Grant Accounting Financial Accounting

November 17, 2021 | Tags: Bookkeeping

grant accounting

First, grants can come in different types, and each type may have different requirements. It’s important to stay up to date with the latest accounting requirements. Second, the accounting treatment of a government grant depends on the nature of the grant. Finally, government grants are treated as an expense in the same period they’re recognized, rather than when they’re received. HUD has updated the Integrated Disbursement and Information System (IDIS) to begin phasing out the first-in-first-out (FIFO) accounting methodology.

  • Second, the accounting treatment of a government grant depends on the nature of the grant.
  • The Accounting Office should be consulted early in the budget development process.
  • Furthermore, this office usually routes the proposal to the approving parties, mails the document to the grantor, distributes copies to the responsible offices, and follows up with the grantor as necessary.
  • Grant requisitions submitted on line are automatically forwarded to the Accounting Office staff for review and approval before they routed to the Purchasing Office processing as a purchase order.
  • Grants Accounting provides the standard forms to satisfy government reporting requirements and financial management of awards.

Faculty and staff frequently ask for guidance regarding the appropriate expenditure of project funds. Consult your accounting partner while you’re putting the proposal together to see if the requirements have usage restrictions or conditions that need special financial consideration. For example, conditions that specify the grant will be paid in four installments throughout the year and not in one lump law firm bookkeeping sum. An NFP accounting specialist knows how to accurately record grants according to state and federal regulations and helps ensure that the funds are used in an appropriate manner. Whether or not to return a grant if conditions are not met is up to the entity. Capital grants are funds that are provided to assist in the acquisition, construction, renovation, repair of capital assets, or fixed assets.


Macalester requires you to keep your records for a period of seven years from the date of submission of the final financial report. Generally, narrative and financial reports are due thirty (30) to ninety (90) days after the project end date. Moving funds from one budget FOAPAL to another is considered a Cost Transfer.

grant accounting

Indirect costs are recorded as a debit to the Indirect Cost account in the grant fund and as a credit to an appropriate unrestricted current fund revenue account code. The Accounting Office has negotiated and obtained an approved rate of 44% of personnel costs including fringe benefits from the Department of Health and Human Services. This rate is applicable to all federal programs, and is subject to negotiation and change. Where a grantor does not support the above indirect cost rate, at least 8% of the total grant award must be requested to support University overhead.

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We do this because the quality of implementation and application of the Standards affects the benefits that investors receive from having a single set of global standards. F&A cost is charged based upon the rate and base in the approved award, up to the federally negotiated rate. They assist with proposals, preparation and submission of narrative reports, grant revisions, conflict of interest and other grant work. A description of the expenses, including justification for the project, and original detailed receipts are required. Grants Accounting integrates with Oracle Grants Proposal to create awards and budgets from funded proposals. Award distributions allows users to determine transaction charging instructions for expenditure items based on a predefined funding pattern for cost distribution.

  • Fill out a Grant Revision Request Form to request the budget changes and send it to Grant, Foundation and Corporate Relations for review.
  • To comply with nonprofit accounting compliance requirements, government grants must be matched with related expenses.
  • The grant must be used according to the terms and conditions of the grant agreement to be classified as income.
  • Grants should not be used in any way that could be perceived as fraudulent or unethical.
  • The Federal government requires recipients of grants to maintain time and effort reports that reflect effort levels by employees on grants.
  • If your grant terms allow Macalester to authorize the change, fill out a Grant Revision Request Form to request the budget changes.