Ever since we started developing grant accounting solutions, our clients have shown us that there are common sets of challenges that overlap when it comes to grant management. Regardless of whether it’s a large research university or a small nonprofit, all who manage grant accounting can feel overwhelmed by the process, which includes overseeing balances and expenditures, meeting deadlines, and communicating across departments. Grant accounting solutions can help you solve a variety of issues regardless of your size of funds, staff, or projects. Below we discus several of the challenges and also offer a solution to make the process smooth and sequential.
Grant Accounting Solutions
Some of the most effective organizations turn to grant accounting solutions to help with day to day award management. Specifically, these organizations cut the administrative burden it takes to accurately report, maintain, budget and balance funds for multi-year projects, as well as calculate projected personnel costs. Typically, research organizations and other nonprofits select software solutions to help them meet the following five challenges:
- Simplify the process: Making record-keeping simple, especially in the important area of grants accounting, is key for a busy department. Ease of use and an intuitive, web-based interface is key when looking to implement automated grants accounting systems. Having easy access and a simple process is the first step in feeling less overwhelmed.
- Increase transparency: Granting organizations regularly ask for comprehensive reporting showing how funds are used. By automating grant management, users are better able to view grant, vendor, salary and other financial data in one place.
- Streamline time-intensive tasks: Manual data entry, cumbersome spreadsheets and duplicate record-keeping takes time when it comes to analyzing spending, budgets, data reconciling and more. Automating grants fund accounting speeds the process, and removes the administrative burden.
- Handle system integration: A grants accounting best practice is to fully integrate grants accounting with the institution’s general ledger or ERP system. The key is to supplement the GL transaction information with additional information to track post award activities. Data should also tightly link with payroll, purchasing and other systems.
- Create user-defined calculations: Effectively accounting for grant funds means departments need to easily calculate and track F&A costs and easily handle user-defined coding systems for tracking special commitments.
The Importance of Effective Grant Accounting Solutions
Our experience with some of the nation’s most respected research universities, colleges, and nonprofits has shown that each of these settings has its own unique mission and funding environment, yet we find that each entity faces similar challenges with financial reporting.
Considering the resources it takes teams to research and develop grant proposals, the effort shouldn’t stop there. Managing grant funds requires a focused and streamlined process usually lasting several years per project, sometimes with multiple projects. Responsible stewardship of grant funds will usually lead to obtaining more funding for additional projects and possibly having to manage exponential growth. Being proactive with your planning can make a huge difference in the complexity of your projects.
Contact the IT Works team to discuss your specific grant accounting challenges. We are glad to talk through solutions and help you streamline your efforts.