55 lines
2.6 KiB
Markdown
55 lines
2.6 KiB
Markdown
# Fund Accounting
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Many non-profits, in particular a
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[fiscal sponsor](http://en.wikipedia.org/wiki/Fiscal_sponsorship), use some
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form of [fund accounting](http://en.wikipedia.org/wiki/Fund_accounting) to
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handle accounting tracking of income and expenses for specific projects, or
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funds.
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In fiscal sponsors, these funds are typically classified by auditors and/or
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accountants as "temporarily restricted assets", and spending of the assets
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are governed by a fiscal sponsorship agreement
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([[see examples below|FundAccounting#Other_Resources]]).
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## Fund Report
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The "fund report" is a shorthand name for a Temporarily Restricted Net Assets
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Report. This report shows the temporarily restricted income, expenses and
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assets. (An example of such a report can be found on page 6 of
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[Conservancy's FY 2011 Audited Financial statement](http://sfconservancy.org/docs/conservancy_independent-audit_fy-2011.pdf).)
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## Subset of the Books
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Ultimately, any account system that truly supports fiscal sponsorship must
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provide all functions, reports, editing, interaction and viewing to allow a
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user to view a "subset" of the books that are specific to any given fund. In
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essence, the books of a fiscal sponsoring org are proper superset of all the
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books of its projects.
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Thus, an individual project contributor wants to:
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- View the books for that project as an independent set, unencumbered by
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transactions for other projects.
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- [[Generate reports|GeneratingReports]] for that project's financial
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data, and have those reports only include data specific to that project.
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The non-profit administrators want to:
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- View the entire set of books for the organization, treating all income,
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expenses, and assets as belonging to the entire org, and only seeing the
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differences treating the project funds merely as "temporarily restricted
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assets".
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- Be able to perform operations that span the entire books, such as
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reconciling bank accounts that are contain funds temporarily restricted for
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different projects.
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## Other Resources
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### Examples of Fiscal Sponsorship Agreements
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- [Software Freedom Conservancy's fiscal sponsorship agreement template](http://sfconservancy.org/members/apply/ConservancyFSATemplate.pdf)
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- [Insight Center for Community Economic Development fiscal sponsorship agreement](http://www.google.com/url?q=http://www.insightcced.org/uploads/publications/legal/721.pdf&sa=U&ei=4UR6UuCONNSrkQfz5YDYCw&ved=0CCAQFjAC&usg=AFQjCNG8usFKh8jSdMM9cG1SAOVUb2Neig)
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More about [fiscal sponsors from the National Council of Non-Profits](http://www.councilofnonprofits.org/resources/resources-topic/fundraising/fiscal-sponsors).
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