2024 revision took effect on October 1, 2024. Agencies may apply it to earlier awards, but are not required to do so. Check the version incorporated into your award and the agency's implementation under 200.110, together with applicable statutes and program regulations.

Under 200.308(e), a federal agency must not impose additional prior approval requirements beyond those specified in the guidance without OMB approval. Award terms need careful review, but they do not give an agency unlimited authority to add approval requirements.

Changes that need prior approval under 200.308(f)

Under 2 CFR 200.308(f), the recipient or subrecipient must request prior written approval for each of these ten changes:

1. A change in scope or objectives, even if the budget doesn't change.
2. A change in key personnel, including employees or contractors named by name or position in the award.
3. The approved project director or principal investigator stepping away from the project for more than three months, or reducing their time on the award by 25 percent over the period of performance.
4. Including costs that need prior approval under subpart E, unless the federal agency waived that approval.
5. Moving funds budgeted for participant support costs to another budget category.
6. Subaward activities that weren't proposed in the application and approved in the award. A change of subrecipient needs prior approval only if the award terms require it. In general, it shouldn't be required unless the original subrecipient was a deciding factor in merit review or eligibility. This item doesn't cover purchases of goods and services.
7. A change in the total approved cost share.
8. A need for more federal funds to complete the project.
9. Moving funds between construction and non-construction work.
10. A no-cost extension, except a one-time extension allowed under 200.308(g)(2). You should submit extension requests at least 10 calendar days before the period of performance ends. An agency may approve more than one extension unless a statute or regulation prohibits it.

Under 200.308(b) and 200.329, you must also report changes from the approved budget, scope, or objectives. Approval and reporting are separate controls, and one doesn't replace the other.

The one-time no-cost extension has conditions

Under 200.308(g)(2), you can skip prior approval only if the award terms let you start one extension of up to 12 months yourself. You must still send the agency written notice, a justification, and the revised period of performance at least 10 calendar days before the end date.

Don't use the one-time extension in these cases:

• Only to spend unobligated balances
• When the award terms prohibit the extension
• When you need more federal funds
• When the extension changes the approved scope

The last three cases need the agency's prior approval. The agency may approve further extensions, but they don't happen automatically. An extension changes the time only. It doesn't change scope, funding, cost allowability, or a subaward.

Expanded authorities and waivers have limits

Under 200.308(g), an agency may waive other cost-related and administrative prior written approvals in subparts D and E, except the requirements in (f)(1) through (10). Paragraph (f) itself includes specific exceptions, including agency-waived cost approvals in (f)(4) and authorized one-time extensions in (f)(10).

The waivers in paragraph (g) may allow pre-award costs within 90 calendar days, a one-time extension of up to 12 months, or carrying unobligated balances into later budget periods. Under paragraph (h), prior approvals for the actions described in (g) are automatically waived for research awards unless agency regulations or award terms say otherwise. The extension conditions in (g)(2) still apply.

An agency may call these permissions "expanded authorities." Check the actual authority granted for your award. The label does not authorize every budget revision, remove a scope-change approval, or establish a universal rebudgeting allowance.

The 10 percent rule doesn't give automatic permission

No federal rule lets recipients move up to 10 percent of the budget without approval. Under 200.308(i), an agency may choose to restrict transfers among direct cost categories, or among programs, functions, and activities, but only when both of these conditions apply:

1. The federal share of the award is more than the simplified acquisition threshold.
2. The cumulative amount of transfers among those categories, programs, functions, or activities exceeds, or is expected to exceed, 10 percent of the total budget last approved by the agency, including cost share.

The simplified acquisition threshold comes from FAR 2.101. It has been $350,000 since October 1, 2025, when an inflation adjustment raised it from $250,000. Check the threshold that applies to your award.

Paragraph (i) describes when an agency may impose the restriction. It doesn't override 200.308(f), a restriction in your award, the approved scope, limits on how appropriated funds may be used, or cost allowability. If the restriction applies, measure the running total of transfers against the last approved total budget, and don't restart the count with each journal entry.

For example, an award with a $400,000 federal share and $100,000 cost share has a $500,000 total approved budget. Ten percent is $50,000. Cumulative covered transfers of $55,000 exceed that threshold, while exactly $50,000 does not, unless further transfers are expected to exceed it. The federal share must also exceed the applicable simplified acquisition threshold, and the agency must have imposed the restriction. Other approval triggers still apply at any amount.

