Chart of Accounts Best Practices for Nonprofits

Your chart of accounts is the foundation of your financial system. A well-structured chart makes grant tracking and reporting much easier.

Standard Nonprofit Account Structure

Assets (1000-1999)

• 1000 - Cash and Cash Equivalents
• 1100 - Accounts Receivable
• 1200 - Grants Receivable
• 1300 - Prepaid Expenses
• 1500 - Fixed Assets

Liabilities (2000-2999)

• 2000 - Accounts Payable
• 2100 - Accrued Expenses
• 2200 - Deferred Revenue
• 2300 - Refundable Advances (unspent grant funds)

Net Assets (3000-3999)

• 3000 - Without Donor Restrictions
• 3100 - With Donor Restrictions - Time
• 3200 - With Donor Restrictions - Purpose

Revenue (4000-4999)

• 4000 - Contributions
• 4100 - Grant Revenue
• 4200 - Program Revenue
• 4300 - Investment Income

Expenses (5000-7999)

• 5000 - Personnel (Salaries & Benefits)
• 6000 - Program Expenses
• 7000 - Administrative Expenses

Grant-Friendly Account Structure

Expense Categories That Match Funder Requirements

Most funders want to see expenses in these categories:

Category	Account Range	Examples
Personnel	5000-5199	Salaries, Benefits, Payroll Taxes
Fringe	5200-5299	Health Insurance, Retirement, PTO
Supplies	6000-6099	Office, Program, Computer
Equipment	6100-6199	Purchases, Rentals, Maintenance
Contractual	6200-6299	Consultants, Subcontracts
Travel	6300-6399	Mileage, Lodging, Meals
Other Direct	6400-6499	Training, Communications
Indirect	7000-7099	Overhead, F&A Costs

Setting Up Budget Category Mapping

In GrantLink, map your accounts to budget categories:

1. Go to Settings > Budget Categories
2. Create categories matching funder requirements
3. Assign QuickBooks accounts to each category
4. GrantLink automatically aggregates spending

Best Practices

1. Use Account Numbers

Enable account numbers in QuickBooks:

• Settings > Advanced > Chart of Accounts
• Turn on Enable account numbers

Benefits:

• Consistent ordering
• Easier account selection
• Better report formatting

2. Create Sub-Accounts for Detail

5000 - Personnel
├── 5010 - Salaries - Program Staff
├── 5020 - Salaries - Admin Staff
└── 5030 - Salaries - Management

6300 - Travel
├── 6310 - Local Travel/Mileage
├── 6320 - Out of Town Travel
└── 6330 - Conference Travel

3. Separate Restricted vs. Unrestricted

For grants with matching requirements or cost-share:

• Create separate revenue accounts per restriction type
• Track deferred revenue for multi-year grants

4. Keep It Manageable

• Don't create accounts you won't use
• Consolidate similar expenses
• Archive unused accounts

Common Mistakes to Avoid

1. Too many accounts - Creates confusion and reporting complexity
2. Inconsistent naming - Makes searches and reports difficult
3. Missing account numbers - Leads to random ordering
4. No sub-accounts - Forces excessive memorized entries
5. Not matching funder categories - Requires manual remapping for reports

GrantLink Integration

GrantLink works with your chart of accounts to:

• Automatically categorize expenses by budget category
• Generate funder reports in required formats
• Track spending by account across grants
• Alert you to budget overruns by category