YW Fund Raiser: Other and Budget Accounts

Our YW had a fundraiser to pay for YW camp. This fundraiser included a "Service Auction" and some of the winners included their donations on their tithing slip: Other YW Camp. (so far, so good I think).

Here comes the confusing parts:
1. The check to pay for YW camp was written and "charged" to both the Other category and the YW Budget category. (i.e.-$700 total; $400 - Other; $300 - YW Budget)
2. Some of the member's donations were made AFTER the check was written. In order to replace the funds in the YW budget category, these donations were entered as donations directly into the YW budget category.

I have the following questions:
1. Should the check have been written entirely out of the Other category with the deficit handled by writing a check from the YW budget to the Other acct? (Training slide 28) OR was this the correct way to handle this since the fund raiser was to "help" pay for YW camp? (Training slide 18)
2. Should the members' donations have been entered as donations to the Other YW Camp category (slide 15); then a check written from the Other account to the Budget account? (training slide 32)
3. If the answer to #2 was yes and the funds should've gone into the Other category, how do I correct this? (training slide 26 & 27, but change from Budget to Other)

Thanks,
Jim

Question - is it possible to "recategorize" the check to change the amounts of the two accounts the check is drawn from?

ralitaco wrote:I have the following questions:
1. Should the check have been written entirely out of the Other category with the deficit handled by writing a check from the YW budget to the Other acct? (Training slide 28) OR was this the correct way to handle this since the fund raiser was to "help" pay for YW camp? (Training slide 18)

The way the disbursement was made is fine. How the funds were handled after the disbursement was made is where there are problems. Your next question provides the correct procedure.

ralitaco wrote:2. Should the members' donations have been entered as donations to the Other YW Camp category (slide 15); then a check written from the Other account to the Budget account? (training slide 32)

This is the correct procedure. Collect the funds in the Other:AMFA:YW Camp then recover the funds disbursed from the budget with the excess in the Other:AMFA:YW Camp category just as you describe. But just for clarity the Check would be written to the Ward from the Other:AMFA:YW Camp and then deposited to the Budget:YW category. The yellow copy of the Tithing and Other Offerings slip would be attached to and filed with the disbursement authorization form as the proof of expense. The white copy of the Tithing and Other Offerings slip would be included in the donation batch as per any other donation.

ralitaco wrote:3. If the answer to #2 was yes and the funds should've gone into the Other category, how do I correct this? (training slide 26 & 27, but change from Budget to Other)

Open the donation batch for each donation that was deposited to the Budget:YW category and change the category to Other:AMFA:YW Camp. You will need to provide a reason such as "corrected donation category". Don't forget to notify the donors and get their OK to make the correction on the slip to show the adjusted category. I usually write on the back of the slip the reason for the adjustment and annotate that the donor agreed.

The best approach would have been to write the entire check amount out of the Other:AMFA:YW Camp category. An Other category can have a deficit for a period of time while the funds are collected. If the entire deficit is not recovered then a disbursement from the Budget:YW category would be made and deposited into the Other:AMFA:YW Camp. When that disbursement from the budget is made is entirely up to the bishop in council with the YW leaders to determine if and when any donations would be made.

jdlessley wrote:Collect the funds in the Other:AMFA:YW Camp then recover the funds disbursed from the budget with the excess in the Other:AMFA:YW Camp category just as you describe. But just for clarity the Check would be written to the Ward from the Other:AMFA:YW Camp and then deposited to the Budget:YW category.

I would agree with almost every step you listed. But a simpler way to accomplish zeroing out the Other:AMFA:YW Camp category is to:

1. Adjust all the donation so that they are in Other:AMFA:YW Camp as you described.
2. Then note the balance in the Other:AMFA:YW Camp category
3. Adjust the categories of the check that was written. Increase the Other:AMFA:YW Camp component by the balance calculated in step 2, and decrease the Budget:YW component by the same amount

The advantage of this method is that there is no need for writing an extra check that then has to be deposited. The net result is the same:

• All donations are made to Other:AMFA:YW Camp (correct according to policy)
• The Other:AMFA:YW Camp balance is 0 (also correct according to policy)
• The Budget:YW category is charged for the amount not charged to Other.

But you saved yourself a check and a deposit transaction.

RussellHltn wrote:Question - is it possible to "recategorize" the check to change the amounts of the two accounts the check is drawn from?

I know the category(ies) for disbursements can be changed. I just don't know what the end results would be. I assume it would be the same as for a change in a donation batch. I would definitely take notes to clear up any questions the auditor would have.

aebrown wrote:IBut you saved yourself a check and a deposit transaction.

