---
kind: "section"
citation: "42 C.F.R. § 441.484"
title: "42"
number: "441.484"
heading: "Financial management services."
url: "https://uscodex.org/cfr/42/441.484"
---

# §441.484. Financial management services.

- (a) States may choose to provide financial management services to participants, or their representatives, as applicable, self-directing PAS, with the exception of those participants utilizing the cash option who directly perform those functions, utilizing a financial management entity, through the following arrangements:
  - (1) States may use a reporting or subagent through its fiscal intermediary in accordance with section 3504 of the IRS Code and Revenue Procedure 80-4 and Notice 2003-70; or
  - (2) States may use a vendor organization that has the capabilities to perform the required tasks in accordance with Section 3504 of the IRS Code and Revenue Procedure 70-6. When private entities furnish financial management services, the procurement method must meet the requirements set forth in [2 CFR 200.317 through 200.327](/cfr/2/200.317..200.327.md).
- (b) States must provide oversight of financial management services by performing the following functions:
  - (1) Monitoring and assessing the performance of financial management entity, including assuring the integrity of financial transactions they perform.
  - (2) **Designating a State entity or entities responsible for this monitoring.**
  - (3) Determining how frequently financial management entity performance will be assessed.
- (c) A financial management entity must provide functions including, but not limited to, the following:
  - (1) **Collect and process timesheets of the participant's workers.**
  - (2) Process payroll, withholding, filing and payment of applicable Federal, State and local employment-related taxes and insurance.
  - (3) **Maintain a separate account for each participant's budget.**
  - (4) **Track and report disbursements and balances of participant funds.**
  - (5) **Process and pay invoices for goods and services approved in the service plan.**
  - (6) Provide to participants periodic reports of expenditures and the status of the approved service budget.
- (d) States not utilizing a financial management entity must perform the functions listed in [paragraph (c)](#c) of this section on behalf of participants self-directing PAS, with the exception of those participants utilizing the cash option who directly perform those functions.
- (e) States will be reimbursed for the cost of financial management services, either provided directly or through a financial management entity, at the administrative rate of 50 percent.

## Notes

### Amendments

[73 FR 57881, Oct. 3, 2008, as amended at 81 FR 3012, Jan. 20, 2016; 89 FR 80070, Oct. 2, 2024]

### Source

Source: 73 FR 57881, Oct. 3, 2008, unless otherwise noted.

### Authority

Authority: 42 U.S.C. 1302.

### Source

Source: 43 FR 45229, Sept. 29, 1978, unless otherwise noted.

### Amendments

[73 FR 57881, Oct. 3, 2008, as amended at 81 FR 3012, Jan. 20, 2016; 89 FR 80070, Oct. 2, 2024]