One of the most common questions when reviewing fund statements is why certain activity appears on the statement while other activity does not. Understanding how Fund Statements, Balance Sheets, and Income Statements relate to one another is key to answering those questions and determining which report should be used for troubleshooting. This connection is often the source of confusion when numbers do not appear to match across reports. By cross-checking these reports against one another, you can confirm where numbers should match and identify the source of a discrepancy when they do not.
Who: Fund accounting staff, foundation controllers, and CFOs validating financials.
Scenarios for Tying Fund Statement, Balance Sheet, and Income Statement Numbers Together
- A Fund Statement is being run repeatedly to troubleshoot an issue that never appears there, because the underlying transaction is Balance Sheet activity, not Income Statement activity.
- Audit prep requires understanding roll-forwards and tie-outs before auditors arrive.
- A new staff member on the finance team needs a walkthrough of how these reports work together.
CommunitySuite Report Names vs. Nonprofit Accounting Terms
Throughout this article, the terms Balance Sheet and Income Statement are used because those are the labels displayed in the left-side menu for CommunitySuite's Financial reports. When the reports are run, however, the labels display using the standard nonprofit accounting names Statement of Financial Position and Statement of Activities. These are the same reports presented under different names, a distinction that can be helpful to understand when comparing CommunitySuite terminology with nonprofit accounting terminology.
How the Three Reports Differ
The Balance Sheet, Income Statement, and Fund Statement each serve a distinct purpose, even though they draw from the same underlying data.
Balance Sheet - Statement of Financial Position
The Balance Sheet, or Statement of Financial Position, shows assets minus liabilities at a single point in time. The balances reflect all activity recorded up to that point, not just activity from a single reporting period.
The Balance Sheet answers questions about:
- Cash accounts
- Investments
- Grants payable
- Accounts receivable
- Liabilities
- Net assets
Use the Balance Sheet, not the Fund Statement, when validating a transaction that moves money between asset and liability accounts, such as a transfer between investment accounts or between payable accounts. For example, the actual recording of a check paying a voucher will only show on the balance sheet. These transactions do not affect income or expenses, so they will not appear clearly on the Fund Statement.
Income Statement - Statement of Activities
The Income Statement, or Statement of Activities, shows money in and money out for a chosen date range. It includes revenue, expenses, and the resulting change in net assets, or net income, helping explain the activity that caused balances to change during the period.
The income statement answers questions about:
- Revenue
- Expenses
- Current or prior monthly, quarterly, or yearly activity
The Change in Net Assets (or net income) shown on the Income Statement should explain the corresponding change in net assets seen on the Balance Sheet for that same period. Use the Income Statement when a balance changed from one month to the next and the reason for that change needs confirming.
Fund Statement
The Fund Statement shows the same beginning and ending fund balance reflected on the Balance Sheet when using a comparative view like Month over Month or Year over Year, together with the same period's revenue and expense activity reflected on the Income Statement. It presents these figures into one view for the benefit of communicating with fund advisors, without the underlying account-level detail found on the Balance Sheet.
Use the Fund Statement to present a fund's activity the way a fund advisor would expect to read it. For validating a specific transaction or an unexpected balance, the Balance Sheet or Income Statement is the most accurate path.
Note that in the fund statement example below, account-level detail like what is seen on a balance sheet is not present by default. Fund statements can be customized to include more information. This demonstrates why fund statements are not the right troubleshooting tool for figuring out questions about balance or account activity.
Audit Report: a Fund Statement Preview
The Audit Report, or Fund Balance Change Report, provides a preview of the information that will appear on a fund statement by showing a fund's beginning balance, period activity, and ending balance. Unlike bulk fund statement generation, which requires the books to be closed, the Audit Report can be run at any time to validate balances and activity before fund statements are produced.
Roll-Forward View and Validation
The Audit Report is often referred to as a roll-forward report because it shows where a balance started, what activity occurred, and where it ended. Users can use it to validate that the ending balance from one period matches the beginning balance of the next period. The Audit Report provides a clear way to verify that no unexpected changes, adjustments, or transactions were recorded between reporting periods.
Auditors often use the roll-forward to verify that the prior year's ending balance correctly became the current year's beginning balance and that all changes during the period are properly accounted for.
