#1. Keep your organization out of trouble with the IRS and its funders.

This is very important if your organization will be seeking future grant dollars – especially if you are working with or pursuing federal grant money. There are numerous nonprofits that haven’t followed the OMB and spending guidelines of their funders who have ended up on “debarment” or “excluded parties” list. This means they will never be allowed to accept or apply for grant funding again.

A good Grant Manager is going to analyze your financial systems and make improvements (if needed) to such systems. A good Grant Manager will ensure your grant money is being spent only on allowable items (this applies to both in-kind and direct grant expenditures) and is being documented properly (i.e., with receipts, contracts, etc.). A good Grant Manager is going to make sure everyone working on a grant is documenting his/her time and effort for the work performed. These are just a few functions of a qualified Grant Manager.

#2. Make you audit ready.

Every nonprofit organization spending more than $300,000 of government grant dollars in a fiscal year is required to go through a single audit. The word “audit” alone can be somewhat frightening. Being audit ready means your financial systems and grant implementation documentation are being processed in a systematized way to where they are in full compliance with your own organizational policies and procedures as well as the policies and procedures of your funder. For government funders, these policies and procedures can be incredibly strict. A good Grant Manager should know – off hand – the restrictions of government funders. Among other things, this will include the OMB Management and Cost Circulars, OMB Circular A-133 for Nonprofits, the Assurances for Construction and Non-Construction, and various other guidelines specific to the funding agency. If your Grant Manager doesn’t know these off hand, then he/she should know where to find them for quick reference. Operating your grant programs within the rules and regulations of these documents is key to being audit ready.

#3. Create or continually update policies and procedures for how grant funding must be used and accounted.

An organization’s board and operational policies and procedures are extremely important to a professional Grant Manager. This is because a good Grant Manager knows if you are ever audited, your CPA (and even your grant funders) will analyze your policies and procedures for internal controls as well as look for proof you are regularly following these practices. The “following the practices” part is just as important as having quality policies and procedures. Many nonprofits adopt “copy cat” policies and procedures from other agencies and just let them sit on the shelf. This won’t work in an audit environment. Moreover, all policies and procedures should really be original and customized to the needs and processes of your organization. A good Grant Manager will ensure these are updated and shared with your Board and leadership. He or she will also monitor to ensure they are being followed as needed.

#4. Support (not shove) your organization into meeting such policies.

It is important your Grant Manager strike a balance between using various rules and regulations as sanctions versus using these standards to support (and educate) your organization into becoming a better functioning operation. The last thing any nonprofit needs (especially nonprofits new to grants) is to have someone walk in the door and begin telling them they are doing everything wrong. Some Grant Managers who are overly authoritarian can threaten to “whistle blow” to your funders or even worse, the IRS. As a sidebar, we are not saying there is anything wrong with reporting fraud and significant problems to the proper authorities; we are only implying an organization needs to be given the chance and support and education to make things “right” before it gets to this level.

A good Grant Manager will walk in your door and observe. He/she will review your organizational policies and procedures and will analyze your financial, documentation, and grant reporting systems. With this information, the Manager should sit down with the board and leadership of your organization and show these entities how the practices, policies, and procedures of the organization may or may not be in alignment with the law or with funder regulations. The Manager should then work closely with these individuals to make improvements over time with common goals in mind. Good Grant Managers take the role of a “teacher” as opposed to a “police officer.” If your organization is in need of the latter because of bad marks on an audit or for whatever reason, it may be best to have both a Grant Manager and a CPA (who has training and experience with yellow book audits) work together.

#5. Assist you in creating organization-wide forms, spreadsheets, and reports to track and control systematized grant activity and evaluation.

Because Capacity Builders Inc. has been implementing its own government and private grants for a number of years, we have several forms we commonly use to track grant and budget activity. We, for example, have a spreadsheet for every grant listing dollar amount spent, type of documentation on file for each expenditure, date of purchase, and line item totals to date. This spreadsheet is hosted online for any and all of our grant leaders, management, and board to view at all times. Moreover, various members of our bookkeeping and grant leadership staff are able to simultaneously update the spreadsheet so it is always current. This is just one of many different examples of a simple form which can be used in such a way it cuts down on email-based document exchange. Our grant management team also keeps a number of different forms tracking grant activities and timelines against activity benchmarks in addition to a number of different evaluation indicators.

