CUBS Message Section - Budget Allocation

Discuss questions around local unit policies for budgeting, reconciling, etc. This forum should not contain specific financial or membership information.
atticusewig
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CUBS Message Section - Budget Allocation

Postby atticusewig » Wed Oct 13, 2010 11:11 am

From what I read in the message Budgets will be allocated as follows:

One month before the start of each Quarter each unit will receive a
preliminary budget notice stating the incoming budget allowance and
asking them to make any last minute changes to the most recent
Quarterly report that might affect this number. The December notice
(for the January Allotment), would concern the 3rd Quarter report.
It mentions ward budget percentages could be updated at this time.

In the first month of the Quarter, the Allotments for each unit go through the
Stake who have assigned percentages for the SacMtg Attendence,YM,
YW,Primary, and YSA components of each unit's Allotment to pass on to
each unit, and keep the remaining to cover Stake Expenses.

The monies the Stake allows to flow through are deposited into the unit's
bank account under Budget, and that amount is placed into a Budget
subcategory in MLS called Budget: Budget Allocation and the clerk should
transfer funds to the appropriate Budget subcategories (many now preset
and locked from CHQ) or sub-sub-categories under these locked main categories.

Questions:

1) Is the summary of events listed above correct ? Please make corrections.

2) Who receives the preliminary notice of the budget allotment. Does each
unit receive it for the unit, and the stake for all their units ? Also when it
says the ward can adjust Budget Allocation percentages does this mean
there will be an automated way for the unit to allocate the incoming
monies for the quarter. Set 50% to the Bishopric and 10% for each
auxillary for example (assuming five auxillaries), so when the money
comes in it goes automatically to each Budget subcategory ?

3) What is the default passthrough-to-unit percentage. 0% or 100%.
If the Stake Clerk doesn't enter percentages, will all of a unit's
allotment passthrough to the unit, or all remain with the Stake ?

4) What will the mechanism be for moving the money from the
Budget: Budget Allocation to the other Budget subcategories ?
Percent-automated as explained in question 2, same as the previous
MLS "Set Budget" method, only now the initial allocation is locked,
or will the clerk need to do a series of Transfers ?

5) In the current unit budget we have an account for YM-YW
combined activities; Because there will be mostly locked
Budget subcategories, would I need to create a sub-subcategory
called Budget:Bishopric:Joint YM-YW Activities to have such a fund ?
Putting it as a sub-sub under either the BU:YM or BU:YW subcategory
would overstate their overall budget, no ?

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Postby lajackson » Wed Oct 13, 2010 12:47 pm

atticusewig wrote:From what I read in the message Budgets will be allocated as follows:

One month before the start of each Quarter each unit will receive a
preliminary budget notice stating the incoming budget allowance and
asking them to make any last minute changes to the most recent
Quarterly report that might affect this number. The December notice
(for the January Allotment), would concern the 3rd Quarter report.
It mentions ward budget percentages could be updated at this time.

In the first month of the Quarter, the Allotments for each unit go through the
Stake who have assigned percentages for the SacMtg Attendence,YM,
YW,Primary, and YSA components of each unit's Allotment to pass on to
each unit, and keep the remaining to cover Stake Expenses.

The monies the Stake allows to flow through are deposited into the unit's
bank account under Budget, and that amount is placed into a Budget
subcategory in MLS called Budget: Budget Allocation and the clerk should
transfer funds to the appropriate Budget subcategories (many now preset
and locked from CHQ) or sub-sub-categories under these locked main categories.

Questions:

1) Is the summary of events listed above correct ? Please make corrections.

2) Who receives the preliminary notice of the budget allotment. Does each
unit receive it for the unit, and the stake for all their units ? Also when it
says the ward can adjust Budget Allocation percentages does this mean
there will be an automated way for the unit to allocate the incoming
monies for the quarter. Set 50% to the Bishopric and 10% for each
auxillary for example (assuming five auxillaries), so when the money
comes in it goes automatically to each Budget subcategory ?