That is a cleaner way of doing it. The only thing that would affect this methodology is when the donations that were made after the disbursement were received. If they came in over a short period of time then things are fine. But if adjustments are made each Sunday as donations arrive over several weeks or months then there are going to be a lot of adjustments to the disbursement. To an auditor that would be a red flag. I would hope that the clerk at the audit was the one making all the changes so he could clarify the situation to the auditor.

jdlessley wrote:But if adjustments are made each Sunday as donations arrive over several weeks or months then there are going to be a lot of adjustments to the disbursement. To an auditor that would be a red flag.

I'd think any transfer of funds from Other to Budget would be an immediate red flag. I'd think a re-adjustment would have a better chance at being self-explanatory.

jdlessley wrote:That is a cleaner way of doing it. The only thing that would affect this methodology is when the donations that were made after the disbursement were received. If they came in over a short period of time then things are fine. But if adjustments are made each Sunday as donations arrive over several weeks or months then there are going to be a lot of adjustments to the disbursement. To an auditor that would be a red flag. I would hope that the clerk at the audit was the one making all the changes so he could clarify the situation to the auditor.

I would definitely wait until things settle before making the adjustment. But it's the same issue with writing a check from Budget to Other -- do you keep writing checks to move funds around, or wait until things settle and write one check?

aebrown wrote: [*]Adjust the categories of the check that was written. Increase the Other:AMFA:YW Camp component by the balance calculated in step 2, and decrease the Budget:YW component by the same amount
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I was good up to here. I am confused now. How can you change the amount checks are for once they have been cut, transmitted and deposited? It would have to be two separate checks because the funds are from Other and Budget. I realize the total amount is still the same, but these are two separate accounts your checks are drawing from, and they've already been issued and likely cashed. This just doesn't seem to be clean to me.

Going on to the audit issue, your check stubs no longer match the documentation as well. I guess you could document the change, but I still can't get past that it feels wrong to change the amount a check is for after it's already been cashed. Am I just off base?

crislapi wrote:I was good up to here. I am confused now. How can you change the amount checks are for once they have been cut, transmitted and deposited? It would have to be two separate checks because the funds are from Other and Budget.

Of course you can't change the amounts of checks that have already been written. I was not suggesting that. I was simply talking about adjusting the categories.

You are thinking it has to be two separate checks because the check was written from Budget and Other. But that has not been a restriction since the CUBS transition -- you can now write a single check from multiple major categories.

The OP specifically said 'The check to pay for YW camp was written and "charged" to both the Other category and the YW Budget category. (i.e.-$700 total; $400 - Other; $300 - YW Budget).' The check already spans major categories; I was merely suggesting that the categorization of that check be adjusted.

crislapi wrote:Going on to the audit issue, your check stubs no longer match the documentation as well.

You raise a reasonable point, but that is true of any category adjustment you ever make to any check or donation. I don't think you're saying that no category adjustments should ever be made. We just need to attach a note of the adjustment to the documentation for the original donation or expense.

aebrown wrote:You are thinking it has to be two separate checks because the check was written from Budget and Other. But that has not been a restriction since the CUBS transition -- you can now write a single check from multiple major categories.

I didn't know that. I'd saw a recent post about it. At my last read of it, it seemed the conclusion was this was in error. This was a very quiet feature added to MLS if even you just found out about it 3 weeks ago.

If it is a single check and the total amount does not change, then yes, adjusting the amount taken from each subcategory should be fine. Still, it seems different adjusting a check where all the categories are Budget categories (same account) compared to when it is Other and Budget (different accounts). I guess CHQ just has the bank transfer the funds to cover the adjustment. If the system allows it and is capable of doing it, then why not?

aebrown wrote:But you saved yourself a check and a deposit transaction.

This may be the "cleaner" way of doing it, but I would prefer have the full amount of the check come from the Other:AMFA:YW Camp and then reimburse the balance from Budget:YW with a second check.
This way, when looking at the income and expense report for the Other:AMFA:YW Camp category it is easy to see how much the actual expenses were for the YW Camp and how much was offset by the fundraiser.

greggo wrote:This may be the "cleaner" way of doing it, but I would prefer have the full amount of the check come from the Other:AMFA:YW Camp and then reimburse the balance from Budget:YW with a second check.
This way, when looking at the income and expense report for the Other:AMFA:YW Camp category it is easy to see how much the actual expenses were for the YW Camp and how much was offset by the fundraiser.

Yes, this is my prefered way of doing it. But we are discussing methods to rectify a situation that has been done another way. Perhaps others will see the issues and headaches involved when doing it the way the OP described.

Thank you everyone for the responses.

