Non Profit Chart of Accounts

Introduction to the Non Profit Chart of Accounts

The chart of accounts for a non profit organization differs from a normal business in that the balance sheet is referred to as the statement of financial position, the income statement is referred to as the statement of activities or statement of operations, and as the non profit organization is governed by trustees and does not have owners, the equity side of the accounting equation is replaced by the term net assets or funds.

A chart of accounts, sometimes abbreviated to COA, is a list of all the names of the accounts found in the general ledger with an account code (chart of accounts numbers) allocated to it.

The chart of accounts simply sets out the structure of your accounts system so that all similar accounts are grouped together. For example, statement of financial position fixed operating assets accounts might have codes from 1600, or revenue accounts might have codes from 4000.

A simple structure allows you to easily identify accounts and helps in the posting of transactions and the preparation of the trial balance and financial statements. It is usually best to use numbers for account codes as this will speed up the process of entering transactions as the numeric key pad can be used.

What Should a Non Profit Chart of Accounts look like?

The nonprofit chart of accounts should be split into statement of financial position and statement of activities sections, each of which is then subdivided into groups (e.g. cash, accounts receivable, revenue, expenses etc). Generally the most used accounts should be kept near the top of each group.

A sample non profit chart of accounts is shown in the interactive table below.

Non Profit Chart of Accounts Guide and Key

1. Account Name: The name of the account in the general ledger
2. FS: The Financial Statement in which the account appears
3. SFP: Statement of Financial Position
4. SA: Statement of Activities:
5. Group: The type of account.
6. Code: A suggested account code for the account

Notice how each account in the non profit chart of accounts is classified as statement of financial position or statement of activities and then further classified into a group such as for example other assets. The account names will depend on your type of business, but the classification and grouping should be similar to the table above.

When allocating account codes (chart of accounts numbers) don’t forget to leave space in the non profit chart of accounts for additional accounts and codes to be inserted in a group at a later stage. For example the revenue codes run from 4000 to 5999 so there is plenty of room to incorporate new categories of revenue if needed.