Nonprofit Accounting Basics

Recent Articles

Nonprofits Should Prepare Now to Accept Cryptocurrency

Over the past year, there has been exponential growth in both the volume of cryptocurrency (crypto) donations to nonprofits and the number of nonprofits accepting such donations, either as cryptocu

Accrued Vacation

Most organizations include some paid time-off in their benefits packages offered to employees.  Rules concerning when an employee is eligible to receive these benefits vary widely within organ

Give Me Your 990!

Public Disclosure Requirements for Tax-Exempt Organizations | 2022 Edition

Reporting the Total Number of Volunteers on the Form 990

Nonprofits have only a few touchpoints where a lasting impression can be made in the blink of an eye.

Governance Review of the Form 990

Form 990, Part VI, Line 11 relates to the organization’s process for filing the Form 990 prior to the form being filed with the IRS. Line 11 includes two parts.

Top Ten Items to Review at Year-End

Your year-end review and audit preparation should include these items among others depending on your organizations form, accounts and transactions.

Ratios: Current Ratio

This ratio tells you how many times current (within 12 months) assets could cover current liabilities. A value of 1 or better indicates that current liabilities could be covered by current assets.

Ratios: Profit Margin (Surplus Margin)

This calculation indicates by what percent revenues are over or under expenses.

Ratios: Net Working Capital

This indicator is another liquidity measure that expands to include all current (within 12 months) assets such as receivables and inventory.

Operating Reserve Ratio

This ratio is a focused variant of the Months Cash on Hand ratio.