The purpose of this guidebook is to reflect the changes that have occurred since 1973 in governmental accounting and education finance. This document serves as a vehicle for program cost accounting at the local and intermediate levels. Although not required by federal law, the National Center for Education Statistics (NCES) encourages state and local adoption of the guidelines provided in this book, which conform to generally accepted accounting principles (GAAP). The contents are as follows: an overview of educational finance principles and information sources; uses of the account classification system; account classifications; implementation of account classifications; cost accounting for educational programs; and account classification descriptions. Appendices provide examples of financial statements, minimum required classifications, cash basis/single-entry accounts, supplies and equipment criteria, federal revenue sources, and a nonpublic school chart of accounts cross walk. Eight tables and seven figures illustrate the material. (LMI)