Local Book of Mormon Money from Years Past

[shepshep-p40]

I'm a relatively new ward clerk in a stake where leaders called for each ward to start a local Book of Mormon project a few years ago. I realize this is against church policy, and so does the current bishop, who was not in the bishopric at the time. Nevertheless, we have an Other:Book of Mormon subcategory with a significant balance. All donations were made at least two years ago.

During an attempt to repair some old budget discrepancies, someone at church HQ told us that we must send the Book of Mormon money to HQ as excess funds. I agree that we need to clear that subcategory. However, my reading of the training on the Other category indicates that if the payers can be contacted, excess funds in Other subcategories can be A) refunded to the payer, or B) changed to a charitable donation (i.e. tithing, fast offering, etc.) with the payer's permission.

Conveniently enough for us, we have a large deficit in a different Other subcategory for past years' Scout camps. The bishop and I were wondering about whether it is within Church policy for us to either 1) ask payers' permission to change their local Book of Mormon payments to Scout camp funds, or 2) refund their Book of Mormon payments. If we refund the payments, the bishop would like to approach some of the members to ask if they would be willing to use some of that money to help fill our Scout camp deficit.

Can anyone explain what Church policy indicates in this case? I need answers based on policy more than those based on opinions--the bishop and I have plenty of opinions ourselves. I need to know if there is a way within Church policy for us to keep that local Book of Mormon money to fill our other deficit. Thank you in advance for your help!

[aebrown]

I'm a relatively new ward clerk in a stake where leaders called for each ward to start a local Book of Mormon project a few years ago. I realize this is against church policy, and so does the current bishop, who was not in the bishopric at the time. Nevertheless, we have an Other:Book of Mormon subcategory with a significant balance. All donations were made at least two years ago.

During an attempt to repair some old budget discrepancies, someone at church HQ told us that we must send the Book of Mormon money to HQ as excess funds. I agree that we need to clear that subcategory. However, my reading of the training on the Other category indicates that if the payers can be contacted, excess funds in Other subcategories can be A) refunded to the payer, or B) changed to a charitable donation (i.e. tithing, fast offering, etc.) with the payer's permission.

Conveniently enough for us, we have a large deficit in a different Other subcategory for past years' Scout camps. The bishop and I were wondering about whether it is within Church policy for us to either 1) ask payers' permission to change their local Book of Mormon payments to Scout camp funds, or 2) refund their Book of Mormon payments. If we refund the payments, the bishop would like to approach some of the members to ask if they would be willing to use some of that money to help fill our Scout camp deficit.

Can anyone explain what Church policy indicates in this case? I need answers based on policy more than those based on opinions--the bishop and I have plenty of opinions ourselves. I need to know if there is a way within Church policy for us to keep that local Book of Mormon money to fill our other deficit. Thank you in advance for your help!

You're right about the options to return funds given to the Other account to donors when the purpose and donors of the funds are identified. You can see that documented in the training lesson Understanding and Using the Other Category, which says on slide 25:

If the purpose of the excess funds is identified, and the funds were not used for the intended purpose, you can either:

• Return the leftover funds to the member by printing a check payable to the member from the applicable “Other” subcategory.
• Or obtain permission from the member to change the category of the donation from “Other” to a charitable category such as fast offering or humanitarian aid.

However, note that the option to change the category extends only to a charitable category. This would not include your Other:Scout Camp category.

And as you mentioned, the lesson also says (on slide 24): "If you cannot identify the purpose, clear the funds by printing a check from the “Other” subcategory, payable to Corporation of the President." So that's your only real option for funds where you can't identify or contact the donor.

I would also advise you to read the Church Handbook of Instructions, p. 159-161, where you will see that:

• All activities are to be funded from the Budget Allowance
• Members may not make donations to fund activities
• If Budget funds are not available for a single annual youth camp, the youth may earn part or all of the cost, or there may be approved fund-raising activities.

So donations to the Scout Camp fund are not appropriate. It doesn't matter whether those would be new donations, or changing the category of old donations -- the result is the same.

You have to treat the separate subcategories within Other as if they were separate accounts, since the funds were accepted for a specific purpose and may only be spent for that specific purpose (or refunded as mentioned above). There is no way within policy to transfer funds from one purpose to an entirely different purpose.

So the best way to make up the deficit in Other:Scout Camp is to use Budget funds. After all, the deficit in that fund means you were artificially avoiding spending Budget funds back then, so it is appropriate that you now use Budget funds to make up the difference. I'm a bit surprised the Other account deficit hasn't been a significant audit issue twice a year for the time you've been running that deficit.

