On Financial Suite reports, all accounts are grouped by account type. A Balance Sheet Report contains Assets, Liabilities, Fund Principals, and Restricted accounts. Income/Expense reports or ACS Analysis of Revenue reports can contain accounts such as Revenues, Expenses, and other revenue and other expenses.
Click on the account type in the list to read about it:
— A type of account for things of value owned.
- Assets include cash, cash in the bank, land, savings, stock, bonds, investments, accounts receivable, equipment, promises from others to pay, or any other physical resource with value. Asset accounts carry a debit balance.
- Land, buildings, tools, and supplies are called fixed assets and represent items typically held for more than a year that can be easily converted to cash.
- Promises from others to pay the church or organization are often called receivables. These can include tuition commitments for a school.
- Receivables, plus cash, stock, and other available assets are called current assets. They can typically be quickly converted to cash.
— A type of account for a debt or debt owed.
Designated or Restricted Accounts
- Liabilities include goods or services bought on credit or time. Liabilities are also commitments that are owed.
- Loans from the bank are long term liabilities.
- Bills from vendors for services rendered are often called payables.
- Payments owed for payroll taxes, insurance benefits, etc. are also liabilities.
- Income taxes withheld from employees’ paychecks are liabilities. Liability accounts carry a credit balance.
— A type of account that represents special kinds of liabilities.
- Money has been entrusted to the church for a specific purchase, such as a new building or a Youth Ministry.
- Your organization must spend this money as specified or return it to the donor, unless some other arrangement is made.
- GAAP require that you show Designated and Restricted accounts separately.
- Restricted accounts carry a credit balance. Receipts post to restricted accounts as credits. Disbursements from a restricted account post as debits.
- Restricted accounts are not revenue. They are liabilities in restricted accounts.
- Temporary Restricted accounts could be used for a gift designated for a youth trip or memorial, while Permanent Restricted accounts could be used for endowments, from which only the interest on the principal can be used, not the principal itself.
— The fund principal is the excess of assets over liabilities. It's also called the fund balance or fund equity, and it represents an organizatinorganization
's resources. The Fund Principal equals liabilities plus restricted funds. Revenues
— Revenues reflect amounts received by an organization in the form of contributions, donations, receivables, or something of value and other revenues the organization uses in its daily operations.
- Revenues carry a credit balance.
- Examples of revenue forms for a non-profit organization include offerings, tithes, and book sales.
- Revenue Accounts are also called Income Accounts.
— Expenses eflect reflect
the cost of operating, such as utilities, salaries, or postage.
Quick Reference Chart
- Expenses carry a debit balance.
- Examples of Expenses include utilities, wages, and maintenance expenses.
- Expenses are the monetary measurement of resources the organization uses during a period of time for which cash or other compensation was given.