As a Grants & Contracts Manager, you need to spend most of your time ensuring awards and subawards are awarded and implemented correctly, and keeping up to date with the rules and regulations, and complying with grant conditions. That's why we've put together this resource page, specifically designed for those who work with grants & contracts at NGOs. This page contains tools and guides that will make your role easier to manage. We've also included some blogs, videos and podcasts where relevant, to help keep you informed in your role as Grants & Contracts Manager.
The Grant Management Cycle
Whether you are a giver or receiver of grant funds, (or both), managing grants and funding relationships is a part of life for most NGOs. NGOs often receive funds from donors, which they spend themselves and sometimes pass on to other organisations. For example, it is common for a government department to fund an international NGO which funds a local NGO which funds grass-roots community organisations.
Partnership is a ‘buzz’ word in the world of grant making. But it is sometimes used when in fact the relationship does not feel collaborative or equal. Donors and NGOs need each other. Donors provide funds, and without funds NGOs cannot achieve their objectives. But donors also have their own agendas and objectives which they cannot achieve without implementing NGOs. Developing good relationships and shared understanding is really important if both sides are to work together effectively to achieve their goals. But managing relationships between organisations is not easy – you will probably have experienced challenges like language and culture differences, lack of understanding or respect for each other, problems with email communication, funds sent late, accountability reports sent late, difficult grant conditions and the messy complexity of implementing aid or development programmes. All this makes for a challenging environment.
The key to making funding relationships work is open and regular two way communication. In particular, in depth discussions before any agreements are signed will save problems during the implementation stage. Effective communication builds mutual trust, respect, and commitment to keep promises – all critical in funding relationships.
The Power of Community
As a Humentum member, you can interact with other peers working in compliance and finance, grants, and contracts on Humentum Connect, our online community. Join the FGC group and pose questions for real-time responses from your colleagues in the sector.
Not a Humentum member yet, but interested in having your organization join? Humentum membership is organizational and every individual working for a member organization can take full advantage of membership benefits. Learn more here about the power of Humentum membership.
At Humentum, we inspire organizations to achieve operational excellence and help them make the most of their resources to achieve greater change for the communities they serve. Our staff and consultants have extensive experience in finance, grants, and contracts and care deeply about sharing their expertise. As trusted experts, Humentum Client Services combines your knowledge with our own to develop practical solutions which work for you. We do this with three key service areas: in-house training, consultancy, and capacity development.
As a starting point, download our Compliance Top Tips card and keep it handy near your desk for a quick reference and reminder of our client services on the back!
Before awarding or renewing a grant to an NGO partner, it is wise to carry out some sort of assessment to decide whether or not the organization has the capacity to use and account for the funds properly. There is a balance to strike between getting sufficient information to have confidence, versus the time cost of gathering and assessing the information. There is also a challenge of quantity vs quality of information. Sometimes donors get far too much detail on issues that do not really help them to decide whether or not to fund the partner organisation.
It helps to clarify some assessment criteria, for example:
- Board and Senior Management are honest
- Basic bookkeeping systems are adequate (cashbooks and supporting documents)
- Cash and bank are adequately controlled
- Spending is properly authorised
- The organization will be able to account for the grant
It also helps to prioritise criteria into Must have (red), Should have (orange), Could have (yellow). Any checklists should be seen as a ‘tool not a straight jacket’. If an organisation ticks all the boxes but doesn’t feel right, or vice versa, it is good to leave room for judgement.
There are various methods of assessment. On one end of the spectrum is a desk review of documents such as audited financial statements, project proposals and the like. There may be meetings in the donor country with representatives from the partner NGO. There may be checklists to be filled out. On the other end of the spectrum there may be a visit to the NGO, or a comprehensive assessment by a specialist (either from the donor or a consultant), or a consultant facilitated self assessment.
