Metropolis Health System has received a wellness grant from the charitable arm of an area electronics company. The grant will run for twenty-four months, beginning at the first of the next fiscal year. Two therapists and two registered nurses will each be spending half of their time working on the wellness grant. All four individuals are full-time employees of MHS.

The electronics company has only recently begun to operate the charitable organization that awarded the grant. While they have gained all the legal approvals necessary, they have not yet provided the manuals and instructions for grant transactions that MHS usually receives when grants are awarded. Consequently guidance about separate accounting is not yet forthcoming from the grantor.

Required:

How would you handle this issue on the MHS Operating Budget for next year?

Produce a detailed written explanation of at least one page that

-summarizes the situation

-explains the options (e.g., separate accounting versus consolidated accounting)

-explains there is no existing budget guidance

-sets out the reasons why the issue should be handled either as separate or consolidated accounting.