Your chart of accounts is the backbone to your organization’s finances. Since every organization is different, your chart of accounts should be different as well. This guide will provide more information about a nonprofit chart of accounts, it will cover the process of setting up your chart of accounts in Aplos, and will include a couple helpful webinars to walk you through that process in more detail.
In accounting, there are five different types of accounts:
Assets: Accounts that you create to represent anything that your organization owns, like your checking account, savings account, petty cash, accounts receivable, or fixed assets. Typically numbered from 1000-1999
Liabilities: Accounts that you create to represent anything that your organization owes, like a loan, credit card, or accounts payable. Typically numbered from 2000-2999
Equity (Funds): Any area of your organization that needs to have its own income, expense and/or ongoing balance. These are the accounts for money that you have set aside for specific reasons, like a grant, or a building project. Typically numbered from 3000-3999
Income: Any way that you receive money, like contributions or grant income. Typically numbered from 4000-4999
Expenses: Any way that you spend money, like Office Supplies, or Utilities. Typically numbered from 5000 and up
Your chart of accounts provides a few different levels of organization. Each type of account is broken out into its own category, and you can create an account group, account, and sub-account as needed. This organization will affect the way that you view your reports as you will have options to sub-total by account groups, and either show or hide your sub-accounts.
When creating an account, you will click the + sign on the Account Group where that account should be listed. You will assign an account number and name, and can assign a default fund, or make that account a sub-account. Additionally, if you are creating an asset or liability account, you can make it as a register to record transactions to that account, and choose the Activity type, which will affect your Statement of Cash Flows report.
Once your chart of accounts is set up, you can enter the starting balances for your asset and liability accounts from your Starting Balances page.
If you’re looking for more details on what a nonprofit chart of accounts is, this tutorial may help provide some more information: