Edition of "JIMs JRNL"
(Click Here for "Blogger like" perspective/rationale)
TO: Interested Onliners FROM: Jim Bramer, Retired Auditor-CPA
RE: J I Ms J R N L for the months of November/December 2009 FILE: jrnl/2009/1112-09
01 - An eBook published by Jim Bramer (14)
Well I have done it ....... I have written a Book entitled "FINANCES at CHRISTIAN MINISTRIES" ------- well an eBook, at least. Please Go Here for details. An outline appears below:
Perspective of our eBooks or Web Books - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Page 00
"Table of Contents" Cover Page - - - -- - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - Page 01
Unique Matters re Christian Ministry Finances - - - - - - - - - - - - - - - - - - - - - - - - - Page 02
In Charge - who is responsible - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Page 03
Financial Accounting Features - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Page 04
Structural Matters - - - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - - - - - Page 05
Money Coming In - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Page 06
Money Going Out - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Page 07
Spending Controls - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - Page 08
Reporting of Ministry Finances - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Page 09
Fiscal Year End Matters - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Page 10
02 - January is a busy Month (06)
As indicated when you Click Here , one of the reasons we recommend that Ministries do NOT have "Calendar Year" for their operational/fiscal year is that the month of January is very "task filled." We trust that all is going well as you have been involved in at least some of the following during January 2010:
>> Annual contribution statements >> Housing Allowance matters >> Estimated tax payment >> IRS Form 941 Employer's QUARTERLY Federal Tax Return >> Employee's W-2 s >> 1099-MISC
03 - Are you getting meaningful weekly "Spending Control" information? (07)
Whether you are responsible for spending at either a Christ-Centered Ministry or at your Home, I trust you can answer "yes" to this question: "Are you getting meaningful weekly "Spending Control" information? I trust the INTER - OFFICE MEMO contents that follow are some possible resources that enable you to do this:
INTER - OFFICE MEMO
TO: Those of you who are Interested FROM: Jim Bramer
RE: Use of "Envelope" like resources
for Ministry Finance & Accounting purposes DATE: July 2009
I am a retired “Auditor-Certified Public Accountant (CPA)” who functions remotely as would a fully supported vocational Missionary. This CPA would count it an honor to especially assist you “Smaller Ministries” who are “Ministry Finance Internet Friendly.” By this term I mean those of you who use your Computer (especially Lap Tops) with a fast connection to access the Internet minimally once a day to at least receive and send Email.
Some of you use the Mvelopes bookkeeping system (or like software) to manage your personal finances as advocated by Crown Ministries. Or when money comes into your possession it is immediately placed into the appropriate “Envelope” (like we did when we only handled green stuff or cash) and we could spend money only when that physical "Envelope" had money in it, etc. The Mvelopes system uses the same “Envelope” concept as you mainly account for your individual Bank and Credit Card transactions as they flow automatically into the Mvelopes system. Benefits of this system include the following:
>> You go Online at any time and update the Mvelopes system
>> You know the running balance from these reliable Bank and Credit Card resources
>> There is no need to manually maintain check stubs and running balances
>> There is no need to manually enter your transactions into your computer system and
>> Then go and reconcile your manually kept records to theirs (No need for a Bank or Credit Reconciliation process, etc)
>> You have no Credit Card debt when you can go Online and weekly pay off your Credit Card balance.
>> All of this obviously greatly contributes to your # 1 goal of living within your available monies.
Please note when you to review this eFINFAX data how we have taken many of the principles of this Mvelopes process above, and its features, and applied them to the unique "Fund Accounting" needs of "Small Ministries." Note our use of the term "BuxBoxes", rather than "Envelopes". Or you make full use of the same Internet resources and related computer accounting systems so that you are the very best steward of your finances. In my mind, “Small Ministries” are “Christ-Centered Entities” who handle $500,000 or less per year. Entities include: Such Churches, such Mission agencies or like endeavors, Christian Camps, Christian Schools, etc. Those of you that are just beginning need to lay good finance management foundations.
