Conditions of Grantmaking

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Terms and Conditions of Grant-Making

  • Grants are often approved with conditions. These can be conditions relating to the timing of the funding, the ability of the organisation to raise matched funding or any other conditions precedent that are required before funding is released. The funds can be given either in one lump sum or in tranches against milestones or against approved third party quotes.
  • It is good practice to ensure that the donee agrees to the conditions and accepts the grant in writing.
  • Almost all donors expect some type of reporting; either at the end of the grant period or at specific intervals as well as at the end of the period. Some foundations are not prescriptive about the content of a report, satisfied with a set of audited financial statements and a general annual report.
  • Finally, there is a stage, usually towards the end of the grant period, when the donor must consider whether to continue funding the organisation, which will usually request further support. If the donor is considering ending the funding, this is often a difficult decision because personal relationships and expectations have been established. Some of the common reasons for ending a relationship are:
  • The project has come to an end (most common with infrastructure projects);
  • Evidence of fraud or serious mismanagement at the donee organisation;
  • The organisation is likely to close down due to ongoing poor financial or other management;
  • A change in the donor’s strategy.
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