Funding Shares, Matching, and Cost Share Tracking for Grants

A funding share shows how each grant-related dollar is treated for reporting. For example, a dollar can be paid by the grant, count as cash or in-kind match, be unrecovered indirect cost, be program income, be another local share, be excluded, or still need review.

GrantLink uses the term "funding share" because it covers more than traditional match. Funders and accountants may say match, cost share, local share, recipient share, or non-federal share. GrantLink tracks all of these as funding shares, so the reporting steps are the same across awards.

What GrantLink tracks

QuickBooks Online stays your accounting record. In GrantLink, you add each grant manually or by uploading its documents. Each grant has its own Expenses and Money received links to the QuickBooks Online records that hold its activity. You set these links on each grant, not in an organization-wide setting.

Why funding shares matter

Many grants do not pay for the whole project. For example, a funder may pay 80% and require you to pay 20%. A funder may also reimburse grant costs but require you to document a local match, count approved volunteer time or donated goods as in-kind match, or accept unrecovered indirect costs as match only with approval.

For federal awards, 2 CFR 200.306 sets the rules for counting cost sharing. Cost sharing must meet all of these conditions:

• It is verifiable in your records.
• It is not counted as a contribution to another federal award.
• It is necessary and reasonable for the award's objectives, and it is allowable under the cost principles.
• It is not paid by another federal award, unless the program's statute specifically allows it.
• It is in the approved budget when the agency requires it, and it follows the other rules in Part 200.

You may count unrecovered indirect costs as cost sharing only with prior approval from the federal agency or pass-through entity. Program income counts as cost sharing only when the award names that method or the agency gives prior approval. Otherwise, the deduction method in 2 CFR 200.307 applies.

Federal agencies do not expect voluntary committed cost sharing on research grants. They may not use it in merit review for research grants unless a statute or agency regulation allows it and the notice of funding opportunity says so. Agencies are discouraged from using it in merit review for other programs, and if they do, the notice of funding opportunity must explain how it will be considered. If you include voluntary committed cost sharing in your approved budget, it becomes binding. The rule's treatment of voluntary uncommitted cost sharing applies only to institutions of higher education. The program statute and award terms control.

Funding share types in GrantLink

GrantLink label	What it means	Common evidence
Grant funded	The funder pays this cost.	QuickBooks Online transaction, invoice, receipt, or payroll support
Cash funding share	Your organization or a partner paid an eligible project cost with cash that is not from the grant. Funders often call this cash match.	QuickBooks Online transaction, bank record, invoice, or payroll register
In-kind funding share	Someone donated goods, space, equipment, or services that count toward the project. Funders often call this in-kind match.	Donor letter, volunteer log, and valuation support
Unrecovered indirect	Indirect costs you could have charged under your approved rate but did not, when the funder approves counting them	Approved rate, calculation, and funder approval
Program income	Income earned by the grant-funded program	Deposit record, invoice, and the award terms on how to use it
Other local share	A local or non-federal contribution that does not fit the other types	Source record, funder approval, and allocation notes
Excluded	An amount that does not count in the funding share calculation	Reviewer note explaining the exclusion
Needs review	An amount GrantLink cannot classify yet	Accountant review

Match, cost share, and funding share

People use these terms loosely, but they all describe the part of a project that the main grant does not pay for.

• Match usually describes the required contribution as a ratio. A 1:1 match means you contribute one dollar for every dollar the funder provides.
• Cost share usually describes the required contribution as a percentage of total project cost. A 20% cost share on a $100,000 project means your share is $20,000.
• Funding share is GrantLink's broader term. It covers grant-funded dollars, match dollars, program income, excluded dollars, and items that need review.

For example, if the total project costs $100,000 and the funder pays $80,000, your funding share is the remaining $20,000. Depending on the award, the $20,000 may be called match, cost share, local share, recipient share, or non-federal share.

How QuickBooks Online fits

QuickBooks Online stays your accounting record, and you do not need to rebuild your chart of accounts to track funding shares.

Many nonprofits already record grant information in QuickBooks Online in one or more of these places:

• Classes, which group transactions by a segment such as a department or program. Classes are available in QuickBooks Online Plus and Advanced.
• Customers and Projects. A Project groups the transactions for one customer, and Projects are available in QuickBooks Online Plus and Advanced.
• Custom fields, which record extra information on some transaction forms. The forms that support custom fields depend on your QuickBooks Online plan.
• Accounts, when you already have separate income or expense accounts for match, local share, or program income.

GrantLink can read one of these as a funding share signal, but it does not require you to change your QuickBooks Online setup. Do not change your chart of accounts or QuickBooks Online fields because of this article. Follow your accountant's design.

How to work with funding shares in GrantLink

1. Choose how funding shares are classified

Open Settings > Funding shares and choose a Tracking mode:

• Manual means your team classifies funding shares on each allocation in GrantLink.
• QBO signal means a QuickBooks Online field decides the funding share.
• Hybrid review means the QuickBooks Online field suggests a funding share, and reviewers approve or change it before reporting.

