User Support Forum

Several helpful ladies gave cash to the VBS coordinator who used it directly to buy supplies. I learned about it after the fact. In all the time I have worked here, there has NEVER been a petty cash box (account) and I'd really rather not have to set one up for this, unless it's my only option.

This is the transaction I entered, but it is wrong because it overstates the actual expenses. How do I fix it?

CR 4210 - VBS-designated income $50.00
DB 5209 - VBS expenses $50.00

Also, since it is going into a donor-restricted income account, when I expense it should I use Release from Restrictions?

Thanks,
Eden

Eden:

I can't tell from your comments if the helpful ladies gave money out of their own pockets, or out of some church money that was available to them at the time.

What should have happened is the items should have been purchased, and the receipts turned in for reimbursement which looks like this:
CR 01-1110-000 checking
DB 01-5209-000 VBS expense

DB 01-4810-000 VBS release
CR 01-4999-000 general release

Can't you simply reimburse the kind ladies as shown above, and get the receipts from those who purchased the items?

JohnDMeyers wrote:Eden:

I can't tell from your comments if the helpful ladies gave money out of their own pockets, or out of some church money that was available to them at the time.

What should have happened is the items should have been purchased, and the receipts turned in for reimbursement which looks like this:
CR 01-1110-000 checking
DB 01-5209-000 VBS expense

DB 01-4810-000 VBS release
CR 01-4999-000 general release

Can't you simply reimburse the kind ladies as shown above, and get the receipts from those who purchased the items?

Boy! Did I do a lousy job of describing the problem! I apologize for the confusion.

The ladies wanted to make a donation to the church, designated to help offset VBS expenses.

The Chart of Accounts already is set up with both a contribution fund and a donor-restricted income account for VBS contributions.

What should have happened was for the cash to come to me and get deposited into the checking account. A standard transaction as you showed above. Then, the VBS coordinator who made the purchases for VBS should have submitted the receipts to me, at which time I would have written a reimbursement check for the full amount.

Unfortunately, that's not how it happened.

Instead, the ladies gave their cash contributions (to the church, designated for VBS) into the hands of the VBS coordinator who (unthinkingly) put it in her pocket. The next day, when she went to purchase supplies for VBS, the coordinator used the cash the ladies had given her for part of the purchase and used her debit card for the rest. She has submitted the receipts and I wrote a reimbursement check for the amount of the purchases less the amount of cash the ladies had given her.

I posted the ladies' cash contributions to update the contributions module only, since the cash never made it to the bank. And, since it never was deposited in the bank, I never wrote a reimbursement check for that amount.

Is there a way to fix this, short of having the VBS coordinator give me the cash and then I write her a reimbursement check for it?

Thanks again,
Eden

You could have recorded the money coming into the checking account (which it didn't) and out of the checking account (which it didn't) because these two transaction would cancel out anyway, leaving a net $0.00 in the checking account. Then just reconcile the two transactions even though they don't appear on the bank statement.

Since you showed the ladies have a contribution, you may as well make the entries in Fund Accounting:
--money coming in--
DB 01-1110-000 checking
CR 01-4210-000 VBS

--money coming out--
CR 01-1110-000 checking
DB 01-5209-000 VBS
DB 01-4810-000 VBS release
CR 01-4999-000 general release

Then, just reconcile the two bank entries at the same time to get rid of them.

FWIW, we probably would not have processed this through our church books, because the money wasn't verified through our double counting system, and it wasn't given a chance for the church to decide how to use it (even though it was a donor restriction, it still must be passed through the church's accounts to be tax-deductible).

JohnDMeyers wrote: FWIW, we probably would not have processed this through our church books, because the money wasn't verified through our double counting system, and it wasn't given a chance for the church to decide how to use it (even though it was a donor restriction, it still must be passed through the church's accounts to be tax-deductible).

John, Thank you so much for your help! I will do as you have suggested.

BTW, I totally agree with your assessment of how the whole episode should have been handled; and I have spoken to the VBS coordinator (who is one of the church leaders, so the information will be passed along) so that hopefully we will not have another circumstance like this in the future.

Blessings,
Eden