Adding Accounting Fund - Endowment

[M_artin]

Hi to all!
First a big thank you to all experienced users in here! Checking the forums has already helped.
As we are (finally) setting up PCP to also do our accounting I would appreciate guidance for setting up an additional Accounting Fund (separate from the General Fund) for our Endowment.
I know how to add the Fund but I am unsure which accounts from the General Fund to copy (? because they'll show with the same # in the General Fund just with the 01- , right?) into the new Accounting Fund which will be only our 2nd Accounting Fund.
For the Endowment Fund all we really need are the Asset lines and lines for the income generated through the investment, plus a few expenditure accounts (for advertising, a speaker, maybe). Do I set them up manually? Do I copy some accounts from the 01 Fund?
Finally, since the amount is showing presently in the 01 - General Fund, I am reasonably certain we would have to transfer them into the new 02 - Endowment Fund, correct?
Help would be appreciated! But in any case: Thanks again to all the good supporters in here.
Martin

[JohnDMeyers]

I suggest you copy the Level 1 accounts, and maybe some other GROUP accounts into the new fund, so that you follow the same basic outline as the General Fund. This will help if you ever need to run consolidated reports (funds 01 - 10, for example).

To transfer $1000 from Fund 01 to Fund 02:
CR 01-1110-000 checking $1000
DB 01-9010-000 transfer $1000

DB 02-1110-000 checking $1000
CR 02-9010-000 transfer $1000

[M_artin]

Thanks, John!
I gather from your reply (and previous postings you made) that I would then add accounts under the new Accounting Fund 02 later. Correct?
Also, if the amount for the new fund (02) shows under an asset account in the general fund (01) I would use that account for the transfer. Correct?
Thanks again. You certainly are one of the "heroes" of PCP in this forum! I will suggest that we sign up for your training videos for a few months to teach our volunteers over here.
Now, I will search for an answer for my next question...
Martin

[JohnDMeyers]

I gather from your reply (and previous postings you made) that I would then add accounts under the new Accounting Fund 02 later. Correct?
Yes. I don't make a big deal about my tutorials on this forum, but I do have a good one in the free section on "Group and Detail Accounts" that explains how to structure your accounts for proper subtotaling.


Also, if the amount for the new fund (02) shows under an asset account in the general fund (01) I would use that account for the transfer. Correct?
Yes.

I usually create several transfer accounts which I use according to the purpose of the transfer. In your case, I would use 01-9010-000 and 02-9010-000 to transfer any beginning balances. I might create another transfer file later, if I was going to transfer income from one to the other. It's just a matter of preference. When I run a report, it gives me an idea of what I used the transfer accounts for.

To transfer another type of asset, as a beginning balance, might look like this:
CR 01-1120-000 savings
DB 01-9010-000 transfer beginning balance

DB 02-1125-000 some new savings
CR 02-9010-000 transfer beginning balance

[M_artin]

Still working on this...
I have gone back and forth on this one with backups and restores. Not yet got the results we need.

I manage to set up the new Accounting Fund #02 (Endowment) and copy all or just some accounts. I can also just copy the level 1 accounts. But then, some lower level accounts (group and detail) should show in the new Accounting Fund.
Question 1: Should I show the actual bank accounts and investments in Accounting Fund # 01 and # 02? (Some investments would only apply to 02, some fund are sitting in a checking account which applies to 01 and 02.)
I managed to transfer the funds from the General Fund #01 into the new Endowment Fund #02. However, under assets the Endowment Fund still shows only in the General Fund #01. When I tried to transfer them so they would no longer appear in the #01 I had the Unrestricted Assets show double the amount and the asset line for the permanently restricted asset account had a negative amount. ... I guess, I'm not getting it still...
Question 2: How do I transfer the Asset account balance from the General Fund #01 to the Endowment Fund #02 so the asset shows no longer in #01?
Related question 3: Do I transfer the asset between the two funds as well? How, since this is a permanently restricted account?
I hope I am making myself clear... because I am confused right now.
Thanks so much if aynone tries to help!
Martin

[JohnDMeyers]

Actually, it's not very clear what you are doing.

If you have three asset accounts that have $100, $200, and $450 in them, the total is $750. But, you have to transfer each one separately. I'm not sure if you are thinking that you can just transfer the total. You cannot.

If you want to transfer a restricted amount, then you have to recreate all three unique restricted accounts in the new fund.
In General Fund:
01-3210-101 restriction #1 equity
01-4210-101 restriction #1 income -- closes to 01-3210-101
01-4810-101 restriction #1 release -- closes to 01-3210-101

You have to create:
02-3210-101 restriction #1 equity
02-4210-101 restriction #1 income -- closes to 02-3210-101
02-4810-101 restriction #1 release -- closes to 02-3210-101

If you have $324 restricted in Fund 01, it shows up in 01-3210-101 and 01-4210-101.
To transfer it, you only have to do this:
DB 01-4210-101 restriction #1 income $324
CR 01-9012-000 transfer restriction $324

CR 02-4210-101 restriction #1 income $324
DB 02-9012-000 transfer restriction $324

You may have tried to do something with the equity accounts (01-3210-101, in my example), which you didn't need to do. You only need to transact the income account, and the equity will automatically update.

