Advances and redeposits

Discuss questions around local unit policies for budgeting, reconciling, etc. This forum should not contain specific financial or membership information.
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ffrsqpilot
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Advances and redeposits

Postby ffrsqpilot » Fri Jul 03, 2009 8:09 am

For our Young Women's camp this year at the request of the Stake Young Women's president and her camp director, I made several Check Advances so youth leaders wouldn't be paying out of pocket. I made the checks out from the "Other - Young Women's Camp" account. I gave each of the check recipients a letter explaining that they needed to keep a good accounting of funds and that I needed the receipts back in order to staple to the disbursement form (or in this case the Reimbursement Form that our stake uses). All good and proper so far.

One of the sisters who had a rather large check did not spend all the funds and thus returned the remaining funds back with all the receipts. Again, so far so good. All the funds are accounted for and all the receipts add up to the right total. However, now the remaining funds need to be redeposited back into the Young Women's Camp account.

I probably already know the answer to the question I am about to ask but somehow I still have a weird feeling that I might be doing something wrong thus I thought I would ask for opinions (or direction) here on the site rather than bothering Salt Lake.

The Question: When I entered the returned funds in MLS, rather than using the Sister's name who originally had the advance check, I used the stakes name as the depositor. My thought process was that the stake originally kept the funds thus they would be the entity making the deposit back into the account. Somehow that doesn't seem right, but it is the only logical thing I can think of. If I used the Sisters name it would appear that she is making a deposit to Young Women's camp but that didn't sound right either as the funds really weren't hers to begin with.

I realize this is way down there on the list of things to be worrying about, but I wonder if others who have done advances, how they return unspent monies back into the account they came out of and who is listed as the "donor".

Jim (puzzledinmontrose)!

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Postby aebrown » Fri Jul 03, 2009 8:25 am

Pilotfly wrote:When I entered the returned funds in MLS, rather than using the Sister's name who originally had the advance check, I used the stakes name as the depositor. My thought process was that the stake originally kept the funds thus they would be the entity making the deposit back into the account. Somehow that doesn't seem right, but it is the only logical thing I can think of. If I used the Sisters name it would appear that she is making a deposit to Young Women's camp but that didn't sound right either as the funds really weren't hers to begin with.


In the lesson Handling Church Expenses, on slide 23 it says:

If there are leftover funds, the member should place the money in a donation envelope, write “Budget Return” in the “Other” category on the slip, and give the envelope to a member of the bishopric.
The scenario described is an advance against the Budget category, but the principles are the same for the Other category. Although the lesson doesn't say specifically that the member would list herself as the donor, that certainly seems the most natural. If some other donor name should be listed, I would think the lesson would have mentioned that.

In any case, if the return of unused advanced funds were done by check, it would definitely be good to have the actual member's name. That way, if the check happens to bounce, it would be easier to match up the check to the donor.

There is no need to be concerned about it appearing that she was "donating" funds in her name. The stake never receives donated funds anyway, and does not issue Official Tax Statements at the end of the year. Even if the stake did that, "donations" to the Other category aren't charitable contributions and are excluded from the Official Tax Statement anyway.

So I would definitely say that she should be listed as the donor. It provides better tracking of the transaction, and there is no downside risk at all in doing so.

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Postby crislapi » Fri Jul 03, 2009 9:11 am

Pilotfly wrote:However, now the remaining funds need to be redeposited back into the Young Women's Camp account.

I probably already know the answer to the question I am about to ask but... thought I would ask for opinions (or direction)


Since you asked for opinions, I'll offer mine as well. I would also point you to the same slide and paragraph Alan_Brown mentioned. It discusses the issue at the ward level but you can do the same thing at the stake level. I would probably make the donor the stake or create a donor for Young Women's Camp. Really, it's whatever makes sense to you or, more importantly, whoever follows you. It doesn't matter who it is since, as was pointed out, it's a non-charitable contribution and therefore wouldn't be reported on the donor's tax statement anyway.

Obviously, you will have to create a donation batch at the stake level for this return and deposit it into the stake bank account to actually get it back into your account.

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Postby aebrown » Fri Jul 03, 2009 10:33 am

There are also some opinions expressed in the thread Question about donation to other category. It's a somewhat different scenario, but still involves non-charitable donations where a clerk was considering putting a name other than the donor's on the donation.

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Postby ffrsqpilot » Fri Jul 03, 2009 10:55 am

Not that it makes a difference to the original question (whose name is used as the donor) but the money returned was all in cash. So there were no checks to enter.

