Fixed Asset/Fund balance totals

[whfpc]

Pc 12.2, when I first started, I knew nothing about this position, someone came in and trained me and noticed some things we should change and made changes in our funds, account numbers and all. We asked for them to be changed back (giving the chart of accounts they had prior to me starting) but it only made it worse so now I am trying to correct it with the knowledge I have and help from the help section, book and this forum (which is awesome). Here's how it was:
Fund 01 - Operating income 4____ and expense 5____, if 4____ was 4114 then 5___ was 5114. and sub accounts would be, pastor 001.
Fund 02 - is restricted to certain items, someone donates $10,000 for new computers it goes to that fund and is spent out of that fund. income remains 4_____ and expense is 6___, same instance was above but most have contribution codes as well so we would set it up like so: 324 contribution for scholarship, 02-4324-324 income account, 02-6324-324 as expense and 02-3324-324 as close to account, this would make it simple to run a sub account report and see all activities for all instances. (now it could be 324 is still contribution fb is still 02-3324-324 but income could be 02-4216-216 and expense 02-6216-216)
I started correcting with our Missions Special Offering: One great hour, Christmas eve, 3 cents a meal...... in order to get them to a number that wouldn't conflict I used the 800's 02-3842-842 02-4842-842 02-6842-842. on my balance sheet my subtotal fixed assets FB (close to 3510-500) now shows before the 3850 accounts and that number is correct (compared to what we actually have and a report I ran a few weeks ago) but now the 800's are adding to my fixed assets instead if my subtotal of session/donor FB which is 3200.

How do I get my new accounts to add to the subtotal session/donor fb instead of my subtotal fixed assets fb? Or do I just change it back and deal with all of the different numbers that could be beautiful and now are not?

Robin

[NeilZ]

Pc 12.2, when I first started, I knew nothing about this position, someone came in and trained me and noticed some things we should change and made changes in our funds, account numbers and all. We asked for them to be changed back (giving the chart of accounts they had prior to me starting) but it only made it worse so now I am trying to correct it with the knowledge I have and help from the help section, book and this forum (which is awesome). Here's how it was:
Fund 01 - Operating income 4____ and expense 5____, if 4____ was 4114 then 5___ was 5114. and sub accounts would be, pastor 001.

First off ... by default income is the 400 series of numbers. I have no idea why you would want to have the income number be 4111 and the expence equal 5111. Be definition operating income should cover everything in operations. If someone gives specifically to support a certain ministry then those are donor restricted funds, and should be setup as such.

Now Subaccounts can tie things together, such as all the pastor costs, but its easier to also group those under one area such as.
Pastor Expenses - 01-5100-001 Level 3
Pastor Salary - 01-5101-001 Level 5
Pastor Housing - 01-5102-001 Level 5
Pastor Benefits - 01-5103-000 Level 5 (no budget)
Pastor Health In - 01-5104-001 Level 6

and so on ...

The level number shown is set in the COA, and creates 'headers' or active accounts. Normally levels 1 thru 3 are headers and 4 thru 6 are active, you can use 4 as an active account (I believe) also.

Fund 02 - is restricted to certain items, someone donates $10,000 for new computers it goes to that fund and is spent out of that fund. income remains 4_____ and expense is 6___, same instance was above but most have contribution codes as well so we would set it up like so: 324 contribution for scholarship, 02-4324-324 income account, 02-6324-324 as expense and 02-3324-324 as close to account, this would make it simple to run a sub account report and see all activities for all instances. (now it could be 324 is still contribution fb is still 02-3324-324 but income could be 02-4216-216 and expense 02-6216-216)

The problem is this should not be a separate fund, as these are all operational type purchases. These again should be donor restricted accounts, and when you purchase them under OPERATIONS you would RELEASE the funds from those restrictions. You can still use subaccounts to do this, but you would eliminate another fund that is kind of redundant, along with another checking account (I'm assuming)

I started correcting with our Missions Special Offering: One great hour, Christmas eve, 3 cents a meal...... in order to get them to a number that wouldn't conflict I used the 800's 02-3842-842 02-4842-842 02-6842-842. on my balance sheet my subtotal fixed assets FB (close to 3510-500) now shows before the 3850 accounts and that number is correct (compared to what we actually have and a report I ran a few weeks ago) but now the 800's are adding to my fixed assets instead if my subtotal of session/donor FB which is 3200.

Again, these types of special offerings are actually not income to the church, they are liabilities as they 'pass through' to the denomination. So a liability account can be used, or again, you can set these up as donor restricted. Again, when you send the money out, you would have these setup as expenses under fund 01, and release the funds from the donor restricted account.

Special Offerings 01-7500-000 Level 3
OGHA - 01-7510-001 Level 5
Pentecost - 01-7511-001 Level 5
Christmas Joy - 01-7512-001 Level 5

and so on.

How do I get my new accounts to add to the subtotal session/donor fb instead of my subtotal fixed assets fb? Or do I just change it back and deal with all of the different numbers that could be beautiful and now are not?

Robin

Fixed assets are anything that is land, building, etc. Evidently you have all that included in the operations, and they have a fund balance account. Everything else is liquid assets. FWIW .. a church is run on a cash basis (liquid assets), churches can have savings (which is liquid) and endowments which can be turned into liquid assets, but everything else (building, vehicles, furniture, etc) is fixed assets.

To easily correct that just verify what accounts close to what accounts. By default the 3110-000 account is the Unrestricted Net Asset account all your liquid assets should close to this account. Anything else should have its own fund balance (net asset) account. You can use the Account Close To Report to see what is closing to what.

What I've done is to keep endowments in its own accounting fund, as well as building assets in their own accounting fund. This keeps the 01-Opeations accounting fund clean and shows exactly what liquid assets and expenses are being used for the work of the Kingdom.

In any case, I would not make any changes until the end of the current fiscal year, I would also get with the Session and plan the Chart of Accounts so that expenses line up with the ministries. This may mean you have an account for activities under a Fellowship ministry, and one under a Youth Ministry. But in any case, I would sit and plan any changes to be made well before you do it.