Statement of Activities

Updated on July 9, 2024
Article byAswathi Jayachandran
Edited byAswathi Jayachandran
Reviewed byDheeraj Vaidya, CFA, FRM

What Is A Statement Of Activities?

A Statement of Activities details financial performance on nonprofit organizations throughout a fiscal year. It contains data on operating earnings, operating costs, non-operating revenues and expenses, and changes in net assets. Pledges, accruals (non-cash, long-term liabilities), depreciation, and subsidiary income and expenses are all included in this report.

Statement Of Activities (Components)

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Source: Statement of Activities (wallstreetmojo.com)

The statement of financial activities is a document that lists a nonprofit organization’s income and expenses for a given reporting period. It is similar to an income statement for for-profit businesses. These two documents provide a brief overview of how the organizations’ net assets have changed during that given period.

Key Takeaways

  • A statement of activities (SOA) unveils nonprofit organization’s income and expenses over a specific period. It showcases fund allocation toward achieving organizational goals.
  • It is essential for the financial operations of a nonprofit organization, much like an income statement in for-profit entities.
  • It helps determine whether a company can obtain enough funding for operational support. Additionally, it highlights necessary changes (rising income, falling costs, or both) to fund critical projects.
  • SOAs enable enterprises to make well-informed decisions.

Statement Of Activities For Nonprofit Explained  

A Statement of Activities (SOA) reveals the income and expenses of nonprofit organization over a reporting period. It demonstrates how the funds are used to achieve the organization’s goals. It is similar to an income statement for a for-profit organization. An income statement is used to show a company’s profitability. A nonprofit organization is driven more by a mission or a service than financial success. The SOA contrasts an organization’s net assets with its income and expenses for a fiscal year

All firms must closely monitor their financial performance in order to make wise judgments. The nonprofit sector is no exception to this rule. For management to comprehend the bigger picture and improve the organization’s performance, revenues and expenses must be reported. A SOA is essential for the financial operations of a nonprofit organization, much like an income statement.

It also helps determine whether a company can obtain enough funding to support its operations and identify what has to change (rising income, falling costs, or both) to fund critical projects. It helps identify certain programs that cost more and have a low success rate. The organization can adjust its activities to succeed in its ventures. Conversely, if a project does well, the organization can invest more in it and apply the insights to other projects. In essence, they help the organization make informed decisions.


Let us consider these examples to understand the concept better:

Example #1 

Let us consider the SOA of Sunshine Nonprofit Organization for the year ended on June 30, 2022.

Statement of Activities of Sunshine Nonprofit Organization for the year ended on June 30, 2022

BasisWithout donor restrictionsWith donor restrictionsTotal
Grants and Contribution revenues  

Net assets released from restrictions  

Total revenues  





Program service expenses  


Total expenses





Change in net assets$22500 –$22500

In the SOA for the year ended June 30, 2022, the funds received via grants and net assets released from restrictions total $25,000. Expenses, including significant programs, fundraising, administration, and general, total $2,500. Consequently, the increase in net assets of $22,500 is derived after deducting both revenues and expenses.

Example #2

The image below is the SOA of a nonprofit organization in Washington, DC, called Freedom House (2015). The organization performs research and supports democracy, political freedom, and human rights. Initially founded in October 1941, the organization describes itself as a clear voice for freedom and democracy worldwide.

Statement Of Activities Template


Since it is nonprofit and primarily funded by the United States government, government grants (federal grants) are its primary source of revenue, followed by international public agencies, corporations, and foundations. Their expenses prioritize program services as part of their mission, followed by supporting services such as fundraising and indirect costs. Revisions of the changes in net assets, then follow it. The expenses, revenues, and changes in net assets help the management achieve important objectives.


There are three key sections in the SOA:

  1. Revenue/Income 
  2. Expenses
  3. Change in Net Assets

A sample template would look like the following:

Statement of Activities

Nonprofit’ name and period

SectionsWithout donor restrictionsWith donor restrictionsTotal
Change in net assets   

Statement Of Activities vs Income Statement

The differences between the SOA and income statement are listed below:

Key PointsStatement of ActivitiesIncome Statement
ConceptAn SOA shows nonprofit organization’s revenue and expenses over a reporting period.  A statement outlining the company’s income and expenditures is called an income statement.  
Aim  The purpose of the SOA is to provide users with information about the changes in the net assets.   It displays a company’s profitability or loss over a specific time frame.  
ApplicabilitySOA applies to nonprofit entities.  Income statements are applicable to for-profit organizations.  
Frequency  SOA is computed annually.  Income statements, unlike other financial statements, are published quarterly or monthly.  

Frequently Asked Questions (FAQs)  

How do Statement of Activities and Statement of Financial Position differ?

The SOA outlines a company’s profits and expenditures over a period, while the Statement of Financial Position presents its financial position at a specific point in time.

Do nonprofit organizations have to follow any particular accounting rules or guidelines before preparing the Statement of Activities?

Yes, nonprofit organizations follow certain accounting rules and regulations while preparing the SOA. These include standards set by the Financial Accounting Standards Board (FASB), which are designed specifically for nonprofits, and the Generally Accepted Accounting Principles (GAAP).

In nonprofit accounting, how is the Statement of Activities different from the Statement of Cash Flows?

Unlike the SOA, the Statement of Cash Flows outlines cash inflows and outflows. It provides insights into liquidity and cash management instead of detailing income and expenditures.

This article has been a guide to what is Statement Of Activities. Here, we explain its examples, template, and comparisons with income statement. You may also find some useful articles here –

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