Additional features of the eFINFAX system, as set forth in detail within the "Blue Links" below, also include the following:
>> Using Internet resources, you can receive money that comes directly from their bank to your bank account -
>> And you can pay bills via the Internet – or money electronically goes from your bank directly to their bank account.
>> The staff’s net pay can go electronically from your bank to their bank account.
>> You would have a separate computerized “People” database which includes donation information that provides deposit information for this overall system.
>> Trained remote helpers are available via the Internet as you arrange for them to help you either each week or as often as they are needed, etc.
Please note the eFINFAX system provided "BuxBox" and "Photo" financial Charts (or reports) per the samples displayed below.
500 Special Purpose Funds - SPFs BuxBoxes
501 Missionary Jones - Support
502 Missionary Smith - Support
590 GPF (Deficits) from previous years
599 Board Emergency Fund
Total 500 SPFs BuxBoxes
600 Annual General Purpose Fund -GPF
601 Fixed Expenses #01
620 Fixed Expenses #20
625 Fixed Expenses #25
681 Non Fixed Operating Depart #81
682 Non Fixed Operating Depart #82
Total 600 -GPF BuxBoxes for this year
Contact Jim@bcidot.org if you have "Fixed" questions
Total Year To Date BuxBox Balances
Photo (Balance Sheet) Report
As of May 31, 2xxx
ASSETS (See the BREC Sweep system)
101 Checking Account
102 Savings - short term
199 Savings - longer term
Total Bank Accounts
141 Accumulated Depreciation
149 Offset of Equity in Equipment
LIABILITIES AND EQUITY
222 Credit Card
280 Unpaid Payroll
Year To Date BuxBox Balances
TOTAL LIABILITIES AND EQUITY
After you have digested this content, please let us know just how you think we can help you by contacting us at Jim@bcidot.org ( An Outsider looking in) or Brad at Brad@rpfin.org (An Insider looking out). Of course, we would be happy to provide you with references.
Also there has been some consideration given to making available an Online "Yahoo Forum" for interested eFINFAX system users as they help each other in such an effort. Here is a "Yahoo Forum" example: http://groups.yahoo.com/group/qbunch/. Let me know if you think something like this would be of value.
04 - Accounting for Self Funded Church Events (08)
As indicated when you Click Here, you will note that I have been retained as a HLPER by a local Church that handles over $2.000.000 per year. This Church uses the software product known as QuickBooks Pro (QBs) and it makes use of more than one QBs Company, or set of QBs.
>> The first QBs company is called LIQ (short for Liquid) as it handles the every day accounting matters that have to do with the “General Purpose Fund -GPFund ” and the “Special Purpose Funds - SPFunds.” This LIQ set of QBs meets the Internal accounting issues that we address when you Go Here.
>> Then there are two sets of QBs that have annual or fiscal year end use only. One is the “Land, Buildings and Equipment (LB&E)” set of QBs which, of course, is non-liquid and it is updated annually from LIQ’s set of QB’s transactions that have to do with:
a> Fixed Asset acquisitions (or sales) during the fiscal year; as budgeted items of the GPFund or via SPFs projects, etc. At one time such information came from a Construction set of QBs.
b> LB&E debt servicing. This includes the GPFund payment of both the required monthly payment of Principal and Interest, plus any optional GPFund payments on the principal only. This Church also allows donors to make SPFund contributions for principal payment only.
c> Depreciation Expense that is booked within the LB&E only.
>> The last set of QBs used also only at the fiscal year end and is called the COMBO set of QBs. This complies with the External accounting/reporting issues. Its financial transaction source is both the above updated annual LB&E set of QBs and from condensed information flowing via the LIQ set of QBs.
