Everything you need to know about the association chart of accounts

Like commercial enterprises, some associations have accounting responsibilities. They are required to maintain rigorous accounting records, and to present their annual accounts at the end of each financial year (i.e. balance sheet, income statement and notes).

Have you ever heard of the chart of accounts specially designed for associations? This is a simplified version of the general chart of accounts (PCG) that takes into account the particularities of the associative sector.

What exactly is the association chart of accounts? How can you manage your accounts using it? You'll find the answers to these questions in this practical guide.

The new chart of accounts for associations

This accounting standard, updated in January 2020 following a decree of December 26, 2018, aims to harmonize the accounting practices of associations. Although it does not generate any major changes, as the Comité de la Réglementation Comptable (CRC) has already been imposing specific regulations on associations governed by the 1901 law since 2000, this new chart of accounts responds to a growing demand for transparency from the public as well as the State concerning associative accounts.

It should be noted that the associative chart of accounts does not apply exclusively to associations, but also to not-for-profit organizations in general, such as works councils, foundations and endowment funds.

Accounting obligations mainly affect larger structures, although they can also apply to your small association if your articles of association require you to do so. The authorities may also require such compliance for organizations recognized as being in the public interest or those receiving accreditation.

If your association is not legally bound to follow the associative chart of accounts, you can still learn from it to manage your cash accounting.

CRC regulation 99-01, in force since 2000, was updated in 2020 by the French Accounting Standards Authority (ANC). The organization by chapters has given way to an organization by articles, thus adopting the model of the PCG for companies.

The changes include

  • Valuation of in-kind donations (provision of equipment, volunteer work, etc.) at the end of the income statement,
  • Balance sheet and income statement presentation based on sample summary tables,
  • Recording investment grants indiscriminately in a revenue account,
  • The treatment of loan-to-use as a voluntary contribution in kind,
  • Certain terms have been adjusted, for example "profits" has become "surpluses", and "losses" has been replaced by "deficits".

Bookkeeping with NPC

The new chart of accounts for associations (NPC) has some similarities with the PCG. It is made up of 8 categories of accounts, each encompassing several sub-accounts:

  • Class 1: Capital accounts
  • Class 2: fixed asset accounts
  • Class 3: inventory and work-in-progress accounts
  • Class 4: Third-party accounts
  • Class 5: financial accounts
  • Class 6: expense accounts
  • Class 7: Revenue accounts
  • Class 8: treatment of voluntary contributions in kind

Classes 1 to 5 relate to balance sheet accounts, while 6 and 7 relate to the income statement. So far, this is very similar to the PCG. However, class 8 stands out, as it is not present in the PCG. It includes sub-accounts such as 861 (free provision of goods), 864 (volunteer staff) and 870 (donations in kind).

The rules governing the recording, presentation and content of accounting documents are defined by standards, forming what we call the chart of accounts. The advantage of having a sector-specific chart of accounts is that standardized operations are understood by all.

Each professional chart of accounts offers various details, and even differences from the general chart of accounts. These may include :

  • Account subdivisions adapted to the specific needs of the sector.
  • New accounts that do not exist in the PCG.
  • Specific accounting methods may be prescribed to remedy gaps or shortcomings in GAAP.
  • Different rules and definitions.

The general chart of accounts serves as a framework for the development of these specific plans.

Keeping your association's accounts means respecting the rules of the association's chart of accounts, a guide to allocating each transaction to the appropriate account.