[GNC] BotanyBayGardens nonprofit example, and why GnuCash does not suffice

[Adrien Monteleone]

I'm not an accountant or an attorney either. But I've been a manager and 
I've caught people stealing from various cash sources. I can attest, 
that if you don't track it tightly, even with access control, it will 
magically walk away at some point.

Not treating PayPal like an account in your books is asking for trouble. 
That's a pile of money that can flow back and forth from and to various 
sources and is 'invisible' to the books in that case. That is the very 
antithesis of 'accounting'.

For the issue of using cash for disbursements, that is the point of a 
petty cash account. (otherwise, it is just 'undeposited funds') Some 
organizations as part of their control and accounting mechanisms require 
disbursements over a certain amount ($5 is not unusual) to be by check. 
Some make it iron clad for any amount. This greatly simplifies cash 
handling, tracking and accounting and in such a case, the physical cash 
the organization receives is usually handled by a single person. (a good 
idea in general)

As for dating transactions, I wouldn't alter anything unless the law 
specifically allowed for it. Otherwise, I might reconsider using Accrual 
instead of Cash basis if it became a repeated issue.

Regards,
Adrien

On 7/25/20 12:03 AM, will at theprescotts.com wrote:
> I have a few comments on this long post. I will preface it by admitting that I am neither a tax attorney nor an accountant. I have kept my personal accounts in GnuCash for many years. I am the treasurer for two non-profits, or more accurately, two subsidiaries of one non-profit. But neither of them are legal entities nor in the US. Legally, they are probably more akin to informal associations.
> 
> The suggestions for falsifying the dates of transactions for convenience in accounting strike me as very bad advice. Is it even legal for an organization that has to abide by US tax laws.
> 
> Similarly, I don't understand the advice to just treat Paypal transactions as if they were directly on checking. This would make accounting for Paypal fees strange. For organizations outside the US, Paypal no longer holds funds; they transfer them immediately, so the Paypal balance is always zero except for immediately after a deposit to Paypal. Even so, it is much easier to track activity treating Paypal as a bank account.
> 
> Finally, I don't understand the suggestions about not having a cash account and immediately depositing all cash to checking. Perhaps it is partly because I live in a country where many transactions are still done with cash, where no one uses checks, just bank transfers. But I often accept donations in cash, and often pay bills in cash. Not accounting for those transactions directly would be neither accurate nor convenient.