Nonprofits
Fund accounting, grant tracking, and 990 prep for organizations that answer to donors, grantors, and boards.
The Industry
Nonprofit accounting is not the same as for-profit accounting with different tax forms. Fund accounting changes how you track every dollar. When a donor gives $10,000 for a specific youth program, that money cannot pay the electric bill. When a foundation awards a grant with spending restrictions, those restrictions have to be honored and documented. Mixing restricted funds with general operations is a compliance violation that can mean returning money, losing future funding, or damaging relationships you spent years building.
The Form 990 is public. Donors, grantors, and watchdog organizations read it. They look at executive compensation, program spending ratios, and whether the numbers tell a coherent story. Functional expense allocation matters because funders want to know how much goes to programs versus overhead. Boards need reports that help them govern, not just accounting printouts they cannot interpret. All of this requires bookkeeping designed for nonprofits from the start, not generic small business accounting adapted after the fact.
Who This Covers
Who This Covers
Charities, churches, foundations, associations, and community organizations in MetroWest and Greater Boston. Organizations receiving donations, managing grants, or operating with a board that needs financial oversight. Any 501(c)(3) or similar tax-exempt entity that files a 990 and tracks restricted funds.
What Makes It Complex
What Makes It Complex
Fund accounting with restricted and unrestricted tracking. Donor-imposed restrictions that must be honored and documented. Grant requirements with specific expense categories and reporting timelines. Functional expense allocation across program, administrative, and fundraising. Board reporting that goes beyond a basic P&L. Form 990 preparation that requires books structured for nonprofit disclosure requirements.
What We Handle
Fund accounting starts with a chart of accounts built for how nonprofits actually operate. Restricted gifts get tracked separately from day one. Each grant gets its own tracking so expenses code properly and reports pull cleanly. When a donor restricts a gift to building maintenance or a specific program, the books reflect that restriction through the entire lifecycle of the funds. You know at any moment how much restricted money you have, what it is restricted for, and how much unrestricted cash is available for operations.
Compliance reporting becomes manageable when the books are set up correctly. Your 990 preparation draws from clean records with functional expenses already allocated. Grant reports pull from properly coded transactions instead of requiring someone to reconstruct the year from bank statements. Board packages include fund balances, program spending, and cash position in formats that help board members understand the financial picture without an accounting degree. We also coordinate with your CPA or auditor so year-end work goes smoothly.
Fund Accounting and Grant Tracking
Fund Accounting and Grant Tracking
Chart of accounts structured for fund accounting. Restricted and unrestricted funds tracked separately. Grant expenses coded by funder and category for clean reporting. Donor restriction documentation so nothing gets spent incorrectly. Monthly reconciliation showing fund balances and available cash by purpose. QuickBooks configured for nonprofit requirements.
Compliance and Board Reporting
Compliance and Board Reporting
Functional expense allocation across program, management, and fundraising. 990 preparation support with properly categorized revenue and expenses. Board-ready monthly or quarterly reports showing fund positions, program spending, and cash flow. Grant report preparation pulling from clean transaction records. Audit preparation and coordination with external CPAs.
What Goes Wrong
The most common problem is restricted funds getting mixed with general operations. A church receives a designated gift for the building fund but uses it to cover payroll during a tight month. A charity gets a grant for program supplies but codes some of those expenses to general administration. When this happens, you either have to move money around retroactively and hope the documentation holds up, or you explain to a donor or grantor why their restricted gift was spent elsewhere. Neither conversation is pleasant. Grant compliance failures can mean returning funds or being disqualified from future awards.
The 990 becomes a crisis when the books were not kept with those requirements in mind. Functional expense allocation gets invented at year-end instead of tracked throughout the year. Executive compensation questions require digging through payroll records. Program service accomplishments need narrative that connects to the numbers, but nobody can explain how the numbers were calculated. Board members receive financial reports that do not match what the accountant eventually files. These problems compound when there is turnover in staff or volunteer treasurers who each had their own system.
Fund Violations and Grant Problems
Fund Violations and Grant Problems
Restricted money spent on unrestricted purposes because tracking was inadequate. Grant expenses coded incorrectly making reports inaccurate or impossible to generate. Documentation gaps when grantors request backup for expenses. Having to return grant funds because compliance requirements were not met. Donor trust damaged when restricted gifts cannot be accounted for properly.
Reporting and Compliance Gaps
Reporting and Compliance Gaps
990 preparation scramble because books do not align with form requirements. Functional expense ratios that look suspicious because allocation was done hastily at year-end. Board receiving reports they cannot interpret or that conflict with filed returns. Audit findings that require restating prior periods. Staff turnover creating gaps where no one knows how transactions were coded or why.
What Changes
Every dollar tracks to the correct fund from the moment it arrives. Restricted gifts stay restricted. Grant expenses code properly so reports pull without reconstruction. When a board member asks about the building fund balance or how much of the youth program grant remains, you have the answer in minutes, not days. Fund accounting stops being a source of anxiety and becomes a reliable system that protects both the organization and its relationships with funders.
Your 990 preparation becomes a straightforward process because the books were kept with those requirements in mind all year. Functional expense allocation is consistent and defensible. Board packages arrive on schedule with information that actually helps governance. Auditors receive organized documentation instead of boxes of receipts. You spend less time explaining accounting problems and more time focusing on the mission that brought everyone to the organization in the first place.
Clean Fund Tracking
Clean Fund Tracking
Restricted and unrestricted funds tracked accurately from receipt through spending. Grant compliance documented and reportable at any time. Donor restrictions honored with clear audit trails. Monthly fund balance reports showing exactly what is available for operations versus designated purposes. No year-end scrambles to figure out where the money went.
Confident Governance and Filing
Confident Governance and Filing
Board receives reports that answer their questions and support good decisions. 990 prepared from clean books with defensible functional expense allocations. Audit preparation organized and complete. Staff transitions handled smoothly because systems and documentation are consistent. Leadership focuses on mission and programs instead of accounting cleanup.
Greater Boston's Trusted Bookkeeping Partner
The Next Step:
A Short Conversation
We'll ask a few questions, figure out what you need, and give you a straightforward quote.