What is a grant ledger?
A grant ledger is a set of accounts organized around your funding. Each entry shows not only the type of cost but also the project, the grant, the budget line and the fund it belongs to. Its purpose is to answer questions such as:
- How much of Grant A has been spent, and on what?
- How much of it is committed but not yet spent?
- Which money is restricted, and which is free to use?
- What can we report to the donor this quarter?
It is built for management and for donors.
What are statutory accounts?
Statutory accounts are the formal financial statements an organization must keep under the law and accounting standards of its country. They are usually prepared by an accountant, audited by an external auditor and filed with an authority. They answer questions such as:
- What does the organization own and owe?
- What was its total income and expenditure for the year?
- Did it follow the rules for its legal form?
Their rules vary by country and by type of organization, and you should always check which apply to you. Some use recognized standards, but the details of what applies are a matter for your accountant.
Why do the two look different?
Each is built for a different reader. A donor wants to know what happened to one grant, in the donor’s categories. An authority wants a complete picture of the whole organization, in the legal categories.
| Grant ledger | Statutory accounts | |
|---|---|---|
| Main reader | Donors, managers | Authorities, auditors, board |
| Main question | What happened to this grant? | What is the organization’s position? |
| Organized by | Project, grant, fund, budget line | Legal account structure |
| Rules from | Grant agreements | Law and accounting standards |
| Prepared by | Finance team | Accountant or finance lead |
When do you need both?
Most NGOs with several restricted grants do. A single donor-driven view cannot give the complete legal picture. A purely statutory view hides which money belongs to which grant, and you cannot report to a donor from it without extra work.
Common triggers for keeping both:
- You have more than one restricted grant.
- Donors need reports in their own budget lines.
- You file annual accounts with an authority.
- Your auditor reviews both donor-specific and organization-wide figures.
If you have only one funder and a small budget, your accountant may suggest one set of books with grant tags. Ask before you decide.
How do you keep the two in agreement?
The two sets should agree on the facts: cash received, cash spent and balances. They may differ in classification and timing. Keep them in line with a simple routine:
- Agree a mapping between the grant ledger’s accounts and the statutory accounts.
- Reconcile each period. Compare total income, total spending and bank balance in both.
- List differences with a cause, such as timing or a donor-specific rule.
- Clear them or carry them forward with a note.
- Have a second person review the reconciliation.
A mapping that is written down saves days during the annual audit. Our chart of accounts guide helps you design one that maps cleanly.
What goes wrong when the two drift apart?
- Donor reports show a cost that the statutory books classify differently, and nobody can explain why.
- The audit finds a gap between the grant view and the financial statements.
- A restricted balance in the grant view is spent in the statutory view.
- Exchange-rate differences build up with no owner.
Each is avoidable with a regular reconciliation.
Where EMPOBase fits
EMPOBase’s General Ledger is a double-entry ledger built around projects, grants and restricted funds, with budget vs actual, bank reconciliation, period closing and financial statements. It is not statutory accounting: it does not compute local tax or social contributions and does not produce country filing formats. Keep your statutory books with your accountant, and use EMPOBase for the grant and project view that donors ask for. Our page on operations software for NGOs shows where the line is.