User Support Forum

Back in May someone (as yet unidentified) apparently paid their utility bill by phone, using the church's checking account routing/account numbers. It showed up on the bank statement as a withdrawal.

Although the utility company has said they would notify the bank to credit the withdrawal back to the checking account, that has not yet been done.

In the meantime, I did not enter the withdrawal in PC+. Consequently, the bank statements have failed to reconcile by that amount every month since then. I have made a written notation on each reconciliation report explaining the reason the statement did not reconcile.

Now that it is time to close the fiscal year I think I should make some kind of entry in PC+ to cover this circumstance but I'm stumped as to what to do.

Checking account 01-1110
Utility expense account 01-5401
Amount of unauthorized withdrawal $300.49

I have not yet closed fund accounting for May.

When/if the utility company gets around to correcting the church's checking account, what kind of entry would I make at that time? Or simply reverse the one I make now (assuming I have not closed fund accounting for the month I post it to)?

Guidance would be greatly appreciated!

Eden

I would set up an accounts receivable account for this. Then, post an entry in Fund Accounting as follows:

Debit accounts receivable $300.49
Credit checking account $300.49

This way you don't lose sight that you're owed the money. Once the refund comes in post the following entry to clear the receivable:

Debit checking account $300.49
Credit accounts receivable $300.49

matt wrote:I would set up an accounts receivable account for this. Then, post an entry in Fund Accounting as follows:

Debit accounts receivable $300.49
Credit checking account $300.49

This way you don't lose sight that you're owed the money. Once the refund comes in post the following entry to clear the receivable:

Debit checking account $300.49
Credit accounts receivable $300.49

Thanks, Matt, for your response.

I've not worked with accounts receivable before. Do you mean that I should do some activity in the Accounts Receivable module? Or do you mean that I should set up an expense account (e.g., 5401-001 Utility Accounts Receivable) in the Chart of Accounts?

(The expense account for the utility in question is 01-5401-000.)

Then my transaction in Fund Accounting would look like this:

CR 1110-000 $300.49
DB 5401-001 $300.49

Hmmm, on second thought.... Would I want to set up an asset account?
For example, add asset account 01-1199-000 to Chart of Accounts for Receivables?

Then
CR 1110-000 $300.49
DB 1199-000 $300.49

Is either of the above correct?

Eden

Your second entry--Debit 1199-000 and Credit 1110-000--is the entry you want to post. Post this entry in Fund Accounting using Enter Transactions. I do not recommend using the Accounts Receivable module in this circumstance, as this is not a case where the church needs to prepare and send out a bill to a customer.

THANK YOU, Matt!!

What a blessing you continue to be!

May the Lord prosper the work of your hands to His glory!

Eden

The unauthorized payment item from May 2008 has still not been cleared up and, to my knowledge, no follow-up is being done (by bank, utility company, law enforcement).

I set up the asset account for this item as Matt suggested.

How long do I keep something like this on the books?

When it does come time to clear it off, what transaction do I enter to take care of it?

(I honestly don't expect the church to ever recover this money.... )

Thanks,
Eden