The SPFund section of the LIQ set of QBs has an area that has to do with what is referenced as EVENTs. Or the Church has ministries, or activities, that are all or partially funded by the participants with the GPFund picking up the shortage when they do not pay for all of the activity’s expenses, Applicable Mission Trip activities that appears within the SPFund area of the LIQ set of QBs are also detailed in the EVENTs set of QBs. CHURCH EVENT examples include the following:
>> Events by various Church groups
>> Missions and Music Trips
This Church has decided to NOT include the finance transactions of these EVENTs within the GPFund since it is confusing when the GPFund does, indeed, budget for coverage of any shortages mentioned above. Or a segment of the SPFund area of LIQ is assigned to these EVENT activities and you always know the running Balance of each EVENT. But in this process there are at least two missing finance accounting issues:
01> When you use the QB Equity accounts and you know each EVENT balance within the SPFunds area, it is not possible to use the QB Budget feature as you control expense line items, and
02> There needs to be a comprehensive integrated method for knowing whether or not a participant has paid their pledge or promise, bill, etc. This “Pledge or Accounts Receivable” like system is referenced as the “YETOPAY” process.
A potential solution is to establish yet another set of QBs for EVENTS. When this is done then we need to handle the following Issues:
>> The cash flow transactions appearing within the LIQ's EVENTs section of the SPFunds mentioned above are duplicated and assigned differently within this separate EVENTs set of QBs.
>> Of course, there needs to be a means of proofing that all such SPFund activities get to this second set of QBs
>> You structure your EVENTS QB "Chart of Accounts" so that there are QB Income and Expense accounts for the types of income and expenses for these EVENTs . In doing this, you now have the means to use the Budget features of QBs.
>> QB Class accounts are established for each EVENT
>> Budgets for each EVENT are established and said information is placed herein and monitored accordingly..
As to “YETOPAY” issues:
>> The EVENT leaders (or their staff or volunteers) do their own YETOPAY bookkeeping. Some do it manually or they use Excel docs while others do it via their People Database facilities.
>> But this separate EVENTs set of QBs would be postured to use its own “Account Receivable” QB features to do this kind of record keeping. Of course, detailed information is needed via this method in order for it to be complete and current, etc.
>> Via whatever method, this YETOPAY information should appear in this EVENTs set of QBs at least at the end of each month.
05 - Daily and Year End GAAP at Christ-Centered Ministries. (09)
It is more and more evident to me that there should NOT be a universal GAAP (Generally Accepted Accounting Principles) for Non-Profits like Christ-Centered Ministries. Such Non-Profits need daily operational information that includes accounting for GPFund budgeted required "Debt Retirement (monthly payments of Principal and Interest, etc)", "Fixed Asset" expenditures provided via the GPFund Budgets, accounting for budgeted GPFund "set aside" money for later or future activities..... plus some GPFund budgets has additional loan pay-off expenditures. As we know, these transactions are handled entirely differently at the end of the year for GAAP Year End accounting and reporting purposes. Please Go Here for more information on this topic.
06 - Web Site Local Search capabilities (10)
Please Go Here and find that we finally have the means for you Onliners coming to our web sites to do some electronically searching therein. Thank you for being patient in all of this.
07 - Most Important Financial Issues --- or MIFIs (12)
Ministry Finance Committees need to concentrate on what is most important at their Christ-Centered Ministry. Let me know if you would like a copy of what was recently shared along these lines within context of this Helper assignment.
08 - Analysis of Special Purpose Funds resources, or Receipts (13)
What follows is an analysis of the source, or In-Flow Receipts, types that come into Special Purpose Funds
From Usual Scrip See 0101 For more info see 5040 Current Year Tax Tax Ways to Receive Money see 5802 Gen Fund Deduction Deduction *** More Info *** From Gen Fund Board Discretionary Fund of Prior Years Facility Maintenance xxx Scholarship Fund #1 xxx xxx Scholarship Fund #2 xxx xxx Benevolence Fund xxx xxx See 5021 Mission Projects $1 xxx xxx xxx Adult Mission Trip xxx xxx SetASide fr the GPFund xxx See 0088 Special Projects xxx Mission Education xxx Mission Conference xxx Local Outreach xxx Adult Group #1 xxx xxx Board Approved Adult Group #2 xxx xxx Board Approved Self Funded Events
shortages flow from the
Via Annual GPFund Depart Budget
09 - "Meaningful Declarations" for any of us -- God has the answer : (02)
You say: "It's impossible"
God says: All things are possible
You say: "I'm too tired"
God says: I'll give you rest
You say: "Nobody really loves me"
God says: I love you
(John 3:16 & John 3:34)
You say: "I can't go on"
God says: My grace is sufficient
(II Corinthians 12:9 & Psalm 91:15)
You say: "I can't figure things out"
God says: I will direct your steps
You say: "I can't do it"
God says: You can do all things
You say: "I'm not able"
God says: I am able
(II Corinthians 9:8)
You say: "It's not worth it"
God says: It will be worth it
You say: "I can't forgive myself"
God says: I Forgive you
(I John 1:9 & Romans 8:1)
You say: "This is too much"
God says: I will supply all your needs
You say: "I'm afraid"
God says: I have not given you a spirit of fear
(II Timothy 1:7)
You say: "I'm always worried/frustrated"
God says: Cast all your cares on ME
(I Peter 5:7)
You say: "I don't have enough faith"
God says: I've given everyone a measure of faith
You say: "I'm not smart enough"
God says: I give you wisdom
(I Corinthians 1:30)
You say: "I feel all alone"
God says: I will never leave you or forsake you
10 - Click below for potentially Helpful Online Link Contents: (03)
>> Board Members Resolution for New Year >> Combating Church Embezzlement >> Donor Management Software List >> When Does Your Ministry Need an Audit >> Designated Funds Accounting Made Easy
>> The Return of Donors' Designated Gifts
11 - "For What it is Worth" editorials by Jim Bramer (04)
>> GAAP Internal and External >> One Business Manager Serves more than one Ministry
12 - Ministry Finance TRUISMS - or precepts/beliefs/principles. Please go to 0069 for complete TRUISMS list.
>> Unified Accounting System >> Current Operations - General Purpose Fund
13 - Prayerful Thot :
Dear Lord .... someone has shared the following with me about "Bookkeeping and two sets of Books." At the end of the age we all will stand before the throne, and books recording what each of them had done will be opened. If God keeps a record of sins, who can stand? Our hearts are shot through with wickedness and idolatry and selfishness and pride and anger and lust and covetousness-- all of which are a grievous insult against a holy God. The first entry from those books will be enough to condemn us for eternity.
But for us, that the Lord has saved, the scene is different. "Then another book was opened, which is the "Book of Life." The dead are judged by what was written in the other book, but praise God, there is hope, for there is another book! Our only hope to escape the just condemnation of the other book content is to have our name found here. I will not be judged according to what I have done, because my name is written in the book of life. Thank you, Lord, that, by your Grace, there is this "Book of Life" .... or another set of books!
In thy Precious Name I pray --- Amen
- This "Blogger" like endeavor (99) allows me to share some personal comments/thoughts as to Ministry Finance issues. For topic alphabetical lists in earlier JIM's JRNLs. editions, please Go Here.
If you would like to receive the next JIM's JRNL edition, please join the following Yahoo Group: ---- http://groups.yahoo.com/group/JIMsJRNL/. Caution --- the non www.bcidot.org web links that I reference herein do NOT necessarily imply my endorsement. Further, if any of these links do not work, let us know which one at Jim@bcidot.org . Lists of our www.bcidot.org articles (or Web Docs), can be found at 9708 and 9709
Probable "Ministry Finance Lingo", or "Frequently Used Vocational Terms" used herein, appear below:
BLVR = Someone who has accepted Jesus Christ as Lord and Savior, CBA = Church Business Administrator, CBAer; CMS = Church Management Software/System; CPA = Certified Public Accountant; GAAP = Generally Accepted Accounting Principles/Practices; GPFund or GPF = General Purpose Fund; MFTeam or MFT= Ministry Finance Team; QBOE = QuickBooks Online Edition; QBooks or QBs = Quickbooks; SPFunds or SPFs = Special Purpose Funds
Links on our Website include:
ABOUT US | OUR PURPOSE | TABLE OF CONTENTS | SEARCH MATTERS | HOW WE HELP SPECIFICS | FUND ACCTG VIA COMPUTERS | GLOSSARY
Click Here for information about earlier JIM's JRNLs - or contact me via Jim@bcidot.org
This document was updated last on: April 20, 2011