CHANGE "close to" equity fund account

[KarinK22]

Is there a way to change the "close to" account?

We have a building project and the funds are merged with our general equity account... we realize now it should be showing separately, but we are now on year 2 of the building campaign.

[NeilZ]

Is there a way to change the "close to" account?

We have a building project and the funds are merged with our general equity account... we realize now it should be showing separately, but we are now on year 2 of the building campaign.

Yes and no. I haven't tried this. So make a backup of the accounting database so you can restore to before the changes. You should make this a Donor Restricted Account, so all income comes through the Building Fund income which should also be pointed to the new fund balance (equity) account.

Go to Accounting -> Funds Accounting -> Setup -> Maintain List of Donor Funds , you want to click on the ADD button. The system will then walk you through the process.

Step 1: The next window will ask you to Specify the description of the donor restriction , obviously this will be the building fund. It will be temporarily restricted. I'm also guessing it will be in the default general accounting fund of 01, so enter that. Then click NEXT.

Step 2: you'll be asked to Specify the fund balance account. If you haven't created it yet, you can do that here. The default Powerchurch installation enters headers for 'Donor Restricted' and under that 'Temporarily Restricted' using a number series of 3201-000 for the header. Create your fund balance account here. If you've already created the account, click the Use existing account and select from the list above. Then click on NEXT.

Step 3: The next window asks you to Specify the income account I suspect that has already been created, so select that here by clicking the box for use existing, and select the income account. Then click NEXT. Again, if you're using the default Powerchurch setup, there are headers for Temp Restricted income. If the income account you're going to use is not listed under that header, its not a big deal, but you may want to renumber that account to put it under that header. You would do that after all this is finished, under Maintain Chart of Accounts. If you do change the number, the system will update everywhere the previous number was used.

Continuing on here Step 4: Specify the release account this is in the 4800- range in the normal Powerchurch setup. 4801- is the start of the temp restricted release range, create an account in that range. This account is used to move funds from the restriction, to the unrestricted when you write a check.

Step 5: Is Specify the expense account, this is optional, as you may be paying from a few different expense accounts, and you'll have some flexibility to do so so you can just click on NEXT.

Step 6: Specify the contribution fund here's where you select the contribution fund where donations toward the building fund get tallied. Again, I expect its already been created, so select from the list. Click NEXT, then FINISH. The system will then setup everything you need.

Now open the Maintain Chart of Accounts and verify all the changes have been made. If you want to change that income account number you can do it here by just finding the account, selecting it, and overwrite the current account number. Click SAVE and the system will update everything.

Now you need to move funds from the unrestricted fund balance (equity) to the temp restricted fund balance. That's a simple transaction you'll enter from Accounting -> Funds Accounting -> Enter Transactions

You've probably done this before, the top entries are fairly self-explanatory, although I'd definitely add as much detail in the window's note box at the bottom left for audit purposes.

The transaction itself is fairly straightforward.

You're going to DEBIT the General Equity (Fund Balance) and CREDIT the new Temp Restricted Equity (Fund Balance) account for the amount of funds you want to move. Post that, and then run a Balance Sheet report, and you'll see the funds are where they're supposed to be.

Then whenever you write a check for the building fund, you will basically use the same Accounts Payable invoice as before. The funds will still come out of your normal checking account, and the expense the normal expense, unless you've decided in Step 5 above to create a specific building expense, in which case you may need to update your vendor record to reflect that.

The one additional step here is to Release Restricted Funds .. by clicking on the button at the bottom left of the Open Invoices window, select the building fund temp restriction and enter the amount to be released. Usually the amount of the check you're writing. The system will add the proper release accounts. Then just post the accounts payable, and post transactions in Fund Accounting, and your Income & Expense report will reflect the funds moving from restriction to general as well as the expenses incurred.

Does that help?