Grants need to be accounted for at all times and many organizations do not realize that it is necessary to establish proper and transparent accounting practices in order to manage grants and continue to receive them.
All income and expenditures from the grant need to be allocated and tracked. Each grant should have a distinct and separate classification in your accounting system and co-mingling of funds needs to be protected against.
In order for grants to be used for the written purpose, a strong accounting team is needed that has the experience and ability to track multiple funding streams. Things to consider include: being sure to never use funds from the grant to purchase something that is not pre-approved, if an amendment is needed to the budget it is necessary to obtain funder approval prior to making the change, make sure expenses have back up documentation (such as payroll and receipts), using proper accounting software to classify the funding stream and monitoring the income and expenses monthly.
Why do I need a CFO?
You didn’t start your business or become the head of an organization because you are a financial expert. You are there to grow and succeed. The accounting, bookkeeping and financial aspects of your business are important to how you run your company, but it is time consuming and if not done properly, can lead to more headaches down the road.
Keeping track of your bookkeeping and your financial statements is time consuming and difficult to manage. But most frustrating is understanding and interpreting your financial picture from reports. CFOs are responsible for timely and accurate presentations and financial reports in order to capitalize on your growth.
SABRINA HOUSERMAY 19, 2017