Transfers between direct and indirect costs

The current 200.308(f) does not list transfers between direct and indirect costs as a separate universal prior approval trigger. Paragraph (i) addresses optional restrictions on transfers among direct cost categories or programs, functions, and activities. It does not state a blanket direct-to-indirect or indirect-to-direct approval requirement.

A transfer may still need approval because it triggers another rule in 200.308(f), a cost-specific requirement, or an applicable agency requirement. Check the award terms, approved indirect cost rate and base, and applicable cost principles before moving funds in either direction. A budget transfer does not authorize a different indirect cost rate or make an otherwise unallowable charge allowable.

Approval for specific cost items is a separate test

2 CFR 200.407 says you may ask for prior approval to avoid later disputes about whether a cost is reasonable or allocable. A missing approval affects allowability only when one of the listed sections requires approval in the circumstances. Section 200.407 points to these sections:

• Cost sharing (200.306), program income (200.307), budget and program revisions (200.308), and fixed amount subawards (200.333)
• Certain compensation for personal services under 200.430(h), and fringe benefits (200.431)
• Equipment and other capital expenditures (200.439), and exchange rates (200.440)
• Fines, penalties, damages, and settlements (200.441), fundraising and investment management (200.442), goods or services for personal use (200.445), and insurance and indemnification (200.447)
• Organization costs (200.455), pre-award costs (200.458), rearrangement and reconversion costs (200.462), and travel costs (200.475)

Read the cited section and the award to find the actual circumstances and who must approve. A broad budget line doesn't mean a cost was approved in advance. On the other hand, 200.407 doesn't make every listed cost unallowable without approval.

Suggested decision checklist

Before you commit funds, spend, rebudget, change personnel, issue a subaward, or extend work, document the answers to these questions:

Question	Evidence	When to stop
Does any 200.308(f) item apply?	Comparison of current scope, budget, staffing, subawards, and the extension	If yes, get written approval first
Does a cost section require approval in these facts?	The 200.407 list and the specific cost section	If yes, get written approval first
Does the award add a threshold or procedure?	Current award and agency terms	Follow it before you act
Is the change within the appropriation, scope, period, and available funds?	Program, legal, and finance review	If no, don't make the change
Is this a one-time extension you can start yourself?	Express award authority and 200.308(g)(2) evidence	If any exception applies, request approval
Is a pass-through entity the approving party?	Subaward terms and notices	Send the request to the authorized party

The table above is a suggested internal practice, not an agency approval form. Under 200.308(c), you submit budget revisions in the same format as your application budget, unless the agency approves another format, e.g., an electronic system or email.

Give the reviewer the reason for the change and the budget before and after the change. Also include the running total of transfers, and the effect on scope, milestones, cost share, and funding. Add the effective date and the authorized official's certification. Under 200.308(d), the reviewing party should respond within 30 days or tell you in writing when to expect a decision. Silence is not approval.

Version control workflow

Keep an approval trail that you add to and never overwrite. The steps below are a suggested practice, not a software requirement in 2 CFR 200.

1. Lock the baseline. Keep the signed award, the budget and scope it incorporates, and every amendment as separate versions that nobody edits.
2. Open a change record. Give the request an ID. Record who proposed it, the date, the reason, the affected categories, the running total of transfers, and the effect on scope, personnel, period, cost share, subawards, and cost items.
3. Run every check. Finance, program, and the authorized official review the change against 200.308, 200.407, and the award terms.
4. Submit without making the change. Store the exact package and the delivery receipt. Mark the request as submitted, never as approved.
5. Keep the official response. Save the written approval, denial, questions, conditions, effective date, and any formal amendment. Check that the sender has authority to approve.
6. Create a new baseline instead of overwriting the old one. Link the old and new versions, and summarize every changed field.
7. Make the change from the approved version. Update operating budgets, forecasts, purchasing checks, subawards, calendars, and report mappings. Tell the affected staff.
8. Reconcile. Test the first QuickBooks Online and grant reports after the change against the effective date and the approved categories.

For controls when you first receive an award, use the federal award intake matrix. After approval, use grant budget versus actual in QuickBooks Online to compare spending with the revised budget categories.

Making the change in QuickBooks Online and GrantLink

QuickBooks Online is your accounting system. Keep posted transactions as they are, and make dated corrections only when the accounting is wrong. A budget revision usually changes the approved budget you compare against and what you may spend from now on. It doesn't by itself justify rewriting past accounting.

