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Fiscal Non-Profit Administration

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VII. SAMPLE CHART OF ACCOUNTS

Effective Date: April 21, 2008

Sample Chart of Accounts

This sample Chart of Accounts was developed for use by nonprofit agencies in Smart Start programs. DHHS is not mandating its use, but it is available for use by any agency. However, a funding agency/division within DHHS may mandate it for use. by its grantees/contractors. The sample Chart of Accounts objects may be changed as appropriate for other individual nonprofit agencies.

Department of Health & Human Services

Recommended Chart-of-Accounts

Smart Start - Local Partnerships

Account Classes – Position 1

1XXXXXXX

Unrestricted

     

2XXXXXXX

Temporarily Restricted

     

3XXXXXXX

Permanently Restricted

     

Funds – Positions 2, 3 and 4

X100XXXX

Management and General

     

X200XXXX

Fund Raising

     

X300XXXX

Smart Start- (State)

     
 

X301XXXX

Child Care Services

   
 

X302XXXX

Health Services

   
 

X304XXXX

Staff Training

   
 

X305XXXX

Quality-Grants

   
 

X306XXXX

Child Care Resource & Referral

   
 

X307XXXX

Community Outreach

   
 

X308XXXX

Community Awareness

   
 

X309XXXX

Transportation

   
 

X310XXXX

Family Services

   
 

X311XXXX

Capital Projects

   
 

X363XXXX

Parent Education

   

X400XXXX

Other State Grants

     

X500XXXX

Federal Grants

     

X600XXXX

Private Gifts and Grants

     

X700XXXX

Other

     

Control Accounts – Position 5

XXXX1XXX

Assets

     

XXXX2XXX

Liabilities

     

XXXX3XXX

Net Assets

     

XXXX4XXX

Revenues and Gains

     

XXXX5XXX

Expenses and Losses

     

Major Accounts – Position 6

Sub Accounts – Position 7

Categories – Position 8

Assets

XXXX11XX

Cash and Cash Equivalents

 
   

XXXX111X

Checking Account

   

XXXX112X

Petty Cash, Change Funds, Undeposited Receipts

   

XXXX113X

Savings Accts, Money Market Accts, CD's

XXXX12XX

Current Accounts, Contributions and Interest Receivable

 
   

XXXX121X

Sales Tax Receivable

   

XXXX122X

Accounts Receivable – Vendors

   

XXXX123X

Other Receivables

   

XXXX124X

Interest Receivable

   

XXXX125X

Contributions Receivable

   

XXXX126X

Allowance for Doubtful Contributions Receivable

 

XXXX13XX

Due from Other Organizations

 
   

XXXX131X

Due from State of North Carolina

   

XXXX132X

Due from Federal Government

   

XXXX133X

Due from Local Governments

   

XXXX134X

Due from Private Organizations

   

XXXX135X

Advances to Contractors

XXXX14XX

Interfund Receivables

 
 

XXXX15XX

Inventories and Prepaid Expenses

 
   

XXXX151X

Inventory of Materials and Supplies

   

XXXX152X

Prepaid Insurance and Maintenance Contracts

 

XXXX16XX

Investments

 

Assets

XXXX11XX

Cash and Cash Equivalents

 
   

XXXX161X

Bonds

   

XXXXI62X

Stock

 

XXXX17XX

Non-Current

Receivables

 
   

XXXX171X

Accounts Receivable

   

XXXX172X

Contributions Receivable

   

XXXX173X

Allowance for Doubtful Contributions Receivable

   

XXXXI74X

Grants Receivable

 

XXXX19XX

Land, Buildings, and Equipment

 
   

XXXX191X

Land

   

XXXX192X

Buildings and Improvements

   

XXXX193X

Furniture and Equipment

   

XXXX194X

Data Processing Equipment

   

XXXX195X

Leasehold Improvements

   

XXXX196X

Accumulated Depreciation

Liabilities

XXXX21XX

Accounts Payable

   
   

XXXX211X

Accounts Payable -Vendors

   

XXXX212X

Accounts Payable - Employees

   

XXXX219X

Other Payables

 

XXXX22XX

Accrued Payroll

 
   

XXXX221X

Salary and Wages Payable

   

