I am trying to set up accounts to use as “Provisional / Budget Accounts”. Almost like different “savings accounts”
If I receive R1000
I know that R500 of that is to be allocated to Rent
R300 to be allocated to Electricity.
With then R200 leftover in the Bank Account
So my total amount should still say R1000
But when I physically pay the R500 rent, then Id like to pay it from the Rent provisional Account. So that the provisional account is empty now.
First I thought to use the Cash accounts or bank accounts and create extra to use as provitional accounts and use inter-account transfer to transfer the amounts from the Actual bank account. But then I won’t be able to reconcile my bank account so I am not sure that will work.
Does anyone have a solution for me, please? Maybe the control accounts or Special Accounts? I am new in Manager and learning as I go.
I hope I have explained my thoughts clearly and that it makes sense to you guys.
You want to earmark money held in your bank account for future expenses - you can’t do this in Manager without setting up separate accounts and then as you point out, you will not be able to reconcile your bank account balance with your bank statement
I am going to use my Main Bank Account, and also a Bank Savings account which can easily transfer money to and from the main bank account.
Then in Manager, I am going to open Multiple “Provitional” accounts. In manager, they will look like normal bank accounts but the physical Provisional account will be one account (Savings Account). That way I should be able to reconcile my Main Bank account in Manager and keep track of the provisional accounts.
It is a bit of extra work on my side to move the money between bank accounts in real life and in manager. But I think it is worth it because having provisional accounts is very important to me.
If anyone has an idea or some advise it would be much appreciated
On the balance sheet create liability accounts for each of the funds you want to set aside. You can group them under a special account using an account structure suitable for the longer term (saving type not specific project). Alternatively Capital accounts could be set up in a similar manner but used for projects and inactivated when done.
The allocate funds from retained earing to these accounts via what ever schedule makes sense to you.
When spending funds it can be done from the relevant liability account.
Purists may prefer to make these sub accounts of retained earnings.