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                  TO:   All Interested Onliners                                                                    FROM: Jim Bramer. Retired Auditor-CPA
                                                                                                                                       FILE:  0953-11/fwi

                   RE:  Accounting for "Upcoming Financial Obligations"                      Originated in July 2011

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    "Today's "Ax to Grind"   

            In pursuit of this "Accounting for "Upcoming Financial Obligations"   topic I will initially display the financial statements of this larger Ministry below.   To remind you:  a "PHOTO"   has a "liquid" only "Point in Time" reporting thrust  (you do not display any "Land, Building & Equipment" assets with related Liabilities).  The VIDEOs"  below have a "Period of Time" reporting emphasis of either the "General Purpose Fund - GPFund"  or all of the "Special Purpose Funds - SPFunds."

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 PHOTO
as of the July 12, 20xx  Point in Time 

Checking/Savings via Pool Vest
101	Checking		$ 1
102	Money Market-rate x.xx		$ 25,395
103	CD-rate x.xx due xx/xx/xx		101,858
104	CD-rate x.xx due xx/xx/xx		$ 50,145
110	Imprest Checking		$ 1,552
	Total Checking/Savings			$ 178,951
120	Accounts Receivable			$ 4,214
170	SCRIP  Store Resources			$ 523
	Total Asset Pool			$ 183,688

Liabilities:
200	Payable to Vendors		$625
220	Due on Credit Cards		$6,328
260	Others		$779
	Total Liabilities			$7,732
	**Donor Restrictions**
300	Named Projects	$ 39,588
310	Other Donor Designated	$ 5,124
334	Special Missions Fund	$ 7,773
337	Short Term Mission Trip	$ 2,880
339	All Other such Designations	$ 1,243	$ 56,608
	**Board Discretionary**
350	Contingency Reserve	$ 50,000
352	Self Funded Events	$ 10,000
355	Board Designations	$ 12,761	$ 72,761
	Total SPFunds		$129,369
GPFund Net Income -- See VIDEO			$46,587
	Fund Balances/Net Assets:			$175,956
	Total			$183,688

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VIDEO - GPFund
 for May 1, through July 12, 20xx Period of Time  

				Actual	Budget	Variance
Income
	401 Unrestricted Donations			$ 807,679
Expenditures:
	500-Salaries and Benefits			$ 425,043	$ 454,043	$ (29,000)
	620-Office Expenses			$ 34,605	$ 48,400	$ (13,795)
	640 Facility Expenditures			$ 93,147	$ 92,285	$ 862
	660 Generic Ministry Exp			$ 110,460	$ 148,563	$ (38,103)
	700-Mission Support			$ 103,020	$ 80,940	$ 22,080
	800-Self Funding Activities			$ (5,183)	$          00	$ (5,183)
	Total Expenditures			$ 761,092	$ 824,231	$ (63,139)
Net Income		of the  GPFund		$ 46,587

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         VIDEO SPFunds 
for May 1,  through July 12, 20xx Period of Time

                        01 Beg. Bal. 5/1/20xx                                 $ 134,202
                        40 SPF or SPFund Income
                                44-Restricted Donations         171,978
                                48 Other Income                           2,369
                                49-Interest Income                       6,960
                           Total 40 SPF Income                                 181,307

                       50 SPF Expenditures
                            01-Sal/Benefits                            (11,950)
                            61 Operating Exp                      . (82,912)
                            63 Travel Expense                       (9,105)
                            64 Bldg. Maint                            . (25,700)
                            65 Grounds Maint.                         (2,065)
                            66 Modular Expense                   (14,104)
                            67 Help Provided                         (15,968)
                            81 Expense Reimb/Event Fees   60,599
                            71 Grants                                      (78,341)
                            91 Internal  Transfers                  25,936
                            92 Fixed Asset Acquired            (31,350)
                            94 Other                                          (1,179)
                        Total 50 SPF Expenditures                        (186,140)
                SPFund Ending Balances   (1)                          $ 129,369

    (1)  Must agree with total SPFunds within the above PHOTO, etc.

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             This publication complements our WebBOOK when you GO HERE  as it sets forth a way to do the accounting/reporting for "Upcoming Financial Obligations"  of the GPFund  of a larger Christ-Centered Church (or Ministry) to insure that such matters are timely cared for and you adhere to some GPFund  "Upcoming Financial Obligations"   priorities.   The obvious result of this process is that you know each week if you have residual GPFund  monies for the rest of the Ministry. 

