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Non-Profit Accounting With Ledger CLI, A Tutorial
Non-profit organizations (NPOs), particularly 501(c)(3) charities in the USA, have their own specific accounting needs. These often differ from for-profit accounting needs. For example, for-profit-oriented systems often make problematic assumptions about the workflow of accounting tasks (often because NPOs rely primarily on donations, rather than fee-for-service or widget-selling income). Also, non-profit income is categorized differently than for-profit income, and the reporting requirements vary wildly from their for-profit equivalents.
This project is designed to provide some basic templates, tutorials, workflow documentation and scripts to handle accounting for an NPO. The primary example is a direct project (aka Model A) fiscal sponsor NPO.
This tutorial was written primarily based on Software Freedom Conservancy's use of Ledger CLI from 2008-10-22 to present for its own accounting needs. While Conservancy has done well using this system, and believes that its account system meets Generally accepted accounting principles (GAAP), this document does not constitute advice from a CPA nor legal advice for a non-profit that seeks to comply with relevant state and/or federal accounting requirements for USA non-profits. The authors make no representations nor warranties regarding this information and this information is provided for discussion purposes only. Readers of these tutorial and templates are urged to seek professional advice from a CPA and/or tax legal counsel in constructing an accounting system appropriate for your organization.
Furthermore, given the authors' limited knowledge of accounting requirements outside the USA, the suggestions herein probably are not particularly useful at all for organizations outside the USA.
Configuration of Chart of Accounts
The first thing any accountant will ask to see if your so-called "chart of accounts". The first time I heard this phrase, I thought it was something complicated. Fact of the matter is, it's really just a list of all the accounts that you use. Accountants also use "account codes", which, as near as I can tell, are of primary interest because they get better sorting. Ledger CLI doesn't really support account codes, so I've ignored them.
The real place that Ledger CLI stores your chart of accounts is if you use
the account directive along with the --pedantic CLI option. This will
ensure that only accounts you declared explicitly will used.
Asset Accounts
Our recommendation for asset accounts FIXME.
Reporting The Chart of Accounts
The
general-ledger-report.plx script in the non-profit-audit-reports Ledger CLI contrib directory
will generate a file called chart-of-accounts.csv, which is the chart of accounts.
Copyright and License of This File
This specific document, the README.md file for npo-ledger-cli, is copyrighted: Copyright © 2013, Bradley M. Kuhn
This document's license gives you freedom; you can copy, modify, convey, propagate, and/or redistribute this software under the terms of either:
* The GNU General Public License as published by the Free Software
Foundation, Inc.; either version 3 of the License, or (at your option)
any later version (aka GPLv3-or-later).
* *or* the Creative Commons Attribution-ShareAlike 3.0 United States
license, as published by Creative Commons, Inc. (aka CC-By-SA-USA-3.0)
In addition, when you convey, distribute, and/or propagate this document and/or modified versions thereof, you may also preserve this notice so that recipients of such distributions will also have both licensing options described above.
A copy of GPLv3 and CC-By-SA-3.0-USA can be found in the same repository as this file under the filenames GPLv3.txt and CC-By-SA-3.0-USA.txt. If this document has been separated from the repository, a copy of GPL can be found on FSF's website and a copy of CC-By-SA-USA-3.0 can be found on Creative Commons' website.