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Session 5: Successfully managing a grant contract end to end with practical tips

Session layout

  • Budget, types, budget monitoring and control
  • Grant contract terms and condition
  • Challenges and Tips for grant management

Budget basics

  • A budget is estimation of revenue and expenses over a specified future period, usually the project period for a grant.
  • It is financial plan (blueprint) of the project plan. One need to budget the plan and not vice versa.
  • Budget is a Planning (align with objectives)Tool, Control (within policy framework) Tool, Compliance (ceiling) Tool and Mirrors the Financial Report
  • A budget covers quantitative, qualitative and cost aspects.

The purpose of budget is to:

  • Ascertain reasonable estimation of costs for interventions/activities in a grant proposal/award.
  • Segregates costs-direct/common/indirect or OH costs
  • Cost matching/sharing (co-financing) for multi donor grant, in kind match.
  • Is a framework for donor-donee in a grant award
  • Enables course correction based on measurement of actual achievements versus estimates
  • Statement of SOF and Estimated Costs
  • Enables Recognition-activity, group, period, income, expenditure, deficit, surplus

Pre requisites

  • Organisation structure
  • Data
  • Chart of accounts
  • Managerial support
  • Formal process for formulation

Types of Budgets:

Activity budget

Activity based budget as the name suggests, covers the costs required for implementing a project activity. In ABB, one looks at resources required for completing an activity and the resources cost

For example, if project strategy is to build capacity of civil society leaders, workshops is an activity. Workshops costs would be towards hiring resource persons, booking a venue, transportation cost, food, lodging and materials and handouts.

Activity Budget for Conducting a Workshop
Particular of Expense Rate per unit No of Units Total in Rs
Trainer Fees @ Rs 1000 per day 3 days 3,000
Venue @ Rs 500 per day 3 days 1,500
Rental for Furniture @ Rs 500 per day 3 days 1,500
Rental for Equipment @ Rs 100 per day 3 days 300
Catering Exp for Lunch and tea two times @ 100 per person 55 persons X 3 days = 165 16,500
Conveyance paid to attendees

@ Rs 50 per person per day

50 attendees x 3 days = 150

 7,500
Printing of handouts @ Re 1 per page 50 pages x 50 copies = 2500 pages 2,500
Grand Total

32,800

 

Line Item Budget

    A Line-item budget presents the budget under broad heads It lists income and expenses by category Major donors like USAID, European Commission prefer to have their budget templates by line items. It helps better tracking for trends in major cost categories
    Line Item Budget
    Expenses Unit # of Units Unit rate ($) Cost ($) Human Resources:



    CEO Per day 3 350 1050 Trainer Fees Per day 2 200 400 Subtotal Human Resources


    1450




    Travel:



    Trainer Airfare Per person 1 300 300 Participant Transportation Per person 30 10 300 Subtotal Travel


    600




    Equipment and Supplies:



    Materials and hand-outs Per person 30 15 450 Subtotal Equipment and Supplies


    450




    Other Costs and Services:



    Venue Per day 2 300 600 Catering Per person 30 15 450 Subtotal Other Costs and Services:


    1050




    Subtotal


    3550 Overhead (10%)


    355 Total


    3905

     

     

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