Finance User Manual ENG -> 6. Donor Management -> LUFI-6.6 Funding Pool Illustrations.
DONOR MANAGEMENT ILLUSTRATIONS
LUFI-6.5 Funding Pool Illustrations
LU Introduction
In this LU we will explain what the types of funding pools to create are in order to reflect three funding scenarios. You will find below three use cases:
- Earmarked + Total project costs same cost centers and funding duration dates
- Total project costs same cost centers and funding duration dates
- Earmarked + Total project costs different cost centers and funding duration dates
Example Case #1: Earmarked + Total Project Costs
Let’s assume that we have signed two financing contracts: Grant A and B corresponding to Donors requiring ear-marked AND total project costs reporting, for the same cost center and with the same start/end (eligibility) dates.
To produce all relevant reporting to all Donors, the user needs to create three funding pools to allocate expenses:
- Pool A – GRANT type: Expenses earmarked specifically to GRANT A
- Pool B – GRANT type: Expenses earmarked specifically to GRANT B
- Pool Z – COFI type: Expenses declarable to both Donors A & B (but not specifically earmarked)
- Pool PF – PF type: Expenses paid by private funds (not declared to any Donors) already exists in the system.
The actual total cost of the project for MSF is the sum of the 4 funding pools, for the same dates & cost centers, and in MSF functional currency.
Note that expenses allocated to funding pool PF will not be included in the reports to institutional Donors.
To produce reports for Donor A, the user will pick all expenses included in the following funding pools (converted in the Donor relevant currency, and as per its relevant reporting format / financing lines):
– Grant use: Funding pool A
– Total project costs: Funding pools A+B+Z
And to produce reports for Donor B, the user will pick all expenses included in the following funding pools:
– Grant use: Funding pool B
– Total project costs: Funding pools A+B+Z (same as for Donor A)
Example Case #2: Two Donors with Total Project Costs
For the second illustration we will start over from a case where we expect to sign contracts with 2 Donors, for same cost center and the same dates (1st January to 31st December). Both Donors are global contributors.
In this case, we need only to create 1 funding pool in addition to PF:
- Pool Z – COFI type : Expenses declarable to both Donors A & B
No need for any specific {GRANT} type funding pool, as neither of the 2 Donors require a specific reporting on earmarked expenses paid by its grant.
Reporting to Donor A – from 01/Jan to 31/Dec:
– Total project costs: Funding pool Z
Reporting to Donor B – from 01/Jan to 31/Dec:
– Total project costs: Funding pool Z
Example Case #3: Two Donors with different Cost Centers
After having played with grant types and eligible dates we will now add 2 other factors which may influence the funding pools structure: coverage in terms of cost centers (in use cases 1 and 2 all grants were covering the same set of cost centers) and eligible expenses (some Donors may accept a few specific natures of expenses while others do not consider them as eligible).
Let’s imagine we have 2 fundings confirmed:
- One from Donor A, a global contribution type, for 6 months until end of June, and only for cost center AA
- And a second grant from Donor B, which requires mixed reporting on grant + total project costs valid for the whole year and for both cost centres AA + BB
In this case, we would need to create 4 funding pools:
- 2 of GRANT type for both cost centers, for the earmarked expenses allocated to Donor B (with cut-off at the end of grant A = 30/06, because it is really in the middle of the year and as this is probably a major institutional Donor for a large grant amount, there are high chances that there may be freight expenses which were earmarked to this grant but may be charged late by HQ). Now of course if the earmarked expenses were only for very few expenses which have no risk to be delayed there would not be need to split in 2 the GRANT pool– it is up to the user to asses this.
- The 2 other pools of COFI type are absolutely necessary, as cut-off is compulsory when a contract ends on a Donor who required reporting on total project costs (because there are very high chances of having to include such late-charge expenses!).
NB: It is not necessary to create separate COFI pools for the various cost centers. Indeed, cost centers can be managed via the selection associated to the financing contract.
In the case of the 2 COFI type pools we can simply link the 2 cost centers AA+BB (and not only AA), because even though we don’t need BB for reporting to Donor A, we will however need those COFI pools for the reporting of total project costs to Donor B (which covers cost center BB).
=> As we have restricted the cost centers on the specifications of each financing contract (just as for eligibility dates), in addition to the specifications of the funding pool only expenses allocated to pool Z1 AND on cost center AA will be selected for the reporting to Donor A (not the expenses allocated to Z1 & cost center BB).
