Funds Appropriation

By Yasser Latif Hamdani

We received a query which I am re-wording so as to not reveal anything confidential. A business concern received funding from a government organization for a project, logistics of which required purchase of equipment to be used for the purchase of certain equipment. The business concern obtained the equipment at a lower cost than previously anticipated. What happens to balance funds?

Legal Opinion:

Not knowing the exact nature of the agreement and/or binding legal commitments that you may have, I can only say that if a quotation was given to the government agency for the purchase of the equipment, then you are bound to return the balance amount to the government. However if the grant was for the project and did not specify amounts to be spent on equipment, funds may be retained provided that they are directed towards the project at hand.