Background:
I am the current president of a small, volunteer based 501c3 charitable, educational, non-profit organization. We earn small amounts of operating income every year. Every other year we earn a large amount of income that we use to sustain our group throughout the two year period until the next time we earn the large sum of income. We have that large sum of cash we earned in 2007 on hand. 2008 is a regular income year.

Question:
We are working on our 2008 budget. All our sources of income in 2008 total $10,685.00. All our sources of Expenses in 2008 come to $20,394.00. That leaves Income $9,709.00 less than Expenses. We plan to use the money we have on hand left over from 2007 to close that gap. What do non-profit groups call that line item under Income for $9,709.00 in order to balance the budget? Please help!?

My sincerest thanks!

Depends on how you closed out your books in 2007. If you closed out the Revenues over Expenditures to your Fund Balance, then you are all set. Your income for 2008 would not show the large portion. You would simply be spending your fund balance down. So 2008 would look like you were overbudget because your income is small, but 2007 would appear to be way under budget. This method makes for confusing planning and budgeting, so I think in your big income years you need to make a line item expenditure of "Large Fundraiser Reserve" (or something else that makes sense). Then in your small income years you can have "income" of "Transfer from Reserve". Make sense?