Bookkeeping Services for Small and Growing Businesses

Question 

Suggested Answer 

COMMENT 

A. ACCOUNTING SYSTEM: Applicant/recipient organization’s accounting system should align with 45 CFR Part 75.412 Classification of Costs 

 Expect that you will be using QuickBooks Online (QBO) to keep all the information organized for your grant. QBO is essential to fulfilling your promises below. 

1a. Is there a Chart of Accounts that provides for consistent treatment of direct costs and F&A (indirect) costs? 

YES 

 Your bookkeeper needs to set up the COA with Direct (COGS) and Indirect Costs (Facilities and Administrative) 

1b. Does this chart include an account for program income in the event that income is produced by funded research? 

YES 

It is important to separate your grant expenses from your non-grant expenses like income coming from sales or refunds.  You can use customers for each grant or class in (QBO). We recommend using customers.  

2. Is there a Job Cost Accounting System in place to identify income and expenses for each grant? 

YES 

See 1b. 

3. Are procedures in place to ensure that all income and expenses are allocated to the appropriate source(s) of support (grant)? 

YES 

See 1b. 

4. Are there procedures in place to ensure that personnel charges are allocated appropriately to individual sources of support (grant)? 

YES 

You would need to have time tracking in place.  It can be done through your payroll company or as simply as in an Excel document. Have a bookkeeper set up a system for you and then allocate the payroll each month to the appropriate line item in the COA and the Grant (Customer/Class) 

5. Are there procedures in place to ensure that personnel charges are reasonable, conform to the established policy of the organization, are consistently applied regardless of the source of funds, and reasonably reflect the percentage of time actually devoted to the grant? 

YES 

This means that you need an Employee Manual that specifies company policy.  Possibly Employment Contract would specify the time to be spent on the Grant. 

B. FINANCIAL CAPABILITY: Applicant/recipient organization’s accounting system must provide for strong financial capabilities to support the grant/cooperative agreement as outlined in 45 CFR Part 75.205A 

YES 

Answering YES assumes that you will be using financial software to keep track of all your transactions relating to the Grant. We recommend QBO for ease of use. 

1. Does the organization prepare audited financial statements at least annually? 

NO/YES 

Depends on your organization. Most small grants are to smaller organizations that do not need audited financial information.  You will not be required to have an audit performed unless you have more than $750,000 in funding for the government.  Funding could come from one or more grants but if you receive more than $750,000 you will be required to have an audit.  Best to try not to have an audit because it is costly and time-consuming.