If you use a QuickBooks Online signal, choose the QuickBooks source you already use: QBO Class, QBO Customer, QBO Project, Custom field, or QBO Account. Then map each value to a funding share type. The signal classifies the funding share of an allocated amount. It does not decide which grant the transaction belongs to, and GrantLink does not write the classification back to QuickBooks Online.

2. Add the grant and link its QuickBooks Online activity

Add the grant manually or by uploading its documents. On the grant, set the Expenses and Money received links to the QuickBooks Online Customers, Projects, Locations, or Classes that hold the grant's activity. GrantLink includes costs assigned to the linked expense records in the grant. You can allocate other transactions from the Ledger or manually.

3. Add the grant's funding share requirement

On the grant, open Transactions > Funding shares and choose Add requirement. Enter a Name, a Type, a Required amount, and, if the funder states one, a Ratio. The types are Total non-federal share, Cash funding share, In-kind funding share, Unrecovered indirect, Program income, and Other local share. For example, you might enter a $20,000 total non-federal share, a $25,000 cash funding share, or a $10,000 in-kind funding share.

GrantLink stores requirements separately from the grant budget, because a grant can have both a budget and a separate match or cost share rule.

4. Classify allocations

When you allocate a QuickBooks Online transaction to a grant, GrantLink stores a funding share type on the allocation. You can review and change it on the grant's Transactions > Allocations page.

A QuickBooks Online label or a GrantLink allocation does not by itself prove that a cost meets the federal cost sharing rules. Confirm that the cost is allowable, check the funding source, value, and award period, and get any required approval before you count it.

5. Review eligibility

A reviewer decides whether each share counts toward the requirement. GrantLink uses these statuses:

• Unreviewed means no one has reviewed the share yet.
• Eligible means the share can count toward the requirement.
• Ineligible means a reviewer decided it cannot count.
• Submitted means it was included in a funder report.
• Accepted means the funder accepted it.
• Rejected means the funder rejected it.

Shares that are Eligible, Submitted, or Accepted count toward the requirement. Unreviewed shares do not count unless your funding share settings allow it. An amount can be classified as a cash funding share and still not count until it has support and a reviewer approves it.

6. Attach or record evidence

For a cash funding share, the evidence is usually normal accounting support, e.g., an invoice, receipt, payroll report, bank record, or QuickBooks Online transaction.

For an in-kind funding share, the evidence usually includes the donor, date, description, value, and valuation method, and a signature or acknowledgment when appropriate.

Under 2 CFR 200.306, rates for third-party volunteer services must match the rates paid for similar work by your organization or, if you do not employ people with those skills, in your labor market. The value of donated property must not exceed its fair market value at the time of the donation.

7. Add contributions that are not in QuickBooks Online

Some funding shares do not appear as QuickBooks Online expenses. On the grant's Transactions > Funding shares page, choose Add contribution to record one. The contribution types are Cash, Third-party cash, Volunteer services, Donated goods, Donated space, Donated equipment, Unrecovered indirect, and Other in-kind. For in-kind contributions, GrantLink asks for a rate basis that explains how you set the value.

Recording contributions in GrantLink keeps the funding share report complete without creating artificial transactions in QuickBooks Online.

8. Monitor the grant summary

For each grant, GrantLink shows these totals:

• The required total and the remaining amount needed
• The eligible total, which includes eligible, submitted, and accepted shares
• Unreviewed, ineligible, and rejected totals
• Totals by type, e.g., cash, in-kind, unrecovered indirect, other local share, and program income

Use the summary to find shortfalls and unsupported amounts before the final report or the audit. The summary helps you reconcile, but it does not show that the funder accepted your match.

9. Report and prepare for audit

In a report, you can show grant-funded expenses, your funding share, program income, excluded items, and items that still need review as separate amounts.

To create a report, open Chats > New chat, or use Draft report with Assistant on the grant's Reporting > Reports page. Reports for the grant are listed on that page. Reconcile each report to the QuickBooks Online transactions, the contribution support, and the award terms.

Example

A grant funds an after-school program, and the award sets a total project budget of $100,000. The federal grant pays $80,000, and the award requires a $20,000 non-federal cost share.

In GrantLink, you add a $20,000 Total non-federal share requirement. Then you track these amounts:

• $12,000 of staff time paid with unrestricted funds, classified as a cash funding share
• $5,000 of donated professional services, classified as an in-kind funding share
• $3,000 of unrecovered indirect costs that the agency approved

After you review and document these amounts, GrantLink shows $20,000 counted and $0 remaining.

Mistakes to avoid

• Counting the same dollar toward two grant requirements
• Using federal funds as match for another federal award, unless the program's statute allows it
• Counting in-kind contributions without valuation support
• Waiting until the final report to find a match shortfall
• Treating a QuickBooks Online label as enough evidence by itself
• Using one field for both the grant assignment and the funding share when you need both

Sources and terms

The article uses GrantLink's term "funding share" and relates it to common funder and accounting terms, e.g., match, cost share, local share, recipient share, and non-federal share.

Sources:

• 2 CFR 200.306, Cost sharing
• QuickBooks Online classes
• QuickBooks Online projects

Grant terms vary by award. Follow the award agreement, the funder's guidance, and your accountant's documented policy. For step-by-step product instructions, see Tracking Funding Shares and Match Requirements.