V.9 Setting Up Release, Income and Expense Accts.

[KenL]

When we acquired our upgrade copy of PC+ v. 9, we did not immediately begin using the new COA and I suppose that we can just as well continue using the current setup, however, I like the manner in which restricted donations are accounted for and I am working to convert the present COA to the new COA using restricted income accounts and release accounts. We currently have 11 separate funds that qualify as temporary donor restricted funds in addition to the general fund which, of course, is unrestricted. My question is this: when setting up restricted income. release and the expense accts. (that affect those restricted income and release accts) to close for the year, should the restricted income and expense accounts which affect those funds close to their respective fund net asset accounts with the release accounts closing to the unrestricted asset account or should those income and expense accounts close to the unrestricted net assete account. For example, we have the following temporary restricted fund called the Bookclub Fund (BC) which we use as an outreach tool to the community where members can purchase their own books and also contribute to defray the cost of books for non-members with any remaining cost directed to the General Op fund (1G) and the accounts would be the following:

3110 Unrestricted Net Assets
3225-105 Bookclub Outreach Net Assets (Donor Temp Restricted)
4225-105 Bookclub Outreach Receipts (Income)
4825-105 Bookclub Outreach Release
4999-000 Released From Restriction
5550-105 Bookclub Outreach Materials (Expense)

Would the income and expense accounts be set up to close to the 3110 unrestricted account or to the 3225-105 account? It would seem to me that if income is released from restriction it should close to the unrestricted asset acct and the same should apply to expense account as well.

Thank you,
Ken Leib

[Matt]

Ken,

In your example, you should set up accounts 4225-105 and 4825-105 to close into 3225-105. The 4999-000 and 5550-105 accounts should close into 3110. You don't want account 5550-105 closing into 3225-105. Doing so will cause a duplicate debit posting to the 3225-105 account.

Matt

[KenL]

That's all I needed to know. After setting up the release, income and expense accounts, I ran a Balance Sheet by Fund report which looked a little strange, but since I am converting from a COA that did not include restrictions and release accounts, I believe that I now have to release available funds from their restricted income accts to pay expenses in those funds and then that should make everything look right in the various fund balance columns.