Background Information on the costs of implementing programmes designed to provide support of orphans and vulnerable children (OVC) in sub-Saharan Africa and elsewhere is increasingly being requested by donors for programme evaluation purposes. To date, little information exists to document the costs and structure of costs of OVC programmes as actually implemented "on the ground" by local non-governmental organizations (NGOs). This analysis provides a practical, six-step approach that NGOs can incorporate into routine operations to evaluate their costs of implementing their OVC programmes annually. This approach is applied to the Community-Based Care for Orphans and Vulnerable Children (CBCO) Program implemented by BIDII (a Kenyan NGO) in Eastern Province of Kenya. Methods and results The costing methodology involves the following six steps: accessing and organizing the NGO's annual financial report into logical sub-categories; reorganizing the sub-categories into input cost categories to create a financial cost profile; estimating the annual equivalent payment for programme equipment; documenting donations to the NGO for programme implementation; including a portion of NGO organizational costs not attributed to specific programmes; and including the results of Steps 3-5 into an expanded cost profile. Detailed results are provided for the CBCO programme. Conclusions This paper shows through a concrete example how NGOs implementing OVC programmes (and other public health programmes) can organize themselves for data collection and documentation prospectively during the implementation of their OVC programmes so that costing analyses become routine practice to inform programme implementation rather than a painful and flawed retrospective activity. Such information is required if the costs and outcomes achieved by OVC programmes will ever be clearly documented and compared across OVC programmes and other types of programmes (prevention, treatment, etc.).