We received a grant in which the grant holder pays for some expenses on our behalf and we also pay an "in-kind" portion.  All of the expenses - whether paid by our nonprofit or by the grant holder - need to be also recorded as "Grant Income" according to our auditor.  The auditor's notes, "During the year, the Organization received income and fixed assets as a beneficiary of a grant.  The income and corresponding asset were not recorded in the general ledger.  We believe that this practice can result in the financial statements being materially misstated.  We therefore recommend that the income and corresponding asset or expense be recorded when money has been paid on the grant."  I understand the "why", I am just unsure how I go about recording it in QB.