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I have had costs disallowed on an FS-10-F because the costs were not encumbered during the project period. When exactly is an encumbrance incurred on a grant? Are the rules different for State versus Federal grants?

All project encumbrances, whether on a State or federal grant, must be made within the approved funding period of the grant. Costs encumbered outside the project dates cannot be reimbursed on the FS-10-F. However, the type of cost affects when the encumbrance is made. For example, if the cost involves the performance of work other than personal service, the encumbrance is made on the date on which the grantee makes a binding written commitment to obtain the work. A contract would be a type of binding written agreement. An encumbrance for travel, on the other hand, is treated differently. In this case, the encumbrance is made when the travel is actually taken. For more specific examples, please refer to the General Guidelines section of our Fiscal Guidelines for Federal and State Grants