Fund accounting is something that pretty much every nonprofit organization has to deal with in one way or another.  Basically, it is used in a way that emphasizes accountability rather than profitability. Nonprofits are required to use their financial statements and reports as a means to demonstrate how money is spent, rather than to account for profits earned.  Oftentimes, they will have multiple funds to manage, depending on the reporting requirements for the account or funding source.  A nonprofit's financial success isn't defined by profit, but rather by financial clarity that shows how the organization works to maximize the impact of every dollar received.