November has its own rhythm in many non-profit organisations. Funding reports need writing, next year’s budget is taking shape, and somewhere in between sits the question of whether all funds have been used as planned.
What impresses us every year is the care with which teams handle this alongside their actual work. After all, they want to deliver projects, not sort receipts, allocate them and check them against the planned budgets.
Don’t wait until spring
Deferring grant income often only comes up once the annual accounts are due. But a first look pays off now, with a single question:
Which grants have already been received but will only be spent next year and therefore need to be deferred?
Typical candidates are grants whose funding period runs over the turn of the year and advance payments for projects that only really start in the new year. A simple list is enough to begin with: for each grant, the amount received this year, how much of it will probably be spent by the end of December, and the remainder that carries over into next year.
The bank balance is not the result
Sorting this out now gives you a realistic sense of the year’s result and no surprises when the annual accounts are prepared. A surplus visible in the bank account is often no surplus at all, but simply money already committed to next year’s expenses.
The list also helps with November’s second task. The funds carried over into next year belong in the budget that is taking shape right now.
How we help
Your tax advisor prepares the annual accounts. We make sure grants, projects and budgets are set up in your bookkeeping so that questions like these can be answered in a few clicks. More on our Finance & Controlling page.
What grant logic looks like when it is built in from the start is described in Grant logic first, then the data.