Handling funds for multi-stake events

I'm curious how some of you who are stake clerks handle things when your stake is handling funding for a regional event. Do you spend funds out of budget categories, or set up an "Other" account? How do you track what other stakes need to pay and have paid?

Thanks,

All events should come out of unit finances so unless there is a very special situation nothing should come out of an other account for something like this.

You could either assign each stake specific tasks and they make the payments themselves, or have one stake handle everything and then the other stakes write a check to that stake to cover the expenses.

aclawson wrote:All events should come out of unit finances so unless there is a very special situation nothing should come out of an other account for something like this.

I don't necessarily agree with that. Given the multi-stake aspect of this, it would be cleaner to run this all out of a single "other" account. That way the "other" account shows a clean tracking of the event and the stake's budget account just shows what that stake contributed for the event - just like it would for the other stakes.

Note in this case all funds ARE coming from the unit finances - not the members. Which is what I believe the guidelines are about.

In our coordinating council we generally do things one of two ways:

1) For areas that will likely have ongoing expenses throughout the year (regional YSA activities, or expenses related to Family History Centers), one stake takes financial responsibility for that area, and sends an invoice to the other stakes to cover the estimated expenses for the year.

2) For one-time regional activities one stake is chosen to take financial responsibility for that activity, and people who incur expenses for the activity are reimbursed by that stake. When all of the expenses are in, the stake handling the money sends a letter to the other stakes to let them know what their share of the expenses are and request payment.

In both cases when my stake is responsible for the finances I've been using an "Other" account, for the reasons that russellhtn mentioned. I didn't feel comfortable mixing regional funds with Stake budget funds and it seems like a better way to track what goes in and out.

Recently, though, I've been wondering whether that's the right way to go. Especially in the second case above, we have a tendency to run a negative balance in these categories while we wait for the other stakes to send their portion of the money. Recently that generated an email from the church asking us to correct a negative balance, and that email suggested that the expenses should come from budget funds -- although maybe they just didn't understand that these were expenses for regional activities.

bedone wrote:Recently, though, I've been wondering whether that's the right way to go. Especially in the second case above, we have a tendency to run a negative balance in these categories while we wait for the other stakes to send their portion of the money. Recently that generated an email from the church asking us to correct a negative balance, and that email suggested that the expenses should come from budget funds -- although maybe they just didn't understand that these were expenses for regional activities.

Perhaps you should be running "type 2" like the "type 1". Ask for money from the other stakes up front - at least enough so there isn't any negative balance for a long enough time to generate a letter.

Last year, I tried creating an Other subcategory specifically for a multi-stake Single Adult event. I paid all expenses from that source, resulting in a negative balance. I planned to transfer money from our Single Adult budget category to cover our share of the expenses, and ask the other stakes to send us a check for their shares. In the end, the subcategory would have a zero balance, and I would close it.

I thought it was a great plan. However, I quickly received a scalding e-mail from a Church auditor in SLC, telling me that I should NEVER spend funds first, and collect funds later to zero everything out. So I simply recategorized all expenses for the SA event as Single Adult Budget expenses, and closed the Other subcategory I had created.

Apparently, Other subcategories are supposed to accumulate funds BEFORE expenses are incurred.
Oh well.

Here is the redacted e-mail I received for my great idea:

In reviewing your units’ checking account, we have found that the “Other“ account has been currently overdrawn and is in the negative. Your current balance in this account is -$128.99. It appears that the unit has overspent in this category to support a Single Adult Conference, which possibly should and/or could have come out of the appropriate “Budget” account. . It doesn’t appear that there were enough funds brought in to support this activity, thus leaving you with a deficit.

As a general reminder, please remember that the “Budget” guidelines indicates that money collected in “Other” for the annual camp and group equipment for those camps, can only be used for the one annual camp and/or group equipment for the camps. Everything else is to be paid out of the budget allowance. Please refer to reference 13.2.8 on pages 103/104 of handbook 2, and 14.7.2 in pages 130/131 of handbook 1.

As additional clarification: The Other account is a pass through account for short term expenses. It is a collect and expense account, not an expense and then hopefully we collect all the funds later. This account should always be at a zero balance unless you are in the process of collecting funds for an upcoming expense such as a camp registration, etc. This means that we need to do a little more and/or a better job at pre-planning for upcoming events so that we collect the necessary funds before we have a need to expense them. If we have collected the funds and do not have enough to cover the expense when it is due, then the difference should come from the Budget. Then as we collect additional funds after the expense, they can be deposited back into the Budget account to offset the check that was written from there for the activity. None of our accounts should go into the deficit with hopes to collect and replenish.

In the meantime, ... In order to bring this deficit to a zero balance, we would suggest that you please have your clerk write a check from “Budget” for $128.99, to the unit, and deposit it into the “Other” account to bring its balance to zero as soon as possible.

Once any additional funds come in, in the event of any fund raisers, assessments or other donations, reimbursing the funds for this activity, you can deposit them back into your “Budget” offsetting the check written to “Other”.

drepouille wrote:Everything else is to be paid out of the budget allowance. Please refer to reference 13.2.8 on pages 103/104 of handbook 2, and 14.7.2 in pages 130/131 of handbook 1.

Which overlooks the reference to 16.3.7 which shows that it is permissible.

drepouille wrote:Once any additional funds come in, in the event of any fund raisers, assessments or other donations, reimbursing the funds for this activity, you can deposit them back into your “Budget” offsetting the check written to “Other”.

Messy. I'd think any donations going into budget would trigger a in-depth examination to make sure they were proper. (Offset by matching or larger expenses.)

I suppose another way of doing it is do an "advance" transfer from budget to other, then when the other stakes have settled their expenses, write a check for the balance back to budget. That way there's only two transactions of the budget to examine to make sure it was spent properly, and "other" has all the details.

It's either that or get the stakes to all pay in advance and refund/bill as needed to bring it to zero when done.

drepouille wrote:Here is the redacted e-mail I received

You got the standard "you overdrew your Other account" email. It does not take into consideration what you are trying to do.

However, the principle that you should not spend funds out of the Other account before they are received is correct and should be followed.

One of the stakes in our area manages the Young Single Adult and Single Adult accounts for our Coordinating Council that are used to handle major regional YSA and SA conferences. The stakes agreed that they would each send a certain amount to that stake according to an approved budget that was set by the Council.

Each stake sends funds out of the stake Budget account that the managing stake puts in their Other account. The managing stake also "sends" from their Budget account to the Other account. The major conference activities are then completely managed and tracked out of that stake's other account.

This system has worked well for many years.