Fund accounting

Fund accounting is the practice of tracking the receipt and use of resources, according to their intended use. Carrying balances on restricted and unrestricted funds across reporting periods is of particular importance for accountability and transparency.

This 2 minute video introduces the questions and issues relating to financial statement presentation and fund accounting.

What is the issue?

How can the presentation of financial statements help understanding of funds that have stipulations attached? How should different types of reserves be disclosed? Can donor reporting requirements be supported?





Watch this 18-minute explainer video for an overview of the proposals in INPAG Exposure Draft 1. Click “watch on YouTube” to view the playlist for French and Spanish.

Explaining the proposals

This video explains the proposals relating to the financial statement presentation in International Non-Profit Accounting Guidance, Exposure Draft 1, as set out in Sections 3-8 and 10.

The journey so far

Until Exposure Draft 3, the issue of fund accounting was addressed under the heading ‘financial statement presentation’. Initial ideas were set out in the Consultation Paper issued in January 2021, together with explanatory videos.  Part 2 Issue 7 of the Consultation Paper set out specific alternative approaches which were presented in a webinar in Aug 2021, before the consultation response period closed in Oct 21. In November 2022, Exposure Draft 1 included proposals for financial statements presentation. In September 2023, Exposure Draft 2 included proposals for recognition of grant revenue, making it clear that restrictions or use constraints were not sufficient to warrant income deferral. In May 2024, Exposure Draft 3 included a new section specifically on fund accounting.

You can access all the resources from this page with the most recent first. Some are available in Spanish (ES) and French (FR) as well as English.

Financial reporting challenges

Presentation of financial statements alternatives

  • Jan 21: 20 minute explainer video
  • Jan 21: IFR4NPO Consultation Paper Part 2: Issue paper 7 available – EN | ES