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Funds Overview

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The core of all nonprofit and government accounting is the fund. Funds categorize the various sources of revenue for your organization and define donor imposed time and/or usage restrictions. By using proper fund accounting, you can track expenses against programs, projects and activities (i.e. Dimensions). You can also encode the source of money (Fund No.), and provide transparency to funders, auditors, board members and staff.

Examples of funding sources:

  • Grants (corporate, individual, or governmental) – Grants may sometimes be defined as a separate Dimension in Fundamentals’ Advanced App for Grants, depending on your organization’s reporting needs.
  • Donor gifts
  • Membership dues
  • Fees for service
  • Endowments
  • Public services
  • Sales of goods or services
  • Taxes, licenses, permits, utilities or fees

Fund Requirements & Automated Transactions

In Fundamentals, you can set up an unlimited number of funds, but you must have at least one. Each fund should have a distinct purpose, and will help explain how your organization’s money is being spent to meet your mission and goals. Your funds, if setup properly, will balance automatically within Fundamentals and will default both the Fund Class and Fund Type into posted GL entries for reporting purposes.

All debits and credits are forced to be equal by fund number, creating a separate “balance sheet” within the same company. Funds may also be used for multi-entity balancing (e.g. property, store, etc.)

Balancing can be done using automatic inter-fund (i.e. due-to/due-from entries), or by distributing the control entries based on the revenues and expense entered on line items. This distributed method eliminates most inter-fund entries and creates multiple fund entries on Balance Sheet Accounts.

Key Uses of Fund Management:

Once setup and implemented, Funds will:

  • Capture detailed information about the funding source
  • Define time and usage restrictions imposed by the donor
  • Track the spending of funds by project, department, location, and other dimensions of your organization for better management, better reporting, and support for your business development efforts.
  • Report back to donors and other constituents in order to tell your organization’s story and prove positive impact on the mission that guides your existence.

Special Vocabulary:

  • Dimension – Dimensions are the core components of an organization that you want to analyze with reports. Examples include departments, locations, programs, projects, or events. In Fundamentals you have the opportunity to determine and use up to 8 global dimensions in your chart of accounts structure.
  • Fund -A set of money earmarked for specific type of spending. An organization can have unlimited funds within Fundamentals, so you can report on how a donor’s money was well spent in the quest to resolve your mission.
  • Fund Class – list the grouping of funds which target Net Asset GL Accounts in the Statement of Financial Position.  Each class will target a specific net asset account in the balance sheet.  Examples might include “Donor Advised”, “Board Designated”, “Operating”, etc.  Each class will also connect to a Restriction Type of either “With Donor Restrictions” or “Without Donor Restrictions”. The restriction type will be used to create column grouping on the financial statements.
  • Fund Type – A list of codes which may be used to generate report groupings. While the Fund Class Codes have special meanings for financial reporting, the Fund Type may be be used for any purpose to categorize funds.

Setting up Funds

The set up and operation of funds in Fundamentals begins with the Fund Card. You access this card via the Home Page, and selecting the Funds menu item in the action bar (immediately beneath the menu bar). When selected you will see a page listing all your funds, and you can access more details about any fund by selecting its fund number from the left-most column, the No. column. A fund number can be a word or a number, depending on the requirements of your organization. You can also create a new fund by clicking on the +New in the action bar immediately beneath the menu bar.

The Fund Card has four tabs. Please hover over any field label for help with the kind of information needed to complete filling in the field in that tab:

  • General- The General tab helps you document the correct profile for your fund, including the designation of Fund Classes and Fund Types, the budget amount set aside for this fund and all important ways that budget is being financially affected.
  • Restrictions and Posting- This section addresses the allowable posting dates, and includes a manual toggle that can block inter-fund entries. These allow you to define time and usage restrictions for this fund.
  • Source- The source tab gives profile and contact information about your funders. Within this tab you’ll see a CFDA number which is a five-digit number assigned in an awarding document to most grants and cooperative agreements funded by the Federal Government.
  • Audit- the audit tab allows you to oversee who created the fund card and when, as well as seeing when a fund has been modified and by whom.