Transferring from General to restricted

[CuMc1233]

I have been trying to figure the best way to do this. We are taking 10% of our general offering and reserving it to pay apportionments. Normally, I would credit a an in/out fund and debit the expense account to do this. The problem is that we pay multiple types of apportionments and we won't know which ones are being paid with those funds until we divide out the funds.

I thought maybe moving it from our tithes and offerings account to a restricted fund but that would make my tithes and offerings received total off at the end of the year.

I also thought about the restricted as a seperate checking account but that leaves it in net unrestricted assets and it would be restricted.

Thoughts, ideas on how best to do this.

When we do pay apportionments some the payment would have to look something like this:

credit: 01-1110-general fund $x.xx
credit: 01-1130 apportionment fund
debit: 01-6802- conference mission and ministry apportionment
debit:01-6803-next apportionemnt
there are about 10 apportionment accounts.

or it would leave out 01-1130 and do a release from restricted instead.
The issue I have is how to get the money moved from the general fund to a restricted account.

Thanks for any help.

[NeilZ]

I have been trying to figure the best way to do this. We are taking 10% of our general offering and reserving it to pay apportionments. Normally, I would credit a an in/out fund and debit the expense account to do this. The problem is that we pay multiple types of apportionments and we won't know which ones are being paid with those funds until we divide out the funds.

I thought maybe moving it from our tithes and offerings account to a restricted fund but that would make my tithes and offerings received total off at the end of the year.

I also thought about the restricted as a seperate checking account but that leaves it in net unrestricted assets and it would be restricted.

Thoughts, ideas on how best to do this.

When we do pay apportionments some the payment would have to look something like this:

credit: 01-1110-general fund $x.xx
credit: 01-1130 apportionment fund
debit: 01-6802- conference mission and ministry apportionment
debit:01-6803-next apportionemnt
there are about 10 apportionment accounts.

or it would leave out 01-1130 and do a release from restricted instead.
The issue I have is how to get the money moved from the general fund to a restricted account.

Thanks for any help.

Why are you using an asset account (01-1130) for something that is really not a checking or savings account? You say that 10% goes to apportionment payments? Are these something that is mandated by your denomination, in which case shouldn't it be a liablity??

Do you take 10% each week, or do you wait until the end of the year to figure that amount? Are you worried about your Tithes & Offerings Income account being off ?? If you automatically move 10% to a restricted income account it would still show as income, but you would have to make a note of that so that your finance/governing board understands that income is 10% off the top.

As you can see, there is some additional info needed on what and how you expect things to work.

[CuMc1233]

I only use the 1110 (checking account) when I the bill because I write a check out of that account. The 10% is not mandated. Because we were not making apportionments payments, we decided to start taking 10% of income each week and apply it to our apportionments so it would not reflect as available income for anything else. Since that is still not the full amount of our apportionments due each month, we will decide monthly which apportionment funds the money will go to pay. The issue is that I need to move it to a restricted account each week but still need to be able to see what our overall tithes and apportionments were for the year. When contributions are posted, the entry is:

debit 01-1110 checking
credit 01-4025 tithes and offerings. I then need to go in and reserve 10% of what came into that account throughout the week for apportionments. I am trying to figure out how to get it to show in accounting that we are paying that 10% out of tithes and offerings instead of just moving it from 01-4025 tithes an offering income to a temporarily restricted 01-4200 income account because we have to show how much we received total in tithes and offerings at the end of the year and doing it that way will throw that figure off. I just can't figure a way to do it without throwing off this account.

[NeilZ]

I only use the 1110 (checking account) when I the bill because I write a check out of that account. The 10% is not mandated. Because we were not making apportionments payments, we decided to start taking 10% of income each week and apply it to our apportionments so it would not reflect as available income for anything else. Since that is still not the full amount of our apportionments due each month, we will decide monthly which apportionment funds the money will go to pay. The issue is that I need to move it to a restricted account each week but still need to be able to see what our overall tithes and apportionments were for the year. When contributions are posted, the entry is:

debit 01-1110 checking
credit 01-4025 tithes and offerings. I then need to go in and reserve 10% of what came into that account throughout the week for apportionments. I am trying to figure out how to get it to show in accounting that we are paying that 10% out of tithes and offerings instead of just moving it from 01-4025 tithes an offering income to a temporarily restricted 01-4200 income account because we have to show how much we received total in tithes and offerings at the end of the year and doing it that way will throw that figure off. I just can't figure a way to do it without throwing off this account.

You could create another tithing income account 01-4026 (make both of these level 6 accounts, and make a 01-4020 (if not used) a level 4 group account and both 4025 & 4026 roll up to if you need to reflect totals>

Now, in Contributions you create an 'office use only' Contribution fund (say number 2000) that is setup to receive 10% of the Contribution Fund used for Tithes and Offerings (100 ??), this 2000 Contribution Fund when you set it up should reflect that the income is shown under the 01-4026 account. (see Contribution Fund setup in the manual or built-in Powerchurch help)

That should take care of tracking your income, and give you a full total at the end of the year.

You then create a transaction to DEBIT the expense account or accounts budgeted to support apportionment (as this should be part of your yearly budget) and CREDIT a liability account. This will then reflect that there is money set aside (restricted) that the church is required to pay out.

When you then write the check to pay the apportionment, you DEBIT the liability account and CREDIT the checking account.

[CuMc1233]

Yes, Ideally I would. The problem is that our apportionments are broken out into about 15 different expense accounts. We are asked to pay a specific amount towards pastor health insurance, retirements, various mission funds, etc...each year to our conference as part of apportionments. I need to hold the money each week until the next monthly meeting and then report how much is in there, then finance will decide which fund expense to pay out and how much to each. It is only then that I would know which funds to expense the liability to. That is my dilemma, How I restrict those funds for the month until I know where to expense them out. I thought I had a solution (creating an equity fund 3112-board restricted funds and then an unrestricted income account 4026-tithes to apportionments that closes to that account) This way went I put the funds in the 4026 account, it would not show under net unrestricted assets but rather board restricted assets.

The issue is that these are not temporarily restricted (since they are not donor specified) and would still not provide a chance to just release the funds. So I would have to add additional expense accounts that close to the 3112 account. and use those when paying from the restricted fund and the others when paying from the general fund. It would work and show everything on income/expense and balance sheet but it seems like a lot more work.

[CuMc1233]

OK, I think I figured this out. I created a new category of funds in the accounts chart.

Under restricted release, I added board restricted release as a category and added an account for apportionments.

I then set up under the add restricted funds:

Apportionments:
Equity account: 3112 (new board restricted equity account under unrestricted assets)
income account 4027 (unrestricted income labeled Tithe to Apportionment)
release account: 4801-101 Board restricted release

I also created a sub-checking account
1110-101 Apportionment fund

now I can transfer from 4025 to 4027 and group them under tithes and offerings and it will also close to 3112 instead of 3110 so it will show as board restricted instead of unrestricted net assets at the end off my balance sheet.

When I pay them, it would look like:
cr: 1110-101-apportionment fund
db: 67xx--all expense accounts
Then Release from apportionments This should fix it since my 4801-101 release will close to 3112 decreasing that equity account on my balance sheet and keeping all funds where they need to be.

This seem right?