Your nonprofit runs on volunteers who give their time freely in service of your mission. That volunteer time is valuable and meaningful to your organization — and it deserves to be recognized!
Because volunteering doesn't generate any financial flow, volunteer time is traditionally not recorded in accounting and doesn't appear in the nonprofit's annual financial statements. However, it can be worthwhile to reflect volunteer contributions alongside financial flows in order to give a complete picture of all the organization's activities. In this article, we'll cover:
- How to record a volunteer contribution in Springly
- How to value volunteer time
- What journal entry is created (advanced)
How to record a volunteer contribution in Springly
Accessing the Voluntary Contribution in Kind entry page
Go to Accounting > Book entry, then click Voluntary Contribution in Kind.
On this page, you can record 3 types of transactions:
- In-kind donations;
- Skills-based sponsorship;
- Volunteer time.
By default, you land on the In-kind donation section. Navigate to the Volunteer Time section.
Recording volunteer time
Fill in the required information.
Required fields
- Label: the name of your entry. It should be descriptive enough that you can identify what it refers to (e.g., Volunteer resource used for Activity A);
- Date: the date the activity took place (if it spans multiple days, enter the end date);
- Amount: the dollar value assigned to the volunteer time. Note: the nonprofit sets its own valuation method.
Example:
During a regional food drive held in April, a nonprofit receives food valued at a total of $45,600. The drive mobilized 450 volunteers over 15 days. After reviewing the volunteer activity logs, the accountant finds that each volunteer contributed between 5 and 60 hours. They calculate the average time per volunteer at 18.5 hours. The total volunteer hours for this drive therefore amounts to 450 x 18.5 = 8,325 hours. The accountant determines that the work involved doesn't require any specialized professional skills and values the time at the applicable minimum wage rate — 8,325 x $6.83.
- Donor: the volunteer's name
Optional fields:
- Free notes: to add additional details
Finding your entry after saving
Once saved, you can find this entry at the bottom of your Profit and Loss statement.
Important: if you record this volunteer contribution, be sure to explain your valuation method in the notes to your annual Financial Report.
How to value volunteer time
In the US, the valuation of in-kind contributions — including volunteer time — is governed by US GAAP guidance under FASB ASC 958. Nonprofits that solicit public support are generally required to disclose the value of contributed services, distinguishing between volunteer time, in-kind services, and in-kind donations.
The IRS provides guidance on valuing donated services. For more information, refer to IRS Publication 526 – Charitable Contributions.
Specifically for volunteer time:
- If the contribution comes from a company — meaning the company makes its employees' time available to the nonprofit — this is not volunteer time but skills-based sponsorship.
To learn how to record it, see our dedicated article: Recording skills-based sponsorship.
- If the contribution comes from an individual, the volunteer time is valued according to the method the nonprofit defines. However, this time cannot be the basis for a Tax Receipt.
As a result, it is not possible to generate or attach a Tax Receipt to this entry when recording it.
Only waived expense reimbursements from volunteers can qualify for a Tax Receipt — for example, an Expense Report that the volunteer chooses to forgo in exchange for a receipt.
As mentioned above, the method for valuing volunteer time is set by the nonprofit itself, and must be explained in the notes to the annual Financial Report. For example, the valuation can be based on the applicable minimum wage rate as of December 31 of the year, adjusted for the level of responsibility and the nature of the tasks involved. More information here.
What journal entry is created when recording this (advanced)?
The entry uses Class 8 accounts (off-balance-sheet accounts).
| Label | Account | Debit | Credit |
| Volunteer activity A | 864 - Volunteer personnel | X $ | |
| In-kind donation of item A | 870 - Volunteering | X $ |
Learn more:
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