How to report by project and by funder

The funder asks for the mid-term report and you have ten days. Spending sits in the general ledger, mixed with two other projects; the workshop invoices are in a paper folder; two field staff still haven’t settled last month’s fund, and nobody remembers whether the printer was bought with this project or the previous one. The report goes out, but only after several late nights and with figures nobody feels confident defending.

Reporting well doesn’t depend on the report template. It depends on how you record spending from day one.

The three questions you’ll always be asked

Every funder, board or auditor ends up asking the same things:

1. Did you spend on what was approved, and in the approved proportion?
2. How much have you executed and how much is left, line by line?
3. Where is the supporting evidence for each expense?

If your records answer these three questions without reprocessing anything, the report is almost a formality.

Step 1: budget by line item and by source

Build the budget as a matrix: rows = budget lines, columns = funding sources (each funder plus your own matching contribution). Suppose a Bs 600,000 project over 12 months:

Line	Source A	Source B	Matching	Total
Staff	180,000	–	60,000	240,000
Workshops and training	150,000	–	–	150,000
Equipment	–	90,000	–	90,000
Travel and transport	72,000	–	–	72,000
Administrative costs	–	48,000	–	48,000
Total	402,000	138,000	60,000	600,000

Also spread each line by month following the activity schedule, not in twelve equal parts. Equipment is bought at the start; workshops cluster once the project has participants.

Step 2: code every expense when you record it

Every outflow needs three tags: project, budget line and source. In accounting, the most practical approach is one cost center per project and one account or sub-account per line; the source can go as an additional code. The rule is simple: if an expense comes in without a code, it doesn’t get paid.

For shared costs (office rent, accountant, utilities), write down the allocation base (hours, floor space, a percentage agreed in the grant agreement) and apply it the same way every month.

Step 3: measure execution with simple formulas

• Execution % = executed ÷ budgeted.
• Available balance = budgeted − executed − committed (orders issued but not yet paid).
• Burn rate = executed ÷ months elapsed.
• Forecast at close = executed + burn rate × months remaining.
• Forecast variance = forecast at close − budgeted.

Always compare execution % with the % of time elapsed and with the monthly schedule, not just with the annual total.

Worked example: month 6

Suppose you reach month 6 of 12 (50% of the time) with this execution:

Line	Budget	Executed	Execution %	Reading
Staff	240,000	118,000	49%	On track
Workshops	150,000	45,000	30%	Underspent
Equipment	90,000	86,000	96%	Expected: bought up front
Travel	72,000	51,000	71%	Overspent
Administrative	48,000	22,000	46%	On track
Total	600,000	322,000	54%

The total (54%) looks healthy, but it hides two problems:

• Travel: burn rate = 51,000 ÷ 6 = Bs 8,500 per month. Forecast = 51,000 + 8,500 × 6 = Bs 102,000. Forecast variance = Bs 30,000 over what was approved. You have Bs 21,000 left, which at the current pace lasts two and a half months. You need to slow down or request a budget revision now, not afterwards.
• Workshops: Bs 105,000 remain for six months, i.e. Bs 17,500 per month, against Bs 7,500 per month so far. Either activities are behind schedule, or the workshops came in cheaper.

To tell those two explanations apart, cross spending with physical progress. If 40% of the planned workshops have been delivered, earned value is 40% × 150,000 = Bs 60,000. With an actual cost of Bs 45,000, the cost performance index (CPI = earned value ÷ actual cost) is 1.33: workshops cost less than planned. If only 20% were delivered, earned value is Bs 30,000, CPI is 0.75 and the problem is twofold: delay and overrun.

Step 4: supporting documents per expense

For each outflow, the minimum file is:

1. The approved request or order (who authorized it and when).
2. The invoice or receipt issued to the organization.
3. The proof of payment (transfer, check or cash receipt).
4. Evidence of the activity: attendance list, report, photos or delivery record.

File it under the same code as in Step 2 (project-line-source) and the accounting voucher number. That way, when someone asks for “the support for entry 214”, you find it in a minute.

Petty cash in projects

Petty cash is where traceability gets lost most often. A few rules that work:

• One fund per project, with a named custodian.
• A fixed deadline to settle, and no replenishment without the previous settlement.
• Replenish only what was settled and approved, not what was spent.
• Each receipt is recorded once: check for duplicates by number and date.
• Advances for a trip or a one-off purchase are settled and closed separately.

Closing the project

1. Reconcile the project’s execution with the books: both must show the same number.
2. Check that no advances or petty cash funds remain unsettled.
3. Determine unspent balances by source and apply what the agreement says (refund, reprogramming or authorized use).
4. Take a physical count of the equipment purchased and decide its destination per the agreement; keep the signed record.
5. Close the document file and keep it for as long as the agreement requires and your accountant or advisor indicates.

Common mistakes

• Recording spending in the general ledger and coding it only when preparing the report.
• Looking only at total execution %, which hides unbalanced lines.
• Revising the budget once the variance has happened, instead of when it is forecast.
• Allocating shared costs with different criteria each month.
• Buying equipment without recording who is responsible for it.

Monthly checklist

• Every outflow this month has a project, line and source.
• Execution by line is compared against the monthly schedule.
• Lines with a forecast variance above your threshold have a defined action.
• Petty cash is settled and replenished only for what was approved.
• Every expense has its four supporting documents filed under its code.
• New equipment has an assigned custodian.

Moving it to a system

If you keep this in spreadsheets, it works; once you run several projects at once, manual cross-checking becomes the bottleneck. An ERP like MKA can compare the budget with execution captured from purchases down to the document that caused a variance, receive petty cash settlements with a photo of the receipt and keep each asset assigned to its custodian (see the solution for NGOs and institutions). You still put together each funder’s format yourself, but with the data already in order.