Maintaining Audit-Ready Documentation

Being "audit-ready" means you can produce documentation for any transaction at any time. This guide covers how to maintain that state.

Core Documentation Requirements

For Every Transaction

Keep evidence appropriate to each expense and its risk; an invoice alone may not establish allowability:

• Invoice or receipt - What was purchased
• Proof of payment - Check copy, bank record
• Approval documentation - Who authorized it
• Allocation rationale - Why charged to this grant

For Every Grant

Maintain a complete grant file:

• Award letter/agreement - Original terms
• Budget - Approved and modifications
• Correspondence - Funder communications
• Reports - Submitted reports and acknowledgments
• Modifications - Budget changes, extensions

For Your Organization

Policy documentation:

• Accounting policies - How you handle transactions
• Allocation methodology - Cost allocation procedures
• Internal controls - Approval thresholds, segregation of duties
• Personnel policies - Time tracking, payroll procedures

Document Retention Periods

There is no universal seven-year rule. Adopt a retention schedule with legal, tax, employment, privacy, litigation-hold, audit, and funder input. For federal awards, 2 CFR 200.334 generally requires financial records and supporting documents for three years from submission of the final financial report (or, for awards renewed quarterly or annually, from the quarterly or annual report). Exceptions alter the start or duration for litigation, claims, audits, written extensions, real property/equipment, certain program-income records, and indirect-cost proposals. A pass-through entity must not impose a retention period longer than three years except as permitted by the section.

Organization Systems

Physical Files

If you maintain paper files:

• One folder per grant
• Consistent organization
• Clear labeling
• Secure storage

Digital Files

Recommended structure:

Grants/
├── [Funder Name]/
│   └── [Grant Name - Year]/
│       ├── Award Documents/
│       ├── Budget/
│       ├── Correspondence/
│       ├── Reports/
│       └── Supporting Documents/

GrantLink Integration

GrantLink helps organize:

• All allocation details
• Complete audit trail
• Synced transaction data
• Generated reports

GrantLink is not the authoritative accounting ledger or a substitute for the organization's records-retention and backup system.

Documentation Best Practices

At Transaction Time

1. Scan receipts immediately - Paper fades and gets lost
2. Add notes - Explain unusual items
3. Attach to the record - Link to QuickBooks or GrantLink
4. Verify approval - Document who authorized

Monthly

1. Reconcile accounts - Bank and grant balances
2. Review open items - Clear outstanding issues
3. File loose documents - Don't let piles accumulate
4. Backup digital files - Protect against loss

At Grant End

1. Complete all allocations - No pending items
2. Generate final reports - Document spending
3. Organize the file - Ready for audit or archive
4. Document close-out - Funder communications

Common Documentation Gaps

Watch for:

• Missing receipts - Implement policies early
• Verbal approvals - Document in writing
• Allocation explanations - Note the rationale
• Time records - Essential for personnel costs
• Modification approvals - Get them in writing

Using GrantLink for Documentation

Attach Files

Store support in the authoritative system appropriate to the record, such as the QuickBooks Online transaction attachment or the grant's Documents area. Preserve a stable reference between the support, QuickBooks Online source transaction, allocation, and submitted report rather than assuming GrantLink creates a line-level attachment relationship.

Add Notes

Use grant notes, allocation rationale, and activity history for operational context. Keep accounting approvals and source evidence in the organization's controlled record system.

Export for Backup

Regular exports:

1. Go to Chats > New Chat
2. Request the report and review its source data and scope
3. The report then appears in the grant's Reports tab for review or export
4. Store backup files securely

Best Practices Summary

1. Document as you go - Don't play catch-up
2. Be consistent - Use the same system every time
3. Make it accessible - Others may need to find things
4. Protect the records - Secure and back up
5. Train staff - Everyone follows the same procedures

How GrantLink supports this today

GrantLink helps by organizing allocations backed by QuickBooks Online, budget lines, fund receipts, funding shares, documents, report outputs, and activity history. It supports audit preparation, but it does not replace funder guidance, accounting policy, or professional review.