In GrantLink, keep the approved budget and the amendment evidence in the grant's Documents, then update the grant's Budget from the approved version. The QuickBooks records under Expenses and Money received are set separately on each grant. The shared Settings > QuickBooks > Mapping page holds organization-wide QuickBooks settings and does not map your funder's budget categories. To draft a report, choose New chat under Chats in the sidebar. GrantLink is read-only toward QuickBooks Online by default. It can't give approval for a budget change, and it doesn't make a cost compliant.

As a check, reconcile the old and new category totals, the effective date, cost share, funding, and the QuickBooks Online activity linked to the grant. Then review each affected transaction for allowability, allocability, period, support, procurement, and approval.

Recovering from a change made too early

Don't backdate a request, change records after the fact, or describe a pending approval as received. A suggested recovery process has eight steps:

1. Where practical, stop further affected commitments, charges, draws, and reports.
2. Keep the QuickBooks Online entries, approvals, communications, submitted reports, and a timeline of events.
3. Identify everything affected. Note whether the change involved scope, key personnel, participant support, subawards, cost share, funding, construction, an extension, or a cost item rule.
4. Tell the authorized official, the finance and program leads, and legal or CPA advisers, as appropriate.
5. Tell the agency or pass-through entity promptly when required, and ask for written direction or retroactive approval. Don't assume they will grant it.
6. Set aside the questioned costs, and don't draw or claim them until the issue is resolved.
7. If approval is denied, reverse or transfer the costs only to a funding source that actually benefited, under your documented accounting and cost allocation rules. Repay funds or correct reports as directed, and deal with any effects on the program.
8. Keep the final decision, adjustments, repayments, resubmitted reports, and control fixes.

Moving a cost to another federal award only to cover a shortfall isn't allowed under 200.405(c). Any transfer must be allowable and allocable to the receiving award on its own merits. See how to allocate expenses across multiple grants and maintaining audit-ready documentation.

Frequently asked questions

Which federal grant changes require prior approval?

Under 2 CFR 200.308(f), request prior written approval for scope or objective changes and changes to key personnel identified by name or position in the award. Other triggers cover project director or principal investigator disengagement or reduced effort, certain costs, participant support transfers, unapproved subaward activities, total cost share changes, additional federal funds, construction transfers, and no-cost extensions. Apply the conditions and exceptions for each trigger, even when no money moves between budget lines.

Does the 10% rule always require approval for budget transfers?

No. Under 200.308(i), an agency may restrict transfers among direct cost categories or programs, functions, and activities when both conditions apply. The federal share must exceed the simplified acquisition threshold. Cumulative transfers must exceed, or be expected to exceed, 10% of the total budget last approved by the agency, including cost share. Check whether the agency imposed the restriction. Transfers below the threshold can still need approval under other rules.

Do transfers between direct and indirect costs always need approval?

No universal requirement for those transfers appears in the current 200.308(f). Paragraph (i) describes optional restrictions among direct cost categories or programs, functions, and activities, not a blanket rule for direct-to-indirect transfers. A transfer in either direction may still trigger another approval requirement. Check the applicable agency rules, award terms, cost principles, and approved indirect cost rate and base.

Do expanded authorities allow rebudgeting without approval?

Only within the authority that applies to the award. Section 200.308(g) permits certain waivers but excludes the requirements in (f)(1) through (10), which have their own specific exceptions. Under (h), approvals for the actions described in (g) are automatically waived for research awards unless agency regulations or award terms say otherwise. Expanded authorities do not remove scope-change approval or authorize every budget transfer.

How do you request prior approval for a budget revision?

Submit the request to the federal agency or pass-through entity with approval authority. Under 200.308(c), use the application budget format unless the federal agency approved another format. Include the proposed budget and a clear explanation of the change, following the award's submission procedure. Under (d), the reviewer should notify you of approval or denial within 30 days of receipt, or provide written notice of when to expect a decision. Silence is not approval.

Sources

• 2 CFR 200.308, Revision of budget and program plans
• 2 CFR 200.110, Effective date
• 2024 Guidance for Federal Financial Assistance, effective date and earlier awards
• 2 CFR 200.329, Monitoring and reporting program performance
• 2 CFR 200.403 to 200.407, Basic considerations and prior written approval
• 2 CFR 200.439, Equipment and other capital expenditures
• 2 CFR 200.458, Pre-award costs
• FAR 2.101, Definitions, including the simplified acquisition threshold

This guide is general information and is not legal or accounting advice.