2 CFR 200.440 sets 2 requirements for organizations that receive federal grants and cooperative agreements. Applies when you build your application and budget, and to every cost you charge after award.
Cost increases from exchange-rate fluctuations are allowable subject to the availability of funding; prior approval by the Federal agency is required only when the fluctuation results in the need for additional Federal funding, or the increased costs require significantly reducing the project scope.
Budget includes foreign-currency expenditures (international activities)
The recipient or subrecipient must review local currency gains to determine the need for additional Federal funding before the award's expiration date; subsequent adjustments for currency increases are allowable only with adequate source documentation from a commonly used exchange-rate source in effect at the time the expense was made, and only to the extent sufficient Federal funds are available.
Award involves local-currency spending abroad
Upload the funding notice and your draft budget or narrative, and ask. Grantable answers from its compliance database of federal, agency and state rules, with citations.
(a) Cost increases for fluctuations in exchange rates are allowable costs subject to the availability of funding. Prior approval of exchange rate fluctuations is required only when the change results in the need for additional Federal funding, or the increased costs result in the need to significantly reduce the scope of the project. Before providing approval, the Federal agency must ensure that adequate funds are available to cover currency fluctuations in order to avoid a violation of the Antideficiency Act.
(b) The recipient or subrecipient is required to make reviews of local currency gains to determine the need for additional Federal funding before the expiration date of the Federal award. Subsequent adjustments for currency increases may be allowable only when the recipient or subrecipient provides the Federal agency with adequate source documentation from a commonly used source in effect at the time the expense was made, and to the extent that sufficient Federal funds are available.
Source: eCFR · checked Sep 17, 2026
Cost increases from exchange-rate fluctuations are allowable subject to the availability of funding; prior approval by the Federal agency is required only when the fluctuation results in the need for additional Federal funding, or the increased costs require significantly reducing the project scope. The recipient or subrecipient must review local currency gains to determine the need for additional Federal funding before the award's expiration date; subsequent adjustments for currency increases are allowable only with adequate source documentation from a commonly used exchange-rate source in effect at the time the expense was made, and only to the extent sufficient Federal funds are available.
Budget includes foreign-currency expenditures (international activities). Award involves local-currency spending abroad.
Plain-English summaries for information only, not legal advice. Always check the regulation text, your award terms and your agency’s guidance.