We basically do the same thing for recording of "award receivables" however, we
view the receivable as a budget advance for the grant, not as a true receivable
where we have expended the funds and someone already owes us reimbursement. The
true receivable amount should only be what you have expended; any unexpended
awards at the end of the fiscal year should be reported in the notes to the
financial statements as "Awards Receivable".

If you're getting scrutiny about the rather large amount because you're
recording the total grant award at the beginning, perhaps you might
consider giving the "budget advance" in smaller doses instead of all at once.
For a $500,000 grant over three years, maybe upon award you could advance
$100,000. While this will take some extra work throughout the grant (recording
additional budget advance entries for the grant) it would help to lower the
"receivable" amount and the level of anxiety for your administrators.

Barry Tate, CPA
Contract & Grant Administration
Sam Houston State University
Huntsville, TX  77340
(409) 294-1091     fax 294-3776
xxxxxx@SHSU.EDU