Nonprofit Accounting Basics

Recent Articles

Define Purpose and Mission

Originally Posted: March 15, 2023

Every organization has a mission. For for-profits, it is to create profit for the owners or shareholders. In the nonprofit sector there are just about as many missions as there are organizations.

Inventory

Originally Posted: March 15, 2023

Inventory represents the value of assets held by an organization for resale.

Accounts Payable

Originally Posted: March 15, 2023

Accounts Payable is a liability account found on the Balance Sheet or Statement of Financial Position that represents money owed to another party.

Security Act 2.0: What you need to know

Originally Posted: March 8, 2023

On December 29, 2022, President Biden signed the Consolidated Appropriations Act, 2023, which includes the provisions of the Securing a Strong Retirement Act, commonly called SECURE 2.0.

Sending Invoices

Originally Posted: February 15, 2023

Invoices may need to be prepared for a number of reasons. Some organizations sell books or newsletters for a fee. Others require registration for meetings or bill for dues.

Internal Controls

Originally Posted: February 15, 2023

What are internal controls?

Internal controls are the financial processes and procedures that enable the organization to safeguard its assets.

General Ledger

Originally Posted: February 15, 2023

The general ledger documents all of the organization’s transactions over the course of a year for all accounts.

Recording Other Transactions

Originally Posted: February 15, 2023

The general ledger is the journal where all transactions are posted throughout the year and balances are maintained.

Sample Journal Entries for Government Grants

Originally Posted: February 15, 2023

The following are the entries necessary for cost-reimbursable government grant (assuming the grant is determined to be an exchange transaction):

Exchange Transactions

Originally Posted: February 15, 2023

Factors that may indicate an exchange transaction:

Often it is difficult to distinguish between a contribution and an exchange transaction, the following factors are indicative of an exchan

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