Utilisation Certificate by CA
A utilisation certificate tells the body that gave you money exactly how it was spent. For central government grants, Rule 238 of the General Financial Rules, 2017 asks for it in Form GFR 12-A within twelve months of the close of the financial year. We check your books against the sanction letter and certify it with a UDIN.
What it is
A utilisation certificate (UC) is a statement of where grant money went. It shows the opening balance, the funds received with sanction numbers and dates, interest earned, what was spent under each head, and what is left unspent. The funder relies on it before releasing the next instalment.
For grants-in-aid from a central ministry or department, the General Financial Rules, 2017 set the format. Rule 238(1) prescribes Form GFR 12-A for autonomous bodies and grantee organisations, and Rule 239 prescribes GFR 12-C when central grants go to a state government for a central scheme. GFR 12-A is signed by the head of the organisation and its chief finance officer. Some ministries also ask for a chartered accountant’s certificate on letterhead, countersigned by the grantee, and that is the part we handle. CSR donors and subsidy schemes have their own formats, but the idea is the same.
Who it applies to
NGOs and institutions with government grants
Trusts, societies, Section 8 companies, universities and research bodies that receive grants-in-aid from a ministry or department. The sanction letter usually names the UC format and the due date.
CSR implementing agencies
Entities registered through Form CSR-1 that spend a company’s CSR money on a project. The donor company’s board must satisfy itself that the funds were used as approved, so it asks the agency for a certified account of how the money was spent.
Businesses claiming subsidy or project funds
Units that receive capital subsidy or scheme assistance, and borrowers whose bank asks how a loan was used. Think of a small Faridabad manufacturer whose bank wants proof that a term loan went into the machine it was meant for. The scheme or bank sets the format.
Why it matters
The next instalment depends on it
Rule 238(2) says that for recurring grants, the ministry should release the next year’s sanctioned amount only after the UC for the previous year is submitted.
It protects your future funding
The Ministry of Culture’s 2017 instructions on UCs say a department may blacklist an organisation that does not submit them, cutting it off from future grants and subsidies.
It gives the donor something to verify
A CA certificate carries a UDIN, a unique number generated on the ICAI portal. The funder can check on udin.icai.org that the certificate is genuine and was issued by the CA named on it.
Documents required
About the grant
- Sanction letters with number, date and amount
- Scheme guidelines and the approved budget heads
- The UC format the funder wants (GFR 12-A or its own)
- The previous year’s UC, if any
From your accounts
- Audited financial statements for the year
- Separate ledger or subsidiary account for the grant
- Bank statement of the grant account
- Interest earned on grant funds and proof of any refund
Proof of spending
- Bills, vouchers and payment proofs by budget head
- Asset register for capital items bought from the grant
- Physical progress or project completion report
- Signed list of beneficiaries, where the scheme needs it
Which format applies to your funds
| Source of funds | Format | Who signs |
|---|---|---|
| Central grant-in-aid to an autonomous body or grantee organisation | Form GFR 12-A (Rule 238(1)) | Head of the organisation and CFO; a CA certificate where the ministry asks for one |
| Central grant to a state government for a central scheme | Form GFR 12-C (Rule 239) | State government, countersigned by the Administrative Secretary or Finance Secretary |
| CSR funds given to an implementing agency | Donor company’s format | The agency, usually with a CA certificate; the company’s CFO certifies to its own board under CSR Rule 4(5) |
| State subsidy or bank loan | Scheme or bank format | Usually the borrower plus a CA |
GFR 12-B is a further UC format in the same Rules. Your sanction letter tells you which one the department expects. Follow it exactly. A generic certificate usually comes back with queries.
Here is the catch for many small trusts. Picture a Faridabad education society that got a central grant for a skills course in 2025-26, but kept it in the same bank account as its fee income. Before anyone can sign GFR 12-A, the grant money has to be separated out on paper, receipt by receipt. A clean grant ledger from day one saves weeks, and good book-keeping does most of that work for you.
How it works
Read the sanction letter line by line
We note the approved budget heads, any cap on salary or administrative spending, and the format the funder wants.
Match the grant ledger to the bank and vouchers
We trace every grant receipt and payment to the bank statement and the bill. Say a trainer was paid from the general account and the grant account repaid it later: we make sure that payment is counted once, not twice.
Agree the figures with the audited accounts
The UC must agree with the audited financial statements. If the two differ, we find the reason before anything is signed.
Calculate interest and the unspent balance
We calculate interest earned on grant money and the closing unspent amount, and show what was refunded or carried forward.
Certify with a UDIN and hand it over
We sign the certificate, generate the UDIN on the ICAI portal and give you the final copy for countersignature and submission.
