Transfer money from Budget to "other"

Discuss questions around local unit policies for budgeting, reconciling, etc. This forum should not contain specific financial or membership information.
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gregwanderson
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Re: Transfer money from Budget to "other"

Postby gregwanderson » Fri Jun 14, 2013 1:28 pm

Yes, that is exactly what I recommend.

TinMan
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Re: Transfer money from Budget to "other"

Postby TinMan » Fri Jun 14, 2013 4:18 pm

Query:

The opening post said this:

"Reason: Bishop wrote a check for scout camp from the designated other category, but we didn’t have enough money to cover the full cost. "

Rule number 1: Tell the bishop to quit writing checks. :p

But. Since the check should have come out of budget, not other, shouldn't you go back and correct the problem by making the entire $1000.00 come out of budget (as the poster indicates was intended) instead of splitting it now? And putting the $300 they got into budget instead of "other?"

Second question: Is it really a problem if the "other" category shows a negative balance? Won't that get caught up as the people pay their camp fee, in this case, disregarding the argument about how camp should be funded...? IWO: Can't you just leave it alone and let the other category catch up as people donated their camp funds? It may show a negative balance at the end of the year, but that would be helpful in future budgeting.

It's not like the check is going to bounce or anything. Budgeting is just an internal (to the ward) thing anyway, isn't it?

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Re: Transfer money from Budget to "other"

Postby russellhltn » Fri Jun 14, 2013 4:30 pm

TinMan wrote:Second question: Is it really a problem if the "other" category shows a negative balance?


I'll bet if "Other" as a whole goes negative, there's going to be some questions coming down from above.
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TinMan
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Re: Transfer money from Budget to "other"

Postby TinMan » Fri Jun 14, 2013 4:37 pm

russellhltn wrote:
I'll bet if "Other" as a whole goes negative, there's going to be some questions coming down from above.
But transferring "budget" money to "other" is okay? If so, couldn't you just do that at the end of the year after the dust all settles?

Personal note: I don't pretend to understand the "budget" system in MLS... As you can tell.

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Re: Transfer money from Budget to "other"

Postby russellhltn » Fri Jun 14, 2013 4:40 pm

TinMan wrote:But transferring "budget" money to "other" is okay? If so, couldn't you just do that at the end of the year after the dust all settles?

I imagine you'd hear about it before the end of the year.
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Re: Transfer money from Budget to "other"

Postby lajackson » Fri Jun 14, 2013 6:01 pm

TinMan wrote:But transferring "budget" money to "other" is okay? If so, couldn't you just do that at the end of the year after the dust all settles?

Personal note: I don't pretend to understand the "budget" system in MLS... As you can tell.

In an ideal world, the ward would budget for Scout camp and make the payment out of Budget funds.

Following Handbook instructions, it is possible to arrive at a situation where the money for Scout camp will wind up in the Other account, either through member payments or that famous one yearly fundraiser. If all of the money for camp is in the Other account, the payment for camp would be made out of the Other account using those funds.

In this particular case, it appears that some of the Scout camp money came from member payments or a fundraiser, but it was not sufficient for all of the camp expense.

Normally, the clerk would then write two checks, one using the Other funds, and one for the balance using the Budget funds. In this case, it appears that the bishop wrote the entire check from the Other account.

And so the proper accounting step is as has been proposed, to transfer the funds from the Budget to the Other account. As others have mentioned, this used to require the writing and redepositing of a check, but can now be done by changing the category of the check in MLS.

In the end (in this case), it will be as if part of camp was paid from Budget and part was paid from Other. So yes, it is okay.

While it seems logical from an accounting perspective to make the transfer at the end of the year, there are two really good reasons to make it now. One, the Other account is overdrawn and should be brought back to zero. Two, if the bishop believes the Other account has received all of the Scouting funds it will receive, there is no reason to wait to settle the difference, especially in view of reason One.

Please note that this is a discussion of MLS and accounting procedures, not a discussion on how Scout camp should have been budgeted for, paid for, fundraised for, or any other kind of for that can be searched for and discovered in other Topics of the Forum. No forking please. [And forgive me for . . . oh, nevermind. (grin)]

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Re: Transfer money from Budget to "other"

Postby jdlessley » Fri Jun 14, 2013 7:58 pm

lajackson wrote:Normally, the clerk would then write two checks, one using the Other funds, and one for the balance using the Budget funds.

