10 October 2026
Restricted funds for a PTA: what they are and how to track them
A restricted fund is money the PTA holds for one purpose and can spend only on that purpose. It sits in the same bank account as everything else, which is why it is easy to lose track of, and why the accounts have to show it separately.
This post covers what makes money restricted, how to keep a record that holds up, and what to do before you spend from one. It sits alongside the pieces on the CC16a and the Trustees’ Annual Report, both of which ask you to report restricted money on its own.
What a restricted fund is
The test is what the giver was told and what they agreed to. A parent who gives to “the playground appeal” has given for the playground. A grant of “£400 for library books” is for library books. In both cases the PTA holds the money on those terms, and the committee cannot decide later to spend it on something else, even for a short time and even with every intention of putting it back.
The split is a matter of the terms the money came with, not of where the cash is. There is no separate bank account for a restricted fund unless you choose to open one, and the bank statement will never show you the difference.
Restricted and unrestricted
The CC16a has a column for each, and every pound the PTA holds belongs in one of them.
- Restricted. Given for a stated purpose. The terms bind the committee.
- Unrestricted. Money the committee can spend on any of the PTA’s purposes. This is the general fund.
You may also hear about designated funds. That is unrestricted money the committee has earmarked for something, such as the float for next year’s Christmas fair or a pledge to the school. The Charity Commission’s reserves guidance (CC19) describes a designation as administrative only: it stays unrestricted money, it goes in the unrestricted column on the CC16a, and the committee can cancel it by a decision of its own. A restriction is different. It comes from the giver, and the committee cannot simply change its mind.
With Treasurer’s Ledger
In Treasurer’s Ledger a designated fund lives on the Funds page. Add a fund, choose “Set aside (designated)” and the Treasurer uses “Set aside money” to move money into it from your general funds. You can also do it straight from an approved funding request with “Set aside money for this”. You spend from it like any other fund, and “Release” gives the money back to your general funds when the committee decides it is no longer needed. If a fund you set up as restricted turns out to be the committee’s own money, press “Edit” beside it and choose “Set aside (designated)”. Nothing it holds changes, only which column of the accounts it sits in. At year end Treasurer’s Ledger asks whether each one carries over into next year. It stays in the unrestricted column on the CC16a throughout.
How money becomes restricted
Money becomes restricted when the person or body giving it attaches a purpose, and that can happen in a few ways:
- A grant with conditions. The offer letter or the terms say what it can be used for. Keep them, because they are the evidence.
- A donation with a stated purpose. A parent who writes “for the minibus” on a cheque or in an online donation.
- An appeal. A poster, a flyer or a page that asks for money for one named thing. Everyone who gave in response gave for that thing.
The third is the one that surprises people. A summer fair that is “in aid of the new playground” has told everyone who came what the money is for. Whether that creates a restriction depends on what was actually said, which is why it is worth deciding the wording before the event rather than after.
If you are raising money for something particular, it helps to say, on the poster and on the form, that any money raised beyond what is needed will be used for the PTA’s general charitable purposes. Then a surplus is yours to use freely. Without that sentence, using a surplus for anything else means one of the routes set out below.
A fund name is not evidence of a restriction. An online donation platform may make the giver choose a fund or campaign, and the name that results (“Sports day”, “Summer fair”) is usually just what the appeal was called. It does not mean the money is ring-fenced. What counts is the wording the giver saw.
With Treasurer’s Ledger
Donations that arrive from Zeffy bring their fund name with them, and each one is created as an unrestricted fund, because Zeffy says nothing about whether the money is restricted. If a fund really is ring-fenced, you tick that on the Funds page yourself.
How to track it
You need a record for each restricted fund that a new treasurer, a committee member or an independent examiner could pick up cold. It is a short list:
- The fund’s name and its purpose, in the words the giver used.
- The evidence: the grant letter, a copy of the appeal wording, the donor’s note.
- What it held at the start of the year.
- What came in, and what was spent from it.
- What it holds now.
Then there is the one check that proves the whole thing. Add up every fund, restricted and general, and the total must equal what the PTA actually holds: the bank balance plus cash in hand. If it does not, a payment or a gift has been put against the wrong fund or against none.
| Fund | Kind | Holds |
|---|---|---|
| Playground appealParents gave to a stated appeal | Restricted | £650.00 |
| Library grantA grant for books only | Restricted | £400.00 |
| Christmas fair floatSet aside by the committee | Unrestricted | £500.00 |
| General fundEverything else | Unrestricted | £10,050.00 |
| All funds together | £11,600.00 | |
| Bank balance £11,450.00 plus cash in hand £150.00 | £11,600.00 | |
Two habits keep this honest. Allocate each receipt and each payment to a fund when you record it, not at year end, and carry each fund’s closing balance forward as the next year’s opening balance. A restricted fund does not reset on 1 September.
