Ten Common, and Avoidable, Grant Project Budget Errors
September, 2008The following include common grant budget challenges and suggestion on how to overcome them.
Karen Eber Davis is a consultant, strategist, group facilitator and writer. As president of Karen Eber Davis Consulting, she draws on her full set of skills to help organizations plan and fund their way to excellence. Her firm has attracted such clients as the Red Cross, Circus Sarasota, the Evangelical Lutheran Church in America, the Suncoast Workforce Development Board, the Englewood Water District, Dreams are Free and more than 100 local, regional and national organizations. Her consulting work is respected for its innovation, enthusiasm and energy as well as its practical understanding of the spirit and psychology of nonprofit organizations. For more information, visit her website at www.kedconsult.com
- Doing the budget in a hurry. At a minimum it will take three or four hours, over several days, to develop the project budget.
- Waiting until the last minute. Since the project budget follows the narrative in the grant packet, it’s easy to put it off until the end. Begin working on your budget well before writing your final narrative draft.
- Making major changes within 24 hours of submittal. Budget changes often impact everything else. Most people use numbers and “thoughts” from these numbers throughout their grants. Ban any significant changes, except corrections on the day of submittal.
- The numbers in your narrative and budget don’t agree. During one of your reviews, check and compare only the numbers.
- Basic math mistakes. If you show them that you’re challenged by basic addition, how will they believe you can take care of their money? Prepare all of your budgets in a spreadsheet program. Then check your formulas before transferring numbers to the donor’s forms.
- Failing to recognize that some of your reviewers will only look at your budget. For them, your project budget is the proposal. They view the narrative as the details and not the other way around. Examine your project budget as a stand-alone document. Does it tell the story of what you will do?
- The numbers in your annual operating budget bear no resemblance to the numbers in your project budget. For example, the project budget supply line item for five people cost three times your annual supply budget for your 50-person agency. If true, explain why in a footnote of the project budget. Also, adjust your annual budget accordingly.
- The reviewer can purchase the items you list, at similar quality, for less money. You list a $500 printer. It’s the same or similar to the one a reviewer bought last week for her office for $250. Don’t ballpark prices—confirm them.
- You fail to account for vacancies, calling people multiple times for appointments, meeting cancellations due to weather and other realities. Include time estimates for events that do not lead to your project outcomes.
- You fail to put a time frame on your budget. You add cents on a $50,000 budget. You forget to label the columns and other format challenges. Compare your budget to the one prepared by your auditor. Adopt their format.
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