Glossary / Net Assets
What is Net Assets?
The nonprofit equivalent of equity.
Simple definition
The nonprofit equivalent of equity. Calculated as total assets minus total liabilities. Under FASB ASU 2016-14, classified as either 'with donor restrictions' or 'without donor restrictions.'
Why it matters for your nonprofit
Net assets show what your nonprofit owns after obligations—split between amounts donors restricted and amounts the board can allocate freely.
How it shows up in daily work
Your statement of financial position lists assets, liabilities, and net assets with with/without donor restrictions so the board can see liquidity and flexibility.
Common mistakes
- Showing one pooled net asset number with no restriction breakdown.
- Counting pledged but uncollected gifts as unrestricted cash.
- Forgetting to release restrictions when a donor purpose is met.
How Alignmint helps
Alignmint ties fund accounting, donor records, and reporting in one place so terms like Net Assets show up correctly in your books—not only in a policy memo.
FAQ
Questions about your books?
Schedule a free walkthrough. We will help you see fund balances, donor history, and reporting in one system.