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Introduction to accounting

Scout Manager uses a simplified version of double-entry accounting to track all financial transactions using cash basis accounting methods. This means the date of the transaction is the date used for reports. Double-entry means we’ll always ask you for at least two accounts in a transaction, but you can also set a transaction to uncategorized.

When recording a transaction, you’ll normally know where the money came from (e.g. a donation for $250) and where its going (e.g. to your checking account). This this example you would create a deposit and select two accounts: e.g. donations and checking account. Scout Manager will then create two entries:

  • one to record that you’ve received a donation for $250
  • and second to record that you’ve added $250 to your checking account.

These entries are called transactions and you’ll be able to view them for all accounts. A transaction can have more than one account associated with it. In the example there are two accounts associated with the transaction. When you view or edit a transaction you can see all the accounts associated with it.

If you understand so far you’ve tackled the biggest hurdle in understanding how Scout Manager Accounting works and basic accounting practices.

General Accounting

Accounting, broadly considered, is the system of measuring, recording, and reporting economic events based on the accounting equation: Assets = Liabilities + Equity (also stated as: Assets - Liabilities = Equity).

Scout Manager uses a self-balancing accounting method consisting of two-sided transactions that record where your money comes from and where it goes to. This is in contrast to single-entry accounting such as your personal checkbook – money simply enters stage right (when you deposit a paycheck) and exits stage left (when you write a check for groceries).

We never want money to simply appear; it should be transferred from a source account to a destination account. For instance, you might buy awards from your checking account (Asset); the payment withdrawal should also be entered in your Awards expense account (Expense). This allows you to track exactly where, how and when your finances are being used.

The transactions are recorded as negative and/or positive entries. Deposits create positive entries in asset and revenue accounts. Withdrawals create negative entries in asset and expense accounts. Transfers creates negative entry in one account and a positive entry in another.

Net Assets (or Equity) – is what remains of your Assets after deducting your Liabilities. If you have $100 in Assets and $25 in Liabilities, your Net Assets (Equity) would be $75.

  • Income is the revenues you take in during a given time period. Your income accounts might be: Donations, Pack/Troop dues, Fundraiser.
  • Expenses are the costs you incur during a given time period. Utility Bills, Scout Awards, Insurance – these are typical expense accounts.

Understanding Account Types

Before you can effectively set up your accounting you’ll need to understand the basic account types and how to use them. The type of account is super important as it determines how the accounting system behaves as it flows money through an account.

Account Types

Accounts represent a variety of ways of keeping track of the flow of money (where it comes from, where it’s going) within your unit. They are at their most basic and abstract, accounts consist of a number (for identification), a name, a type, and a balance.

Account balances are the sum of the initial balance and transactions.

There are five types of accounts: Asset, Liability, Revenue (or income), and Expense. Revenue and Expense are sub-accounts under Equity, but they behave differently enough that they’re worth treating on their own.

  • Asset Accounts represent things that you have (cash in the checking account, or maybe a trailer) or that someone is legally obligated to give you later (such as Accounts Receivable).
  • Expense Accounts are monies that you’ve paid out such as Awards, Reimbursements, etc.
  • Revenue Accounts represent income of money into your Pack/Troop. These could be fundraisers, donations, dues, etc.
  • Liability Accounts are monies that you are legally obligated to pay to someone else – like debts for registration, member accounts, or camping money not yet disbursed. You can also use liability accounts to set aside money for future purchases such as tents.
  • Member Accounts are specialized Liability accounts to help organize other liabilities from your members such as scouts, adults, den and patrols.

Asset accounts

These accounts represent the tangible money the pack has. For instance, you should create an ASSET account to represent the Pack/Troop Checking account. You can have more than 1 ASSET account – for example some council Scout Service Centers allow units to put money into an account at the store so the Awards Coordinator can buy awards without needing to pay out of pocket or carry a blank check. To handle this scenario, you can create an ASSET account called Scout Service Center and transfer or deposit money into the account.


This is the most difficult one for some to understand. Just because you’re writing the check out of the pack’s checking account doesn’t mean the entire cost is an expense for the pack. Again, the Day Camp you mentioned isn’t a pack expense unless the pack is paying for the entire event from it’s funds. If you are collecting the money from the scouts and then paying the Day Camp, it isn’t a pack expense – it’s the scout’s expense. Expenses would be office supplies, rent on storage units, refilling propane tanks, new equipment, etc.


This is probably the easiest to understand. If the pack has income, it should go into a revenue account. Examples are: pack dues (not registration fees), fundraisers and donations.

Liability and Member accounts

These accounts represent the money you owe to someone. If you are collecting money for something and then paying it out, it’s a Liability. The Day Camp you mentioned would be a Liability account. Collecting money for yearly BSA registrations should be collected into a liability account. Some fundraisers may have a liability portion to them, like Trails End Popcorn. All your scout and adult member accounts are liability accounts.

Other liabilties

Because of their fundamental differences in purpose and structure, non-profits have different accounting needs than for-profit businesses. While businesses concern themselves with how much profit was earned, non-profits have numerous individual funds, which, rather than paid out to shareholders, are used to prove the Pack or Troop is using its resources for the correct purposes (especially donations). For example, monies donated for a particular scholarship must be used for that scholarship; a liability is set up to ensure the money accounted for properly and to make misuse of such funds much more difficult to hide.

A liability is a pool of money set apart for a specific purpose. For instance, you may set up a liability for maintenance and improvements on the troop’s the tents, tarps, cooking supplies and other inventory. To balance this out you could also set up a set of expense accounts for the same equipment. Some people like to go further and create an ASSET Savings Account to completely seperate the unit’s general funds from their long-term liabilties to ensure it doesn’t unintentionally get spent.