XXXX222X

Social Security Contribution Payable

   

XXXX223X

Retirement Contribution Payable

   

XXXX224X

Disability Insurance Payable

   

XXXX225X

Unemployment Insurance Payable

   

XXXX226X

Workmen's Compensation Payable

   

XXXX227X

Payroll Clearing Account

 

XXXX23XX

Interfund Payables

 
 

XXXX24XX

Unearned Revenue/Refundable Advances

 
       

Liabilities

XXXX21XX

Accounts Payable

 
   

XXXX241X

Unearned Revenue/Refundable Advances - State of North Carolina

   

XXXX242X

Unearned Revenue/Refundable Advances – Other

 

XXXX25XX

Current Debt Payable

 
   

XXXX251X

Notes Payable

   

XXXX252X

Capital Leases Payable

   

XXXX253X

Mortgage Payable

   

XXXX254X

Accrued Interest Payable

 

XXXX26XX

Grants Payable

 
 

XXXX27XX

Accrued Leave

 
   

XXXX271X

Accrued - Vacation Leave

   

XXXX272X

Accrued Sick Leave

 

XXXX28XX

Long-Term Debt

 
   

XXXX281X

Notes Payable

   

XXXX282X

Capital Leases Payable

   

XXXX283X

Mortgage Payable

       

Net Assets

XXXX31XX

Net Assets

 
   

XXXX311X

Unrestricted Net Assets

   

XXXX312X

Temporarily Restricted Net Assets

   

XXXX313X

Permanently Restricted Net Assets

Revenues & Gain

XXXX41XX

State Grants

   
   

XXXX411X

Smart Start

 
   

XXXX412X

Other

 
 

XXXX42XX

Federal Grants

   
 

XXXX43XX

Private Gifts and Grants (Contributions)

   
 

XXXX44XX

Non-Cash Contributions

   
         

Revenues & Gain

XXXX41XX

State Grants

   
   

XXXX441X

Donated Materials, Facilities

and Equipment

 
   

XXXX442X

Donated Services

 
     

XXXX4421

Donated Services – Specialized Skills

     

XXXX4422

Donated Services - Other

 

XXXX45XX

Fees and Special Events

   
   

XXXX451X

Special Events (Net Revenue)

 
     

XXXX4511

Special Events Receipts

     

XXXX4512

Special Event Expenses

 

XXXX46XX

Investment Income

   
   

XXXX461X

Interest Income

 
   

XXXX462X

Income on Long-Term Investments

 
   

XXXX463X

Other Investment Income

 
   

XXXX464X

Net Realized Gains on Long-Term Investments

 

Revenues & Gain (cont.)

XXXX47XX (not in manual)??

Other Income

   
 

XXXX48XX

Net Assets Released from Restrictions

   
   

XXXX481X

Satisfaction of Program Restrictions

 
   

XXXX482X

Satisfaction of Equipment Acquisition Restrictions

 
   

XXXX483X

Satisfaction of Time Restrictions

 

Expenses & Losses

XXXX51XX

Personnel

   
   

XXXX511X

Salary and Wages

 
   

XXXX512X

Social Security Contribution

 
   

XXXX513X

Retirement Contribution

 
   

XXXX514X

Disability Insurance Contribution

 
   

XXXX515X

Unemployment Insurance Contribution

 
   

XXXX516X

Workmen's Compensation

 
   

XXXX517X

Board Member Compensation/Stipends

 
   

XXXX518X

Donated Services

 
     

XXXX5181

Donated Services – Specialized Skills

     

XXXX5182

Donated Services – Other

   

XXXX519X

Accrued Leave

 
 

XXXX52XX

Contracted Services

   
   

XXXX521X

Accounting and Tax Services

 
   

XXXX522X

Legal Services

 

Expenses & Losses

XXXX51XX

Personnel

   
   

XXXX523X

Temporary Services

 
   

XXXX524X

Other Contracted Services

 
   

XXXX525X

Management Services

 
   

XXXX526X

Honorariums

 
 

XXXX53XX

Supplies and Materials

   
   

XXXX531X

Office Supplies and Materials

 
   

XXXX532X

Computer Supplies and Software

 
   

XXXX533X

Janitorial Supplies

 
   

XXXX534X

Educational Supplies and Materials

 

Expenses & Losses (cont.)

