Nonprofit Accounting Editing and Proofreading Services

A nonprofit's financial statements show $2 million in "restricted net assets," and a board member reading this reasonably assumes the organisation has $2 million it cannot currently spend on anything. In fact, $1.4 million of that figure is released from restriction as soon as a matching grant condition already satisfied is formally documented, and the remaining $600,000 is restricted to a specific programme the organisation is actively running and would be spending regardless of the restriction. The number is accurate. The impression it creates about the organisation's actual near-term flexibility is not.

We edit what nonprofit accountants and finance teams produce to disclose fund restrictions — restricted and unrestricted net asset disclosures, donor restriction terms and release conditions, fund accounting classification notes, and the correspondence explaining to a board or donor what a specific restriction actually means for spending. Our editors work on the word "restricted" and what it actually constrains.

The disclosed restriction terms are what a fund classification actually needs behind the total, and its failure is a single aggregated figure that treats every restriction as equally constraining regardless of what the underlying donor terms actually require. Restricted net assets describes a category; it does not describe whether a specific restriction is time-limited, purpose-limited, close to release, or effectively already committed to spending the organisation was doing anyway, and a reader relying on the aggregate figure cannot tell which. We work through these so restricted funds are broken out by the actual nature of their restriction — purpose-restricted to a specific programme, time-restricted until a stated date, restricted pending a condition already substantially met — rather than combined into one total, since a board assessing near-term financial flexibility needs to know how much of the restricted total is genuinely unavailable versus effectively already allocated to ongoing programme spending; so release conditions are stated specifically, given that a restriction pending a matching grant condition already satisfied is functionally different from one requiring years of future fundraising, and "restricted" alone does not distinguish them; so any restriction near release is flagged, because a board or donor assuming a static restricted balance may not realise a significant release is imminent and will affect the next period's unrestricted figures; so donor-imposed restrictions are distinguished from board-designated funds, given that a board can release its own designation but not a donor's actual restriction, and conflating the two in a single "restricted" label misstates how much flexibility the organisation genuinely has; and so a board or donor's specific question about a specific restricted fund receives the actual terms, not a repetition of the aggregate total. Disclosures written this way mean a reader understands what "restricted" actually constrains, not just that a number carries the label.

Everything you send is treated in confidence, including financial data, donor agreements and board correspondence. We are editors rather than nonprofit accountants, auditors or fund administrators, and we offer no view on fund classification, restriction terms or financial reporting. What we can do is make sure the label describes what it actually restricts.