3) What is the default passthrough-to-unit percentage. 0% or 100%.
If the Stake Clerk doesn't enter percentages, will all of a unit's
allotment passthrough to the unit, or all remain with the Stake ?

4) What will the mechanism be for moving the money from the
Budget: Budget Allocation to the other Budget subcategories ?
Percent-automated as explained in question 2, same as the previous
MLS "Set Budget" method, only now the initial allocation is locked,
or will the clerk need to do a series of Transfers ?

5) In the current unit budget we have an account for YM-YW
combined activities; Because there will be mostly locked
Budget subcategories, would I need to create a sub-subcategory
called Budget:Bishopric:Joint YM-YW Activities to have such a fund ?
Putting it as a sub-sub under either the BU:YM or BU:YW subcategory
would overstate their overall budget, no ?


Relax.

As I understand it, the stake gets all the money, and the stake determines what percentage of it will be allocated to each individual ward or branch. Specifically:

1) It sounds as if you have it about right. We will know for sure once we go through the process for a quarter or two.

2) The stake gets the money and allocates it to the wards. As I understand it, the wards get a lump sum in Budget to split up into subcategories as they see fit. I have read nothing about a ward being able to set percentages so the the incoming money will automatically transfer to different budget sub-accounts. (Not that you can't. I just have not seen anything on that.)

3) I have no idea, except that I understand once the stake sets it, it will remain the same until the stake changes it. I suspect (just guessing here) that the initial default will be zero, because the fields will be blank until the stake sets a percentage for the first time.

4) I do not know. I though you needed to transfer the money, just as you have to enter it now when the stake gives you a budget allocation.

5) You lost me. Unwind. Keep it simple. Set up a combined Youth account or something. Do whatever works best for your unit. Don't worry about accounts that are "locked down". Work with the ones that are not.

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aebrown
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Postby aebrown » Wed Oct 13, 2010 12:56 pm

atticusewig wrote:From what I read in the message Budgets will be allocated as follows:

One month before the start of each Quarter each unit will receive a preliminary budget notice stating the incoming budget allowance and
asking them to make any last minute changes to the most recent Quarterly report that might affect this number. The December notice (for the January Allotment), would concern the 3rd Quarter report. It mentions ward budget percentages could be updated at this time.

In the first month of the Quarter, the Allotments for each unit go through the Stake who have assigned percentages for the SacMtg Attendence,YM, YW,Primary, and YSA components of each unit's Allotment to pass on to each unit, and keep the remaining to cover Stake Expenses.

The monies the Stake allows to flow through are deposited into the unit's bank account under Budget, and that amount is placed into a Budget subcategory in MLS called Budget: Budget Allocation and the clerk should transfer funds to the appropriate Budget subcategories (many now preset and locked from CHQ) or sub-sub-categories under these locked main categories.

Questions:

1) Is the summary of events listed above correct ? Please make corrections.


I've seen no evidence that the preliminary letter will suggest that units make changes in the Quarterly Report. At that point, it might be too late to make such changes, or perhaps there is still time. I don't know. The primary purpose for the stake in receiving the preliminary letter is to let them know what the amounts are by category, and to remind them what their percentages are for the allocations, so that they will know what each ward's (and the stake's) allocation will be. The stake can then make adjustments to the allocation percentages as desired.

I wouldn't say that the monies "go through the stake." Rather, based on the percentages that the stake has submitted, the designated amounts will be sent directly from CHQ to each unit's account.

atticusewig wrote:2) Who receives the preliminary notice of the budget allotment. Does each unit receive it for the unit, and the stake for all their units ?


At the end of the announcement, it says that both the wards and the stake will receive the "Projected Quarterly Budget Allowance" report. I know that the stake report will cover each individual unit as well as the stake; it seems logical that each ward would receive information only about their own unit.

atticusewig wrote:Also when it says the ward can adjust Budget Allocation percentages does this mean there will be an automated way for the unit to allocate the incoming monies for the quarter. Set 50% to the Bishopric and 10% for each auxillary for example (assuming five auxillaries), so when the money comes in it goes automatically to each Budget subcategory?