Hopefully, you created a backup and you can restore and try again.

[M_artin]

Sorry I am so unclear... not an accountant.

"If you have $324 restricted in Fund 01, it shows up in 01-3210-101 and 01-4210-101."
Maybe, there is the problem: I see the amount in the 01-3310 NET ASSET account but it does not appear again in the 01-4310 INCOME account at all.

I created the 02 Accounting Fund and when asked which accounts to copy I decided to copy all accounts that have anything to do (or will have anything to do) with the Endowment, i.e. the ASSET accounts that carry funds of the endowment. I also made sure that all level 1 accounts were copied as well.

I also managed to enter successfully the transactions (I made it one single one with several lines) that effectively transfer all funds into the 02 Accounting Fund.

But now, when I create a report "Balance Sheet by Fund", I see the permanently restricted Endowment Fund still in the 01 column, AND the transferred amount shows under "unrestricted assets" in the column for 02. - When I tried to transfer that before, I ended up with double the amount under "unrestricted" and a negative amount under "endowment fund" (both in 02).

Sounded like your direction at the end "If you have $234 restricted in Fund 01, it shows up..." was getting me there, but then: see above.

Getting real tired of this right now... - and of doing all these backups! Wish I'd understand better...
But thanks for your patience and help!
martin

PS: Maybe, I should add: This situation is the result right after the Accounting Setup interview where I entered the current amount of the endowment as an asset.

[JohnDMeyers]

My guess is that something went wrong when you setup your restriction.

It is likely that you have an expense account that closes-to 01-3310 and it is also possible that your restricted income or the release account doesn't.

I would get rid of the restricted equity (make it unrestricted) like this:
DB 01-3310-000 restricted $324
CR 01-3110-000 unrestricted $324

Without a restricted income amount, there should not be a restricted equity amount.

In fact, until you get all the Funds setup, I wouldn't worry about restrictions at all. That's like advanced PowerChurch, and you still need to get the basics dealt with. I hope I'm not being too picky here.

[Matt]

Without actually seeing your system it is hard to tell for sure what is causing the problems you are describing and what corrections need to be made. But from what I gather it sounds like there is a balance sitting in the permanently restricted Fund Balance account in Fund 01 for your Endowment Fund that you want to see in the same permanently restricted Fund Balance account, but in Fund 02. It also sounds like you have a related asset account (e.g. savings account, CD, etc.) that makes up this fund balance in Fund 01 that needs to be transferred to Fund 02. Assuming that is the case this is the type of entry you would need to make in Fund Accounting to transfer these balances from Fund 01 to Fund 02:

Debit 01-3XXX- - Endowment Fund Balance
Credit 01-1XXX- - Related Asset Account For Endowment Fund

Debit 02-1XXX- - Related Asset Account For Endowment Fund
Credit 02-3XXX- - Endowment Fund Balance

[M_artin]

"it sounds like there is a balance sitting in the permanently restricted Fund Balance account in Fund 01 for your Endowment Fund that you want to see in the same permanently restricted Fund Balance account, but in Fund 02"
YES
"you have a related asset account (e.g. savings account, CD, etc.) that makes up this fund balance in Fund 01 that needs to be transferred to Fund 02"
I managed to transfer these assets (from 2 accounts) into Fund 02
BUT
Balance Sheet showed correct allocation for ASSETS
Under NET ASSETS it got weird, because the "Total Liabilities and Fund Balance" matches "Total Assets".
In Fund 01 Endowment Fund still showing as perm restricted fund.
In Fund 02 amount for Endowment also showing as unrestricted net asset; nothing for perm restricted fund.

I am sure it's my fault. I entered bank statement totals and outstanding cheques during interview. Maybe, I shouldn't have added the endowment fund (as an asset, I believe)? Maybe, I should have entered that as a transaction after the interview? - Now feeling totally lost... and
martin

[Matt]

Ok. I think I understand what happened. Try posting the following two entries to see if this corrects the problem:

Debit 01-3XXX- - Endowment Fund Balance
Credit 01-3110-000 - Unrestricted Net Assets

Debit 02-3110-000 - Unrestricted Net Assets
Credit 02-3XXX- - Endowment Fund Balance

[M_artin]

First, a big THANK YOU to JohnDMeyers whose videos and other guidance have helped me to sort this out!

In hindsight I wish we had entered 0s as beginning balances as were setting up. The manual and Accounting Setup wizzard seem to cover a setup for one fund (General Fund) only. Our experience was that we followed the wizzard too closely, not knowing what was ahead of us.
In fact, as I am now dealing with mistakes in the beginning balance (cheques that had cleard but were reported as not cleared when I began the setup), I would recommend entering the beginning balances outside the setup wizzard and posting them one by one.
Not sure what the "pro's" would say to that. Just our experience.