Temporary Restrictions

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JPGA
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Joined: Fri Jul 28, 2017 11:15 pm

Temporary Restrictions

Post by JPGA »

I went through the setup wizard and have all my temporary restricted accounts set up, I have been trying to figure out how to run expenses in these temporary restricted accounts and I am not having any luck. I have been working on this for a couple of years and just can not get it right. I am not sure what I am missing.

NeilZ
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Re: Temporary Restrictions

Post by NeilZ »

JPGA wrote:I went through the setup wizard and have all my temporary restricted accounts set up, I have been trying to figure out how to run expenses in these temporary restricted accounts and I am not having any luck. I have been working on this for a couple of years and just can not get it right. I am not sure what I am missing.
You do not 'run' expenses through the accounts, you RELEASE funds from the restricted accounts using the "Release Restricted Funds" button on the invoice entry screen.

Here's a sample exchange:

01-1110-000 CHECKING CR 1000.00
01-5323-000 Some Exp DB 1000.00

You then click the Release Restricted Funds button, select the restriction to use, and either click OK to use the default amount, or adjust the amount to only release a partial amount. That entry then adds these two lines;

01-4819-000 Restrictd Fund Release DB 1000.00
01-4999-000 Released from restriction CR 1000.00

This transaction properly enters the expense, and then releases funds from the Temporary Restricted Fund to the Unrestricted Net Assets which is the main Net Assets account most all expense accounts close to.

Does this help?
Neil Zampella

Using PC+ since 1999.

JPGA
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Joined: Fri Jul 28, 2017 11:15 pm

Re: Temporary Restrictions

Post by JPGA »

I did try to follow your example but where I am having my issue is where do I run the DB?

I have several temporarily restricted accounts example Women's ministry, Back Pack program, Men's ministry etc, but when I look at my chart of accounts I only have Liability, Net Assets and income that are labeled with my Temp restricted Accounts do I need to make an expense line item for each one? or where would I run the Debit so I can release my restricted funds.

NeilZ
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Re: Temporary Restrictions

Post by NeilZ »

JPGA wrote:I did try to follow your example but where I am having my issue is where do I run the DB?

I have several temporarily restricted accounts example Women's ministry, Back Pack program, Men's ministry etc, but when I look at my chart of accounts I only have Liability, Net Assets and income that are labeled with my Temp restricted Accounts do I need to make an expense line item for each one? or where would I run the Debit so I can release my restricted funds.
Basically the first thing you do is create the invoice. You use the standard checking account and an expense account that would cover the ministry making the expense.

Say your Worship Ministry has account 01-5530-000 Miscellaneous Expenses. The Women's Ministry buys a new Advent Candle stand for $500.00 from Cokesbury. The women's ministry temp restricted release account is 4819-000.

You would create the invoice with the Vendor code for Cokesbury, the account area of the invoice should look like this at this time:

01-1110-000 Checking CRedit 500.00
01-5530-000 Worship Misc DeBit 500.00

Now since the money is coming from the Women's Ministry's Temp Restricted Account, you would click on the Release Restricted Funds button on the invoice entry screen. The dialog that appears will ask you to select the Temp Restricted Account you're taking the money from. You should see the 500.00 already listed, if not enter it. You can add any additional information in the comment box such as Authorized by Jane Smith, Women's Ministry chair then click OK.

The SYSTEM will then add the next two lines for you:

01-4819-000 Restricted Fund Release DB 500.00
01-4999-000 Released from restriction CR 500.00

that's all you need to do.

This is a situation where the misc worship account is non-budgeted, so it will show that way on the I&E report, but the funds will be released from the Women's Ministry temp restriction. This may sound strange, but the system works this way. The release will show in the I&E report under restricted releases.

