User Support Forum

I am starting with one employee and he is a Youth Leader. A portion of his salary comes from a 5XXX account which is fine but the balance of his salary comes from a restricted fund account. I cannot enter that account in the Income Item for his salary so that it will post to that account accurately each pay period. At this time I have no choice but to use a 5XXX account and do a journal entry to post it to the proper account.

Is there another way to handle this so I don't have to go through these maneuvers each pay period to post correctly?
Thanks

LQ Helper wrote:I am starting with one employee and he is a Youth Leader. A portion of his salary comes from a 5XXX account which is fine but the balance of his salary comes from a restricted fund account. I cannot enter that account in the Income Item for his salary so that it will post to that account accurately each pay period. At this time I have no choice but to use a 5XXX account and do a journal entry to post it to the proper account.

Is there another way to handle this so I don't have to go through these maneuvers each pay period to post correctly?
Thanks

FWIW ... you're not 'Posting' to a temporarily restricted income account. You should be 'releasing' the funds. I have to do this monthly with our minister's housing allowance. This comes out of a temp restricted income account setup when they church sold the manse.

What I do this this:

1. Use payroll as normal. Have all the correct expense accounts setup as usual.
2. Post the payroll to Funds Accounting.
3. Go into the Modify Unposted Transactions function of Funds Accounting.
4. Find the Payroll transaction, then click on the Release Restricted Funds button at the bottom of the transaction window. Find the Restricted Fund, enter the amount being released, then click the Finish button.
5. Save the transaction. You WILL get a message about modifying a transaction that came from the Payroll Module. This is normal, and you can click on the YES button to save the transaction.

The system will then do what is needed to properly take care of the postings.

If you were changing the transaction to put the Restricted Income account for the expense, you are causing net asset issues.

Thank you, Right now I don't use release of restricted funds to an expense account. I use a Release Restricted Youth Funds (4845-000) directly. For income to that account I use a Restricted Income Youth Funds (4245-000). I will do that and thank you.

LQ Helper wrote:Thank you, Right now I don't use release of restricted funds to an expense account. I use a Release Restricted Youth Funds (4845-000) directly. For income to that account I use a Restricted Income Youth Funds (4245-000). I will do that and thank you.

No problem .. when you use the method I listed above, its a 'no brainer' the system enters the proper income release account and the released from restriction account (usually 4999-000 the default).

Couldn't be easier.

I have a similar problem and want to make sure this will work:
We collected monies for Pastor Appreciation month and I paid the pastor via Payroll. I posted to fund accounting and posted in fund accounting before realizing that I did not release from restrictions.
I reversed the transaction in fund accounting and it gave me the warning that Payroll will not be adjusted.
I now have a reversed entry 21000-REVERSE.

Do I now need to add a new transaction with the same payroll details for check 21000 and then do a release from restrictions?


Thanks for your help!

LizAA wrote:I have a similar problem and want to make sure this will work:
We collected monies for Pastor Appreciation month and I paid the pastor via Payroll. I posted to fund accounting and posted in fund accounting before realizing that I did not release from restrictions.
I reversed the transaction in fund accounting and it gave me the warning that Payroll will not be adjusted.
I now have a reversed entry 21000-REVERSE.

Do I now need to add a new transaction with the same payroll details for check 21000 and then do a release from restrictions?


Thanks for your help!

Liz ...

you don't have to create a new transaction in Payroll. There's no way to release funds in the Payroll module, and frankly nothing going to change there anyway.

Just use the original Posted Transaction (not the reversal) in Funds Accountingl as a 'template' and create a new transaction in Funds Accounting using all that information. Then click on the Release Restricted Funds button, to release the funds, and have those accounting lines added. Then post that transaction fo Funds Accounting. This will take care of the issue.

In future, you really DON'T have to reverse the payroll transaction if you forgot to 'release funds'. All you need to do is go into Funds Accounting Transactions, and enter the usual information at the top of the screen, then click on the release funds button, and release the funds from the restricted fund for the amount in question. Add as much information in the comments box for an audit trail, then post the transaction.

