Moving funds / equity

[Eden Whitehead]

The church decided to set up a special Music Fund using donor-restricted monies that were previously received as memorial gifts. The monies will remain in the bank account where they were originally deposited.

The existing accounts for Memorials are:
01-3240-401 Equity
01-4240-401 Income
01-4840-401 Release
01-8040-401 Expense

For the new Music Fund, I set up these accounts:
01-3240-402 Equity
01-4240-402 Income
01-4840-402 Release
01-8040-402 Expense

What do I need to do to "move" the $$ from the -401 to the -402 account(s)? (Using ver 10.4 with Nov. 15 MR on Windows XP Home Edition)

Thank you.

[Matt]

You can input the following entry in Fund Accounting to accomplish the transfer:

Debit 01-4840-401
Credit 01-4240-402

This entry releases the monies from the Memorials fund and shows it as income in the Music Fund. The entry assumes that both accounts above are set to close into the corresponding equity accounts.

[Eden Whitehead]

Matt,

Thanks for your quick response.

This entry releases the monies from the Memorials fund and shows it as income in the Music Fund.

I neglected to mention that the Memorials "expense" account 01-8040-401 has a current balance of approx. $3200.00, which would need to decrease (wouldn't it?). Does "releasing" the monies from the Memorials fund via the debit transaction accomplish the decrease?

Do I *want* to show income when no new money is coming into the church?

My thinking was that I need to establish a "beginning balance" ($900) in the Music Fund, so what I did (last week) was this:

DB 01-8040-401 $900
CR 01-8040-402 $900

Now, I guess I need to "undo" that using the "Reverse" tool. But how do I respond to the query "Should restricted funds be released?" (I don't remember if I "released" restricted funds when I entered the original transaction.)

Would it help you to look at the Changes in Equity report?

Your help is greatly appreciated!

[Matt]

Eden,

Yes, you do want to look at the Changes in Equity report. This report should show a positive ending fund balance in the 3240-401 account of at least $900 before inputting the transfer. When you input the transfer using the debits and credits I described earlier the Changes in Equity Report will show a decrease in income and the ending fund balance for account 3240-401 and an increase in income and the ending fund balance for account 3240-402. The net effect on income between the two accounts is zero. This entry will establish the beginning fund balance of $900 in the Music Fund you are looking for.

You do not want to do anything to change the balance in the 01-8040-401 account. This is money that has already been spent. Also, you will want to reverse the $900 entry that you input to establish the beginning balances. To determine if you released funds on the original transaction run either the Journal Report or an account activity report for account 01-4840-401.

[Eden Whitehead]

Matt,

Thank you for your patient, detailed explanation.

I have completed the steps you prescribed and everything seems to be in order. The Changes in Equity report shows $900.00 (negative) released from restrictions in the 3240-401 account and income of $900.00 in the 3240-402 account.

From the Income/Expense report I see that the TOTAL INCOME is the same as before entering the transaction (the income shown for the Music Fund account is offset by the decrease in the release from the Memorials account).

You are truly a blessing!