[GNC] How to record 'balancing' trnsactions?

[Michael Hendry]

On 13 Jul 2023, at 08:01, Chris Green <cl at isbd.net> wrote:

> 
> On Wed, Jul 12, 2023 at 02:51:39PM -0700, Vincent Dawans wrote:
>> Leaving aside the why you need 2 sets of books, I'll just focus on the how.
>> 
>> First you need to decide if the money in and money out really needs to be
>> classified as income and expenses in your first set if books (the main bank
>> account) or can more simply be treated fully as pass-through. If fully
>> pass-through, then the following...
>> 
>> *For example we might have 'income' into the current account as*
>> *follows:-*
>> *    Scarfe Trust for roof       750.00*
>> *    Talk and Tea collection     205.00*
>> *    Tea concert                 410.00*
>> *    Carol singing                35.00*
>> 
>> Is not recorded as income in your main book but instead as a liability
>> towards the building fund. So you create a building fund account under
>> liability and when your receive money for the building fund you debit your
>> bank account and credit that liability account. Then when you are ready to
>> write a check for the building fund, you look at the balance in that little
>> account and write the check for that amount. When the check is cashed it
>> will come as a credit on your bank account and a debit on the liability
>> account. That liability account becomes a sort of running ledger you can
>> provide showing money collected then transferred to the building fund over
>> time.
>> 
>> On the building fund side, you can either book the money coming in as
>> income directly on the date received from the main account, or if you want
>> the detail of all the original transactions, then create a receivable
>> account under assets with the same detailed transactions from the other
>> side booked against income, then that gets zeroed when the check is
>> deposited.
>> 
>> The opposite movements then are made for payments from the building fund to
>> the main accounts of needed.
>> 
> Thank you Vincent, I think you have outlined an approach that will
> work for me.  I will start trying it out and see how things go.
> 
> -- 
> Chris Green

Morning, Chris,

Have you considered setting up a current account for the Buildings account?

This would allow you to separate the Church and Buildings accounts completely, the only extra work being to transfer funds between the current and savings accounts as the need arises, with a small balance kept in the (Buildings) current account to deal with (eg) small repairs and renewals,

The Rotary Club for which I’m treasurer has two such account pairs for the running expenses of the Club itself,  and for the associated Charity. The charity is, of course required to have its own bank account because of its charitable status.

Regards

Michael