A chart of accounts is the list of headings your accounts are kept under. For an NGO, the way you build it decides how easy donor reporting will be. This guide gives a sample structure for a Pakistani project-based NGO, with the reasoning, so you can adapt it instead of starting from a blank page.
The principle: account says what, tags say who and where
The most common mistake is putting everything into the account name: "Salaries, Project A, Karachi, Donor X". With five projects and four locations you will soon have hundreds of accounts, and every new project means new accounts.
Keep the chart short and generic. Let the account say what the money was spent on (salaries, travel, training). Let tags say who funded it and where it was spent: donor, project, activity and location. Then a new project needs no new accounts, only new tags.
A sample structure
These account numbers are examples. Use any numbering that suits you, and keep it consistent.
1. Assets (1000 to 1999)
| Code | Account |
|---|---|
| 1100 | Cash in hand |
| 1200 | Bank accounts (one per bank account) |
| 1300 | Advances to staff |
| 1310 | Advances to vendors and partners |
| 1400 | Receivable from donors |
| 1500 | Fixed assets: equipment, vehicles, furniture |
| 1590 | Accumulated depreciation |
2. Liabilities (2000 to 2999)
| Code | Account |
|---|---|
| 2100 | Accounts payable |
| 2200 | Withholding tax payable |
| 2210 | Salary tax payable |
| 2300 | Salaries payable |
| 2400 | Grants received in advance |
3. Funds and reserves (3000 to 3999)
| Code | Account |
|---|---|
| 3100 | Unrestricted reserves |
| 3200 | Restricted funds (if you keep fund balances) |
4. Income (4000 to 4999)
| Code | Account |
|---|---|
| 4100 | Grant income |
| 4200 | Donations |
| 4300 | Other income |
5. Direct programme costs (5000 to 5999)
| Code | Account |
|---|---|
| 5100 | Salaries and benefits |
| 5200 | Consultants and trainers |
| 5300 | Travel and transport |
| 5400 | Workshops and training |
| 5500 | Materials and supplies |
| 5600 | Civil works and construction |
| 5700 | Equipment purchased (if expensed) |
| 5800 | Communications and printing |
6. Administration costs (6000 to 6999)
| Code | Account |
|---|---|
| 6100 | Office rent |
| 6200 | Utilities |
| 6300 | Audit and professional fees |
| 6400 | Bank charges |
| 6500 | Depreciation |
Why the cost accounts match the budget
Your donor's budget has categories: personnel, travel, equipment, and so on. Make your cost accounts follow those categories as closely as you can. Then the budget key (activity, location, account) works naturally, because every budget line points to an account you already have.
Tags that go with the chart
| Tag | Example |
|---|---|
| Donor | Donor A, Donor B |
| Project | Clean Water Project |
| Activity | Hand pump installation |
| Location | District North, Head office |
Checklist before you finalise
- Do the cost accounts match the categories in your biggest donor agreement?
- Is there a separate account for withholding tax payable?
- Are bank accounts separate, one per account, so reconciliation is easy?
- Is there a place for advances to staff and vendors?
- Can you tell donor-funded assets from your own?
- Is the list short enough that staff can choose the right account without help?
Common mistakes
- Project names inside account names. Use tags.
- Too many accounts. If staff cannot choose, they will choose wrongly.
- One expense account for everything. You lose the donor's categories.
- Changing the structure mid-year. Plan it before the first entry.
Moving to software
A good chart of accounts is the foundation, whatever system you use. OneAccounts gives every company a chart of accounts you can adapt, and every NGO bill line carries project, activity and location tags on top of the account. Our team helps new customers bring over their chart of accounts and opening balances.
Frequently asked questions
How many accounts should an NGO have?
As few as it can while matching its donor categories. Many NGOs work well with 50 to 100.
Should I open a new account for each project?
No. Use tags for the project, donor, activity and location.
Where do I record grants received in advance?
In a liability account until the money is earned, if your accounting policy treats it that way. Confirm the treatment with your auditor.
Can I change the chart of accounts later?
You can add accounts. Renaming or merging accounts after entries exist needs care, so plan the structure before you start.
Is this chart a legal requirement?
No. It is a sample. Your auditor and donors may have their own expectations, so check them first.