Sport Ireland CEO John Treacy has told the FAI they will not receive any funding support until they make the changes agreed in the memorandum of understanding that was drawn up as part of the rescue package to save the association last January.
The MoU saw changes to some of the terms of the governance, including an increase in the number of independent directors from four to six, and a clause that FAI council members who have served for 10 years should step down this year.
Fianna Fáil TD for Sligo-Leitrim Marc MacSharry has criticised the memorandum and called for it to be reversed but Minister for Sport Catherine Martin and then Minister of State Dara Calleary last week confirmed that the new Government has no intention of altering the terms of the agreement.
The rescue package is worth about €20m and included a restoration of grant aid to football, which had been frozen since April 2019. That money was restored and the figure doubled from €2.9m to €5.8m a year.
At the start of this month, the FAI's AGM, originally scheduled to take place on 25 July, was pushed back to September. The association said the meeting "has been rescheduled in line with Covid-19 restrictions and to allow for the newly appointed external auditors Grant Thornton to prepare accounts".
FAI Council members were told an EGM would take place "in the near future" to vote on the required changes to the FAI Rule Book and Constitution as the FAI pushes on with governance reform.
The FAI have yet to receive any of the €5.8m and will not do so until the changes are made at their EGM.
In a statement released on Friday, Sport Ireland reiterated their stance that the FAI must follow through on their commitment to make the relevant rule and constitutional changes before any grant funding will be released.
Treacy said: "Sport Ireland has not paid out any of the €5.8m grant funding to the FAI in 2020 to date.
"Furthermore, no funding is scheduled to be paid in advance of the FAI's EGM. To avail of the funding support, the FAI is aware of the need to make the essential amendments to its rules and constitution in line with its commitments in the MOU.
"These changes are also required as a pre-requisite to the FAI applying to Sport Ireland for any portion of the additional €70 million of new Government funding to support the sports sector through the Covid-19 crisis."
Sport Ireland Chairman Kieran Mulvey added: "The FAI were weeks away from insolvency at the start of this year. In late January 2020, the future of Irish football was secured when the Government, UEFA and Bank of Ireland agreed a vital funding arrangement to save the FAI.
"This multi-stakeholder recovery plan hinges on the FAI delivering absolutely essential governance reforms in the coming weeks. The progress made by the FAI in recent months is welcome and must be safeguarded and built on. There can be no return to the well-publicised financial and governance crisis."