possible existing solutions that may be of help

[Josh Berkus]

> Fund accounting, while not required by FASB 117 or other accounting
> standards, nevertheless has been the standard technique by which
> nonprofits have apportioned and managed grants and contracts in 
> their accounting systems for years. There are many good proprietary
> nonprofit accounting system software packages that are setup to do
> fund accounting; one mentioned was FundEZ, but there is also
> Blackbaud and Sage 100 as well.

(note that the below is my personal opinion, and I don't work for SFC)

I think we're talking about two different things when you say "Fund
Accounting".  Looking at this page, for example:
http://www.fundez.com/fund_accounting.asp , existing proprietary
solutions don't even begin to address the requirements of a fiscal sponsor.

The issue that a fiscal sponsor has is that they have a set of earmarked
funds which are *orthangonal to* the rest of the chart of accounts.
These represent money which is allocated to specific projects which are
members of the fiscal sponsor.  For example, both PostgreSQL and Debian
belong to SPI, and both "hold" money there.  Revenue represents a
mixture of donations, grants, and merchandising for both projects, and
expenditures represent travel costs, personnel, capital purchases, etc.
for both organizations.

Attempting to fix this into a single, heirarchical chart of accounts --
as FundEZ requires you to -- means enormous duplication of categories,
as well as a ginormous list of accounts every time you book a
transaction, making data entry very burdensome. I estimated once that
constructing a heirarchical chart of accounts for SPI, including all
funds, would require over 2000 COA items. To quote:

"Use FUND E-Z Pro to create a customized the chart of accounts (up to
100 characters), with up to 10 segments. Program transaction dynamics,
customize interfund balancing, and close each fund to its own net asset
account."

... in other words, "lets take this whole complicated multi-category
tagging of transactions and push off the effort on the bookkeeper,
instead of having the computer do it".  For that matter, the use of a
hand-typed text-delimited account code is ... very 1950, to say the
least.  I would be willing to bet that the majority of organizations
which really need fund accounting lean heavily on spreadsheets outside
of the FundEZ system.

Both Ledger-CLI's tagging, and the capabilities of relational databases,
make it entirely possible to flag each transaction with multiple
orthagonal categorizations.  We need to use this capability.

Additionally, the fiscal sponsors in the OSS space generally work
through a system of deductions; that is, 5% to 25% of each project
donation goes towards administrative overhead for the host NPO.
Existing proprietary fund accounting packages don't seem able to cope
with this, let alone to gracefully handle the frequent exceptions to the
same rule.

So overall, I'd say that FundEZ is useful as an example of how NOT to do
things.  Which is, of course, useful, but not in the way you intended.

I haven't explored Blackbaud, for the simple reason that you have to
hand them $1000 just to get a demo.

-- 
Josh Berkus
PostgreSQL Experts Inc.
http://pgexperts.com