But on second thought and reading through the answers here and the thread Alan pointed to, I think if a check had been used to cover the remaining funds from an Advance, then the name on the donor list should probably be the member and not the stake.

Alan makes a good point that if there are checks involved and there is any problem then having a name and check number makes the problem solving a whole lot easier.

As a side note, when MLS first came on line I (as a ward clerk at the time) used to enter donations without entering the check number when entering the blocks in MLS. I have become a firm believer that when entering donations you enter not only the amount but the check number as well. As the stake clerk, several times I have had to go directly to the original donor when trying to help a unit clerk resolve a reconciliation issue. When you can identify the actual check number in question it makes the process much easier.

Jim (lesspuzzlednow)

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Postby greggo » Sat Jul 04, 2009 7:48 am

Alan_Brown wrote:In the lesson Handling Church Expenses, on slide 23 it says:

There is no need to be concerned about it appearing that she was "donating" funds in her name. The stake never receives donated funds anyway, and does not issue Official Tax Statements at the end of the year.


I know this is off topic, but is this statement correct?
I've personally not known of any donations received at the stake level, but from official documents I've read (pre-MLS), it's my understanding that donations can be made to the stake (and resulting official tax statements dispersed). Has something changed?

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Postby aebrown » Sat Jul 04, 2009 8:34 am

Greggo wrote:I know this is off topic, but is this statement correct?
I've personally not known of any donations received at the stake level, but from official documents I've read (pre-MLS), it's my understanding that donations can be made to the stake (and resulting official tax statements dispersed). Has something changed?


The MLS help file says (under "Stake Income", and the same basic statement is in the MLS Software Manual on page 40):

Stakes normally accept (1) surplus funds from the wards, (2) funds for the "Other" category to pay expenses for authorized activities and fees, (3) funds for authorized family history centers, or (4) returned unspent budget funds. Individual member donations (tithing, fast offering, and so on) should be made at the ward level.
None of those categories are charitable contributions. The last statement about member donations says they "should" be made at the ward level.

Of course, the word "normally" is in there, which I suppose leaves open the possibility of a charitable contribution made at the stake level, but I have never seen it, and I don't see why it would be necessary. Normally, when the Church describes how things are done "normally," I do things that way unless there's an excellent reason for an exception. It all just seems -- what's the word? -- more "normal" that way.

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Postby russellhltn » Sat Jul 04, 2009 1:17 pm

Greggo wrote:Has something changed?


Yes it has. Those documents were from a different era. Back then local budgets where financed by donations from the members of the ward and stake. Frequently there were ward budget dinners where the leaders would give a summery as to how much was needed from each full-tithe payer to meet the ward budget and stake assessment.

Donations to "budget" were tax deductible and FIS (the financial predecessor to MLS) treated it as such. Care had to be taken so that any returning funds were "donated" in the name of the organization, not the individual. Otherwise the member's tax statement would be inflated by returning church funds.

Of course now is quite different. The budget is funded from CHQ - no exceptions. The change had quite a few ramifications to ward and stake activities. Poorer wards now had a stable source of income. The richer wards had some adjustments, as their budgets were slashed. Their activities were fewer and less grand. If you ask members who remember that time, I'm sure you'll get a lot of stories. In keeping with current policy, MLS assumes that any "donations" to budget are actually church funds being returned and the tax statement reflects that.
Have you searched the Wiki?
Try using a Google search by adding "site:tech.lds.org/wiki" to the search criteria.

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Postby greggo » Wed Jul 08, 2009 3:19 pm

If I'm recalling correctly, I do remember now something the stake auditor said during an audit (pre-MLS days). He told about a donation that was made by a local businessman (not a member) that was given to the stake president and processed at the stake level.

I guess nowadays the stake president would ask the person to donate to the ward or pass it to the ward himself?

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Postby aebrown » Wed Jul 08, 2009 3:34 pm

Greggo wrote:If I'm recalling correctly, I do remember now something the stake auditor said during an audit (pre-MLS days). He told about a donation that was made by a local businessman (not a member) that was given to the stake president and processed at the stake level.

I guess nowadays the stake president would ask the person to donate to the ward or pass it to the ward himself?


With only a few exceptions, anyone in the world can donate to the Church. If someone wants to donate to Fast Offerings, or Humanitarian Aid, or Perpetual Education Fund, or other charitable donation categories, they are certainly welcome to do so. Of course, non-members cannot donate to the Budget category any more than members.

Although stakes have the technical ability to accept donations, they have no way in MLS to generate an Official Tax Statement, so it doesn't seem prudent for them to accept them. Instead, the stake should do what you suggested, and have a ward process the donation, and then at year end to issue the Official Tax Statement.


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