Implementation - Tracking restricted funds
Restricted funds can only be used for the purposes agreed with the donor; they cannot be used to pay for any other costs. It is very important to track restricted funds separately and carefully. This means (a) having a clear understanding of exactly how donors will allow you to spend restricted funds, and (b) tracking expenditure and income very carefully for each project that receives restricted funds. You can achieve these by using a tool called a 'funding grid' and detailed accounts codes.
A funding grid shows in detail how all of your income is allocated to spent on your overall budget. It needs to be carefully set up by finance staff who know the details of restricted grants.
Donors have a great deal of power and influence in the NGO sector. This section provides practical advice to donors on how to use it effectively. Donors face a difficult job. They have to use their funds responsibly, to achieve their goals and avoid fraud. This means making sure that basic controls are in place. But they also aim to support effective local responses and help organisations grow. This means encouraging flexibility and learning.
Having the money puts donors in a powerful position compared to the organizations they fund - donors are very influential. If they get the balance between control and flexibility very wrong in either direction, it can be damaging to the NGO. Donors have a serious responsibility to the organisations they fund. Money is like fertilizer: too much poisons everything.
Signed agreements are important to set shared expectations about the formal aspects of your relationship with NGOs. They are rarely the basis of legal action; the relationship between a donor and an NGO is normally different to the relationship between two commercial contractors. Signed agreements may include details such as:
- An overall statement of the type of relationship being developed,
- The particular activities being funded and a budget,
- Procedures for changing how funds are used,
- The reports required by the donor (including timing and format),
- Audit arrangements (an annual external audit may be enough),
- When cash payments will be made,
- The donor's right of access to project sites and to financial records,
- Any additional conditions laid down by the donor (e.g. around joint publicity, or purchasing).
The more that it is possible to discuss and negotiate the terms of an agreement, the better. It makes it likely that the agreement will recognize the NGO's operating environment and that the terms will be reasonable (and so will be respected).
USAID Rules & Regulations: Grants & Cooperative Agreements
USAID Rules & Regulations: Grants & Cooperative Agreements is the best course for learning how your organization can comply with USAID's requirements and build strong relationships with USAID staff. In 2019 we have added new scenarios to the course to ensure attendees receive the most relevant examples for their training. These include: Budget Revision, Procurement, Financial Management, Subrecipient Monitoring, Allowable Spending and Prior Approvals.
A Short Introduction to Compliance & Risk
In this video Alison Brady describes how Humentum's range of trainings and workshops can help you with your regulation queries, and how to comply with the rules of various funding sources, including USAID. We take pride in providing the most up to date training and learning solutions for NGOs. As the most trusted global provider of USAID training to NGOs, other USAID implementers and their partners, we bring exciting changes to our program in 2019. We are building on the legacy of InsideNGO's expertise in this content, and through our merger into Humentum, offering more online learning options, a more accessible certification, and more affordable solutions for project teams and organizations.
Meet Libby Spader
In a time when organizations are looking for accessible and affordable learning solutions, Humentum is excited to offer the USAID Cost Principles Flex workshop. In another new video, Director of Programs Libby Spader introduces this exciting new online course for 2019. It is designed so organizations have an accessible and affordable solution for everyone involved in a USAID project to understand the Cost Principles regulation that guides all spending. This course will be applicable to all staff from universities and non-profit organizations that implement with funding from any US Government agency. This is the learning that will enable your organization to ensure compliance related to all spending. Ask about how to make this online course available across your entire organization.
Meet Cynthia Smith
Cynthia is an attorney with over 20 years of experience in the design, implementation, oversight, and evaluation of US Government-funded rule of law, access to justice, and civil society strengthening programs across the globe. Cynthia has served as chief of party or deputy chief of party on large-scale USAID-funded cooperative agreements in the Americas and Southeast Asia. Additionally, Cynthia has represented clients in civil rights and whistleblower retaliation cases in the United States while working for a private law firm. More recently, as Deputy Country Director for the American Bar Association in the Philippines, Cynthia coordinated an enterprise-wide assessment and response to various compliance and risk-related issues.
At Humentum, Cynthia liases with our Government Relations Commitee (GRC). Interested in getting involved? Contact her.