[GNC] Bookkeeping for a club's charity account - use business features?

[Christopher Lam]

This "pledged income" tracking looks eerily similar to the budgeting aka
"virtual transactions" that I was floating about some time ago...

On Tue., 27 Aug. 2019, 00:29 Adrien Monteleone, <
adrien.monteleone at lusfiber.net> wrote:

>
> > On Aug 26, 2019 w35d238, at 3:43 AM, Michael Hendry <
> hendry.michael at gmail.com> wrote:
> >
> >
> >> And I see that your organization does pledges. Here in the US, pledges
> ARE receivable,but only according to the terms of the pledge << thus if a
> person pledged X a year for five years, only the X for the current year due
> NOW >> So pledge accounting will require extra work unless all your pledges
> are simple, immediate pledges.
> >
> > Volunteering to be a paying guest at a “Foundation Dinner” is the only
> undertaking that fits into the definition of a pledge, but I can see that
> setting up an invoice for it would make it “receivable”, and have a
> lifetime that went beyond the financial year’s end.
> >
> > But if I avoided setting up invoices for this particular fundraising
> activity, could I use the Business Features to record income from a each
> member (“Customer”) as it arises?
>
> To answer that question first, yes, you can take a payment without a
> corresponding invoice already having been posted, it is considered a
> ‘pre-payment’. But you won’t get any comparison against pledged amounts
> because that is what the invoice is for and those wouldn’t have been posted
> (or created) yet. You’ll just get to see that MemberX paid a certain
> amount. (and since there is no pledge amount to balance it, it won’t
> calculate your ‘gift’ portion.)
>
> However,
>
> The issue with invoices on a cash basis in GnuCash is you can’t post them
> till payment is received otherwise it hits the ‘Income’ account too early.
> But that negates the ability to see what was ‘pledged’ vs. what was paid.
>
> You can get around this limitation by creating two accounts, something
> like this:
>
> Income:Pledges
> Income:Receipts
>
> 1) Post the invoices to the Pledges account.
> 2) Take payments as normal.
>
> You can now track what money is promised vs. what was paid via Customer
> Reports.
>
> 3) When payments are made, make an additional transaction that transfers
> the same amount of funds from the Pledges account to the Receipts account.
>
> 4) When you run your Income Statement, include the Receipts account, but
> not the Pledges account.
>
> You now have a cash-basis Income Statement, _and_ you get to take
> advantage of the A/R features.
>
>
> >
> >>
> >> But you can easily have a second set of books to keep and report on "by
> member" stuff, and if using the business features, can invoice.
> >
> > That’s a method I hadn’t thought of, and will look into. There’s the
> obvious risk of these two sets of books getting out of step.
> >
> >> Note though that  at least in the US "membership dies" are not really
> receivables <<you are legally allowed to drop out of a voluntary
> organization at any time -- organizational rules about "demits", etc. apply
> only if you want to rejoin>> However many organizations even cash basis
> [prefer being able to send out "statements" (invoices to members)
> >>
> >> Notice that I misunderstood.What I was suggesting was if you had to
> supply to the government the CORRECT member name for the donations, not
> just that it had to be SOME member's name. The latter is of course far
> simpler in terms of record keeping << I was picturing the former because
> possibly there were by person limits >>
> >
> > From the point of view of the annual report to OSCR (the charity
> regulator) there is no need for detailed reporting of income - see
> https://www.oscr.org.uk/media/1800/2015-01-27-example-accounts-scio.pdf -
> but the annual claim for Gift Aid requires the total contributed per annum
> by each individual member. The 25% boost that Gift Aid covers is the reason
> why most Rotary Clubs in the UK set up charities which operate “at
> arms-length” from the clubs themselves but whose trustees are club
> officers.
> >
> >>
> >> Michael
> >>
> >> PS: I do NOT attempt to get gnucash to produce reports in their final
> form. Easier to export full reports and then copy into a document that gets
> edited to remove extraneous detail, insert annotations, etc.
> >>
> >
> > The way I’ve set up the accounts may need review, as I’m going to
> require a lot of individual searches to isolate contributions from
> individual members.
> >
> > I think I need to remove a tier and identify the intended destination of
> the income using a tag in a searchable field.
> >
> > Income:Destination1:MemberA … MemberN
> > Income:Destination2:MemberA … MemberN
> > …
> > Income:DestinationX:MemberA … MemberN
> >
> > - a total of X * N accounts.
>
> >
> >
> > Becomes
> >
> > Income:Donations:MemberA … MemberN, with Destinations 1…X recorded in
> the Description field of each transaction.
> >
> > - a total of N accounts.
> >
> > Thanks for your continued interest and support,
> >
> > Michael
>
> 1) Do you need to know how much each member donated for each destination?
>
> or
>
> 2)
>
>   For the Club:
>
>     Do you just want to track how much was received (in aggregate for all
> members) for each destination
>
>   and
>
>   For the Members:
>
>     How much (in aggregate for all destinations) each member donated? (for
> Gift Aid purposes)
>
>
>
> If #1 one, that is quite messy, yes, and you’ll need lots of manual
> transactions and some sort of searchable/filterable tag system as I
> described previously. (to avoid hundreds or thousands of accounts and
> sub-accounts)
>
> But if #2, then the business features can handle that easily with invoice
> line items posted to Income accounts for each destination and assigning
> those invoices to  individual customer accounts. No need for the individual
> member account(s) in the Income tree at all. GnuCash will track each
> customer's pledged (invoiced) amounts as well as payments. The gift portion
> *might* be a little trickier, but I think it can be achieved by the expense
> vouchers feature. (since they operate as sort of a ‘chargeback’) I’ll have
> to investigate.
>
> Regards,
> Adrien
>
>
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