XXXX54XX

Current Obligations

   
   

XXXX541X

Travel

 
   

XXXX542X

Communication (Telephone, Postage, etc.)

 
   

XXXX543X

Utilities

 
   

XXXX544X

Printing and Binding

 
   

XXXX545X

Repair and Maintenance

 
   

XXXX546X

Computer Services (Accounting, payroll, etc.)

 
   

XXXX547X

Employee Training

 
   

XXXX548X

Advertising and Promotion

 
   

XXXX549X

Board Member Expense (Travel, Per Diem)

 
 

XXXX55XX

Fixed Charges and Other Expenses

   
   

XXXX551X

Office Rent (Land, Buildings, etc.)

 
   

XXXX552X

Furniture Rental

 
   

XXXX553X

Equipment Rental (Phone, Computer, etc.)

 
 

XXXX55XX

Fixed Charges and Other Expenses

   
   

XXXX554X

Vehicle Rental

 
   

XXXX555X

Dues and Subscriptions

 
   

XXXX556X

Insurance and Bonding

 
   

XXXX557X

Books (Library Reference Materials)

 
   

XXXX558X

Depreciation

 
   

XXXX559X

Other Expense

 
 

XXXX56XX

Capital Outlay

   
   

XXXX561X

Land

 

Expenses & Losses (cont.)

 

XXXX562X

Buildings and Improvements

 
   

XXXX563X

Furniture and Equipment

 
   

XXXX564X

Data Processing Equipment

 
   

XXXX565X

Leasehold Improvements

 
   

XXXX566X

Expendable Equipment

 
 

XXXX57XX

Contracts. Grants and Stipends

   
   

XXXX571X

Grants and Contracts

 
   

XXXX572X

Grants and Contracts - Related Party

 
   

XXXX573X

Stipends

 

Department of Health & Human Resources

Division of Child Development

Recommended Chart-of-Accounts

Account Classes

Account Classes are used to Classify the organization’s net assets in accordance with generally accepted accounting principles based on the presence or absence of donor restrictions.

1 XXXXXXX - Unrestricted

Used to classify assets which have neither temporary nor permanent restrictions. It is allowable to classify assets for which temporary restrictions are satisfied within the same accounting period (year) as unrestricted.

2XXXXXXX - Temporarily Restricted

Used to classify assets which have donor-imposed stipulations which either expire with time or can be fulfilled or removed by actions of the organization. Examples may include donations with the stipulation that the asset be preserved for a period of time or that the asset be used for a specified purpose.

3XXXXXXX - Permanently Restricted

Used to classify assets which have donor imposed stipulations that neither expire with time nor can be fulfilled nor removed by actions of the organization.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 8

Used to account for transactions which are not identifiable with a single program or fund-raising activity but are indispensable to the conduct of those activities and to an organization’s existence, including expenses for the overall direction of the organization's general board activities, business management, general record keeping, budgeting, and related purposes. Costs of overall direction usually include the salary and expenses of the executive director of the organization and staff. However, if such staff spends a portion of their time directly supervising program services or categories of supporting services, their salaries and expenses should be prorated among those functions. The costs of disseminating information to inform the public of the organization's “stewardship” of contributed funds, announcements concerning appointments, the annual report, and so forth, should likewise be classified as management and general expenses.

Funds provided by the State for the general operation of the local partnership would be accounted for in this fund. However, if the local partnership expends funds for fund raising activities, those funds should be accounted for in the Fund Raising Fund described below.

X200XXXX - Fund Raising

Used to account for costs incurred in raising funds from contributions of money, securities, time, materials, or facilities for which the contributor will receive no direct economic benefit They normally include the costs of personnel, occupancy, maintaining mailing lists, printing, mailing, and all direct and indirect costs of soliciting, as well as the cost of unsolicited merchandise sent to encourage contributions. Fund raising costs paid directly by a contributor should be reported as support and as fund raising expenses in this fund.

