Quick answer
What is a utilisation certificate?
A utilisation certificate is a signed statement showing how much of a grant or fund was received, how much was spent on the sanctioned purpose and what balance remains. For central government grants it is Form GFR 12-A, due within twelve months of the financial year's close; CSR funders and donors usually prescribe their own format.
- GFR 12-A for grantee organisations under Rule 238
- GFR 12-C is only for State Governments
- Late UCs can lead to blacklisting from future grants
- CSR: the company's CFO certifies utilisation to the board
What is a utilisation certificate and who needs one?
A utilisation certificate is how a grantee proves to its funder that money was used as promised. Any organisation that receives a government grant, CSR funds, a donor grant or a government loan for a stated purpose will usually be asked for one before the next instalment is released.
In Delhi this includes NGOs and Section 8 companies running education or health projects, schools and colleges with research or infrastructure grants, cultural societies, incubators, and trusts that implement CSR programmes for companies. The funder sets the format and the deadline, and the sanction letter normally says both.
| Fund received | Usual format | Who signs the UC |
|---|---|---|
| Central government grant to an NGO, society, institute or autonomous body | Form GFR 12-A (Rule 238) | Chief Finance Officer (head of finance) and head of the organisation |
| Central grant to a State Government for a central scheme | Form GFR 12-C (Rule 239) | State Government, countersigned by the administrative or finance secretary |
| Government loan for a stated purpose | Form GFR 12-B (Rule 256) | The borrowing body |
| CSR funds given to an implementing agency | The donor company's own format | Agency's authorised signatory; many companies also ask for a CA's certificate |
| Foreign or private donor grant | The donor's format | As the grant agreement specifies |
Source: General Financial Rules 2017, Department of Expenditure compilation up to 31 July 2024, Rules 238, 239 and 256 and Forms GFR 12-A to 12-C. Checked October 2026.
What does the GFR 12-A utilization certificate format contain?
The GFR 12-A utilization certificate format reconciles the grant like a small cash account: opening balance, interest earned, interest returned to Government, grant received, total available, expenditure and closing balance. It then splits spending by component and ends with nine certified checks signed by the finance head and the head of the organisation.
The nine checks are more than a formality. The signatories confirm that the accounts were audited by designated auditors and tally with the audited figures, that internal controls exist, that no rules were broken, that benefits reached the intended beneficiaries, and that spending followed the proportions allowed in the scheme guidelines. Outcome annexures are attached in the format the ministry prescribes.
| Part | What you fill in |
|---|---|
| 1 and 2 | Name of the scheme, and whether the grant is recurring or non-recurring |
| 3 | Position at the start of the year: cash in hand or bank, unadjusted advances |
| 4 | Sanction number, date and amount; unspent balance brought forward; interest earned and interest deposited back; grant received; total funds; expenditure; closing balance |
| Component-wise use | Grant-in-aid general, salary, and creation of capital assets |
| Closing position | Cash or bank balance and unadjusted advances at the end of the year |
| Certification | Nine checks covering audited accounts, internal controls, compliance, beneficiaries, scheme proportions and outcomes |
| Signatures | Chief Finance Officer (head of finance) and head of the organisation, with date and place |
Summarised from Form GFR 12-A in the GFR 2017 compilation linked above. Ministries may add annexures for outcomes and other schemes run by the grantee.
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Which form applies: GFR 12-A, 12-B or 12-C?
Use GFR 12-A if your organisation received a central grant directly, 12-C only if you are a State Government reporting on a centrally sponsored scheme, and 12-B for a government loan. Many online templates label NGO certificates as 12-C, which is the wrong form.
The mix-up matters because a ministry can return a certificate filed in the wrong format, delaying the next release. When a central grant reaches you through a state department, for example a state society running a central scheme, follow the format your sanction letter names; the state may then consolidate it into its own 12-C. Research grants from scientific departments often come with that department's own UC format, which follows the same logic.
What is required for a CSR utilisation certificate?
The CSR Rules require the company's board to satisfy itself that CSR funds disbursed have been used for the approved purpose, and the company's Chief Financial Officer, or the person responsible for financial management, must certify this. Companies therefore ask implementing agencies for a utilisation certificate, often certified by a CA, to support the CFO's certificate.
