Tuesday, February 10, 2009

Restricted vs. Unrestricted Funds

What is the different between Restricted and Unrestricted Funds?

Restricted Resources are unique to non-profit, or public entity accounting. The limitations on use of funds are external only; they cannot be restricted internally.  Examples of sources of these funds, and their restrictions, include donors, contracts and government agencies.

Unrestricted Resources have no external conditions placed on their use by the organization. Some examples include state appropriations or unconditional gifts. Designated Resources are not restricted by the fund source, but may have conditions placed by someone else giving money to the organization.

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