Initial setup questions for a small non-profit membership startup (UK)

[Cylindric]

It's not quite that tricky, we're non-profit, but not a charity. We're
allowed to sell stuff and make money etc if we can, but it's a "surplus"
and not a profit, and there are restrictions on what we can spend it on in
our constitution.
On 20 May 2015 9:52 pm, "Wm [via GnuCash]" <
ml-node+s1415818n4678408h72 at n4.nabble.com> wrote:

> Wed, 13 May 2015 08:23:20 <[hidden email]
> <http:///user/SendEmail.jtp?type=node&node=4678408&i=0>>
> Cylindric <[hidden email]
> <http:///user/SendEmail.jtp?type=node&node=4678408&i=1>>
>
> >Hi folks. I'm sort of starting out with this sort of company, which is
> >a
> >non-profit membership organisation.
>
> It either is or it isn't, the Charities Commission is your starting
> point (I'm in the UK too) if you want to formalise it or tell folks
> whether you're actually non-profit or not.
>
> >I'm going to need to record basic stuff like bank, rent and bills and
> >stuff,
> >which is fine and I've done before, but I'm not sure how to handle the
> >members and their subscriptions. From time to time we may also sell
> >products
> >to our members.
>
> You've had good advice in the two replies so far.
>
> I'd like to re-enforce that the legal situation in the UK is not
> consistent (Scotland is different to England and Wales, for e.g.) and
> can be very different to that in some other countries like the USA where
> it varies from state to state.
>
> You should be careful what you invoice formally (i.e. make a demand for
> payment) vs what you expect informally and what people have said they
> will pay you.  Think carefully about whether you want to account as
> turnover the amount you expect or the amount you receive (it is very
> different elsewhere, you should start with receipts only, promises are
> for the future and un-enforceable).
>
> The Charities Commission (if you are a small enough org) will allow you
> to work on a cash basis.  This is useful if you *do* *not* charge / send
> invoices / demands for payment, etc.  But you need to be squeaky clean
> about that.
>
>  >>>
> I was going to use Customers, but I can't see how to create
> monthly-repeating transactions for Customers, so should I set them up as
> Accounts Receivable accounts, and use normal recurring transactions?
>
> I'm also getting a bit confused with the number of transactions I'm
> creating, as I currently have, for example:
>
> £25 invoice in *Assets:AR:PersonName* to *Income:MembershipFees*
> £25 payment from *Assets:AR:PersonName* to *Assets:Current:Bank*
>
> A person might pay for 6 months up front, but I'll only want to "take
> out"
> their fee monthly.
>
> How does that sound? I realise it's probably all a bit wonky :)
>
> <<<
> If someone pays 6 months up front you don't have a choice, you *must*
> recognize it, it happened.
>
> You could treat the 5 forward months as a liability but
> a) I suggest you bank the money you've received
> b) by creating a liability you're fucking with the Charities Commission
> and they were trying to be nice to you by saying you could use cash
> accounting because it was simpler.
>
> Be careful, honest non-profit orgs are given many chances to prove their
> worth, those opportunities should not be abused on a whim.  Offered the
> chance of recording things correctly in gnc as my accounting app and
> figuring out who promised what in a spreadsheet I'd do the formal in gnc
> and the informal (but legal!) in a spreadsheet.
>
> The world of differences is wonderful, if you're in the UK, acknowledge
> that, the regime in some USA states (which I think you were heading
> towards) doesn't necessarily apply.
>
> Best wishes.
>
> --
> Wm...
>
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