I suppose you could also consider the possibility of having the scouts earn the funds or do a fund-raiser after the fact, but that seems a bit odd. See the wiki articles Funding youth camps and Fundraising for some possible guidance.

[shepshep-p40]

Alan_Brown, thank you for your very helpful reply. I didn't realize that there was a specific policy against donations for activities, so I'm glad you pointed that out.

I see that Book 2 starts on page 161, so I guess the material you mentioned must be in Book 1, which I do not have. I'll recommend that section to my bishop and summarize your explanation as well.

I guess my follow-up question would be about whether going over budget for the year is allowed. Some of the posts on these forums that say "just pay from budget" give me the impression that there is a bottomless pit of money we could use, but that doesn't seem right to me. I didn't notice anything in the clerk training about this topic. Maybe this is another case where I need to borrow a Book 1. Any thoughts?

Thanks again for your patience with this new clerk.

[jdlessley]

I see that Book 2 starts on page 161, so I guess the material you mentioned must be in Book 1, which I do not have. I'll recommend that section to my bishop and summarize your explanation as well.

You are right, Alan's reference was to the Church Handbook of Instructions, Book 1, 2006.

I guess my follow-up question would be about whether going over budget for the year is allowed. Some of the posts on these forums that say "just pay from budget" give me the impression that there is a bottomless pit of money we could use, but that doesn't seem right to me. I didn't notice anything in the clerk training about this topic. Maybe this is another case where I need to borrow a Book 1. Any thoughts?

The entire ward budget is provided in the ward budget allowance. The ward must keep all expenditures withing this budget allowance. This includes all youth camps. But since a unit budget may not be able to provide the funds necessary for all youth who would like to attend camp, two alternative methods of sourcing funds are discussed in the Church Handbook of Instructions.

Since there was reference to Scout camps in your first post I am assuming the "just pay from budget" reference was to Scout camps. The information about the Church policies for funding annual youth camps is found in the Church Handbook of Instructions, Book 1, 2006, p 160-161. You can find some information about funding youth camps at the LDSTech Wiki, Funding youth camps, and one of the alternate funding methods, fundraisers, at the Fundraising article.

There is information about ward budgets in the LDS Tech Wiki article Budget allowance, and budget accounting at the Budget allowance accounting article. Going over budget is not the answer to pay for these camps. Of course the bishop can counsel with the stake president to see if the stake would be willing to provide budget assistance for this situation. However, as a matter of routine, expecting the stake to fund youth camps beyond the allocated ward budget probably will not happen. The stake's budget may not be able to handle this since they may not have large enough reserve to meet this need.

[aebrown]

I see that Book 2 starts on page 161, so I guess the material you mentioned must be in Book 1, which I do not have. I'll recommend that section to my bishop and summarize your explanation as well.

Sorry about my lack of clarity. Yes, you're right that I was referring to Book 1 (the 2006 edition).

I guess my follow-up question would be about whether going over budget for the year is allowed. Some of the posts on these forums that say "just pay from budget" give me the impression that there is a bottomless pit of money we could use, but that doesn't seem right to me. I didn't notice anything in the clerk training about this topic. Maybe this is another case where I need to borrow a Book 1. Any thoughts?

The budget is allocated from the Church to the stake. The stake president then decides how to distribute that total allocation among the various wards and branches, reserving some for stake use. It's certainly not "a bottomless pit"; the stake only has a certain amount to work with.

The bishop has a responsibility to "ensure that all expenditures are within the allowance" (CHI Book 1, p. 159). On that same page we read, "If necessary, priesthood and auxiliary leaders should reduce and simplify activities to stay within the allowance." There's not really anything in the handbook about wards exceeding their allowance; rather we are given the above counsel and there is an assumption that priesthood leaders will make sure expenses are within the allowance.

The stake president sets policies as to how to handle wards who end the year with a deficit. Before your bishop would take an action that would result in a budget deficit, I would recommend that he consult with the stake president. In this case, the deficit spending really already occurred in the past, but the Budget deficit was masked by carrying a negative balance in Other:Scout Camp. Perhaps in the past your ward had a Budget surplus at the end of previous years, so the stake president might be inclined to be lenient and allow a deficit. As the ward financial clerk, you can help prepare your bishop for his discussion with the stake president by providing him with as much detail as possible:

• How the deficit in Other:Scout Camp came to be.
• What years produced a deficit and how much for each year.
• What your budget balance was at the end of those years.
• What your anticipated budget balance will be at the end of this year.
• Possible options for correcting the problem.
• Relevant policies.

[shepshep-p40]

Thanks for the guidance on the ward budget allowance. Again I will refer my bishop to the handbook and we'll go from there.