correcting a transaction that used restricted funds

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bjwhitson
Posts: 99
Joined: Wed Mar 19, 2008 2:19 pm
Location: Grayson, GA

correcting a transaction that used restricted funds

Post by bjwhitson »

I posted a transaction that paid an expense from restricted funds -

01-1115-000 Designated Funds $94.02 (CR)
01-5005-150 MIsc exp $33.31 (DR)
01-5005-150 Misc Exp $60.71 (DR)
01-4850-150 MIsc Exp $94.02 (DR)
01-4999-000 Release $94.02 (CR)

I realized after the fact that the $33.31 should have been paid to a member so I wrote a check from the same Misc Exp account for $33.31. So I've ended up with the $33.31 being paid twice from a restricted account.

I'd like to redirect the first payment to be used for a General Fund expense (acct 01-1110-000) and can't figure out how to transfer the $33.31.
I tried this -

01-5005-150 Misc Exp $33.31 (CR)
01-5100-100 Office exp $33.31 (DR)
That shows up correctly in the 01-5100-100 account but doesn't reflect properly in the restricted account
I tried using the income account (01-4250-150) associated with the restricted funds, but that doesn't work either.
I can't reverse the original transaction as it's already cleared the credit card statement and the bank rec.
Not sure if I've explained this adequately to be understood.

BJW
current version - Ver 14
BJW
Finance Committee-HPC
PC+ user since 2008
Grayson, GA

NeilZ
Posts: 10209
Joined: Wed Oct 08, 2003 1:20 am
Location: Dexter NM
Contact:

Re: correcting a transaction that used restricted funds

Post by NeilZ »

bjwhitson wrote:
Wed May 03, 2023 11:41 pm
I posted a transaction that paid an expense from restricted funds -

01-1115-000 Designated Funds $94.02 (CR)
01-5005-150 MIsc exp $33.31 (DR)
01-5005-150 Misc Exp $60.71 (DR)
01-4850-150 MIsc Exp $94.02 (DR)
01-4999-000 Release $94.02 (CR)

I realized after the fact that the $33.31 should have been paid to a member so I wrote a check from the same Misc Exp account for $33.31. So I've ended up with the $33.31 being paid twice from a restricted account.

I'd like to redirect the first payment to be used for a General Fund expense (acct 01-1110-000) and can't figure out how to transfer the $33.31.
I tried this -

01-5005-150 Misc Exp $33.31 (CR)
01-5100-100 Office exp $33.31 (DR)
That shows up correctly in the 01-5100-100 account but doesn't reflect properly in the restricted account
I tried using the income account (01-4250-150) associated with the restricted funds, but that doesn't work either.
I can't reverse the original transaction as it's already cleared the credit card statement and the bank rec.
Not sure if I've explained this adequately to be understood.

BJW
current version - Ver 14
OK ... when you release funds from a restricted account what happens is seen in the last two lines of the transaction. The funds are released through a DEBIT transaction from the restriction, and passed over to the unrestricted net assets through the CREDIT transaction to 'Released from Restriction' account which defaults to 01-4999-000.

There are best way to fix this, is to VOID and REISSUE the first check using the same check number and date. I realize it has already cleared the bank, but you're not changing the check amount in reality so this will balance the accounts only.

Since it appears you sent a check to the credit card company, you need to change the amount released in the check from 94.02 to 60.71. Obviously you do not want to print this check, so don't check the Print Check box. If you already entered that second transaction reverse that. Open Maintain Manual Checks and adjust the release amounts, then add a note in the VOIDED check and REISSUED check describing what you did and why. This is always good for any audit trail use.

That should clear up the released funds. That said I have no idea how your system is setup with checking accounts. Is the 01-1115-000 account a completely separate checking account, and exactly what is it used for? This is the fly in the ointment ... as that can mess this up entirely.
Neil Zampella

Using PC+ since 1999.

bjwhitson
Posts: 99
Joined: Wed Mar 19, 2008 2:19 pm
Location: Grayson, GA

Re: correcting a transaction that used restricted funds

Post by bjwhitson »

Thanks, Neil, as always! :D
I ended up just reversing and correcting the first transaction. I only have one checking account - 01-1110 is the undesignated fund acct and 01-1115 is the designated fund acct. By changing that first transaction to reflect only the $60.71 against designated funds, then the second one works fine.
All my accounts are balanced and I'm ready to print April reports!
This is one of those transactions that you look at for so long and you can only see it one way. Thanks for your perspective on correcting!
BJW
BJW
Finance Committee-HPC
PC+ user since 2008
Grayson, GA

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