With Treasurer’s Ledger
Funds is its own page. Add one, tick “Restricted fund” if it is, and each fund shows what it opened the year with, what was raised, what was withdrawn and what it holds. Balances carry over from year to year automatically, and the general fund is shown as a row too, so the column adds up to what you hold in the bank. A banner splits the total into restricted and unrestricted.
A fund can be raised for by an activity as well. The summer fair can be the activity that raised the money and the playground fund the place it was put, and each is recorded as its own answer.
Spending from a restricted fund
Before you pay for something out of a restricted fund, check three things. Is the purpose covered by the terms the money came with? Has the committee approved it in the way your constitution requires? And does the fund hold enough?
Spending from a restricted fund is decided the same way as any other spending, by the committee. If your PTA uses the Parentkind model constitution for England and Wales, that is a majority vote at a committee meeting where at least half the committee is present, or a decision in writing (email counts) that every committee member agrees to. Anyone who would benefit personally declares it and sits out the vote. If you use a different constitution, check what yours says.
When you minute the vote, name the fund the money is coming from and say why the spend is within its purpose. A restricted fund is the one place where “the committee agreed” is not the whole answer: the committee can only agree to spend it on what it was given for.
If the fund is short, the shortfall has to come from another fund by a decision of the committee, and that is normally the general fund. What you cannot do is let a restricted fund go overdrawn quietly, or borrow from one and promise to put it back.
Keep the approval with the payment. The question an examiner asks is not whether the money was spent sensibly but whether it was spent on what it was given for, and the answer is a record you made at the time.
With Treasurer’s Ledger
Requests for money can come in through your PTA’s own request form, and the committee votes on each one in Treasurer’s Ledger. Once the number of approvals you have set is reached, the request is approved, and every vote is kept with who cast it and when. Where the committee has already agreed something at a minuted meeting, the treasurer can approve it directly instead.
Wherever you say which fund a payment comes from, Treasurer’s Ledger tells you if the amount is more than that fund holds, shows what the other funds hold, and lets you split the payment so the fund pays what it has and another fund pays the rest. Money you have approved but not yet paid is shown as committed beside the balance, so you can see what a fund would have left once it goes.
Where it shows up in the accounts
Restricted funds are reported on their own. The Charity Commission’s CC16a has a column for restricted funds, and the closing position asks how much of what you hold is restricted. The Trustees’ Annual Report carries the same split, together with the reserves policy.
This is where a single pot of money shows. If the accounts show one balance and nothing restricted, either the PTA holds none or the split has not been tracked. An independent examiner will ask which it is, and the fund record above is the answer.
With Treasurer’s Ledger
Year-end close asks how much of what you hold is restricted and which funds it is in, so each one starts from its real balance. Each fund’s closing position then carries into the next year, and the figures for the CC16a and the report come from the same funds you have been using all year.
When there is money left over
Sometimes a restricted fund has money left after the purpose is met, or the purpose can no longer be carried out, such as an appeal for something the school decides it no longer wants. What happens next depends on where the money came from. What follows is the position in England and Wales.
It is the committee’s decision, not the members’. The committee members are the trustees, and the routes below are decisions of the trustees. A vote at the AGM does not lift a restriction the giver attached.
If the appeal said what would happen to a surplus, follow it. The Commission’s guidance calls this a secondary purpose. If your appeal had one, you use the money for that, and you do not need to contact the donors or the Commission. This is why the sentence about a surplus going to general purposes earns its place on the poster.
If it was an appeal without one. Since the Charities Act 2022, the trustees can pass a resolution to use the money for a purpose as close as reasonably practicable to the original one. It needs a majority of all the trustees, not just those at the meeting. Up to £1,000.00 it takes effect when it is passed. Above that, it needs the Commission’s written consent, which you ask for by sending them the resolution. Money from collecting tins, a raffle, an event or a sale, and single gifts of £120.00 or less, do not have to be offered back to the givers first.
If it was a grant or a gift that was not an appeal. Go back to the giver. An underspend on a grant is the usual case. Ask what they would like done with it, and keep a record of their answer.
The Commission’s guidance on fundraising appeals for specific purposes sets all of this out, and your independent examiner is a good person to talk it through with before the committee votes. In Scotland the route is different: you apply to OSCR to reorganise the fund.
In short
Know what each pot of money was given for, write that down with the evidence, allocate every receipt and payment to a fund as you go, and check that the funds add up to the bank plus cash. Do that and the restricted column on the CC16a fills itself in.
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Start your free trial →This page is general information, not advice about your charity. Whether a particular sum is restricted depends on what the giver was told and the terms it came with. The Charity Commission publishes its own guidance for trustees, your governing document governs how your committee takes decisions, and your independent examiner is the right person to ask about your particular accounts.