FUNDS
Version 2025.01​
Funds Overview
Funds help you track the cash balances of money set aside for specific purposes, adjusting the fund's balance with each transaction in your Journal.
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The simplest non-profits may have just one fund, often called a "General Fund," but many non-profits use multiple funds for different purposes. Even if you have only one fund, you'll still need to add it to the Funds sheet.
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Enter all your funds in the Funds worksheet, carrying over the ending balances from the prior year as your beginning balances for the new year.
The names of funds used to track donations will appear on donor statements, so choose fund names that clearly show where donations were directed.
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Don’t confuse funds with accounts or budgets. You’ll set up your chart of accounts and annual budgets in the Accounts/Budget sheet. Additionally, while the total balance of your funds should match your reconciled bank account balance at the beginning of your fiscal year, funds and bank accounts are separate concepts.
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The key to understanding funds: They track the cash balance designated for specific purposes, regardless of how the money is distributed across bank accounts (or even lumped into one bank account).
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The Total Beginning Balance will automatically sum all the beginning balances you enter in this sheet. This total is used as the starting balance for your Journal for the year. Do not manually edit this cell (or any other light yellow cells) as it is calculated by a formula.
Restricted Funds
Each fund must be designated as either "Unrestricted" or "Restricted" in the Type column. A general fund is typically unrestricted, meaning it can be used for any purpose within your organization. Donations that are not specifically restricted by the donor should go into your unrestricted fund(s).
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Restricted funds are restricted to a specific purpose by the donors, such as donations designated for building a new playground.
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When you receive funds with a restriction, you’ll set up a restricted fund to track and ensure the funds are used as intended.
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You can easily create new funds throughout the year as needed, but new funds should begin with a $0 balance on your Funds sheet. From there, you’ll increase or decrease the balance of the fund using transactions in your Journal.
If the specific purpose of a restricted fund has been fulfilled and there’s a remaining balance, non-profits are required to either refund the excess to the donors or ask for their approval to use the funds for another purpose (e.g., moving them to an unrestricted general fund). You may need to create a special "Fund Transfer" contact in your Contacts sheet to facilitate transferring values between funds in your Journal.​
👉 Learn more about restricted funds at 501c3.org