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                               TO:  Interested Ministries                                                                                                     FROM: Jim Bramer, Retired Auditor-CPA
                                                                                                                                                                                   FILE:  0070-77/all

                                RE:  Special Purpose Funds (SPFunds) Perspective                                                  Originated:  January 2000                         

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            A Ministry is responsible for "WE SHALT" monies, or the Board decides how to use General Purpose Fund (GPFund) fiscal resources.  Also see other  "Board Discretionary, or Board Designated"  items below.
            But acceptance of a Board approved "OBLIGATORY" monies means that the Ministry must administer "THOU SHALT" funds. Ministry Fund Accounting is the science of handling such "OBLIGATORY" monies, or a Ministry must responsibly handle abnormal operating funds.  Please go to  0041  for additional info on this topic.
            Such issues have been around for a long time. See the "Obligatory" special purpose money found in II Chronicles 34:9-11; or note the paraphrased portions below of "II Kings Chapter 12":

        The Temple was still in disrepair, so the King said to the Priests: "Why haven't you done anything about fixing the Temple? Do not use any more of those receipts for the usual operating needs, but from now on use it to get the Temple in good condition."
        So the Priests set up a special "Repair Fund" by making a hole in the side of a large chest and they set it on the right hand side of the alter at the Temple entrance. The doorkeepers put the people's contribution into this chest and this money was used just to repair the Temple.

        We have concluded that the best Fund Accounting term for such responsibilities is "Special Purpose Funds --SPFunds." Note below some of the SPFund terms we have encountered during our span of some 40 years in dealing with such matters.

• Dedicated Funds;
• Spoken For (like aspects SPFunds - or Special Purpose (F)unds, if you please)
• Strings attached;
• In/Out, or Nout (short for in/out accounts --- get it???);
• Restricted;
• SetASide;
• Designated;
• Trust Funds;
• TOFROM;
• Directed Gifts;
• Encumbered;
• NonAvail;
• Ear marked;
• Protected Funds;
• Impounds;
• Committed
• Escrow

            When a Ministry has money on deposit,  "OBLIGATORY" aspects include monies owed to debtors or outsiders; such as: Unremitted withheld and accrued payroll taxes, Unpaid bills to vendors, prepaid revenue and unpaid installment Equipment and Facility loans.  Imposed spending limits issues are ever before both Ministries and Christian Family Units.
             "OBLIGATORY" elements regarding SPFunds have three common elements:
                  1>  Donor Restrictions (we prefer the term "preferences') for Ministry Board approved projects, etc.
                  2>  Board Designated that includes such things as:   Prior Year Gain/Losses;  Assessments to
                                the GPFund  for named SetASide Purposes.
                  3>  Plus Ministry Self Funded Activities  like:  Church Vacation Bible School; Sunday School
                                activities; Youth activities; AWANA:  Sports activities etc.  Often a portion of
                                these Self Funded Activities are supported by the GPFund

               Please read   Two Sides of the Same Coin  for additional perspective.

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     The bulk of this Publication originated in January 2000 and was  . UPTD: May 03, 2008

Various lInks on this Web Site:   HOME  |  ABOUT  US   |    OUR PURPOSE   |   SITEMAP   |  COMPUTER FUND ACCTG  |  HELPS   |  GLOSSARY

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       (1) An Online Document, or WRIT (Writing), may be applicable to all Ministries, or it may be designed for just groups like: Evangelical Church, School, Missionary Agency or Organization, Christian Camp / Conference, or other named group.
        (2) WRIT formats include the perspective of   Jim@bcidot.org   via IOMs (Inter-Office Memos) to the Ministry Finance Team (MFTeam); THRDs, a hypothetical Online conversation with members of the MFTeam; GLEANINGS, or Scripture within context of the MFTeam; FWIW; A periodic editorial (For What it is Worth); TRUISM, or believed Ministry Finance principles; and FAQ, response to Frequently Asked Questions.

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