I think the best place to start is with the donations we recieved AFTER the check was written because this seems more straight-forward:
From all the responses, I have learned / decided on the following:
1. All of the donations (before and after the check was written) should have been depositted into the AMFA:OTHER:YW Camp subcategory and NOT the BUDGET:YW subcategory.
2. To change the Subcategories where the donations were assigned, I need to edit the deposits containing the donations & document why I made the changes. (just as JD described in post 3)

Next, the Original Check issue:
(Just to clarify, one check was written and the funds were "charged" to the Budget: YW & AMFA:OTHER: YW Camp.)
I have read and re-read the training on "Understanding and Using the Other Category." On slide 28, at the bottom, it states:
"NOTE: If you know that the funds collected in an "Other" subcategory will not cover the costs they are intended for, you can prevent a deficit by transferring the funds from a budget subcategory to the "Other" subcategory.
To transfer funds from a budget subcategory, print a check, payable to the unit, from the budget subcategory, and deposit it in the "Other" subcategory."

From that and a few other places, I have come to the conclusion that the check for YW Camp should have ALL come out of the AMFA:Other:YW Camp subcategory. If there was not enough money in the AMFA:Other:YW Camp subcategory, then I should have written a check and depositted it into the AMFA:Other:YW Camp subcategory. (just as greggo said)
But, since I didn't do that, I think that I will leave the original check subcategories as they are. Then after I correct the donations issue and have funds available in the AMFA:Other:YW Camp subcategory, I will write a check out of the AMFA:Other:YW Camp subcategory payable to the BUDGET:YW subcategory to "refund" the money spent out of the BUDGET:YW subcategory following the instructions on slide 32 of Understanding the Other Account.

On a side note, because of slide 32; I am going to respectfully disagree with aebrown. While I agree that it would be a lot easier, I don't think it is proper to simply adjust the categories of the check to correct where the money came from. If that was the proper/acceptable method, then I would've expected the training to indicate that.
Perhaps this is a new option available in CUBS and the training is outdated. If so, new training docs would be great.

Again, thanks to everyone: JD, AE, Russel, Cris and Greg. I really appreciate your wisdom and willingness to assist.

Jim

ralitaco wrote:On a side note, because of slide 32; I am going to respectfully disagree with aebrown. While I agree that it would be a lot easier, I don't think it is proper to simply adjust the categories of the check to correct where the money came from. If that was the proper/acceptable method, then I would've expected the training to indicate that.
Perhaps this is a new option available in CUBS and the training is outdated. If so, new training docs would be great.

I think there were some good arguments made for writing the check entirely from Other:AMFA:YW Camp. Had you done that originally, I would completely agree. In any case, what you have decided to do will work just fine.

I would note that the training is most definitely out of date. When the training was made, there was no option for writing a check from more than one major category. It's also abundantly clear that the training only covers a very narrow range of the procedures clerks need to do, and can do, and so I see no reason to draw any conclusions from the limited training failing to mention an option. Adjusting expense categories after the fact is certainly not any different from adjusting donation categories after the fact. So I'm going to respectfully disagree with your disagreement. But as I said, your planned course of action should be okay.

As for new training, I've been begging for that for over two years (the current training is 3 years old, but portions of it were out of date in 2009). Whenever I make those suggestions, I am thanked politely for my request, but nothing has happened. I'm not holding my breath for new training any time soon....

ralitaco wrote:I will write a check out of the AMFA:Other:YW Camp subcategory payable to the BUDGET:YW subcategory to "refund" the money spent out of the BUDGET:YW subcategory following the instructions on slide 32 of Understanding the Other Account.

Just a note here. Make sure you have a very specific purpose line on this check or CHQ may change your deposit category back to Other. They do not like funds being transferred from Other to Budget and unless they can see a reason for it, they will supercede you on this. This is one reason why aebrown's suggestion may be best.

ralitaco wrote:On a side note, because of slide 32; I am going to respectfully disagree with aebrown. While I agree that it would be a lot easier, I don't think it is proper to simply adjust the categories of the check to correct where the money came from. If that was the proper/acceptable method, then I would've expected the training to indicate that.
Perhaps this is a new option available in CUBS and the training is outdated. If so, new training docs would be great.

The only point I would make (and you noted it yourself) is that these training slides were created long before CUBS was released and they have not been updated to reflect changes CUBS introduced (for example, they still have a training on reconciling, something we haven't had to do since Oct 2010). If you are not comfortable doing it, that's one thing, but don't rule it out just because it's not mentioned in outdated documentation.

aebrown wrote:...I see no reason to draw any conclusions from the limited training failing to mention an option.

crislapi wrote:If you are not comfortable doing it, that's one thing, but don't rule it out just because it's not mentioned in outdated documentation.