             Their accounting system timely reports the balance of each SPFunds  -- see the above total of $129.369   (see the 3xx accounts within the PHOTO above).    Not shown, but it also arranges the system so you know what each SPFund  started with at the beginning of the fiscal year and what comes in and goes out of each SPFund --   please note the two digit numbers above.

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            Examples of "Upcoming Financial Obligations"  are:    

Property:  like the part of the above acct 640  costs that has to do with "Debt
                 Servicing"  or facility rental payments and/or agreements;

                        People:  like the above costs within the 500 and 700 accts which have to do with
                                      "Staff and Missionaries."  

            These are referenced as  "Fixed"   Expenditures   ......    as apposed to others that are  Variable"  pre-approved Program  expenditures that can be used only when there is available remaining money.  The Board should have written policies that enable management to conclude which of these "Variable"  expenditures come first.

            A way to get this needed information is to post  these "Fixed" items into the accounting system of your larger Ministries so that they appear within the PHOTO and the VIDEO - GPFund reports -- note the comparative condensed sample below.  Some of the factors in doing this are:

    >>  You list each of the types - see the (2) items in the sample below
    >>  The (2) items MUST always offset or be in balance    
    >>  You monitor such "Fixed" transactions and change the amounts below on a
            quarterly basis.

Comparative Condensed Sample

		PHOTO:
		Asset Pool		$ 183,688		$ 183,688
		Liabilities		$ 7,732		$ 7,732
		Fund Balances:
		Donor Restricted	$ 56,608		$ 56,608
		Board Designated	$ 72,761		$ 72,761
		(1 & 3) GPFund Net Income	$ 46,587		$ 6,587
		(2) Upcoming "Fixed" Obligations			$ 40,000
		Total Fund Balances		$ 175,956		$ 175,956
		Total Liabilities & Fund Bal		$ 183,688		$ 183,688
		VIDEO-GPFUND:
		GPFund Income to date		$ 807,679		$ 807,679
		GPFund Expenditures to date		$ 761,092	$ 761,092
		(2) Upcoming "Fixed" Obligations
		(2)   Semi-Monthly Payroll Costs			$ 20,000
		(2)   Monthly Debt Servicing Costs			$10,000
		(2)   Monthly Missionary Costs			$ 5,000
		(2)   Other Future Fixed Costs			$ 5,000
		Total				$ 801,092
		(1) GPFund Net Income		$ 46,587
		(3) Available for "Variable" Costs				$ 6,587

                 >>      You maintain a weekly historical recap of the GPFund.  You will note the weekly recap
                        example of another Ministry below as it especially provides you with a flow of
                        its GPFund Expenditures  . 
 

			1st	2nd	3rd	4th
Weekly Donations			$ 41,274	$ 33,810	$ 28,834	$ 38,207
Wkly Oth Credits -or Exp Credits			$      193	$   2,568	$      831	$         54
	Total		$ 41,767	$ 36,378	$ 29,665	$ 38,261
Weekly Debits - see detail below			$ 24,853	$ 72,701	$ 15,881	$ 66,181
	Difference		$ 16,914	$ (36,323)	$ 13,784	$ (27,920)
*Fixed
	Payroll due on 15TH of Month			$   38,597
	Payroll due last day of Month					$ 38,975
	Payroll Benefits -		$     954	$   13,506	$     954	$ 10,155
	Missions Exp 1st wk		$ 16,784	$     2,100
	Mortgage paid on 1st of Month
		Weekly (1)SetASide	$ 998	$        998	$     998	$     998
	Quarterly Interest SetASide (2)			$     3,370	$  3,370
	Utilities due on xx of month				$  4,968	$   7,748
*Variable
	All Other GPFund Expend		$   6,117	$     6,382	$   5,591	$   8,305
		Computed Total	$ 24,853	$    72,701	$ 15,881	$ 66,181

                        (1)      This Church decided to charge the GPFund each week this amount and place it into a Board
                               Discretionary SPFund awaiting this payment which is made on the 1st of each month.

                        (2)      This is like (1), but it charges the GPFund when the offering are usually larger.

 

                  Let me know at Jim@bcidot.org if you have any questions or comments.

 

K E E P   L O O K I N G   U P !!

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UPTD: March 09, 2012

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