Glossary
Expenses & Payables

Project Tracking

By: Alec Hollingsworth
Updated:  
June 2, 2025

DEFINITION:

Project tracking is the process of monitoring and managing all financial activities related to specific nonprofit projects or programs.
Project tracking in nonprofit accounting refers to the process of monitoring, recording, and managing the financial activities, expenses, and revenues associated with specific projects or programs within an organization. This involves allocating costs, tracking funding sources, and generating detailed reports to ensure that resources are used as intended and compliance requirements are met. Effective project tracking helps organizations assess project performance, supports grant management, and demonstrates accountability to donors, grantors, and stakeholders. By segregating financial data by project, nonprofits gain greater visibility into program success and spending efficiency.

Key Takeaways

  • Helps monitor project-specific expenses and income
  • Ensures compliance with funding restrictions
  • Supports detailed financial reporting
  • Improves accountability to donors and stakeholders

Why It Matters

Project tracking ensures transparency, accountability, and compliance with donor or grant restrictions.

Real World Example

A nonprofit organization receives a grant to build a community garden and separate donations for a youth mentoring program. By using project tracking in their accounting software, they allocate all garden-related expenses (tools, soil, labor) and mentoring program costs (supplies, transportation) to their respective projects. At the end of the year, the organization generates individual reports showing how much was spent and received for each project. This allows them to demonstrate to the garden grantor that funds were used appropriately and to share detailed budget updates with donors supporting the mentoring program.

How Aplos Helps

Aplos provides robust project tracking features that let organizations assign income and expenses to specific projects, programs, or events. Users can generate detailed reports to monitor project budgets, compare actuals to goals, and demonstrate responsible stewardship to funders. The platform simplifies tracking restricted funds and supports compliance with nonprofit accounting standards.
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Frequently Asked Questions

What is project tracking in nonprofit accounting?

Project tracking is the process of monitoring and managing financial transactions related to specific projects or programs, ensuring resources are used as intended and reporting is accurate.

Why is project tracking important for nonprofits?

It helps organizations comply with grant or donor restrictions, improves accountability, and provides clear financial reporting for each project.

How does Aplos help with project tracking?

Aplos allows users to assign transactions to specific projects, track budgets, and generate reports to demonstrate fund usage and project performance.

Related Terms

Petty Cash
Statement of Activities
Modified Cash Basis
Grant Compliance
Dashboard
Variance Analysis

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