We have a church member who used his own money to buy some items for a plaque that memorializes some people. He then came to me and said that he wanted to donate the amount to the Memorial Fund (a restricted fund), and gave me the receipt (for the purposes of this, let's call it $20).
Obviously, I could reimburse him $20 using our standard expense reimbursement form backed up by the receipt, and then he could write me a check for $20 to put in the Memorial Fund. But, it seems reasonable to save him (and me) that extra effort.
The whole transaction should reduce the Memorial Fund restriction by $20, since the $20 was used for a memorial purpose.
How should I enter this in PowerChurch? There is a contribution and an expense and a reduction of restriction. I can't figure out if the contribution was of money (since we didn't actually GET any money -- we got the pieces of the plaque, but we did get a receipt for the money). Do I enter the $20 contribution through the Contribution module (as if we did get cash -- I think this is the only way to record the $20 as a tax-deductible contribution), and the expense through Enter Transactions (in order to record the reduction of restriction)?
What would the transaction(s) actually look like (credit and debit what?)?
Thx,
Bill
Non-cash contribution (I think)
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From the sound of things, you're really not releasing any money from the memorial fund, as the plaque itself is the donation, so I'm not sure you really need to do anything in Powerchurch.
What I would do is give the donor a letter (with a copy for your records) acknowledging the donation and listing the amount of the donation. This will serve as a receipt for the IRS when the donor does his taxes.
I do understand that the donor wants this to reflect in the memorial fund, but in reality, its a wash !!
What I would do is give the donor a letter (with a copy for your records) acknowledging the donation and listing the amount of the donation. This will serve as a receipt for the IRS when the donor does his taxes.
I do understand that the donor wants this to reflect in the memorial fund, but in reality, its a wash !!
Neil Zampella
Using PC+ since 1999.
Using PC+ since 1999.
Confused by your answer
If the exact same overall result had been achieved in a different way, would your answer be different?
Let's say the following occurred:
- the individual gives me a $20 check, with instructions to put it into the Memorial Fund. I enter this through the Contributions module as a donation.
- the next month (or, a year later -- makes no difference), the individual spends $20 getting the nameplates for the plaque (not that it matters, but the plaque already exists, we just needed some new nameplates added to it), and submits a request for reimbursement for the $20. Since the expense needs to come out of the Memorial Fund, I write a check to the individual for the $20, releasing a $20 restriction from the Memorial Fund and crediting the fund $20.
In this scenario, since the contribution came as a lone item, not tied to any eventual reimbursement for an expense, I cannot see how it would make sense to not enter the contribution. Then, when the request for reimbursement came, again, I cannot see how it would make sense to not enter that transaction.
I do honestly admit to not really understanding accounting, but it doesn't seem to me that the amount of time that occurs between 2 events or the order in which they occur changes whether or not they should be included on the books. What am I missing?
One other way of looking at this (it seems to me) is that the only reason this is a wash is because very little money is involved. If, instead of $20 for nameplates, we were talking about $400,000 for a new parish hall, the money would need to be accounted for, and fixed assets would change. But, nobody changes fixed assets for $20 worth of nameplates. Is this right, or wrong?
It may seem as if I am sharpshooting you here, but I am NOT. I am just trying to understand.
Thx,
Bill
Let's say the following occurred:
- the individual gives me a $20 check, with instructions to put it into the Memorial Fund. I enter this through the Contributions module as a donation.
- the next month (or, a year later -- makes no difference), the individual spends $20 getting the nameplates for the plaque (not that it matters, but the plaque already exists, we just needed some new nameplates added to it), and submits a request for reimbursement for the $20. Since the expense needs to come out of the Memorial Fund, I write a check to the individual for the $20, releasing a $20 restriction from the Memorial Fund and crediting the fund $20.
In this scenario, since the contribution came as a lone item, not tied to any eventual reimbursement for an expense, I cannot see how it would make sense to not enter the contribution. Then, when the request for reimbursement came, again, I cannot see how it would make sense to not enter that transaction.
I do honestly admit to not really understanding accounting, but it doesn't seem to me that the amount of time that occurs between 2 events or the order in which they occur changes whether or not they should be included on the books. What am I missing?
One other way of looking at this (it seems to me) is that the only reason this is a wash is because very little money is involved. If, instead of $20 for nameplates, we were talking about $400,000 for a new parish hall, the money would need to be accounted for, and fixed assets would change. But, nobody changes fixed assets for $20 worth of nameplates. Is this right, or wrong?
It may seem as if I am sharpshooting you here, but I am NOT. I am just trying to understand.
Thx,
Bill
Bill,
the way I'm looking at it, is that the donation was like an equipment donation. Somebody donates a computer, and wants it to reflect in the 'equipment' fund.
You have nothing to deposit, so you can't reflect it in any sort of cash account. You could reflect the price of the computer in any account that tracks assets and/or depreciation, but that doesn't come into the equation with your issue.
the way I'm looking at it, is that the donation was like an equipment donation. Somebody donates a computer, and wants it to reflect in the 'equipment' fund.
You have nothing to deposit, so you can't reflect it in any sort of cash account. You could reflect the price of the computer in any account that tracks assets and/or depreciation, but that doesn't come into the equation with your issue.
Neil Zampella
Using PC+ since 1999.
Using PC+ since 1999.