Majority of non-profits run multiple projects and would like to keep track of expenses for each...
What is a grant
What Is a Grant?
A grant is a financial award given by an organization, government, or foundation to an individual or company for a specific purpose. Grants are typically awarded to support projects that align with the mission and objectives of the grant-giving organization.
Types of Grants
Grants can take many forms, including project grants, operating grants, capital grants, seed grants, matching grants, capacity building grants, and fellowship grants. These grants can range in duration from a few months to several years, and the amount of funding provided can vary greatly depending on the nature of the project and the available resources of the grant-giving organization.
Project grants are specific to the performance of a project. They usually have a budget assigned to them with the understanding that the funds granted will be used for the execution of that project. Project grants can be awarded for a wide range of projects, from building a school or hospital to increasing literacy rates in a specific population. Performance of the project grant can be measured in financial and non-financial metrics. Financial metrics include keeping track of expenditure with respect to the budget and ensuring that it is aligned with the approved budget. Non-financial metrics would be more geared towards measuring the deliverables of the project. If a school building was the aim of the project grant then the completion of the building would be a major milestone broken down by the time and resources it took to build the school.
Operating grants are aimed at providing ongoing operational support to not-for-profit organizations, educational institutions, and other charitable organizations that have a social purpose. These grants are not tied to any specific project or program. Instead, the sole purpose of these grants is to support the day-to-day operations of the organization receiving them. Operating grants can help the organization pay salaries, rent, and other overhead expenses necessary for running the organization so it can continue to operate and achieve its objectives. These grants range from single year to multiple years, and donors can require regular reporting to demonstrate that the funds are being used in agreement with the initial grant agreement.
Grants usually have specific requirements and guidelines that must be adhered to by the recipients, such as regular reporting on the progress of the project. This reporting can include both financial reporting, indicating the grants received to date and the expenses incurred, as well as non-financial reporting, such as providing a written report on the progress of objectives for which the grant was initially awarded.
Grants can be an excellent source of funding for a wide range of projects and organizations. However, the application processes, eligibility criteria, and specific requirements for each grant can vary widely depending on the grant-giving organization and the purpose of the grant. Understanding the different types of grants available and their specific requirements can help organizations make informed decisions when seeking funding.