Keeping Track of Projects and Programmes
July 2024
We have written about the need to ‘track’ grant expenditure for accountability purposes in the past, but some organisations also need to keep tabs on separate projects or programmes, and that can get confusing.
Many organisations have more than one distinctive activity. One example is organisations that manage community facilities for general use, and also run an OSCAR programme (after-school care) out of it. It is important to know if that programme pays for itself or has to be subsidised through the organisation’s general funding, donations, or fees for other activities.
Better information about what an activity costs you to run, and what income streams (if any) it has, leads to better decision-making. A community organisation’s resources are limited, after all.
Tracking an activity works exactly like tracking grants, but the two systems must be kept separate. Some accounting software, including CCA’s Accounting spreadsheets, offer two tracking functionalities that can be used: one for grants or funding streams, the other for projects. And although grants are often given for specific projects, the two are still completely separate. They are also separate from your chart of accounts.
The best way to think of it is to see one tracking functionality (funding/grants) as being for external accountability. The other one is for internal management needs. For the external one you ask yourself: what information do we need to keep for the funder in case they ask, whereas for the internal one the question is: what financial information do we need about our activities?
The skill in tracking project or programme income or expenditure is to accurately assign it. There should be a ‘general’ or ‘admin’ tracking code used for anything that is not clearly a project income or expense. This includes wages for management, administration, rent for your office space, toner for your printer and anything else that crosses project boundaries. Only if you know that an expense or income is solely or predominantly for a particular project would you use a project tracking code.
Wages or salaries may be difficult to assign, if people involved in management activities also do hands-on project work. Sometimes the exact hours worked for a project are known, and then this portion of their pay can be assigned, but if it is not, it should go into the ‘general’ tracking. Again, this has nothing to do with how this particular wage is funded. Sometimes we see organisations ‘charging’ their projects an ‘admin fee’ to account for these kinds of costs. This is not a good reflection of the actual cost of these organisation-wide overheads and may blur the financial picture more than it helps. And again, this is independent from whether you may get separate ‘admin overhead’ funding on top of project funding from a particular funder.
General grants, such as are often granted by Lottery, Community Foundations (Rata, Foundation North etc) or some local councils, which are not earmarked for a very specific project, can also be put in the ‘general’ category.
What you end up with are income-expenditure reports that are project-specific, and an income-expenditure report that has everything else. Each report has a ‘bottom line’ (‘surplus’ or ‘deficit’), so you can see exactly whether that activity/project has to be subsidised by general funding (and by how much), or if it contributes to the other activities.
| Project 1 | Project 2 | General/Admin |
| Income $ 56,822 | Income $ 500 | Income $160,000 |
| Expenses $ 52,119 | Expenses $ 82,612 | Expenses $ 75,300 |
| Net $ 4,703 | Net – $82,112 | Net $ 84,700 |
In this example an organisation has a lot of general grant funding, which goes into ‘General/Admin’. It also has a government contract for one of its services, project 1, for which it also charges some user fees. The tracking shows, that that activity makes a small surplus, so is fully self-funded and even contributes to the organisation’s overall funding. Their main activity (project 2) only attracts a small amount of specific donations, but otherwise has to be fully subsidised from general funding.
From this, an organisation can also work out the true cost of running a service, which includes the organisation’s overheads (you’ll need some help to do that, though).
Project tracking can be a powerful tool to get tight finances back on track. Talk to CCA if you want to know more.