Month-End Close and Restricted Funds Checklist

Record and tag the month

• Tag every transaction with a fund: restricted, designated or unrestricted.
• Record grant awards as commitments and each payment when it lands in the bank.
• Record event costs against the event as they are paid.
• Enter every bank fee shown on the statement.

Restricted money is limited by a donor or funder. Designated money is set aside by your board, which can change that decision.

Reconcile the bank to the books

• Start from the bank statement's ending balance.
• Add deposits in transit.
• Subtract outstanding checks.
• Compare the adjusted figure with the book balance and confirm they match exactly.
• Explain any difference before the board meeting, not after.
• Check for duplicate deposits, unentered fees, transposed check digits and split payments, in that order.

Tie the funds out

• Add up every fund's balance.
• Confirm the fund total equals the reconciled book balance exactly.
• Check every restricted and designated fund for a balance below zero.
• Report any negative restricted fund to the finance committee with a plan to restore it.
• Record any board-approved transfer as a transfer, dated with the decision.

A negative restricted fund means its money has been spent on something else.

Restrictions, releases and event results

• Record a release when restricted money is spent on its purpose.
• Split expenses across program services, management and general, and fundraising.
• Write down the allocation method for shared costs and use it consistently.
• Report each event as raised, direct costs, net, and net against goal.

Direct costs are ones paid only because the event happened. Staff time and general overheads are a separate conversation.

Report to the board

• Build the report from the same register, without retyping figures.
• Include the reconciled bank balance and every fund balance.
• Include income and spending for the month.
• Flag any restricted fund below zero and any grant report coming due.
• Get treasurer and president signatures on the report.
• At year end, reconcile fundraising totals with your finance records.
• Keep a handover file: clean books, the last reconciliation and open items in writing.