User Support Forum

I am having difficulty reconciling my checking account balance with what PCP Ver 9 says we have. I have printed out the Check Register By Fund and doubled checked all deposits and withdraws and they all match and they are all in the correct column (i.e., debit vs. credit). I think the problem may be in the Temporarily Restricted Accounts, (some of which I set up myself after I did the original Chart of Accounts using the Accounting Setup Assistant) and also how I paid vendors out of these Temporarily Restricted Accounts.

Please let me know if the process I used to modify our Chart of Accounts to set up additional Temporarily Restricted Accounts was correct:

First I set up a Fund Balance Account (BTW: the figure on page 219 of the Manual calls it “Equity”) for Choir Books using account number 3270-114. (We only have one Fund with lots of accounts.)

I then set up a Temporarily Restricted Income Account using 4270-114 that was set up to close to 3270-114.

Next I set up a Contribution Fund # 114 that was set up to debit the checking account and credit the 4270-114 Temporarily Restricted Income Account. I did NOT set up a Temporarily Restricted Release Account within the 4800 series. (Sadly, I did not think of it at the time.)

When I wrote a check to someone to reimburse them for the Choir Books I debited 4270-114 which automatically debited 3270-114. But after reading a few other posts here on the Forum I now realize maybe that was a mistake. It seems maybe I should have set up a Temporarily Restricted Release Account and used that account? Would debiting a 4200 account directly mess up my checking account balance?

*** I did not set up a Temporarily Restricted Release Account for any of the Temporarily Restricted Income Accounts I set up, but I later noticed that the Temporarily Restricted Income Accounts that were established with my initial Accounting Setup using the Accounting Setup Assistant do have Release Accounts within that 4800 series. I have also written checks for those accounts but did not use the Temporarily Restricted Release Accounts which have numbers in the 4800s. For those I wrote a check and directly debited the 3200 account. After reading the other posts I now realize this was NOT the way to do it. I have looked but cannot find in the Manual where it explains how to pay from Temporarily Restricted Accounts.

I understand that I will need to go in and void all those checks written to debit the Release Accounts directly and re-enter the checks. But before I do that, here are my questions:

1. Was my set-up to add the new Temporarily Restricted Accounts appropriate or should I go back now and set up the 4800 accounts for all my new Temporarily Restricted Accounts? (I think I already know the answer to this one. . . . )

2. Do you think re-entering all the checks correctly will help reconcile my checking account balance with the balance in PCP? I hate to go back and redo all those checks if it will not solve the problem with reconciling the checking account with what is in PCP. (But what else could it be? )

3. Where is the manual does it explain how to pay a vendor from a Temporarily Restricted Account using the Temporarily Restricted Release Accounts? I have looked in Accounts Payable and can’t seem to find it. There are a couple of posts here on the forum about this process, but none in very much detail. (I have found the manual very helpful, if you read it carefully. . . )

Sorry for the long message, but I figured the more information I could provide the better everyone would understand my situation.

This forum is great! I have found answers to just about all of my questions here. Thanks to all of you who answer the questions from us “dummies.”

Jean McCauley
NCUU
Lecanto, FL

mccauleyjean wrote:When I wrote a check to someone to reimburse them for the Choir Books I debited 4270-114 which automatically debited 3270-114. But after reading a few other posts here on the Forum I now realize maybe that was a mistake.

The check should have debited an expense account. An additional two lines in the transaction would handle the releasing of funds from restriction.

mccauleyjean wrote:It seems maybe I should have set up a Temporarily Restricted Release Account and used that account?

Yes, for each restriction, you should have an equity, income, and income release account. Using the "Maintain List of Donor Restrictions" screen to set this up walks you through it step by step, making sure all the necessary accounts are in place. Also, this enables you to click the "Release Funds From Restriction" button when writing a check, making that process much less confusing.

mccauleyjean wrote:Would debiting a 4200 account directly mess up my checking account balance?

It shouldn't, as long as the credit was to the bank, the bank account balance should be correct.

mccauleyjean wrote:*** I did not set up a Temporarily Restricted Release Account for any of the Temporarily Restricted Income Accounts I set up, but I later noticed that the Temporarily Restricted Income Accounts that were established with my initial Accounting Setup using the Accounting Setup Assistant do have Release Accounts within that 4800 series. I have also written checks for those accounts but did not use the Temporarily Restricted Release Accounts which have numbers in the 4800s. For those I wrote a check and directly debited the 3200 account. After reading the other posts I now realize this was NOT the way to do it. I have looked but cannot find in the Manual where it explains how to pay from Temporarily Restricted Accounts.

I do suggest going through the Maintain List of Donor Restrictions screen. Open it up and click the Add button. It will walk you through each step of the process in either defining an existing account for each or having it create a new account for you, where ones are missing. The process to release funds from restriction should look like this: (the account numbers are just for example)

The first part of the transaction looks like writing any other check The second part of the transaction is what is special about this process: The second part of the process is what moves money out of the restricted equity into unrestricted equity (we are sending negative income using the release account, then positive income to the unrestricted equity "Released From Restriction."

When you are in Accounts Payable, creating an invoice or manual check to spend restricted money, the first part of the transaction, recording an expense and taking the money out of the bank, is entered like a normal transaction. Then click the "Release Funds From Restriction" button, choose the Donor Restriction from the list, and PowerChurch Plus will create the second part of the transaction for you automatically.

In debiting the restricted income account, what you have done is taken away your ability to report on the income that you have received. The goal is to always know how much money came in - and using an expense account when spending money will show how much has been spent.

If you receive $100 in restricted income, then that same month spend that $100, if you debit your restricted income to take the money out, then your Income and Expense Statement for the month will show $0, instead of showing $100 income and $100 expense.

mccauleyjean wrote:Do you think re-entering all the checks correctly will help reconcile my checking account balance with the balance in PCP? I hate to go back and redo all those checks if it will not solve the problem with reconciling the checking account with what is in PCP. (But what else could it be? )

Well, if the amount of the credit to the bank was correct, then this isn't your problem with reconciling. Were you ever able to reconcile with the bank statement, or is this a new problem?

mccauleyjean wrote:Where is the manual does it explain how to pay a vendor from a Temporarily Restricted Account using the Temporarily Restricted Release Accounts? I have looked in Accounts Payable and can’t seem to find it. There are a couple of posts here on the forum about this process, but none in very much detail. (I have found the manual very helpful, if you read it carefully. . . )

A brief explanation of the process can be found in the Introduction To Accounting section of the manual. Also the usage of the "Release Funds From Restriction" button is addressed in both the Accounts Payable and Fund Accounting sections (you will see the button on several screens)

The authoritative source of information regarding the Donor Restrictions process is a document called "Accounting For Contributions" that was included on the installation CD of PowerChurch Plus and also here on the website at http://www.powerchurch.com/support/answ ... icle_id=58