Yes the training is out of date, pre-CUBS and only addresses limited procedures. However, it is my understanding that even in the old system, the software would allow you to change the category of an expense (i.e.- Budget:YM to Budget:YW) and that you could even change it from a budget to other category.
Slide 32 of the Other Category training addresses "transferring funds when expenses were paid from the WRONG category" and it says, "Sometimes an activity is mistakenly paid for using budget funds even though funds were collected and designated for the activity in the other category"
If CHQ wanted us to simply change the subcategory, why wouldn't the training have said to edit the expense and change the category. Because I agree that would be a lot easier than writing a check. Instead it goes into detail on the process of writing a check. That leads me to believe that CHQ has a reason for us NOT to just change the category. I am presuming it has to do with the Budget vs Other funds (as was mentioned in earlier responses). Afterall, if I mistakenly selected Budget:YM instead of Budget:YW, I would not have to write a check to correct that mistake.

Here is my logic as to why I feel like my situation is addressed by this slide.
1. The expense should have been paid for entirely out of the Other:AMFA:YW Camp subcategory
2. Had the check been expensed ENTIRELY out of the Budget:YW subcategory, there would be no question as to what to do as slide 32 addresses that situation specifically.
3. Yes I have 2 categories on the expense, but I contest that the portion of the check that came from the Budget:YW subcategory was "mistakenly paid using budget funds" just as slide 32 describes.
4. The amount that was mistakenly charged to the budget needs to be corrected.
5. The only documented method to correct this is to write a check as described on slide 32.

Again, I am grateful for you input and I know what I am going to do to correct our mess.
Both of you and many others, have been immensely helpful to me since I have started in this calling about a year ago. But, I am still not sold on simply adjusting the amounts in the subcategories since one is Budget and one is Other. Perhaps something has changed on the accounting side of things that would make adjusting budget/other categories okay in CUBS where it was not okay with the old software.

If they ever start putting together new training, I would love to be a part of it.
Jim

ralitaco wrote:However, it is my understanding that even in the old system, the software would allow you to change the category of an expense (i.e.- Budget:YM to Budget:YW) and that you could even change it from a budget to other category.

Just to clarify, it would not let you switch major category on a saved expense. It also wouldn't let you cut a single check from multiple major categories (Other, FO, Budget, Ward Missionary).

ralitaco wrote:Slide 32 of the Other Category training addresses "transferring funds when expenses were paid from the WRONG category" ...
5. The only documented method to correct this is to write a check as described on slide 32.

That slide details how to handle your situation exactly. Given that, I, too, would choose to follow the instructions there.

ralitaco wrote:Both of you and many others, have been immensely helpful to me since I have started in this calling about a year ago. But, I am still not sold on simply adjusting the amounts in the subcategories since one is Budget and one is Other. Perhaps something has changed on the accounting side of things that would make adjusting budget/other categories okay in CUBS where it was not okay with the old software.

I would say in response that you have arrived! You know where the various resources are, you know how to use them, and have confidence in your understanding. Sounds like you should be a senior member!

I am surprised that it only recently became possible to cut a check form multiple major categories. That was a feature that I used when I served as the Mission Financial Secretary in 2005-2006.
As I recall from my training with the brother at the area offices who was in charge of auditing the mission finances, the preferred method was to add a matching pair of expense lines to a check.
For example I would put a charge of -$50 on the account 4-5102 (missionary living expenses) and another of +$50 to 4-5300 (rent?) along with a note on each line saying that this was to correct an incorrect charge of $50 in check xxxx from xxx date.
Then print the check for $0, print a note explaining what happened, have the president sign it, mark the check as void and save it along with the documentation in the file with the other check documentation.

Aaron Z

crislapi wrote:Just to clarify, it would not let you switch major category on a saved expense. It also wouldn't let you cut a single check from multiple major categories (Other, FO, Budget, Ward Missionary).

That I did not know.

crislapi wrote:Sounds like you should be a senior member!

I don't know about that; although, my kids keep telling me I'm a Senior Citizen. (43 does not qualify)

Seriously, I have just returned from cleaning up our mess. Turns out that the check was written out of ONLY the Budget:YW and not the 2 categories as I first stated. However, there were 2 checks written...long story, not worth explaining.
Anyhow, I editted the deposits and changed the deposit category From Budget - To Other. Then I printed a check out of Other to reimburse the Budget category. The only question I had was how to update SLC; so I called them. I was confused because the training said call or email the information, but there was a "resend' button on the deposit screen. After speaking to a woman with a British accent in SLC, I was informed that all I needed to do was Send/Recieve the changes. Sooooo Easy!

