Unlike for-profit businesses, nonprofits and fiscal sponsors have unique financial tracking needs, requiring transparency, accountability, and compliance with regulatory requirements. One of the most effective tools for achieving this is a well-structured Nonprofit Chart of Accounts (COA)—especially when paired with a platform like Crowded, which streamlines financial oversight, expense tracking, and reporting.
What is a Nonprofit Chart of Accounts?
A nonprofit Chart of Accounts (COA) is an organized list of all financial accounts used in an organization’s accounting system. It categorizes transactions to help nonprofits and fiscal sponsors track income, expenses, assets, and liabilities, ensuring financial clarity and compliance.
Each account within the COA is assigned a unique code or number, making it easy to classify and locate transactions. A properly structured COA supports budgeting, grant tracking, financial reporting, and audits. Crowded simplifies the process by centralizing financial data, making it easier for fiscal sponsors to fill out and maintain their COA.
Why is a Nonprofit Chart of Accounts Important for Fiscal Sponsors?
A COA is essential for fiscal sponsors, ensuring that financial data is properly organized while leveraging Crowded’s oversight and financial tools. Key benefits include:
- Financial Transparency – Maintains clear records, ensuring accountability to donors, project leaders, and regulatory bodies.
- Efficient Budgeting & Fund Allocation – Allows proper tracking of restricted and unrestricted funds, ensuring compliance with grant requirements. Works in tandem with Crowded’s budgeted Visa debit cards to ensure your sponsored projects are staying in line with allocated funds.
- Audit Preparation & Reporting – With Crowded’s centralized financial data, fiscal sponsors can efficiently complete and maintain their COA for compliance and reporting needs.
How Crowded Supports the Chart of Accounts Process
Fiscal sponsors using Crowded benefit from a system that simplifies COA implementation. Key advantages include:
- Subaccounts– Allocate money to multiple projects globally in seconds, setting custom permission tiers for proper oversight
- Transaction Categorization – Crowded provides tools to track and classify financial activities, making COA maintenance seamless.
- Real-Time Budget Oversight – Sponsors can manage project budgets and expenses in Crowded while using a COA for structured reporting.
- Integrated Compliance & Reporting – Crowded’s dashboards provide real-time visibility into financial activity, simplifying COA documentation.
Key Components of a Nonprofit Chart of Accounts
For fiscal sponsors, a COA should maintain standard nonprofit accounting principles. Common categories include:
Assets (1000–1999)
- Cash and Crowded sub-accounts
- Investments
- Accounts receivable
- Prepaid expenses
- Fixed assets (property, equipment, etc.)
Liabilities (2000–2999)
- Accounts payable
- Loans payable
- Accrued expenses
- Deferred revenue
Net Assets (3000–3999)
- Unrestricted net assets
- Temporarily restricted net assets
- Permanently restricted net assets
Revenue (4000–4999)
- Donations and contributions (tracked via Crowded fundraising tools)
- Grants
- Program service revenue
- Membership fees
- Fundraising event income
Expenses (5000–9999)
- Program Expenses – Direct costs related to sponsored projects (tracked via Crowded’s expense tools)
- Administrative Expenses – Office costs, salaries, and management fees
- Fundraising Expenses – Marketing, donor outreach, and event costs
Best Practices for Using a COA
1. Use the Provided COA Template
Fiscal sponsors can leverage a pre-built COA template to structure financial tracking while using Crowded’s oversight tools to gather the necessary data.
2. Categorize Transactions Effectively
Use Crowded’s expense tracking and fundraising reports to simplify transaction categorization, ensuring easy COA maintenance.
3. Separate Restricted & Unrestricted Funds
Leverage Crowded’s fund tracking features to distinguish between grant-restricted funds and general donations before recording them in the COA.
4. Regularly Review & Update Your COA
Use Crowded’s centralized financial dashboard to monitor real-time spending and fundraising activity, making necessary COA updates as needed.
5. Leverage Crowded’s Integrations
Crowded integrates with QuickBooks, Plaid, Venmo, PayPal, and Square, allowing fiscal sponsors to transfer financial data into an accounting system where the COA is maintained.
Get a Free + Customizable Nonprofit Chart of Accounts Template!
Conclusion
A well-structured Chart of Accounts is a vital tool for any fiscal sponsor looking to maintain financial transparency, ensure compliance, and streamline reporting. Crowded significantly reduces the effort required to maintain a COA by centralizing financial oversight, tracking transactions, and ensuring compliance.
By using Crowded alongside a COA template, fiscal sponsors can use subaccounts to efficiently manage multiple projects, ensuring proper financial tracking without unnecessary administrative burdens. With Crowded, maintaining a COA becomes easier than ever.
Your questions, answered.
How does Crowded simplify financial reporting for fiscal sponsors?
Crowded centralizes all financial transactions, including expenses, payments, and fundraising data, making it easy for fiscal sponsors to generate reports and track financial activity. By providing real-time visibility and seamless integrations with accounting software, Crowded ensures that financial reporting remains accurate, transparent, and efficient.
How does Crowded help with financial oversight?
Crowded provides real-time dashboards, expense tracking, and fundraising reports, ensuring that all financial activities are transparent and easy to categorize for a COA.
Can I track restricted and unrestricted funds using Crowded?
Yes, Crowded allows fiscal sponsors to separate and manage restricted and unrestricted funds, ensuring compliance with grant and donor requirements.
Does Crowded integrate with accounting software?
Yes! Crowded integrates with QuickBooks, Plaid, Venmo, PayPal, and Square, making it easier to sync financial data with your nonprofit’s accounting system.
How does Crowded simplify budgeting for fiscal sponsors?
Crowded offers budgeted Visa debit cards, project-based financial tracking, and centralized reporting, making it simple to delegate and monitor project finances in real time.