Rule 4(5) of the Companies (Corporate Social Responsibility Policy) Rules 2014, inserted on 22 January 2021, places this duty on the company, not the NGO. In practice the NGO's report is the evidence the CFO relies on, so a vague UC can hold up the company's annual CSR reporting. Other rules shape what the company will ask for:
- Form CSR-1. Since 1 April 2021 every implementing agency must register with the Central Government by filing Form CSR-1, verified digitally by a practising CA, company secretary or cost accountant. The CSR registration number goes on every UC.
- Eligible agencies. Section 8 companies, registered trusts and registered societies registered under sections 12A and 80G of the Income-tax Act 1961 (renumbered under the 2025 Act), or government-set-up entities. Independent NGOs need a three-year track record in similar activities.
- Overheads. The company's administrative overheads are capped at 5% of its total CSR spending for the year, so funders want overheads shown separately.
- Impact assessment. Companies with average CSR obligation of ₹10 crore or more in the three preceding years must get an independent impact assessment of projects of ₹1 crore or more, completed at least one year earlier.
Projects and spending are reported on the national CSR portal of the Ministry of Corporate Affairs. If you are setting up an entity to receive CSR funds, read our page on Section 8 company registration first.
When is a utilisation certificate due, and what if it is late?
For a non-recurring central grant, the UC is due within twelve months of the close of the financial year in which it was received. For a recurring grant, the ministry releases next year's money only after a provisional UC for the preceding year, and anything beyond 75% only after the final UC and audited statement.
| Rule | What it says | Practical effect |
|---|---|---|
| 238(1) | UC in GFR 12-A within twelve months of the end of the financial year | Missing it allows the ministry to blacklist the organisation from future grants |
| 238(2) | Recurring grants: next release only after a provisional UC; above 75% only after UC and audited statement | A late UC directly delays the next instalment |
| 238(3) | No UC where the grant reimburses expenditure already incurred on the basis of audited accounts | The sanction letter should say so |
| 230(7) | Unspent balance of the earlier grant is considered; PFMS shows the grantee's bank balance | Large idle balances reduce the next release |
| 230(8) | Interest and other earnings on grants must be remitted to the Consolidated Fund of India after accounts are finalised | Interest cannot be quietly added to project spending |
Source: GFR 2017 compilation, Department of Expenditure, as linked above. Checked October 2026.
What documents are needed for a fund utilisation certificate?
A fund utilisation certificate rests on the sanction letter, a project-wise ledger, the bank statement of the grant account, vouchers for every payment, the audited accounts and, for capital grants, the asset register. Without a separate ledger or bank account for the grant, reconciling it becomes slow and less convincing.
| Document | Why it is needed |
|---|---|
| Sanction letter and budget heads | Defines the purpose, permitted heads, format and deadline |
| Previous UC and opening balance | Carries forward unspent money and advances |
| Bank statement of the grant or project account | Proves receipts, payments and interest earned |
| Project ledger and vouchers | Supports each rupee of expenditure by head |
| Audited financial statements | GFR 12-A figures must tally with audited figures |
| Asset register | Needed where the grant created capital assets |
| Proof of interest refund | Shows interest remitted to Government where required |
| Physical progress and outcome data | Ministries want outputs, not just inputs |
| CSR-1 registration number (CSR funds) | Identifies the registered implementing agency |
How is a utilisation certificate prepared, step by step?
Preparing a UC is a reconciliation exercise: match the funder's sanction to the bank account, match the bank account to the ledger, match the ledger to audited accounts, then fill the prescribed format and get it signed and, where the funder asks, certified by a practising CA with a UDIN.
- 1
Read the sanction letter
Note the permitted heads, the format named, the deadline and whether a CA certificate is required in addition.
- 2
Reconcile the grant account
Tie receipts, payments and interest in the bank statement to the project ledger and identify any unadjusted advances.
- 3
Classify spending
Split expenditure into the funder's heads, such as general, salary and capital assets, and check limits such as overhead caps.
- 4
Tie to audited accounts
Confirm that the figures agree with the audited financial statements for the year.
- 5
Fill the format and annex outcomes
Complete GFR 12-A or the donor's format and attach physical progress and outcome statements.
- 6
Sign, certify and submit
The finance head and head of the organisation sign; where required, a practising CA examines the records and adds a certificate with UDIN.
Common mistakes in utilisation certificates
Most rejected UCs fail on the same few points: the wrong form, figures that do not match audited accounts, interest not shown or not refunded, spending on heads the sanction did not allow, and an unspent balance that is not explained.
- Using GFR 12-C for an NGO grant instead of 12-A.
- Showing the amount transferred to a partner as "utilised" when the partner has not spent it.
- Leaving out interest earned on the grant account.
- Mixing two grants in one bank account with no project ledger.
- Submitting without the outcome annexures the ministry asked for.
- A CA certificate without a UDIN, which a funder may refuse to accept.
Trusts that also file Form 10B or 10BB should keep the UC consistent with that audit report; see our Form 10B guide. Clean monthly books make all of this easier, which is where regular accounting and bookkeeping pays for itself.
How do you choose a CA to certify a utilisation certificate?
Pick a practising chartered accountant who will examine the grant ledger, bank statement and vouchers, who knows the funder's format, and who issues a UDIN you can verify. A CA who already audits your accounts can usually reconcile the UC to those accounts fastest.
Certifying a utilisation certificate is work reserved for chartered accountants. This site gives information only: we do not quote fees for it or take it on. Our CA certificate guide explains how to verify a UDIN. The list of CA firms in Delhi gives factual details of the firms in our directory, and NGOs and schools in North Delhi can also read our CA in Model Town page.
Frequently asked questions
Who signs a utilisation certificate in GFR 12-A?
The form has two signature blocks: the Chief Finance Officer or head of finance, and the head of the organisation. The certification confirms that the accounts were audited by designated auditors and that the figures tally with them. Many ministries and donors also ask for a separate certificate from a practising CA.
What is the difference between GFR 12-A and GFR 12-C?
GFR 12-A, under Rule 238, is for autonomous bodies and other grantee organisations such as NGOs, societies and institutes. GFR 12-C, under Rule 239, is filed by a State Government for central grants given to it for a central scheme. An NGO receiving a central grant directly should use 12-A.
What is the deadline for submitting a utilisation certificate?
Under GFR Rule 238(1), within twelve months of the close of the financial year in which a non-recurring grant was received. Recurring grants need a provisional UC before the next year's release. Your sanction letter may set an earlier date, and that date governs your grant.
Is a CA certificate mandatory for a CSR utilisation certificate?
The CSR Rules place the certification duty on the company's CFO, not on a CA. However, most companies ask their implementing agencies for a CA-certified UC so the CFO has independent evidence. Check the CSR agreement, since it usually says who must sign.
Can unspent grant money be carried forward?
For recurring grants to the same organisation, the ministry takes the unspent balance into account when sanctioning the next grant. Whether it is carried forward or refunded depends on the sanction terms. Interest earned on grants must be remitted to the Consolidated Fund of India after the accounts are finalised.
What happens if we do not submit the utilisation certificate on time?
Under GFR Rule 238(1), the ministry is at liberty to blacklist the organisation from any future grant, subsidy or other financial support. For recurring grants, the next release is simply held back until the UC arrives.
Does a utilisation certificate need a UDIN?
The organisation's own UC in GFR 12-A does not, because it is signed by the organisation. If a practising CA certifies it, the CA must generate a UDIN; ICAI's portal has specific categories for grant utilisation certificates of NGOs, charitable trusts and statutory authorities.
Can an NGO receive CSR funds without CSR-1 registration?
Since 1 April 2021, entities covered by Rule 4(1) that want to undertake CSR activities must register by filing Form CSR-1. Projects approved before that date were protected. Without a CSR registration number, most companies will not release CSR money.
Is a utilisation certificate needed for reimbursement grants?
No, if the grant reimburses expenditure already incurred on the basis of duly audited accounts. GFR Rule 238(3) says the sanction letter should then state clearly that a UC is not necessary.