Summary

The US Government Accountability Office conducted an audit of the National Institutes of Health (NIH) procedures for overseeing extramural research funding, which amounted to over 35 billion USD in fiscal year 2023 (80% of NIH’s budget). The audit assessed compliance with grant and cooperative agreement requirements, management of unobligated balances, and the effectiveness of oversight. SAI analyzed NIH data and documents through 2023, reviewed NIH’s monitoring of grant compliance, and interviewed officials from four NIH institutes. NIH supported approximately 65,000 grants and other awards in 2023, increasing funding by 30% since 2014 (adjusted for inflation) and oversight staff by 20% (400 positions). NIH did not always close funding decisions on time due to about 1,000 delinquent final reports (0.2% of decisions from 2014–2024). These reports show how funds were used and what was achieved, and their delays hinder verification of proper spending and detection of misuse. Some NIH grants allow unspent funds to be carried over to the next year. If funds are not needed, NIH can restrict their carryover. However, NIH lacks a unified system or clear guidelines to track these balances. Each NIH institute manages carryover independently and is not required to track unspent funds, despite their prevalence. This prevents NIH from ensuring funds are used efficiently and allocated to the most critical projects. The audit identified 9.3 million USD in questioned costs among funding recipients from 2021–2023, of which 3.3 million USD were deemed disallowed and recovered. SAI US recommends that NIH (1) identify and address factors contributing to delinquent final financial and progress reports, (2) develop an informational resource for managing unobligated award balances, and (3) require NIH institutes and centers to track unobligated balances in their funding portfolios. NIH concurred with all three recommendations.