In my opinion, the purpose of a functional spec is to describe the
application’s functionality and user interface/experience. The spec
should enable developers to begin coding the application. Note that I
don’t view a functional spec as a ‘design’ or ‘technical’ document.

Here’s an outline that I’ve used over the years:

Cover Page - includes the application’s name, spec version, date and
name of author

Table of Contents – makes it easy to locate a section

Introduction – summary of the entire application, its features and
what’s included in the spec
 
Overview – description of the section’s/page’s functionality

Content – functional wireframes (not designed) for all the pages
which identifying different states (e.g., first time visitor,
returning visitor, etc.). I usually annotate each field with a
footnote (e.g., data values, error messages, etc.) and also describe
what happens whenever a user clicks a button or link

Programming Notes – this is where you can get ‘technical’ and leave
notes for the developers

Appendix – include any supplemental items (e.g., use cases, etc.)
that will help document the application

Anybody care to share their ideas? 

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