Finance
Cost allocation
Formal definition
Cost allocation is an operating term in finance focused on tracking restricted versus unrestricted funding, allocating overhead costs, and managing non-cash asset valuations.
What this actually means for you
Use Cost allocation to guide live decisions: apply systematic weighting to shared overheads, review restricted fund terms, and verify legal rules for special payments, with ownership and reporting agreed at month-end and before trustee reporting cycles.
Example: At the next review checkpoint, Cost allocation is used in practice like this: the finance manager registers external gift-in-kind values and reconciles monthly cost allocations across central services. Accountabilities are captured in team templates, reporting packs, and operating checklists.
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