How to Track Multi-Year Grant Budgets in QuickBooks

Because Quickbooks budgets only span a single fiscal year, a common problem facing nonprofits using QuickBooks is how to deal with budgeting multi-year grants. Here are step-by-step instructions for how to use jobs and estimates to accomplish this: QuickBooks Support Phone Number

1. Turn on the estimates function at Edit > Preferences > Jobs & Estimates > Company Preferences. You may also want to turn on progress invoicing if you will be invoicing the grant in stages.

2. Create a Customer for each granting agency and a job for each individual grant. Go to the Customer Center and click on New Customer & Job.

3. Create double-sided service items for each expense category of the grant. Go to Lists > Item List, click the Items box and select New. Make sure to map them to both a revenue and expense account by checking the box next to "This service is used in assemblies or is performed by a subcontractor or partner".

4. Create an estimate for each grant. Go to Customers > Create Estimates. Select the Customer: Job you created for the grant. Add a line for each expense category you created and enter your budget expense in the Rate column. You can use the Markup column to add a % for overhead expenses, but most granting agencies like to see this broken out in a separate line.

5. You can send your estimate to your granting agencies as a grant proposal by selecting either print or email. You can customize it--change columns, headers/footers, etc.--by selecting Customize, and then Additional Customization.

6. Once the grant is accepted, you might want to consider turning it into a sales order so you can keep track of grant proposals vs. accepted grants. First, turn on the sales order function at Edit > Preferences > Sales & Customers > Company Preferences. Once you do, you can turn an estimate into a sales order by clicking on the little down arrow next to Create Invoice.

7. Make sure to use the items you created for each expense category on all your purchase transactions. All the purchase forms (Enter Bills, Write Checks, Enter Credit Card Charges) default to the Expenses tab, but there's an Items tab just to the right. Select the Items tab, enter the item for the expense category you're paying and enter the customer:job for the grant. If it is a reimbursement grant, keep the Billable box checked. You may also need to turn on the "Create Invoices from a list of time & expenses" function at Edit > Preferences > Time & Expenses > Company Preferences. Note: You can have both Expenses and Items on the same purchase form if you are making a payment for both grant and non-grant expenses.

8. If you are making purchasing or using subcontractors on behalf of the grant, you might want to consider using purchase orders. First, turn on the purchase order function at Edit > Preferences > Items & Inventory > Company Preferences. Once you do, you can turn an estimate into a purchase order by clicking on the little down arrow next to Create Invoice.

9. You can turn an estimate into an invoice by selecting Create Invoice. However, if you turned an estimate into a sales orders you should create the invoice from the sales order instead. Otherwise, the sales order will always remain open. If it is a reimbursement grant, you should create the invoice at Customers > Invoice for Time & Expenses.

10. Use the Job Estimates vs. Actuals Detail report (Reports > Jobs, Time & Mileage) for your grant budget report. You can change the title of the report by clicking on Modify Report and selecting the Header/Footer tab. Other useful reports (depending on what additional functions you turned on) are Open Purchase Orders by Job and Unbilled Costs by Job, both also found under Jobs, Time & Mileage, and Open Sales Orders by Customer (Reports > Sales).

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Ruth Perryman, MBA, CMA, CFE, CFM

is a Certified Advanced QuickBooks ProAdvisor and an Intuit Solutions Provider. She specializes in customizing QuickBooks Enterprise and POS. She can be reached at +1844 454 7202.

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