Ever since the CUBS conversion one check can be written with funds coming from multiple categories.
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Re: Transfer money from Budget to "other"

Postby Gary_Miller » Fri Jun 14, 2013 11:40 pm

TinMan wrote:Is it really a problem if the "other" category shows a negative balance?

Yes its call debt. Even though the church covers the expense the ward is now in dept.

TinMan wrote:Won't that get caught up as the people pay their camp fee, in this case, disregarding the argument about how camp should be funded...?

You could look at it that way but in reality the ward is spending money they don't have.

TinMan wrote:Can't you just leave it alone and let the other category catch up as people donated their camp funds?

You could if your willing to show a deficient in the other account the whole time your waiting for people to get their funds in. The best way I found to do it if all the money has not been received is to write the check, covering the whole cost, for the budget expenses and then make an adjustment close to the end or the year. That's what I did last year. This year I'm making adjustments to the check categories at the end of each month.

TinMan wrote:It's not like the check is going to bounce or anything.

While it may not bounce you are still spending money you don't have.

TinMan wrote:Budgeting is just an internal (to the ward) thing anyway, isn't it?

While it maybe internal its important as its the only way you can figure out where the funds are suppose to go. Without a budget your just spending without a plan which causes cayuse.

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Re: Transfer money from Budget to "other"

Postby TinMan » Sat Jun 15, 2013 5:07 am

Gary_Miller wrote:While it may not bounce you are still spending money you don't have.
You said this twice, so I guess it is important. It is also what I don't understand. Thanks for your patience in explaining it.

The whole premise of the opening post is that the bishop "wrote the check" out of the "other account" (which didn't have any money in it yet, but was going to get money as camp funds came in) instead of the "budget account" (which apparently did have the money to cover the expense.) If you have the money in the budget account, don't you have the money?

As I understand it, you are given a lump sum from the stake (on a quarterly basis) and a ward is to allocate it in various budget accounts. The Church isn't concerned about these budget accounts, only the lump sum. So if there is money to move around, don't you have the money?

Further as I understand it, "other" accounts are meant to be "pass through accounts." We have a funeral expense "other account" whereby people who don't like to make funeral potatoes for a funeral can donated money to the funeral account and the relief society uses it to purchase the sliced ham. What goes in that account, goes out of that account for funeral expenses. If the account runs dry and ham is needed, the RS president comes to me and we take the money out of the bishop's "administration" account.

We use that administration account for "emergency" expenses outside of organizations annual budgets, as well as office supplies and such.

So, it seems to me that by moving money back and forth from "budgets" and "others" accounts, it sort of defeats the purpose of even having "other" accounts.

I will make a confession here: Every week that we write checks to people out of the budget, a report is printed that I need to sign or initial. I can't remember which. But on that report, right below the list of checks written is a line that says "amount left in budget:" and a number. That is the ONLY thing I pay attention to in the whole budgeting process. As long as that number stays positive, I don't pay much attention to the rest of the budget. That is why I have a CPA and an accountant for a counselor and a clerk. They look at all the individual budgets and keep track of who is spending more than they should and they tell me to have a talk with them. They show me the printed out budgets with several columns that have very little meaning to me. But I pretend to be interested. It is my firm belief that the entire budgeting process was invented by church accountants for other accountants to understand. I have kept track of my family expenses and budget for 40 years. I have kept the expenses and budget for my business for 30 years. I know how to make and understand budgets. But the church's system is beyond me. I gave up trying to figure it out six months into my administration. I just watch that number every week...
Last edited by TinMan on Sat Jun 15, 2013 5:28 am, edited 2 times in total.

TinMan
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Re: Transfer money from Budget to "other"

Postby TinMan » Sat Jun 15, 2013 5:10 am

Gary_Miller wrote:Without a budget your just spending without a plan which causes cayuse.
:) On that, we totally agree.

Now if someone can explain how we are supposed to set yearly budgets based on quarterly "estimates" i.e. "guesses," well, chaos can be avoided.

"Dear Young Women's leader: You will have a yearly budget of $1200.00.

Unless it isn't."

:confused:

Thus the bishops "administration fund," also known in certain circles as "the slush fund."


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