I am maintaining residential society accounts on manager.io. The society issue invoices to it’s members against monthly maintenance charges. However, sometimes for capital expenditures, society needs to create specific finds for example replacing old elevators or buying new standby generators.
Is it possible that the we generate receivable reports showing separately against maintenance and capital expenditure. Or we can see receivables against specific development fund?
You may get some ideas from this thread:Help with creating a 'disaster fund' within a beekeeping club
The topic is not exactly the same, but similar.
Thank you @AJD for your reply. I think it is not workable if I create a reserve account in equity and accruing receivables through a journal entry. In this way, I will not be able to get the desired reporting. Any other idea?
The most simple is to add in control accounts under Customer a new “Future Capital Expenditures” account and invoice the members as you do for maintenance. Ideally you would also have a Maintenance account under Customer Control Accounts, both will show in your Balance sheet under accounts receivable.
- In Settings click on Control Accounts
- Create New Control Account “Future Capital Expenditures” in the Customers Control Account and group it under Assets. Do the same for “Maintenance” if not aleady existing.
- Create invoices and select the account you want to receive in.
Hi @eko thank you for your reply. I have created control account and special account for testing purposes.
If I treat special account (Future capital expenditures) as an asset and create sales invoice for capital expenditure collections, then the system is creating negative asset. So I think, there should be another way of doing this.
For example, if the society decides to raise funds (say Rs. 500,000) from it’s 100 members (i.e. 5,000 from each member), then the entry would be:
Credit: Fund / Equity Rs. 500,000
Debit: Customers Rs. 500,000
Once the society start receiving funds from the members then entries should be:
Debit Cash/Bank Rs. 5,000
Credit: Customers Rs. 5,000
Is there anyway, the management of the society can draw report containing the name of customer (member) and their respective balances?
I don’t have any idea about customer reports. If anyone can guide me if it is possible through custom reports, I would be obliged.
basically you need to have two sets of Accounts Receivables - one for Future Capex/Sinking Fund and one for normal expenditure.
You will have to add your customers/members to each account.
Then you invoice them separately for Capex and normal expenditure
But you will not be able to give them a combined view of their overall situation
@Joe91 you got it. Is there any way we can achieve this through custom reports?
Create a new control account for special accounts and designate it as a liability. Putting aside funds (provisioning) creates either a liability or a reserve - they are very similar.
It would probably be good to have a separate bank account for these funds (but not absolutely necessary).
Custom reports are not great at treating Balance Sheet accounts and running totals
But you could export the aged receivables report to Excel for example and re-sort it into member order
That’s sound good that If we create provision account (future development fund) and through journal entry in one go credit provision account and debit all members (customers).
The issue of reporting outstanding balances against each member still remain unresolved.
The provision account can be credited when issuing the invoices to your clients, a journal is not needed
@AJD the provision account is created and through sales invoices I have credited this provision account.
When i will receive the funds against this provision account. I need to decide which account should be credit against cash/bank.
If i select customer account then customer statement will showing accurately debit and credit both. In this case, the provision account will remain stagnant and will not reflect the receipt of funds from the member.
You should record the receipt against the customer account.
The liability account remains unchanged until you post future expenditures against it - for example replace the lift
For this application I use a custom report with a date range
- Range start = start date of business
- Range end = as at date
Doing this works well for sub account totals
I got it. So it is good idea to record sales invoice and select provision / liability account once we receipt funds from members. This way, we can able to get list of members through provision account details.
One confusion still remains that how this liability / provision account gets settled once we start incurring expenditure. For example, say we buy lift for Rs. 100,000. then we need to debit fixed asset and credit bank. This provision / liability account will remain stagnant.
There seems to be some confusion about the business here.
Is this business managing the property on behalf of the owners?
In this case the new lift is not a fixed asset of the business
Does the business own the property and manage it as well?
Then there is no need to have a sinking fund
Got it @Joe91. We should not record fixed assets, as this business do not own property.