A little heavier than most of our blogs, this one will bring you through the ins and outs of obligating and de-obligating training funds under the TAA Program. There's also a discussion of accrued expenditures. Remember, they got to Capone through his bookkeeper...



In the fall of 2020, a large manufacturing company named XYZ, Inc. announced it would start laying off factory employees.  XYZ is one of the biggest employers in the City of Hope.  XYZ’s layoff plans were to layoff individuals on a bi-annual basis for the next three years as it’s winding down business and completing the remaining orders.  The TAA petition filed by City of Hope was approved by DOL shortly after the announcement.  The State of Progress’ Rapid Response unit reached out to XYZ, Inc. and the company agreed to partner with the local American Job Center (AJC) in the City of Hope to start enrolling recently laid off employees into WIOA.  The laid off employees are eligible for Trade Agreement Act (TAA) services. 


[1] At that time, one of the laid off employees were immediately enrolled in the Trade program.  On 10/16/2020, Participant A meets with her case manager and together they complete an application for training.   Participant A wants to enter into the IT field and her case manager examines the local labor market data and sees that IT jobs in the area are on the rise.  Participant A selects an IT security certification program that includes eight (classes) course at a neighboring community college.  The program is two semesters long for a total cost of $7,500 ($3,750 each semester) and the first semester starts on 01/02/2021. 


[2] On 10/23/2020, the case manager finalizes Participant A’s Individual Training Account (ITA) and case notes.  A condition for the approval, is that the participant is to come into the AJC with proof of class attendance and copies of a class attendance report (signed and verified by the instructor) every two months.  The case manager will then follow up with phone calls or emails and if after five messages the participant is unresponsive, the case manager will cancel the 2nd semester of training and will be withdrawn as a TAA participant as an early exiter.  Participant A agrees and signs off on both documents.  The case managers sends Participant A’s training plan to the State’s Trade program office.  Once the Trade office receives the information it forwards it to the Accounting department at the State.  Accounting identifies that current year trade funds are to be used to pay for the Participant A’s IT security course. 

                Accounting obligates $7,500 in the accounting system


[3] On 01/02/2021, Participant A starts the first semester.  The community college has been instructed to remit invoices to the Trade office at the State for Participant A.  A week into the first semester, an invoice (dated 01/03/2021) is received by the Trade office for $3,750.  It identifies that the last date for the participant to drop the course and for the State to receive a full refund for the semester is two weeks from the date of invoice (the drop dead date 01/17/2021). 


[4] Accounting receives the invoice and marks it to be processed and paid on 01/17/2021. 

Accounting records $3,750 increase in expenditures and reduces the unliquidated obligation in the same amount.


During the course of the first semester, Participant A realizes that she will need to complete a Microsoft Certified Solutions Expert test and to purchase the accompanying test materials in order to move onto then next semester. 


[5] On 02/12/2021, during the Participant A’s regular check-in, she mentions this test requirement to the case manager.  The case manager notes that this is an item that is allowable under the Trade program.  The request goes to the Trade office for approval and Participant A receives the voucher in less than a week.  The voucher is only redeemable at the designated community college for the testing fees and materials which cannot exceed $1,500.    

Accounting records an obligation of $1,500 for the voucher.


[6] On 02/20/2021, Participant A redeems the voucher at the community college for the testing materials and to sign up for the next test, in the amount of $800.  The voucher is only good for one test and all relevant testing materials.  The State Trade programs receives the bill from the community college and forwards it along to Accounting for immediate payment. 

Accounting records an expense of $800 and the remaining unliquidated obligation is $700.  According to the State’s accounting policy, it will de-obligate the remaining unliquidated obligation of $700 for immediate reprogramming to make available to other Trade participants.              

Following every quarter, States are required to submit quarterly financial status reports to ETA on current grant fund expenditures and obligations.  Reports are due 45 calendar days after the quarter ending.


[7] For 03/31/2021 quarter ending, Accounting reports the following unliquidated obligations and expenditures in regards to Participant A:

Accounting records $3,750 in unliquidated obligations and $4,550 in expenditures ($3,750 first semester expenses + $800 testing and test materials).


[8] As the 06/30/2021 quarter is coming to an end, Participant A’s case manager has noticed that Participant A has not come in for the regular check-in and has been unresponsive to all phone calls and emails.  There is news circulating that XYZ, Inc. has been temporarily rehiring former employees in order to meet the last of its orders.  The case manager informs the Trade office about Participant A’s unresponsiveness, that the second semester is starting on 07/01/2021, and that the last day to withdraw from the course for a full refund is 07/17/2021.  As of 07/10/2021, Participant A has not attended any second semester classes and a bill has already arrived at the State’s Trade office.  The Trade office has determined that Participant A has ceased participation in training and is to be withdrawn from the training so funds can be de-obligated and reprogrammed for other Trade participants.  A determination is mailed to Participant A informing them that she has ceased participation in training and are provided her appeal rights.

Accounting de-obligates the remaining unliquidated amount of $3,750 and reprograms it back into the current Trade program.


[9] For 09/30/2021 quarter ending, Accounting reports the following obligations and expenditures in regards to Participant A:

Accounting records $0 in unliquidated obligations, $4,550 in expenditures, and a $3,750 increase in the amount available to other program participants (de-obligation).




  • The State Trade program office has a policy requiring regular check-ins with TAA Program participants.
    • This ensure timely de-obligation of funds to ensure that trade monies are reprogrammed for other trade participants when a participant withdraws from training.
  • The State has clear and concise definitions on expenditures, unliquidated obligations, and de-obligation and is distributed to not only Accounting but program case managers as well.This training allows the program case manager to be on the front lines when assisting Accounting and builds a stronger relationship between the two departments.
  • There is constant communication between the case manager at the local AJC and the Trade program office at the State level.
    • In addition, there is immediate communication with Accounting.
  • Notification is given to the participant that she has been determined to have ceased participation in training. A determination was issued and the participant was provided her appeal rights.

Where can I find the nearest American Job Center? - https://www.careeronestop.org/LocalHelp/service-locator.aspx


Where can I find training more training like this including SMART (Strategies for sound grant management that includes:  Monitoring, Accountability, Risk mitigation and Transparency) - https://grantsapplicationandmanagement.workforcegps.org/resources/2019/12/15/21/50/SMART_3-0_Webinar_Training_Series