Inconsistencies in Fund Accounting Reports

[mccauleyjean]

I have been using PCP Version 9 for a little over a month. I have printed out some of the Reports from Fund Accounting for the end-of-the month balances. There is a difference in the amount indicated in the bank checking account balance (01-1110) on some of the reports. This is a new checking account that the church set up for the new fiscal year. Here is a summary of the inconsistencies:

• The Check Register by Fund (Account 110) for May shows the “Beginning Balance” at $3000 and the “Total Current Balance” at the bottom of the report is $9058.
• The Check Register Report for Account 1110 05/01/2006-05/31/2006 shows the “Beginning Balance” at $3020 and the “Ending Balance” at $9058.
• The Trial Balance Report for May 2006 indicates the “Beginning Balance” at $3000, the “Period Actual” at $6058, and the “Current Balance” at $9058
• The Budget Report for May 2006 shows the checking account balance at $6058. This is the Report I want to use to present to the Board of Directors at the monthly meeting.

I did have to do a correction to the new checking account balance at the beginning of the month because the account was opened with $7,000, not $3000. Both Check Register Reports do show the correction to the checking account balance of $4,000. In fact, according to the check book we should have closer to $12,000 in the account. Did I maybe do something way wrong in the Transfer of Funds earlier this month? Everything else I did looks OK (Contributions, Accounts Payable).

Thanks for any guidance you can give.

[Jeff]

The difference in the begining balance for the check register and the account activity is probably being caused by a transaction dated in the wrong period. There are 2 dates on a transaction. The first is accounting month, this is what month a transaction is posted to, it is the month and year only. The second date is the date of the transaction. (full month, day, and year) All reports except the check register work off of the accounting month. If you look at the dates in the account activity, you should fine a transaction dated before 5/1/2006 or run the check register with a wider date range and you should see the amount there too.

You need to be careful with budget report and asset and liability account. When you budget a balance sheet account (Asset, Liability, Equity) you are entering the net change in the account. For example, you can budget a saving account by 1000 a month to make sure you have enough cash to pay a bill you know you are going to have due. Because of this balance sheet accounts on the budget report don't show their balance but the net change for the period. Your post says the report is showing 6058 which is 9058 from trial balance less the 3000 beginning balance, which should be the change in the account for the month.

As far as the balance being 12,000, the best thing to do is to look through your account activity report, this shows all transactions that would have an effect on that balance.

[mccauleyjean]

Thanks for posting a response. I’m not sure if all your answers apply to my situation. Here are your responses and my comments:

“The difference in the beginning balance for the check register and the account activity is probably being caused by a transaction dated in the wrong period.”. . . . . “If you look at the dates in the account activity, you should fine a transaction dated before 5/1/2006 or run the check register with a wider date range and you should see the amount there too.”

I have just started using PCP with the new fiscal year that began May 1 so there are NO transactions dated prior to May 1. I double and triple checked all the “Unposted Transactions” to check the dates and amounts before “Posting”. But I will check the account activity to see if maybe I inputted the date incorrectly.

“Because of this balance sheet accounts on the budget report don't show their balance but the net change for the period.”

I kind of figured that’s what was happening. What you are saying is that the Budget Report shows the CHANGES for the month but not the BALANCE at the end of the month.

Is there a quick and dirty report I can use in the Fund Accounting Reports to let the BOD know how much came in the past month, how much was spent and how much we have left in layman’s terms? I have clicked on all the boxes in a variety of ways on the Budget Report and nothing gives me this information readily. I have checked all the standard reports on the Fund Accounting menu also and don’t see anything that concise. Is this why people use the Custom Reports?

As for your last comment:

“As far as the balance being 12,000, the best thing to do is to look through your account activity report, this shows all transactions that would have an effect on that balance.”

Two seconds after I posted this message it occurred to me why there was a discrepancy. I set up the Contributions Module so that payments to the Capital Fund are “added” to the savings account and not the checking account. (I can’t remember if this is a “debit” or a ‘credit” in accounting terms….) The problem is I have been depositing all money every week into the checking account with plans to transfer money to the Capital Fund which is the savings account. So from now on I will make separate deposits to checking and savings. Duh!

Thanks again for taking the time to respond to my questions. Overall, this is a great program, as long as you read the manual carefully and are meticulous about every entry.

[NeilZ]

Jean,

at my former church, we deposited everything into our Money Market Checking. This took care of any report descrepancies between the Contribution Module and Fund Accounting. The Treasurer then did an electronic transfer online to the Building Fund account, and then entered the transaction in Powerchurch.

This keeps everything straight, and relieves you of having to worry about separate 'deposits'. In fact, the Treasurer here really doesn't do many deposits, all our Sunday contributions are counted and deposited (via night drop) on Sunday by that Sunday's counting team.

Hope this helps

[mccauleyjean]

I am really glad to hear you have a "Counting Team." I am not an accountant, but from all I have read it is a good idea to have one person counting the money and making the deposit and a different person keeping up with the transactions (i.e., the treasurer). I will bring this up to the BOD. Thanks for posting your response!

[NeilZ]

I am really glad to hear you have a "Counting Team." I am not an accountant, but from all I have read it is a good idea to have one person counting the money and making the deposit and a different person keeping up with the transactions (i.e., the treasurer). I will bring this up to the BOD. Thanks for posting your response!

Actually, you want TWO unrelated people doing the counting and contribution entry. This provides a safeguard against any problems with the counting or the data entry, as two separate people are there.

You may say 'but we're a church, surely no one would steal from the collection', unfortunately people are being prosecuted for this every day, all because they were 'trusted' with the counting and deposit.