Annual contribution from investment came early

[gccc]

Our fiscal year runs April 1 to March 31. We have some regular contributors who send their tithe through investment companies once or twice a year. They generally arrive around the same months each year, but this year we had one arrive in February instead of April as it usually does. By posting this contribution with the February date it arrived, it puts it toward our current fiscal year, which ends March 31, instead of the next fiscal year, therefore skewing our projected budget for both this fiscal year and next. Our current budget shows an extra $24,000 that really was meant to be in the 2025-2026 budget year. Our finance management team is asking if there is a way I can "fix" this by moving the contribution posting to April 1 as the date we post it will not make a difference to the contributor since they just need it to show up on their contribution statement in 2025. The check has already been deposited to the bank as I didn't realize there was an issue until the management team brought it up. Is there a way to make this change and not create an accounting issue?

[NeilZ]

Our fiscal year runs April 1 to March 31. We have some regular contributors who send their tithe through investment companies once or twice a year. They generally arrive around the same months each year, but this year we had one arrive in February instead of April as it usually does. By posting this contribution with the February date it arrived, it puts it toward our current fiscal year, which ends March 31, instead of the next fiscal year, therefore skewing our projected budget for both this fiscal year and next. Our current budget shows an extra $24,000 that really was meant to be in the 2025-2026 budget year. Our finance management team is asking if there is a way I can "fix" this by moving the contribution posting to April 1 as the date we post it will not make a difference to the contributor since they just need it to show up on their contribution statement in 2025. The check has already been deposited to the bank as I didn't realize there was an issue until the management team brought it up. Is there a way to make this change and not create an accounting issue?

Churches work on a CASH BASIS ... the money comes in, and it is reported on the I&E report as income. Its income for the fiscal year it was received on. The bank will report it on its bank statement. There's no way to 'fix' this, and the management team should understand that.

A regular business, operating on an accrual basis can do that, but in church fund accounting, you report income as it comes in.

[sgbani]

I agree with Neil,

The short answer is no to your finance management people.

You record the contribution the day you receive it, whatever year it is.

As part of our church's finance team for planning, I perceive that it doesn't matter whether the contribution was received in the previous or current fiscal year for budget planning purposes. Finance management teams should be able to work around this issue with ease. At least, we do at our church because we also receive larger contributions at the end of our year that can skew things.

PC+ can provide a lot of data via reports that can assist your finance management team to better understand income / expense trends, especially when budget planning is involved. It could be that they just need additional data to gain the proper perspective.
I simply export multiple years worth of data, evaluate trends properly, and that makes it straight-forward for analysis for budget purposes by all involved.

[gccc]

Thanks for both of your input.

I relayed your responses to them and they still feel like there should be a way to do this. One of them mentioned that a church he came from before joining ours did prepaid pledges for the following year and thought we could record this payment in that same manner. We do not use a pledging system currently at our church, so I am not sure if that is a viable solution or not.

[NeilZ]

Thanks for both of your input.

I relayed your responses to them and they still feel like there should be a way to do this. One of them mentioned that a church he came from before joining ours did prepaid pledges for the following year and thought we could record this payment in that same manner. We do not use a pledging system currently at our church, so I am not sure if that is a viable solution or not.

Yes, you can use prepaid pledges, all that means is that the funds pledged for the next year, are paid in the previous year. The funds are still in the bank, and there is no way you can undo that income.

I would let them know that they should talk to an accountant who had knowledge of church fund accounting.