Returned Checks

What is the policy for returned check...i have heard conflicting reports on whether SLC needs to be contacted to take the money out of the other account.

Can anyone clarify for me.

Thanks

thesmith7 wrote:What is the policy for returned check...i have heard conflicting reports on whether SLC needs to be contacted to take the money out of the other account.

Can anyone clarify for me?

The reason you may have heard conflicting reports is that this changed with MLS 2.7. Prior to that you did have to contact SLC. But now all you have to do is to cancel the donation in the donation batch. On your next Send/Receive, MLS will send the information to SLC and the adjustment will be made to your Other account and show up on the CUFS for that month.

Alan_Brown wrote:

thesmith7 wrote:What is the policy for returned check...i have heard conflicting reports on whether SLC needs to be contacted to take the money out of the other account.

Can anyone clarify for me?

The reason you may have heard conflicting reports is that this changed with MLS 2.7. Prior to that you did have to contact SLC. But now all you have to do is to cancel the donation in the donation batch. On your next Send/Receive, MLS will send the information to SLC and the adjustment will be made to your Other account and show up on the CUFS for that month.

The money is automatically taken out of the other account when the check bounces. Make sure that you also put in a Temporary Item in your reconciliation for the month that it shows on your financial statement until HQ adjusts it back to the other account.

birdld wrote:The money is automatically taken out of the other account when the check bounces. Make sure that you also put in a Temporary Item in your reconciliation for the month that it shows on your financial statement until HQ adjusts it back to the other account.

Please note that money will not be taken out of your other account if your account has an $1100.00 balance. There are a few units with accounts like this. These units will need to delete the donation from the batch. MLS will transmit and HQ will adjust the donation out of the batch on the statement. You will only need a temporary item if the donation was in the 'other' or 'ward missionary' categories and if the batch and the adjustment are in different months.

For all units..You will not need a temporary item if the batch and the HQ adjustment on the statement happen within the same month.

clerker wrote:Please note that money will not be taken out of your other account if your account has an $1100.00 balance.

I'm missing something. Why is that?

This is referring to what is called a non-concentration account, where a unit has a depository account with a local bank and has to maintain a $1100 compensating balance. With these accounts, notifications of returned checks are sent directly to the unit rather than to Church HQ, so it doesn't post on the Church Unit Financial Statement to the Other account.

13thfloorrocks wrote:This is referring to what is called a non-concentration account, where a unit has a depository account with a local bank and has to maintain a $1100 compensating balance.

So if the software sees "$1100" then it assumes it's a non-concentration account and acts accordingly? OK, that makes sense, but seems a bit jerry-rigged. (Looking at account balance rather then a specific flag.)

RussellHltn wrote:So if the software sees "$1100" then it assumes it's a non-concentration account and acts accordingly? OK, that makes sense, but seems a bit jerry-rigged. (Looking at account balance rather then a specific flag.)

No, what is being discussed is a situation where the LOCAL bank account has $1100. It has nothing to do with the Church unit account balance. The $1100 is a balance the Church carries to compensate the local bank for their costs in carrying the account.

This is the arrangement worked out by the Church with local banks for units that are not on deposit concentration. In this situation, the Church doesn't have as direct a relationship with the bank, and so any deposited checks that are returned are sent directly to the Unit (as opposed to deposit concentration, where returned checks are sent to the Church). Since the Church isn't in the loop for returned checks, there is no automatic deduction from the Other account for returned checks.

I would like to continue this thread. The last time I got a returned check it was a mess.

Currently I have a neg amount on my statement in other for the amount of the returned check. I am now to go in and create a temp item to offset that amount.

Next month CHQ does some adjustments and its fixed.

Can someone expound on this starting from the temp adjustment, please.

kmalone wrote:I would like to continue this thread. The last time I got a returned check it was a mess.

Currently I have a neg amount on my statement in other for the amount of the returned check. I am now to go in and create a temp item to offset that amount.

Next month CHQ does some adjustments and its fixed.

Can someone expound on this starting from the temp adjustment, please.

This is explained in detail in the wiki article Returned Check.

So after I create a temp how is it corrected the following month that allows me to see it the statement so I know I can clear the temp item?

kmalone wrote:So after I create a temp how is it corrected the following month that allows me to see it the statement so I know I can clear the temp item?

On the statement that shows the canceled donation (often this will be in the following month's statement), you will see an entry in section III that will show a credit to the Other category and a charge to the category(ies) of the original donation , reflecting that the administration office has

1. Restored the funds in the Other category that were taken out when the check was returned, and
2. Reduced the totals for the donation batch to reflect the cancelation of the donation.

Once you see those transactions appear on the financial statement, you can clear the temporary item.

Alan_Brown wrote:On the statement that shows the canceled donation (often this will be in the following month's statement), you will see an entry in section III that will show a credit to the Other category and a charge to the category(ies) of the original donation , reflecting that the administration office has

1. Restored the funds in the Other category that were taken out when the check was returned, and
2. Reduced the totals for the donation batch to reflect the cancelation of the donation.

Once you see those transactions appear on the financial statement, you can clear the temporary item.

Perfect this what I needed to know

Thank you