Restricted Funds

[Patty Scott]

For my Temporary Restricted Contributions I have an income account, a release from restricted account, and an equity account for each contribution fund. Do I need an expense account also for each of these? I currently am not using an expense account, but when I use the release accounts to reduce the income when money is spent, the equity account does not calculate correctly. In the manual it does not mention an expense account when setting up restricted accounts. If I do need to set up expense accounts for each contribution fund, how should I do it? In my chart of accounts list I do not see any expense accounts set up for contribution/restricted funds.

[Matt]

It is not required that you have an expense account that correlates to your temporary restricted income, release, and equity accounts. However, when you spend temporarily restricted cash, you do need to debit either an expense or asset account.

It sounds like you may not have the close to accounts set up correctly on your temporarily restricted income and release accounts. To verify, go into Maintain Chart of Accounts for both the income and release accounts. For each account, click on the details button and then the account tab. Make sure that the close to account that's shown for both the income and release accounts is the same temporarily restricted equity account.

If you still can't get the temporarily restricted equity balance to come out correct, run the account close to report to see what accounts are closing into that account. You may have some accounts closing into that equity account in error.