Most of the time in the third sector, we are managing other people's money. We may earn fees from time to time, but receiving grants and donations raises particular challenges in the accounting world.
Charities have a duty to keep track of any funds that have specific restrictions. Whether the donor says "here's £10,000, buy a new minibus", or the charity asks for the money for that purpose, you are bound by this restriction as soon as the cash is received, or receivable - as soon as you are sure you will get the money.
If lots of people give you money for the minibus, you still have to account for these donations in one restricted fund.
Your book-keeping system needs to cope with these funds, and your annual accounts need to show them - and show what balances are held in the funds at year-end.
You might have a restricted fund that is earmarked for a long-term project. You might want to allocate some overheads, such as rent, to this fund - provided that the funders agree. The way you do this should be consistent and transparent.
If you have a restricted fund to purchase a fixed asset, such as the minibus, for example, then once you have purchased the asset, provided you can use it for your general purposes, there is no longer any restriction and the asset will form part of your unrestricted funds.