Timelines
Submit within twelve months of year-end
Rule 238(1): the UC is due within twelve months of the closure of the financial year. For a grant spent in 2025-26, that means by 31 March 2027.
File before you need the next release
For recurring grants, Rule 238(2) links next year’s release to the previous year’s UC. In practice, the sooner you file, the sooner the money comes.
Remit interest once accounts are final
Rule 230 requires interest and other earnings on grants to be remitted to the Consolidated Fund of India immediately after the accounts are finalised.
What happens if the UC is late or wrong
Your next instalment waits
Under Rule 238(2), a recurring grant for the following year waits until the pending UC arrives. The project stalls, but salaries and vendors still need paying.
Unspent money cuts the next grant
Rule 230 says the unspent balance of an earlier grant is taken into account when the next grant for the same purpose is sanctioned, so it can shrink.
You risk being blacklisted
Ministry instructions allow a department to bar an organisation that does not submit UCs from future grants, subsidies and other government support.
Frequently asked questions
What is a utilisation certificate?
A utilisation certificate is a signed statement showing how grant or donor money was spent against the purpose it was given for. It lists opening balance, funds received, interest earned, spending by head and the unspent balance. For central grants-in-aid, Form GFR 12-A under Rule 238(1) of the General Financial Rules, 2017 is the standard format. Once the figures tie to your audited accounts, it is a routine document to prepare.
Who can sign a utilisation certificate?
Form GFR 12-A is signed by the head of the organisation and its chief finance officer. Some ministries, and many CSR donors and banks, also want a chartered accountant to certify the figures on letterhead, countersigned by the grantee with its stamp. Your sanction letter or scheme guidelines say which signatures are needed. We follow that list exactly, so the certificate is accepted the first time.
What is the due date for a utilisation certificate under GFR?
Rule 238(1) of GFR 2017 requires the UC within twelve months of the closure of the financial year. So money spent in 2025-26 must be accounted for by 31 March 2027. For recurring grants, Rule 238(2) also says next year’s release comes only after the previous year’s UC, so waiting for the deadline can delay your own funds. We aim to certify soon after your audit closes.
Is a UDIN required on a CA’s utilisation certificate?
Yes. ICAI requires a practising chartered accountant to generate a UDIN, a Unique Document Identification Number, for every certificate they sign. The funder can verify the UDIN on udin.icai.org to confirm that the certificate is genuine and that the CA named on it issued it. Every certificate we issue carries one, so the funder can check it in a minute.
What is the difference between GFR 12-A and GFR 12-C?
GFR 12-A is used by autonomous bodies and grantee organisations under Rule 238(1). GFR 12-C is used when central grants are given to a state government for a central scheme, under Rule 239, and is countersigned by the Administrative Secretary or Finance Secretary. NGOs, institutions and Section 8 companies usually need GFR 12-A. If your sanction letter names a different format, we prepare that one instead.
What happens to interest earned on grant money?
Under Rule 230 of GFR 2017, interest and other earnings on grants-in-aid must be remitted to the Consolidated Fund of India immediately after the accounts are finalised. The UC shows the interest earned and the amount deposited back. Keeping grant money in a separate bank account makes this simple. We work out the figure from the bank statement and show it clearly on the certificate.
Do CSR funds need a utilisation certificate?
The CSR Rules do not prescribe a UC format, but Rule 4(5) of the Companies (CSR Policy) Rules, 2014 requires the board to satisfy itself that funds were used as approved, and the CFO must certify this. So donor companies ask implementing agencies for a certified utilisation statement, often by a CA. If you receive CSR money, we prepare it in the donor’s format.
Can the CA certify spending that does not match the sanction?
No. A CA certifies facts from the books, so spending outside the approved heads is shown as it is, not hidden. GFR 12-A itself asks you to confirm that expenditure followed the approved proportions and scheme guidelines. If we find a mismatch, we tell you before signing. Often the fix is a revised approval from the funder or a correct reclassification in the accounts.
Do the UC figures have to match the audited accounts?
Yes. Under Rule 235 of GFR 2017, grantees must keep subsidiary accounts of the government grant and give the Accounts Officer audited statements of accounts. Departments check the UC against those audited figures. Any difference raises questions and holds up release. We reconcile the two before certifying, so the numbers on both documents line up.
What it costs
Our fee plus the government fee that applies to your case, quoted before you commit. Tell us the situation and we will price it exactly.
A utilisation certificate is not filed on any government portal, so there is no government filing fee for the certificate itself.
Ready to begin?
Send us the sanction letter and your audited accounts, and we will tell you what the certificate needs.