[GNC] Fund management without an actual account

Chris Skudder CSkudder at earthlink.net
Tue Aug 6 17:20:12 EDT 2024


Hi Daniel,
I apologize if this is a duplicate - I sent it yesterday, but I didn't 
see it show up in the subsequent emails.
This is similar to the "liability" approach. But it works better in my 
case because all the numbers I (and others) want to see are grouped 
together in the assets section of the balance sheet (statement of 
position, in non-profit vocabulary).

As Treasurer of our church, I do something very similar.
This is how it works:
  - A parent asset acct 1120 is called "Checking acct after reserves"
  - a child acct 1121 is called "Checking acct"
  - another child acct 1122 called "Reserve for property tax"
  - another child acct 1123 called "Reserve for elevator maintenance"
     (I think some people might call these 2 Reserve accounts 
"contra-asset" acct's since they normally have a NEGATIVE balance as an 
asset)
In the church's case, the reserves are for:
         - property tax on the parsonage, which is due every 6 months
         - big elevator maintenance work required every 5 years
The acct codes (1120, 1121, etc) help a LOT to keep this clear in the 
chart of accts. I'd suggest using acct codes for all accts. See for example:
double-entry-bookkeeping.com/coa/chart-of-accounts-numbering-system/
     ... or search on "typical chart of accounts numbering system"

Then I take the property tax amount divided by 6 months, and
the estimated elevator maintenance bill divided by 60 months ie 5 years -
... and set up monthly Scheduled Transactions, which:
     - CREDIT the "Reserve for something" acct
     - DEBIT the appropriate expense acct
           ... for the amount needed monthly, to have money available to 
pay these bills when they come up.

So the "Reserve for something" accounts -which are asset accts- usually 
have a negative (credit) balance. This is the amount which has been "set 
aside" towards the known upcoming expense.
The expense actually shows up monthly, instead of a big lump at 6 months 
for property tax, or at 5 years for the elevator maintenance.

When the "big lump" bill comes due and I pay it, the transaction is:
     - CREDIT the checking acct, from which I write the check to pay it,
     - DEBIT "Reserve for something" ... which brings the "Reserve" acct 
balance back to zero (or pretty close).
Note that this debit does NOT go into the expense acct - because the 
expense has already been booked monthly.

So looking at these acct balances in a typical month, it might look like 
this:
1120 "Checking acct after reserves"  =  $6,000  (PARENT)
  - 1121 child acct  "Checking acct"     =  $7,250
  - 1122 child acct "Reserve for elevator" =  -$1000 (Negative balance)
  - 1123 child acct "Resv for property tax" =   -$250(Negative balance)

What this means:
  - 1120 the PARENT "Checking after reserves" is that portion of the 
checking acct available for everything else ... AFTER what's been set 
aside for the next 5-year elevator maintenance and the next 6-month 
property tax payment.
-- 1121 child "Ckg acct" is the ACTUAL amount in the checking acct.
         ... This is the acct into which I book all deposits and checks 
written; and which I reconcile with the bank's statement each month.
      -- 1122+1123 "Reserve for XXX" acct's are the amounts "saved up 
for" the upcoming big-lump payments, which show up as a negative number.

I coded 1120 "Checking after reserves" as a "placeholder" acct, so it 
does NOT show up as a choice when I'm entering transactions. I will not 
ever normally enter a transaction directly into this acct.
Everything goes into the actual checking acct 1121, or the reserve 
acct's 1122 + 1123.

Hope that helps and God bless!
Chris

------------------------------------------------------------------------

On 8/5/24 12:00, gnucash-user-request at gnucash.org wrote:
> Message: 3 Date: Mon, 5 Aug 2024 13:27:22 +1200 From: Daniel Sheffield 
> <d.j.yotta at gmail.com> To: gnucash-user at gnucash.org Subject: [GNC] Fund 
> management without an actual account Message-ID: 
> <CAGBFyFUc8nZAFzAbyTWcUWc3QmgRNvJEeBp=HSJz-7A6_Y+8ZQ at mail.gmail.com> 
> Content-Type: text/plain; charset="UTF-8" Hi, I'm using gnucash to 
> manage my personal finances. ... BUT I'm trying to keep track of 
> savings towards a goal, but without opening an actual account or 
> making any real world transactions to achieve it. ... Cheers, Daniel S