Some organizations hold special fund-raising events, such as banquets, dinners, theater parties, and so forth, in which the donor receives a direct benefit (for example, a meal or theater ticket). Some organizations sell merchandise as a fund-raising technique. The costs of such merchandise or direct benefits are not considered fund-raising costs and should be applied against gross proceeds received from the person receiving such direct benefit. Statement of Financial Accounting Standards (SFAS) Statement No. 117 allows organizations to report net amounts for special events if they result from peripheral or incidental transactions. However, if they are ongoing and major activities, organizations should report gross amounts of revenues and expenses separately.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 9

X300XXXX Smart Start (State)

Used to account for the allocation from the State for specific Smart Start activities. For example: If the State provided funds to the local partnership for a needs and resource assessment, a separate fund would be designed to account for the receipt of the funds and the expenditures incurred in performing the needs and resource assessment Separate funds should be established for each specific Smart Start activity (see examples on the recommended chart-of-accounts).

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 10

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 11

Control Accounts

Control accounts are used to designate the location of accounts on the financial statements of the not-for-profit organization.

XXXX1XXX - Assets

All accounts which provide economic benefit to the organization. Included within the assets control accounts are “contra-accounts” such as accumulated depreciation or allowances for doubtful accounts. These “contra-accounts” are intended to present assets at their net cost or realizable value. For example: the net cost of a building for financial presentation would be its cost less the accumulated depreciation.

XXXX2XXX - Liabilities

All accounts which represent obligations of the not-for-profit organization whether due to outside entities (external obligations) or to other funds (internal obligations). Also included in this group of accounts are unearned revenues or advances provided by outside organizations.

XXXX3XXX - Net Assets

All accounts which accumulate the excess/deficit of revenues and gains over expenses and losses. Generally, an entry is only made to these accounts at the end of each accounting period; unless the not-for-profit organization needs to correct an error which occurred in a prior accounting period. Net Assets are classified by donor imposed restrictions (unrestricted, temporarily restricted or permanently restricted) on those assets.

XXXX4XXX - Revenues and Gains

All accounts which measure gross increases in assets, gross decreases in liabilities, or a combination of both from delivering or producing goods, rendering services, or other earning activities of a not-for-profit organization during an accounting period. Examples may include grants, dues, contributions and proceeds from sales of items. Also, gains resulting from the sale of assets such as investments are included in this control. The accounting principles affecting the recognition of revenues and gains for not-for-profit organizations are the same as for commercial entities: the earning process must be completed before revenues are earned. For operating grants, this usually requires that expenses be incurred before grant revenue is considered earned. In other instances, the goods or services must be provided before revenues are considered earned.

XXXX5XXX - Expenses and Losses

All accounts which measure gross increases in liabilities, gross decreases in assets, or a combination of both, result from providing services or other activities of the not-for-profit organization. Examples include personnel costs, costs of supplies or current obligations. Also, losses resulting from the sale of assets such as investments are included in this control. The accounting principles affecting the recognition of expenses and losses for not-for-profit organizations are the same as for commercial entities: the expenses must be incurred.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII 12

Major Accounts and Sub-Accounts

Assets

XXXX11XX - Cash and Cash Equivalents

These accounts record amounts which represent cash, either on-hand or on-deposit, and cash items which could be converted to cash easily and without significant risk of a loss occurring.

XXXX12XX -Current Accounts. Contributions and Interest Receivable

These accounts record amounts due to the organization which are expected to be realized in cash during the next accounting cycle (usually one year). See Non-Current Receivables for amounts not expected to be realized in cash during the next accounting cycle.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 13

These include accounts which represent amounts due from other organizations.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 14

XXXX14XX - Interfund Receivables

These accounts record amounts due from other funds. Because each not-for-profit organization may have numerous funds depending on the nature of its operations, no sub-accounts are described. Note that interfund receivables and payables should be equal.

XXXX15XX - Inventories and prepaid expenses

These accounts record tangible personal property either for resale or for use in the not-for-profit organization's operations and expenses paid in advance of being incurred.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 15

XXXX16XX - Investments

These accounts record assets held for the purpose of generating income either In the form of interest, dividends, or capital gains. Nonprofit organizations frequently pool investment of various funds. The income from such investments, and the realized and unrealized gains and losses on the Investment, should be allocated equitably to the participating funds. Care should be taken whether there are any restrictions (by donors or regulatory agencies) that would prohibit. the pooling of investments of certain funds.