Show Account Detail
The Show Account Detail left-side menu option within an Audit Report will change the activity columns from account type to general ledger (GL) account number and name, showing which GL account the expense ran through. It will also add net asset columns that should offset. In the example below, Show Account Detail has been applied to the Audit Report.
Beginning Balance: Audit Report to Fund Statement Connection
For example, a monthly fund statement for a fund compared with the Audit Report will show where the same information appears in both places. The Audit Report begins with the same starting balance that appears as the Beginning Fund Balance on the fund statement. Because both reports pull from the same underlying fund balance, these amounts should match and provide a starting point for validating the fund's activity for the period.
| Audit Report Begin Balance | Fund Statement Begin Balance |
Activity Showing Change in Balance: Audit Report to Fund Statement Connection
| Audit Report Expense Activity | Fund Statement Expense Activity |
Ending Balance: Audit Report to Fund Statement Connection
| Audit Report End Balance | Fund Statement End Balance |
Get Ahead of Audit
The other benefit to using the Audit Report is preparing for an annual audit. Running the report for the fiscal year can help you identify issues before an auditor does. The quick way to detect if there is a problem is if you run the report and it shows a net assets column. This indicates a manual journal entry was booked directly to net assets instead of running through the Income Statement, where it would have been closed out at year end. Catching this in the Audit Report identifies the issue before an auditor does.
Balance Sheet to Fund Statement Balances
Although the Balance Sheet and Fund Statement present information differently, they should agree on a fund's beginning and ending balances for the same reporting period. The Fund Statement uses fund balance information reflected on the Balance Sheet and presents it alongside the fund's revenue and expense activity in a format designed for fund reporting. Understanding how these balances connect makes it easier to validate fund activity, reconcile reports, and identify where to investigate when balances do not match as expected.
Use the Month Over Month View
To see a fund’s balance as of the start of a period, use the Balance Sheet’s Month over Month or Previous Fiscal Year End column options. More information for this option is found in the Additional Information section of Balance Sheet Report.
Beginning Balance: Balance Sheet to Fund Statement Connection
In this example, a balance sheet for the Byrnes Family Fund with the Month over Month option applied will show the ending balance for the prior period, Total Net Assets for 05/31/2026 is $13,986,840.18. This matches the Beginning Fund Balance, $13,986,840.18, on the fund statement for the period ending on June 30th.
| Balance Sheet | Fund Statement |
Ending Balance: Balance Sheet to Fund Statement Connection
The balance sheet's Total Net Assets of $13,955,490.18 in the current month end column, 6/30/2026, matches the Ending Fund Balance, $13,955,490.18, in the fund statement, as shown in the example.
| Balance Sheet | Fund Statement |
Activity Showing Change in Balance: Balance Sheet to Fund Statement Connection
The change in that fund balance from beginning to end is also reflected on the balance sheet in the Change column and in the fund statement in the totaling of the Withdrawals grant expense line items or the total grants from the Grants Made for the Period table.
| Balance Sheet | Fund Statement |
Income Statement to Balance Sheet and Fund Statement Balances
Confirm a period's change in net assets against the Income Statement for the same date range. This change should tie to the movement shown on the Balance Sheet and Fund Statement.
In the example below for the Byrnes Family Fund, the Income Statement's Change in Net Assets, $31,350.00, matches the Change column for Total Net Assets on the Balance Sheet, $31,350.00, and the Withdrawals or total grants, $31,350.00, on the fund statement.
| Balance Sheet | Fund Statement | Income Statement |
Which Report to Check When Troubleshooting
A Fund Statement, Balance Sheet, and Income Statement each hold different activity, so the report to check depends on what kind of transaction is in question.
Balance Sheet
- Balance-sheet-only activity, such as moving money between investment accounts, moving balances between payable accounts, or other journal entries affecting assets and liabilities.
Income Statement
- Questions about revenue or expense activity for a period belong on the Income Statement.
Fund Statement
- Fund Statement details, such as contributions, grants, or journal entries shown, are fully configurable for your organization. What your fund statements display is a design choice, not a system default, so it is not recommended to use a fund statement for troubleshooting.
- Balance-sheet-only activity, such as moving money between investment accounts, moving balances between payable accounts, or other journal entries affecting assets and liabilities, will not appear on the Fund Statement. Less common, but those details could be deliberately included in the Fund Statement's custom details. These transactions do not affect income or expenses, so check the Balance Sheet for this activity instead.