Fund Balance – Definitions and Guidelines

  • Fund Balance (General Accounting Definition):
    The net worth of a fund, calculated as total assets minus total liabilities.

  • Fund Balance (ASBWorks Definition):
    Calculated as revenue minus expenses.

Important Notes:

  • When using only trust accounts, the fund balance should be $0, unless a revenue or expense account has also been used.

  • If there is a balance in the fund balance account, it typically means:

    • A revenue or expense account has been used, or

    • A journal entry has been recorded that posted directly to the fund balance account.