XXXX17XX - Non-Current Receivables

These accounts record amounts due the organization which are not expected to be converted to cash within the next accounting cycle (usually one year).

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 16

XXXX19XX - Land, Buildings, and Equipment

These accounts record the not-for-profit organization's cost of acquiring assets. Equipment which exceeds the capitalization rate (currently $500) should be recorded in these accounts. The cost of the asset includes the value of consideration given or consideration received, whichever is more clearly determinable. Cost includes all normal and necessary outlays Incurred to bring the asset into a state of readiness for its Intended use, excluding taxes. Also, included In these accounts are leases which are essentially purchases financed through lease agreements, referred to as "capital leases." The criteria used to distinguish between a capital lease and an operating lease, as well as the requirements for recording a capital lease, are very specific and beyond the scope of this description. If you have assets which have been purchased through a financing agreement (usually a lease-purchase agreement) other than a note payable or mortgage, you should contact your auditor or accountant for advice.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 17

Liabilities

XXXX21XX - Accounts Payable

These accounts record current liabilities which represent debts or other legal obligations arising from transactions in the past which must be liquidated, renewed, or refunded at some future date within a relatively short period, usually no longer than a year.

XXXX22XX Accrued Payroll

These accounts record the liabilities for salaries and wages and employee benefits.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 18

These accounts record the liabilities to other funds. Because these are dependent on other funds .established by the not-for-profit organization no examples of sub-accounts have been provided. Note that interfund receivables and payables should equal.

These accounts record amounts which have been received by the not-for-profit organization, but the earning process has not been completed. Usually with operating grants, the earning process involves incurring qualifying expenditures. With capital grants, the process involves the acquisition of specified assets. in connection with fund raising events, the earning process is completed when the goods or services are provided.

XXXX25XX - Current Debt Payable

These accounts record the current portion of long-term debts or other obligations, due within a year. An entry should be made at year-end to reclassify the portion of long-term debt (principle only) due within a year as a current debt payable. Sub-accounts should be established for each long-term obligation.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 19

XXXX26XX - Grants Payable

These accounts record the amount outstanding grant awards to outside organizations which represent amounts earned but not paid at year end. For grants on a cost-reimbursement basis, this amount would be equal to the amount of expense Incurred by the outside organization but not yet paid at June 30. For other grants which are considered unconditional promises to give, the total outstanding grant amount at June 30 would be recorded. Note: Liabilities resulting from contracts between the State of North Carolina and providers identified in the not-for-profit organization's plan should not be recorded in this account.

These accounts record the obligation at year-end for probable future payments to employees for accrued leave (compensated absences). A liability should be recorded (SFAS No. 43) for compensated absences (illness, holiday, vacation) when:

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 19

XXXX28XX - Long-Term Debt

These accounts record non-current liabilities which represent debts or other legal obligations arising from transactions in the past which must be liquidated, renewed, or refunded In a future period that is at least one year or more subsequent to the current fiscal period. Sub-accounts should be established for each long-term debt/obligation.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 8

Net Assets

XXXX31XX - Net Assets

These accounts represent the accumulated excess (deficit) of revenues and gains over expenses and losses (Assets - Liabilities = Net Assets) from the inception of the not-for-profit organization. Generally, these accounts, referred to as equity accounts, are up-dated annually during the process of closing the revenue and gain accounts and the expense and loss accounts. The only other situation in which entries should be made to equity accounts is to correct an error for a prior period (prior period adjustment). Even then, prior period adjustments should only be recorded in situations where the amounts are material to the financial statements. As required by SFAS 117, the net assets are categorized by the status of donor imposed restrictions at year-end.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 19

Revenues and Gains

XXXX41XX - State Grants

These accounts record revenues earned from grants from the State of North Carolina. Generally, revenues are earned from operating grants by incurring qualifying expenses. In this context, qualifying expenses refer to expenses which are either allowed by the grant award or regulations, are allocable to the grant and are reasonable and necessary to meet the objectives of the program. Sub-accounts should be established for each state grant.