Good Grant Managers, like ours, will have an arsenal of tools they can use to keep your grants on track. It is, therefore, very important to have a Grant Manager who has extensive knowledge and experience with spreadsheets and related project management softwares and technologies.

Your Grant Manager must also be extremely organized. You know those people whose offices you walk into who have piles and piles of paperwork all stacked together? This is the very last type of person you need to hire as a Grant Manager. A good Grant Manager should have a binder system in place where your NOGA (Notice of Grant Award) and all of your grant documentation are nicely organized. Your forms and reports should also be kept in one place to avoid having to do the “paper search and shuffle.” Organization is key to efficiently operating and managing grants.

#6. Educate your staff and stakeholders on the spending and cost principle policies of your funders To Avoid spending pitfalls.

Again, education and support are key qualities of a good Grant Manager. No organization is expected to instantly know how to become grant audit ready once it gets its first grant award – or what is immediately expected of it by a grantor outside of the grant proposal. This is why you need a knowledgeable and supportive manager who will share rules and regulations with you and who will work with you as a team to make improvements to the way you operate and report on your grants. Education is the key.

#7. Take care of your grant drawdowns and expenditure reports.

If you have ever received a government grant, you will know what we mean by “expenditure reports and drawdowns.” These are complicated documents and processes. Most – if not all – government funders (as well as private funders) require expenditure reports at the very least. These are summaries of expenditures made to date as well as an accounting for in-kind (if relevant). It is important to know what “line item” categories your expenditures fall into in order for these reports to be correct. For example, if you have a staff member who chooses not to take fringe benefits and who works a 40 hour week from home, what line item should you charge this expense to? Personnel or contractual? What about other odd expenses, such as insurance or rent or utilities? What if you forgot to put a line item in a budget and now the funder is requiring you to expense against it? For example, many funders will require their grantees to attend an annual grant conference or related event not mentioned in the RFP. What if you didn’t anticipate needing travel money for that purpose? All of these questions can be easily answered by a professional Grant Manager.

In regards to grant drawdowns and expenditures, there are three things all grant operating agencies need to know:

1. Definition of a Reimbursement Grant
   This means a grant which requires the grantee to make grant expenditures first prior to invoicing the grantor for the reimbursement.
2. Definition of a Drawdown Grant
   This means a grant permiting the grant revenue prior to expenditure of funds.
3. Definition of In-kind (also called a Match or Cost Share)
   This means the portion of allowable grant cost not borne by the grantor and borne by the grant funded agency.

Whether you are running a reimbursement grant or a grant on a drawdown or a grant requiring a cash or in-kind match, there are numerous rules and regulations regarding how and what you can spend your money on. For example, did you know most federal funders (with very few exceptions) will NOT allow the renovation of a building to be counted towards a match (even if the building is being used to host your grant program)? Did you know you have to maintain time and effort reports of staff who are considered in-kind as well as grant staff – and these must account for all working hours whether contributed to the grant or not? A good Grant Manager will know all of this and help set up your system so all of these elements are accounted for. This includes regulations of how long monies can remain in your bank account after a drawdown and how interest accrued in your accounts must be reimbursed to your funder, if required.

#8. Oversee the leadership of your grant programs – making sure they are within budget and task so you don’t have to.

A good structure to put into place as far as human resources and management is to have your Grant Manager supervise your grant Program Directors. Placing the Grant Manager over your grant leadership staff will prevent you from having to deal with the day to day functioning of grant programs. A good Grant Manager will hold a weekly (or more frequent) meeting with your grant leaders and staff. He/she will require grant leaders to regularly report on the progress of grant activities in such a way progress and accomplishments of activity requirements are tracked and reviewable at all times. The Grant Manager should be able to help grant leaders troubleshoot through any issues dealing with grant sustainability, funding, and partnerships. This means the Grant Manager should have grant writing experience as well as grant implementation experience. Additional experience in working with partnership coalitions or boards is also very important.

If you have a Grant Manager on staff who is not effectively performing these 8 essential functions, then you are working with the wrong person. Consider saving money and avoid the headache by using Resource Associates’ grant management services.