On 8/6/24 12:00, gnucash-user-request at gnucash.org wrote:
> Send gnucash-user mailing list submissions to gnucash-user at gnucash.org 
> To subscribe or unsubscribe via the World Wide Web, visit 
> https://lists.gnucash.org/mailman/listinfo/gnucash-user or, via email, 
> send a message with subject or body 'help' to 
> gnucash-user-request at gnucash.org You can reach the person managing the 
> list at gnucash-user-owner at gnucash.org When replying, please edit your 
> Subject line so it is more specific than "Re: Contents of gnucash-user 
> digest..." Today's Topics: 1. Re: Fwd: Fund management without an 
> actual account (Alan Johnson) 
> ---------------------------------------------------------------------- 
> Message: 1 Date: Tue, 6 Aug 2024 09:54:08 -0600 (MDT) From: Alan 
> Johnson <alan at argentwolf.org> To: Daniel Sheffield 
> <d.j.yotta at gmail.com> Cc: gnucash-user at gnucash.org Subject: Re: [GNC] 
> Fwd: Fund management without an actual account Message-ID: 
> <3e05dd08-36c6-4dc4-b7e3-91bbcc0ae7f4 at argentwolf.org> Content-Type: 
> text/plain; charset=UTF-8 I guess I don't understand what you mean by 
> offset your mortgage. For the other things, things such as gifts and 
> tithes, they would go into a liability account against the expense 
> category you choose for them. When you pay / make the gift, you would 
> transfer from your assett account (checking, savings, etc) to the 
> liability account to zero it out. The assett (cash) and liability 
> (gift, tithe, etc) would appear opposite each other on reports. Aug 6, 
> 2024 03:20:24 Daniel Sheffield <d.j.yotta at gmail.com>:
>> Thanks Alan, I wonder about the roll up figure on the accounts tab - 
>> I have heaps of future transactions scheduled months in advance to 
>> help me forecast. But that means the account tab never reflects the 
>> current balance. So I can't use that to reconcile. Unless there is a 
>> setting somewhere to show up to today only on the accounts tab? I 
>> also wonder about obligatory fund (ie, promised gift, allowance) - 
>> the 2nd Tithe is a big deal for me, I view it as a liability because 
>> I can not spend it on just anything I like. It's essentially on loan 
>> to pay a bill in the future. Most people stick it in an external 
>> account. I'm not doing that so that I can offset my mortgage. In a 
>> nut shell, I really can't have it factor into my net worth because 
>> it's not my money. Sort of like if you paid without?taxes 
>> withheld?and will have to pay at the end of the year. Every time you 
>> get paid, you're increasing your tax liabilities. The other funds, 
>> this notion is not so important, I can scrap the travel money to pay 
>> the bills if I want - so your way could work for that... but if I can 
>> find one way that works, that's even better. But sub accounts on my 
>> checking account seems to be the prevailing view... probably for a 
>> reason... perhaps I should try harder... Cheers, Daniel? -- In the 
>> beginning Kibo created the Internet. Now the Internet was formless, 
>> and empty. Randomness was upon the face of computing, and the Spirit 
>> of ARPA moved upon the face of the computers. Then Kibo said, "Let 
>> there be data": and there was data. Kibo saw the data, and it was 
>> good, so Kibo divided the data from the randomness, and Kibo named 
>> the data Information, and the randomness Clueless. And the 
>> Information and the Clueless were the first Network. On Tue, Aug 6, 
>> 2024 at 5:24?PM Alan Johnson via gnucash-user 
>> <gnucash-user at gnucash.org> wrote:
>>> Daniel, I would suggest that you use the second savings account and 
>>> it would help with the over spending. I think it would look 
>>> something like this, please forgive formatting as I'm on mobile, but 
>>> you should get the idea. Checking debit 10k / salary credit 10k 
>>> Credit checking 1k / debit savings2 1k Credit savings2 500 / debit 
>>> vacationfund [subaccount] 500 Credit savings2 500 / debit toyfund 
>>> [subaccount] 500 Need money back in checking to spend? Debit 
>>> savings2 300 / credit vacationfund 100 credit toyfund 200 Credit 
>>> savings2 300 / debit checking 300 Your roll up of savings 2 in the 
>>> accounts list will tell you the amount which should match the 
>>> savings statement. There should also, in theory, be a very few 
>>> transactions to reconcile, and it keeps the checking account clean. 
>>> Alan _______________________________________________ gnucash-user 
>>> mailing list gnucash-user at gnucash.org To update your subscription 
>>> preferences or to unsubscribe: 
>>> https://lists.gnucash.org/mailman/listinfo/gnucash-user ----- Please 
>>> remember to CC this list on all your replies. You can do this by 
>>> using Reply-To-List or Reply-All.
> ------------------------------ Subject: Digest Footer 
> _______________________________________________ gnucash-user mailing 
> list gnucash-user at gnucash.org To update your subscription preferences 
> or to unsubscribe: 
> https://lists.gnucash.org/mailman/listinfo/gnucash-user ----- Please 
> remember to CC this list on all your replies. You can do this by using 
> Reply-To-List or Reply-All. ------------------------------ End of 
> gnucash-user Digest, Vol 257, Issue 9 
> ********************************************


More information about the gnucash-user mailing list