Now I have a new issue: excess funds in the Other:AMFA:YW Camp subcategory. But that's a topic for another time.

Thanks to everyone for your input. It was/is a great help EVERY TIME.
JIM

ralitaco wrote:Then I printed a check out of Other to reimburse the Budget category. The only question I had was how to update SLC; so I called them. I was confused because the training said call or email the information, but there was a "resend' button on the deposit screen. After speaking to a woman with a British accent in SLC, I was informed that all I needed to do was Send/Recieve the changes. Sooooo Easy!

Yes, that's one of the issues that is out of date in the training. MLS was changed over two years ago to transmit all financial changes automatically. So in multiple places in the training it says to call in the changes, but there is never a need to do that (the one exception is voiding a check in some circumstances).

ralitaco wrote:Now I have a new issue: excess funds in the Other:AMFA:YW Camp subcategory. But that's a topic for another time.

You said that you just cut a check from Other:AMFA:YW Camp and deposited it into Budget:YW. I would have thought you would have cut that check for the entire balance of Other:AMFA:YW Camp, thus bringing its balance to zero. If the camp is over and no more funds are coming in or out of the Other account, then you should bring that balance to zero. You could have done that with the one check, but you can repeat the process for the remaining balance easily enough.

Aczlan wrote:I am surprised that it only recently became possible to cut a check form multiple major categories. That was a feature that I used when I served as the Mission Financial Secretary in 2005-2006.
As I recall from my training with the brother at the area offices who was in charge of auditing the mission finances, the preferred method was to add a matching pair of expense lines to a check.

Mission offices used a different system from wards and stakes; in particular, if your mission was not in the US or Canada, then they used a back-end financial system called LURBS, which was much closer to CUBS than the CFAR system that was used by US/Canada for many years until CUBS came online. It was CFAR to a large extent that created much of the inflexibility we used to have.

aebrown wrote:You said that you just cut a check from Other:AMFA:YW Camp and deposited it into Budget:YW. I would have thought you would have cut that check for the entire balance of Other:AMFA:YW Camp, thus bringing its balance to zero. If the camp is over and no more funds are coming in or out of the Other account, then you should bring that balance to zero. You could have done that with the one check, but you can repeat the process for the remaining balance easily enough.

If I understand correctly the amount of the disbursement from the budget account covered the entire expense. The amount collected from the fund-raiser and deposited into the Other:AMFA:YW Camp exceeded the expense. I do not how it would be appropriate to deposit the excess of the fund-raiser into a budget account. The disposition of the excess is up to the bishop who may need to council with the stake president. One option is to carry the excess forward to the next year for that year's camp. Another option is to apply it to camp equipment. The third option is to send it to the Corporation of the President as found in How to deal with surpluses. But I know donations cannot be made to the budget which is what would be done if the excess were placed in the Budget:YW category.

jdlessley wrote:If I understand correctly the amount of the disbursement from the budget account covered the entire expense.

I didn't read it that way; it simply said "to reimburse the Budget category", and said nothing about reimbursing the entire amount. But it's certainly a possibility that the entire Budget expenditure has already been reimbursed. If that's the case, then you are certainly correct that it would be improper to move any more funds into Budget:YW than the actual cost of the camp. And you laid out the three options well for what to do with the excess in this case.

jdlessley wrote:If I understand correctly the amount of the disbursement from the budget account covered the entire expense. The amount collected from the fund-raiser and deposited into the Other:AMFA:YW Camp exceeded the expense.

That is correct.

jdlessley wrote:The disposition of the excess is up to the bishop who may need to council with the stake president. One option is to carry the excess forward to the next year for that year's camp. Another option is to apply it to camp equipment. The third option is to send it to the Corporation of the President

I am planning to meet with the bishop to see how he wants to handle the excess.

aebrown wrote:Mission offices used a different system from wards and stakes; in particular, if your mission was not in the US or Canada, then they used a back-end financial system called LURBS, which was much closer to CUBS than the CFAR system that was used by US/Canada for many years until CUBS came online. It was CFAR to a large extent that created much of the inflexibility we used to have.

Good to know. I served in the Rosario Argentina Mission, so it was definitely outside of the US. As I recall, we had a beta of the next version which was due to ship in late 2006. One if the improvements of the beta version was to allow multiple people to access the database simultaneously on multiple computers. As I understand, that version did a table-by-table lock to prevent the other person (or people) from changing the tables which section you were using relied on rather than the database lock that the previous version used.

Aaron Z

Aaron Z