However, if you want to show the purchase by the Women's Ministry, I'm going to assume that there are already expense accounts setup in the system for that ministry to use, you would select one of those for the original DEBIT expense.
Neil Zampella

Using PC+ since 1999.

hutch5838
Posts: 4
Joined: Mon May 22, 2017 11:48 am

Re: Temporary Restrictions

Post by hutch5838 »

Following these Temporary Restriction instructions I made the following entry:

Youth Camp Fund 4235-210 (has $2000 fundraiser income and $500 fundraiser expense. I entered this:
CR Bank Account $500
DB Youth Fund 6152-210 $500
DB Youth Camp Donation Release 4835-210 $500
CR Released from Restriction $500

PROBLEM:
The CHANGES in EQUITY report records the transaction as:

Income Release Expense Balance
$2000 $-500 $-500 $1000

The $500 is deducted twice leaving an incorrect balance. What am I doing wrong?

NeilZ
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Re: Temporary Restrictions

Post by NeilZ »

hutch5838 wrote:Following these Temporary Restriction instructions I made the following entry:

Youth Camp Fund 4235-210 (has $2000 fundraiser income and $500 fundraiser expense. I entered this:
CR Bank Account $500
DB Youth Fund 6152-210 $500
DB Youth Camp Donation Release 4835-210 $500
CR Released from Restriction $500

PROBLEM:
The CHANGES in EQUITY report records the transaction as:

Income Release Expense Balance
$2000 $-500 $-500 $1000

The $500 is deducted twice leaving an incorrect balance. What am I doing wrong?
Was the restriction setup using the Maintain List of Donor Restrictions?
If so, did you click on the Release Restricted Funds button on the Create Invoice window, and did the system enter the last two lines?
What is the account number for the released from restriction?

Which Fund Balance account is showing the issue you report?

You should see a debit from the fund balance account setup for the youth camp donation, you should NOT see any expenses against that fund balance account, as you're releasing the funds from that temp restriction to the unrestricted Net Assets fund balance account.

I somehow suspect that you have that expense account closing to the temp restricted fund balance account and not the unrestricted net assets account.
Neil Zampella

Using PC+ since 1999.

hutch5838
Posts: 4
Joined: Mon May 22, 2017 11:48 am

Re: Temporary Restrictions

Post by hutch5838 »

You were right. I had the expense account closing to the fund balance instead of unrestricted net assets. Thank you.

JPGA
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Joined: Fri Jul 28, 2017 11:15 pm

Re: Temporary Restrictions

Post by JPGA »

Thank you for all your help. I was able to get everything working.

I do have one more question, When I entered all my entries in accounts payable and posted everything I forgot to release restricted funds :wall: is there a way I can do this now or am I going to have to reverse them all and re-enter?

Thank you

Zorak
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Re: Temporary Restrictions

Post by Zorak »

You can enter a separate transaction that only contains the release part. You shouldn't need to reverse and reenter.

NeilZ
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Re: Temporary Restrictions

Post by NeilZ »

Zorak wrote:You can enter a separate transaction that only contains the release part. You shouldn't need to reverse and reenter.
I do this when I have to. I create the transaction in Funds Accounting, and include supporting information in the notes area of the transaction.
Neil Zampella

Using PC+ since 1999.

Jesus Rules
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Re: Temporary Restrictions

Post by Jesus Rules »

When your entering a separate transaction to just contain the release part what does it look like?

NeilZ
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Re: Temporary Restrictions

Post by NeilZ »

Jesus Rules wrote:
Thu Apr 29, 2021 12:27 pm
When your entering a separate transaction to just contain the release part what does it look like?
Something like this:

01-4820-000 DB Release $500
01-4999-000 CR Released from Restriction $500

The 4999-000 is the system created default, and should not be changed.

The easiest way to have this created for you is to do the following:

1. Menu: ACCOUNTING -> FUNDS ACCOUNTING -> Enter Transactions
2. On the Enter Transaction window, click on the Release Restricted Funds button. Then follow the prompts to select the restricted fund you wish to release from, click on the Next button, then enter the amount you want to release. Enter an explanation there for the release if you want. Click the Finish button.
3. The proper entries will then be seen in the Enter Transaction window. Enter a reference such as Restricted Funds Release, a brief description in the Transaction Desc block, and what I do is enter a FULL explanation of why I'm doing this release in the notes block at the bottom of the window for audit purposes.
4. Click on the Save button, and you're done.
Neil Zampella

Using PC+ since 1999.

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