The funds will be released, and all will be right with the world

Sorry,
I had already posted the transactions in Fund accounting so I reversed the Fund Accounting entry even though it said it wouldn't affect the Payroll Module. That gave me the 21000-REVERSE entry. I did not reverse anything in Payroll.

So then technically, I would just have to do what you instructed below... except for....

I checked the payroll entry and the "Maintain Item Description" to find that the expense account was set up to use the 01-4810- restricted account.. I had 'corrected' the restricted 'accounts' for "Pastor Appreciation" under 'maintain list of donor restrictions' but didn't realize that the payroll setup was incorrect... and I've already processed and printed the check. I am not sure if I can correct this entry unless I go and reverse the Payroll entry and process that check again??? Can I even do that now? since I have reversed the Fund Accounting transaction already?

For future 'Pastor Appreciation' payroll amounts this is what I plan to do:

1) Use the 'Maintain Item Description' for Pastor Appreciation and change the Expense account to 01-5270- (Staff Appreciation).
2) The restricted funds set up is correct, I believe, (I used the 'Maintain List of Donor Restrictions" so I have an Equity, Income and -48xx- release account associated to it.)
3) Monies collected for Pastor appreciation will go through the Contribution fund 120 that credits the 01-4270- income account that closes to the 01-3270- equity account.
4) Process Payroll with the Payroll item "Pastor Appreciation" that uses 01-5270- as the expense account that is Income, and taxable.
5) Post Payroll to Fund Accounting.
6) Under Fund Accounting: Use Modify Unposted Transaction to include 'Release from Restrictions' and select 'Pastor Appreciation', which should bring up the auto entries required. Then my income and expense report shd be more accurate.

Is that correct?
Thanks so much for your help and your speedy reply,
Liz

LizAA wrote:Sorry,
I had already posted the transactions in Fund accounting so I reversed the Fund Accounting entry even though it said it wouldn't affect the Payroll Module. That gave me the 21000-REVERSE entry. I did not reverse anything in Payroll.

So then technically, I would just have to do what you instructed below... except for....

I checked the payroll entry and the "Maintain Item Description" to find that the expense account was set up to use the 01-4810- restricted account.. I had 'corrected' the restricted 'accounts' for "Pastor Appreciation" under 'maintain list of donor restrictions' but didn't realize that the payroll setup was incorrect... and I've already processed and printed the check. I am not sure if I can correct this entry unless I go and reverse the Payroll entry and process that check again??? Can I even do that now? since I have reversed the Fund Accounting transaction already?

No need to correct anything in Payroll except change the Item Description to use the expense account. That Item Description account is used to create the transaction that you reversed in Funds Accounting. In which case when you recreate the transaction in Funds Accounting, just use that 01-5270- account instead of the income account.

Just have a lot of explanatory comments as to why the changes were made in the transaction for audit purposes.

For future 'Pastor Appreciation' payroll amounts this is what I plan to do:

1) Use the 'Maintain Item Description' for Pastor Appreciation and change the Expense account to 01-5270- (Staff Appreciation).
2) The restricted funds set up is correct, I believe, (I used the 'Maintain List of Donor Restrictions" so I have an Equity, Income and -48xx- release account associated to it.)
3) Monies collected for Pastor appreciation will go through the Contribution fund 120 that credits the 01-4270- income account that closes to the 01-3270- equity account.
4) Process Payroll with the Payroll item "Pastor Appreciation" that uses 01-5270- as the expense account that is Income, and taxable.
5) Post Payroll to Fund Accounting.
6) Under Fund Accounting: Use Modify Unposted Transaction to include 'Release from Restrictions' and select 'Pastor Appreciation', which should bring up the auto entries required. Then my income and expense report shd be more accurate.

Is that correct?

Perfect ..

Thank you! I sure appreciate your expertise!!

Liz