XXXX42XX - Federal Grants

These accounts record revenues earned for grants from federal agencies. Generally, revenues are earned for operating grants by incurring qualifying expenses. In this context, qualifying expenses refer to expenses which are either allowed by the grant award or regulations, are allocable to the grant and are reasonable and necessary to meet the objectives of the program. Sub-accounts should be established for each federal grant.

XXXX43XX - Private Gifts and Grants (Contributions)

These accounts record revenues from private gifts and grants. This account would be used for corporate gifts, grants from private foundations and contributions from individuals. This account can also be used for pledges which are not contingent upon future events. Sub-accounts should be established for each corporation, unless anonymity Is requested.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 8

XXXX44XX - Non-Cash Contributions

These accounts record contributions from Individuals or organizations. In a broad sense, a contribution may be described as a transfer of an asset or cancellation of a liability without consideration. Therefore, contributions are nonreciprocal (the recipient does not give up an asset 'or Incur a liability of commensurate value). Under SFAS No. 116, promises to give (pledges) should be recognized at fair value (as revenue and receivable) when the pledge is received, even if the donor restricts the pledged contribution to use in a future period, and even if the pledge will not be paid until a future period. Frequently, donors stipulate how their gifts are to be used by placing restrictions on them. SFAS No. 116 requires recognition of contribution revenue upon the transfer of an economic benefit, usually the receipt of either the contribution (cash or other economic benefit) or a pledge (a promise to make a contribution in the future). Therefore, under SFAS No. 116, contributions with donor-imposed restrictions are reported as restricted revenue, which increase either permanently restricted or temporarily restricted net assets. As restrictions are fulfilled or the stipulated time period for the restriction has expired, the amount should be reclassified to unrestricted net assets.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 23

XXXX45X - Fees and Special Events

These accounts record fees collected for membership fees and funds raised through special events. Sub-accounts should be established for each type of fee collected.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 24

XXXX46XX - Investment Income

These accounts record income from investments. The balance of these accounts should include investment income received during the year as well as accrued investment income earned but not received by year-end.

XXXX48XX - Net Assets Released from Restrictions

These accounts record the net assets released from temporary restrictions. The underlying concept for this series of accounts is based on the presentation in the financial statements of all expenses as being deductions from unrestricted net assets. Therefore, if a not-for-profit organization incurs expenses which qualify to release temporarily restricted assets, those expenses are initially recorded in an unrestricted fund or with the use of unrestricted assets. Then, to reflect the decrease in temporarily restricted assets, an account, "net assets released from restrictions," would be debited. This account will appear on the statement of activities as a reduction in net assets temporarily restricted. Conversely, to off-set the effect of the expense being initially recorded as a reduction in unrestricted net assets, an entry is made in a similar account with the same title, "net assets released from restrictions," only this account is reflected in the statement of activity as an increase in unrestricted net assets. The net effect of this series of transactions is to decrease temporarily restricted net assets. There is no effect on unrestricted net assets, but this allows all expenses to be reflected as being made from unrestricted assets.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 19

Expenses and Losses

XXXX51XX - Personnel

These accounts record personnel costs, payroll taxes, employee benefits, professional services (consultants, etc.) and stipends paid to board members. The objective of this group of accounts is to provide information on total personnel costs.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 19

XXXX52XX - Contracted Services

These accounts are used to record transactions to obtain outside services typically provided by employees of the organization.

XXXX53XX - Supplies and Materials

These accounts record the cost of supplies and materials used In the daily operations of the not-for-profit organization.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 19

XXXX54XX - Current Obligations

These accounts record the on-going cost of operations other than personnel, supplies and materials, and fixed charges.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 19

XXXX55XX - Fixed Charges and Other Expenses

These accounts record expenses which are of a reoccurring nature related to the operations of a not-for-profit organization.

XXXX56XX - Capital Outlay

These accounts are used to record cash purchases of fixed assets. When an asset is initially purchased it should be recorded in this account. This will facilitate preparing cash basis grant reports. After all grant reports have been completed, these accounts should be closed to the appropriate asset account.

Chapter: Sample Chart Of Accounts Effective Date: April 21, 2008

Section: Sample Chart of Accounts Page: VII. 19

XXXX57XX - Contracts, Grants and Stipends

These accounts are used to record contracts, grants or stipends with outside organizations or individuals.

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