You Got the Grant? Awesome...Now Let’s Get the Money!
The period after securing a grant is when serious work begins for most nonprofits. While some grants will include restricted funds, other funds may only be partially restricted or be entirely without restriction. Regardless, all funds must be properly managed and accounted for, over the lifetime of the grant.
As we have explained elsewhere, proper grant management is a matter of trust. It is not merely desirable for nonprofits to comply with all relevant grant reporting and management procedures, it is crucial to their ability to continue attracting gifts from donors.
The possibility that certain grants may also adopt a reimbursable structure means complete compliance with grant reporting procedures and policy will be vital to collecting any money. As a result, committing fully to a transparent and detailed process is critical to positioning your nonprofit as a reliable, trustworthy partner.
In this article, we will discuss some of the procedures that should necessarily occur as you enter the post-approval period and start ramping up preparations for grant implementation.
Post-approval procedure for nonprofits
The period after winning a grant is understandably bubbly. All your effort, most likely running into months of work, has paid off and you finally have the funding you desired. While it’s great to celebrate, you need to remember that with great grants come great responsibility.
There’s plenty to do in order to ensure your nonprofit is fully capable and ready to fulfil the responsibilities of grant management. Here’s what your post-approval procedure should look like after securing the grant:
● Formally accept the grant: Most government grants come with a lot of red tape, and one of this will typically include a requirement that you formally accept the grant. Certain corporate grants may require this, but not in all cases. As a result, your first task may be to sign and return a formal document accepting the grant, and also fulfil any special requirements that may be attached.
● Review the grant proposal or requirements: Next up, you should take a second look at your grant proposal or the requirements of the grant. In the euphoria of the award, it can be easy to forget the exact parameters of what will be expected and the process to follow. The whole process, from proposal to award can take months, and it is not unusual for the details to have become a bit blurred in that time. Keeping the requirements firmly in mind will help you better prepare for what comes next.
● Understand the rules and regulations: Typically, grants come with rules relating to reporting, documentation, fiscal controls and other management procedures. For government grants, the rules are more likely to be especially demanding. Be certain to learn exactly what they entail as you begin to lay your plans towards grant implementation. If you have been awarded a grant from a federal government agency, the administrative rules provided by the Office of Management and Budget may be helpful.
● Review accounting practices and procedures: Although accounting for nonprofits is similar in many respects to that of any other business, there are certain principles that are unique to nonprofit accounting. For instance, fund accounting practices may be necessary where the grant relates to restricted funds – money that is expected to be put to a specific use. In this case, the nonprofit must treat each fund as a business unit, complete with its own ledger and accounting columns. Another important aspect to keep in mind here will be proper cash flow management. Without implementing the right controls, your nonprofit may find itself out of cash when it can ill afford penury.
● Work with partner organizations: Nonprofits work with partner organizations all the time, and certain programs may need to be carried out in tandem with a partner or two. Having third parties involved in the process will not relieve the nonprofit of its responsibility to properly account for funds released to partners. As a result, it is important to ensure your nonprofit and its partners are in lock step regarding your reporting and compliance obligations in relation to the grant.
● Announce to your community: Finally, grants improve the capacity of nonprofits to cater to the communities they are committed to. Announcing a successful grant award showcases the belief that funders have in the organization and your relevance in the space where you serve. However, certain funders may not wish to have their gifts disclosed, and these are wishes that must be respected.
With the post-approval procedures all completed, your non-profit can begin to look towards implementing its ideas for the program, as expressed in the grant proposal. During the course of implementation, it will be important to ensure total compliance with grant reporting and other relevant requirements.
Best practices for grant reporting
As you progress in your grant implementation process, there are certain grant reporting responsibilities that will arise. Typically, funders will include specific reporting requirements for periodic updates about how the grant funds are being utilized. It is necessary to manage these responsibilities wisely by doing the following:
● Submit grant reports timely and accurately: Where the grant comes with specific or non-standard details as to when a report must be made or what it should contain, there should be painstaking adherence to these. Some grantmakers will only release funds in reimbursement form, and failing to adhere to the instructions may jeopardize your ability to unlock those funds. Often, it makes the most sense to create a clear reporting schedule that allows you more than enough time to start collating reports several weeks ahead of due date.
● Stay compliant with funders: While the procedures and policies in the grant may seem cumbersome, never forget that they are literally your ticket to more funding. Failing to comply with these procedures, such as those relating to the organization of receipts and expenses or timely filing of grant reports, may affect your ability to secure grant renewal in subsequent years. Worse, you may be required to return some of the grant funds for being non-compliant. Remember, some funders may require an audit of your program to see how well you have worked within the requirements. If you fail the audit, you may likely not receive the grant again.
● Track expenses and ensure reporting with proper account codes: For many government grants especially, there are specific rules regarding how expenses must be reported. Sometimes, this will be specific enough to cover the exact codes certain expenses must be recorded under. Failing to follow these codes or report properly according to budget may mean you are leaving money on the table, or the funder may refuse to accept expenses because you went over budget.
● Share real-time updated budget per grant and program with directors: Program directors are responsible for executing your program, hopefully in line with your timeline and budget. But budgets may change during the course of the year, and where this is the case, program managers need to be kept updated accurately and in real-time. If they don’t know how much is left in the budget for their program, they may overspend or fail to allocate funds properly.
To be certain that the reporting procedure progresses smoothly, many nonprofits rely on grant reporting software to manage their obligations. At PreciseGrants, we provide an intelligent reporting framework that provides deep assistance with complex and non-standard reporting or documentation requirements.
Using PreciseGrants, nonprofits can prepare 100% compliant reports that are completely error-free and guaranteed to unlock the money. To learn more about how PreciseGrants works, or if you would like to request a demo, please contact us.