Understand the Federal Financial Report, or SF‐425, which is a cumulative report that captures the financial status of an agreement at a specific point in time.
The federal financial report, coupled with your budget, helps determine whether the expenditures are aligned with the implementation of the project. Submitted on a quarterly basis, the SF‐425 provides an opportunity to re‐assess assumptions made earlier in the budgeting and planning process.
USAID staff use information from the SF‐425 to reconcile its records to ensure accuracy in financial reporting and oversight. Analysis of this information permits both USAID and the organization to identify how quickly funds are being used (known as the burn rate) and how much money remains for future use (known as the pipeline).
From the partner side, accurately completing the SF‐425 demonstrates an organization’s understanding of their financial management responsibilities. A firm understanding and execution of financial management responsibilities is necessary for a successful activity.
