DESKTOP EDITION CLOUD EDITION SERVER EDITION GUIDES FORUM

Church accounting


#1

Does anyone use Manager for church books?


#2

It can be used for any book keeping.
What do you mean exactly?


#3

Yes. And it works very well for me. However, Manager doesn’t include budgeting yet, so for this I have to export the reports to MS Excel. Still, Manager is the best free accounting program going around to record and report Church financials.


#4

Yes, it is indeed a great product.
I hope that they manage well income with their services, and it is fantastic that they offer an application for free.
There is a motto “the best way to earn money is to give a product away for free”.

Now I recommend to everyone this software.
When I get time I will offer a translation to Swedish.


#5

Do you use it for church bookkeeping? How do you set it up?


#6

How have you got it setup to handle church bookkeeping?


#7

Once the program has been downloaded, installed and your “business” (church) added…

  1. Click CUSTOMIZE below the left-column to edit the left-column tabs.

  2. For a basic church setup, unclick everything you can except for Summary, Bank Accounts, Journal Entries, Reports & Settings, then update. This helps to strip everything back to the bare necessities and keeps things simple. More tabs can be added if necessary.

  3. Click the SETTINGS tab on the left-column, then click Customize, tick Tax Codes and update. Now click on Tax Codes, then add New Tax Codes as required. For Australia, GST 10%, GST Free and Input Taxed should be all you need. Once you’ve done, click the SETTINGS tab again and select Chart of Accounts.

  4. Add Income, Expense, Asset, Liability & Equity accounts to your list as required. You don’t need to select tax codes for assets/liabilities/equity accounts. (Assuming you’re in Australia like me…) For income accounts, make sure you select GST Free as the tax code (like schools & hospitals, churches don’t charge GST on their income). For expense accounts, select the most common tax code for each expense account. For example: your electricity bill will include GST, so for the (newly added) Electricity Expense account, select GST 10%; but your water bill won’t include GST, so for the (newly added) Water Expense account, select GST Free. Because churches aren’t liable to pay GST on their expenses, any GST already paid by your church gets refunded by the ATO when you submit the quarterly BAS-F statement.

  5. Click the REPORTS tab on the left-column, then click Customize up top, then unclick everything, unless it’s under Financial Statements, General Ledger, or Tax Codes, then update.

  6. Click the BANK ACCOUNTS tab on the left column, then click New Bank Account and add details. Do this for all transaction accounts, term deposits and savings accounts.

  7. After all that you’re off and running… To record any spending/receipt/transfer of money with a bank account, just click the bank account and enter the transaction details. Any non-cash “journal entry” transactions (depreciation, accruals, prepayments, adjustments etc…) can be done by someone with basic double-entry accounting knowledge or your accountant at the end of financial year.

[NB: if your church (like mine) only has a couple of employees, the easiest way I’ve found for recording wages and tax withheld is as follows. Go to Spend Money, then under where it says Account, add a line. In the first line, you select your “Gross Wages Expense” account and put the full taxable amount (e.g. $750 net wages paid + $250 tax withheld = $1,000 full taxable amount). Then in the second line, you select your “Tax Payable” account and put the tax withheld as a negative amount (e.g. -$250). That way, it records the amount paid ($750) and the tax withheld as a liability to the ATO ($250). If you do it this way, you don’t need to worry about all the employee-related tabs on the left-column.]

Hope this helps.


#9

Regarding monthly subscriptions of members, do I have to issue an invoice for each money receive. Is there a simple way to issue a receipt only ?


#10

If monthly subscriptions are voluntary, these members are not really creditors therefore invoices shouldn’t be issued to them.

Just record these receipts are plain cash transactions. See: http://www.manager.io/guides/receipts-and-payments/receiving-money/

You can view and print these receipts.


#11

How do set up designated fund accounts. I have as many as 14 different fund accounts. And I want to see fund balances which is essence is profit and loss for each fund.


#12

I assume that by fund accounts you mean bank accounts. Go to Reports, select Bank Account Summary then select the bank account.


#13

Are you saying that I should set up Bank Accounts for each fund? By fund I mean; Building Fun, Tithe Fund, General Fund, New Piano, etc.

Thanks,

Wayne


#14

That is certainly the most transparent way and the simplest to implement. You could then implement tracking codes to follow income (donations, presumably) and expenses for the various funds.

There is no question you can also aggregate monies for the various funds in a single bank account. But record-keeping would be much more complex in order to provide visibility on, for example, how much has been set aside for building repairs or piano replacement. And it would be much easier to make “mistakes,” erroneously using piano money to fix the roof, which might violate terms of gifts.


#15

We use one bank account for all receipts and payments.

We create “funds” on the balance sheet (as liabilities) only when we receive money with strings attached (i.e. money received for a new piano). When we settle that obligation (i.e. pay money to buy the piano), we record the payment against the same account to bring the balance to zero.

That way, we never lose sight of the obligations we owe as they are always on our balance sheet until they are settled.


#16

I would like to see the setup for using Manager for church bookkeeping so several fund accounts. I do not see that in the two answers to my previous questions. I would use Manager as accounting only and not for individual contributions. Thanks


#17

Funds that are set aside for a particular purpose should be considered as claims against the assets of the organisation. As such they should be reported as either liabilities or equity. The generally accepted practice is to show them as equity in the form of “Reserves”, especially if there are any undisbursed amounts held for these funds at the end of a reporting period.

As an example, a church may have a Building Fund, an Overseas Missions Fund, and a Local Missions fund. This will require the creation of three “equity” accounts in the balance sheet chart of accounts named, say, Building Fund Reserve, Overseas Missions Fund Reserve, and Local Missions Fund Reserve. These equity accounts in the Balance Sheet are needed to show the total value of the funds at the end of the reporting period.

To show the inward and outward movements to and from these funds P&L
income accounts would also need to be created for each fund in the chart of accounts for the inward movements (receipts) and expense accounts created for outward movements (expenditure). For example: for the Building fund it would be “Building Fund Income” and Building Fund Expenditure". These P&L accounts would be used in Receipt and Payment transactions.

At the end of the reporting period the nett movement in the P&L, for each fund, would then be journalled to update the relative equity reserve accounts in the Balance Sheet.

Let’s say that for the Building fund for January the income was 50,000 and expenditure was $20,000. This represents an increase in the fund and the journal would be:

Debit: Retained earnings $30,000
Credit: Building Fund Reserve $30,000

If there was a decrease in the fund the journal would be:
Debit: Building Fund Reserve
Credit: Retained Earnings