Create and Process an Internal Grant

Internal grants send money from one fund to another fund within CommunitySuite. Internal grants do not change the account balance. They only change the fund balance by resulting in a donation to the receiving fund. An internal grant letter template must be set up in the system for a letter to be created. Internal grants are the recommended method for moving money from one fund to another; refer to the Benefits of Using Internal Grants Over an Interfund Transfer section for more details.

Who: CommunitySuite users on the grant or finance teams managing the movement of money from one fund to another fund. 

When to Use Internal Grants

• Change ownership of money between funds without creating any movement on the bank level.
• Create a transfer of money that will not show on the bank reconciliation.
• Maintain clear financial reporting by creating an expense on the source fund and a revenue on the receiving fund that will net to zero.
• Fund statements and communication letters are needed for the transaction.

Create an Internal Grant

To create an internal grant in CommunitySuite, use the Create option on the Grants page.

1. Navigate to the Grants page and click Create in the left-side menu. 
2. In the Internal Grant - Choose Funds section, enter the applicable information, and then click Create.
   • Source Fund - Fund from which the money is coming.
   • Destination Fund - Fund for which the money is going.
     
      
3. Enter the applicable Create Grant information, and then click Create.
   • Grant Date and Amount are required fields. 
     • Grantee - Grantee is defaulted to the destination fund. If the destination fund is added to a supporting organization, the name of the supporting organization will populate in the Grantee field.
     • Grant Date - The date of the general ledger transaction or posting date. The grant date has to be in an open financial period in CommunitySuite, meaning the books cannot be closed.
       • This field cannot be edited in GLM/SLM once the request is synced. You can update this field in CommunitySuite.
     • Decision Date - This field is typically used as the date the grant was approved after evaluation, but any date that is helpful for your organization can be used.
       • This field can be edited in GLM/SLM and CommunitySuite.
       • This field can be bulk edited in CommunitySuite by using the Edit Decision Date left-side menu option available on the New, Approval, and Voucher buckets.
     • Description - Grant description.
       • This is available as a merge field in grant letters.
     • Grant Type - The grant type defaults to the default grant type on the source fund but can be edited.
     • Service Area - The service area defaults to the service area on the source fund but can be edited.
     • Amount - Grant amount.
     • Conditional - If checked, the recipient must do something in order to receive the next installment.
       • Installments that are marked as conditional will have the expense and the payable reversed when the books are closed at year end. The reversal is made in a separate fund, so fund statements are not changing throughout the year. This fund can be set in Conditional Payment Fund in Grants Settings. The balance sheet will show a negative grants payable number for the conditional payment fund, and the income statement will show a negative grant expense for the conditional payment fund. This reversal is done when the books are closed on the last day of the year, and it is reversed on the first day of the following year.
     • Grant Advisor - The grant advisor defaults to the primary fund advisor on the source fund but can be edited.
     • Expense Account - The account that will recognize the grant expense. Unless changed, it will be the assigned default expense account for grants.
     • Revenue Account - Default based on your chart of accounts but can be edited.
     • Omit Grant Documents - If checked, grant letters will not be generated when the grant check is posted. Grant documents will reside on the grant record and in the Document bucket on the Grants page if generated.
     • Grant Documents Template - If a grant letter template has been added in Templates, then it can be selected for use. If no template is selected, the default grant letter template will be used.
     • Award Letter Needed - If checked, an award letter will be generated. It can be printed from the Award Letter bucket.
     • Award Letter Template - If an award letter template has been added in Templates, then it can be selected for use. 
       
        
   • If Add Funding is highlighted in the left-side menu, the granting fund does not have enough funds to cover the grant. Click Add Funding to continue. Fund the grant from the open assets of the granting fund, an internal grant from a different fund at the organization, or from an individual donation.
4. Edit the pay schedule to create multiple installments or edit the grant, and then click Post & Get Approval in the left-side menu.
   • An internal donation is automatically created. 
   • General ledger transactions are recorded for Contributions - Internal and Grants - Internal. Balances will go into the Internal Grants Payable and Internal Grants Receivable accounts.
     
      
   • The grant is now in the Approval bucket.
   • Grant approvers listed on the source fund can approve a grant.
5. Click the Donation ID on the internal grant.
   
    
6. Click Change next to Apply to Spendable.
   • This will apply the grant to the spendable balance of the receiving fund. 
     
      
7. Back on the internal grant, click I Approve in the left-side menu.
   • The grant is now in the Voucher bucket.
   • If I Approve and I Reject are not displayed and you believe that they should be, speak with your system administrator about your user permissions.
8. Click approve payment in the Grant Payment Schedule window.
   • If Auto Approve Grant Payments is enabled in Grants Settings, skip this step.
     
      
9. Click create in the Grant Payment Schedule to create the voucher.
   
    
10. Click pay in the Grant Payment Schedule to create the check.
    
     
11. Enter a Transfer Date, and then click Transfer to change ownership of the money from the source fund to the destination fund.
    • Before transferring, click Change to change the Transfer Account if needed.
    • This is an ownership change - there is no real-world movement of money occurring.
      
       

 Benefits of Using Internal Grants Over an Interfund Transfer

CommunitySuite offers two methods for transferring ownership of money from one fund to another: internal grants and interfund transfers. Internal grants are the recommended method of transferring money between funds. Both methods change ownership of money between funds without creating any movement on the bank level. They differ in how they record the transfer on financial statements and in whether transaction records are created and reportable. The table below outlines the key differences between these two approaches and outlines why users may prefer to use internal grants.

Internal Grant Income Statement

In this income statement, the Hiker's Fund made an internal grant to the Ranger Family Scholarship Fund.

Interfund Transfer Income Statement

In this income statement, the Community Park Support Fund made an interfund transfer to the Community Resource Services Fund.