Fund Balance Concern - May have Inherited faulty Acct. Setup

[CBCAdmin]

Hi all,

I am concerned that I may have inherited a bad setup, and I am lost as to where to go from here. I am currently running V10 and when I run the Balance Sheet for all funds I see the following:

TOTAL FUND BALANCE
Fund 01 - GENERAL ______Fund 02 - PRESCHOOL _____Fund 03 - DESIG. _____Total
$4,699,417.91 ___________-$4,707,896.34 ________-$278,954.31 _____-$287,432.74

TOTAL LIABILITIES AND FUND BALANCE
Fund 01 - GENERAL ______Fund 02 - PRESCHOOL _____Fund 03 - DESIG. _____Total
$4,694,381.56 ___________-$4,702,816.90 __________-$278,954.31 _______-$287,389.65


Cleary this doesn't look right, I think something at setup was wrong. I am worried that the previous Admin was not reconciling PC with the Checking Statement, ever!

I am not even sure where to go from here, my gut reaction is to start all over but I am hoping someone wiser than me has a better idea that will preserve the archive of info we have.

Hit me with any questions if this was not enough info, and many thanks in advance!

Kerry

[JohnDMeyers]

Here are my questions:

What are the assets:
Current assets: ???
Building assets: ???
Total assets: ???

What month are those figures from? Dec 2009? April 2010?

Do you have the figures from Dec 2009? Do you have figures from Dec 2008?

All I would need to see are the Total Assets and the Total Fund Balance and Liabilities. The Total Fund Balance without liabilities is not needed.

[CBCAdmin]

I originally posted April 10 numbers. I have now included Dec 08 and Dec 09. I hope you can help so let me know if you need anymore background info.

Thanks!

DEC 2008

ASSETS_______________________________Fund 01____Fund 02_____Fund 03______Total
TOTAL ASSETS_________________________-28,648.91_________________________-28,648.91

TOTAL LIABILITIES
AND FUND BALANCE_________________4,116,694.09__-4,148,334.18___-269,495.31__-301,135.40


DEC 2009

ASSETS_______________________________Fund 01____Fund 02_____Fund 03______Total

TOTAL ASSETS________________________-34,148.35__________________________-34,148.35

TOTAL LIABILITIES
AND FUND BALANCE________________4,567,230.12___-4,599,265.35___-274,599.61__-306,634.84

[JohnDMeyers]

Disclaimer: I'm not an accountant. However, I have just about everything wrong at least once in the past 20 years that I have been doing the church books.

The initial balances were set up incorrectly for one thing. I'm guessing they did something like:
DB unrestricted net assets Fund 01 $4.5 mil
CR unrestricted net assets Fund 02 $4.5 mil

My assessment would be accurate, if indeed, your total assets are about $4.5 mil.

The total assets looks like your typical income/expenses for the year. Is that about correct? ($28,000-ish more expenses than income?)

Also, about what do you estimate your total assets? Building, furniture, bank accounts? I'm guessing these were never added as initial balances.

I recommend you get all your assets and liabilities together, hit the ACCOUNTING RESET button, and start again. It would take an accountant about $20,000 to figure this one out the long way. (I'm just kidding about the dollar amount, of course. I have no idea, but it looks complicated).

[Zorak]

This may actually be fixed by a couple of journal entries. What it looks like to me is that prior to 2010, transactions were being entered out of balance "across funds". In a multiple fund setup, you must balance each transaction in each fund where accounts are used.

For example, if you write a check the credits the 01 checking account and debits an 03 expense account, your Balance Sheet By Fund report will show that both funds 01 and 03 are out of balance by the amount of the check. One in the positive, one in the negative. When entering a transaction this way, PowerChurch Plus warns you that it is out of balance, but will allow you to save it once you click through the warning.

Across all funds, your 2010 books are only out of balance by $43 and some change. According to your numbers, prior years were out of balance by a lot more than that. It looks like someone has already tried to fix this in a prior year.

It doesn't sound like the problem is actually with the setup of the Chart of Accounts, but rather how the transactions were being entered previously.

The journal entry to fix this would only affect the Fund Balance account in each fund. Debiting and crediting each to bring each fund in balance. Once that is posted, only one fund will still be out of balance by the $43 amount. If you can't pinpoint the source of the $43 problem, entering a second journal entry with "OOB" as the reference will all you to adjust only the Fund Balance account in that fund in a one-sided, out of balance transaction to force it into balance.

If you have to run these types of things past a board for approval, you should do so before posting these transactions. This alternative is a lot less work than restarting accounting and will allow you to keep all that transaction history.