I see nothing in the documentation that says this. All references to adjustments of allocation percentages refer only to the stake adjusting percentages for the wards. The wards have no control over this.

atticusewig wrote:3) What is the default passthrough-to-unit percentage. 0% or 100%. If the Stake Clerk doesn't enter percentages, will all of a unit's allotment passthrough to the unit, or all remain with the Stake ?


I'm pretty sure the default is 0, but I don't recall. In any case, a stake would be foolish to leave it at either 0 or 100, so this really shouldn't matter.

atticusewig wrote:4) What will the mechanism be for moving the money from the Budget: Budget Allocation to the other Budget subcategories ? Percent-automated as explained in question 2, same as the previous MLS "Set Budget" method, only now the initial allocation is locked, or will the clerk need to do a series of Transfers ?


As explained previously, there is no "percent-automated" method for wards. Wards will do manual transfers. Under "Budget" the documentation says "Using the Transfer functionality in MLS, you can move balances to auxiliary subcategories."

atticusewig wrote:5) In the current unit budget we have an account for YM-YW combined activities; Because there will be mostly locked Budget subcategories, would I need to create a sub-subcategory called Budget:Bishopric:Joint YM-YW Activities to have such a fund ? Putting it as a sub-sub under either the BU:YM or BU:YW subcategory would overstate their overall budget, no ?


Just because some Budget subcategories are locked, don't assume you can't create whatever subcategories you need to. If there is not a Budget:YM-YW Combined Activities category, but you want one, go ahead and create it. You don't need to create a sub-subcategory.
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Postby crislapi » Wed Oct 13, 2010 1:30 pm

atticusewig wrote:One month before the start of each Quarter each unit will receive a preliminary budget notice stating the incoming budget allowance and asking them to make any last minute changes to the most recent Quarterly report that might affect this number. The December notice (for the January Allotment), would concern the 3rd Quarter report. It mentions ward budget percentages could be updated at this time.

Disbursements are 6 months delayed. January's disbursement comes from the numbers submitted on the Qtr 2 Quarterly report (June's numbers submitted by July 15th). You have until the end of the current quarter to modify percentages (definitely) or old Qtr report numbers (not as sure about this). The percentages (and I'd assume Qtr report numbers) submitted by (or as they stand on) the last day of the quarter (Mar 31, Jun 30, Sep 30, Dec 31) will be used for the next budget distribution

atticusewig wrote:In the first month of the Quarter, the Allotments for each unit go through the Stake who have assigned percentages for the SacMtg Attendence,YM, YW,Primary, and YSA components of each unit's Allotment to pass on to each unit, and keep the remaining to cover Stake Expenses.

The monies the Stake allows to flow through are deposited into the unit's bank account under Budget, and that amount is placed into a Budget subcategory in MLS called Budget: Budget Allocation and the clerk should transfer funds to the appropriate Budget subcategories (many now preset and locked from CHQ) or sub-sub-categories under these locked main categories.

We could nit-pic about wording choice, but essentially, yes. I don't know how many new subcategories there will be. I'm not expecting that many. However, I do feel that the "view/edit budget" screen is going away. Units will probably not have the option to type in subcategory starting balances anymore, just like they can no longer manually enter a total budget amount. Instead, you can only work with money you have. To accomplish this, yes, you will have to use transfers to move money between your subcategories within a main category. You will still have to use checks to move money between major categories, between units, or between units and the the stake.

atticusewig wrote:2) Who receives the preliminary notice of the budget allotment. Does each unit receive it for the unit, and the stake for all their units?

From the very last question of the FAQ section of the New Local Unit Financial Processes Update message sent last Sunday :
Q. What is this report/document I just got? Can you give us an idea of what kinds of new documents the clerks will receive?
A. With the new software, you will receive new and/or enhanced reports. A partial list of these is below:
(These reports will be delivered to your MLS system for review.)
Stake/District
- Monthly Finance Statement
- Consolidated Finance Statement
- Projected Quarterly Local Unit Budget Allowance
- Quarterly Budget Allowance
Ward/Branch
- Monthly Finance Statement
- Projected Quarterly Budget Allowance
- Quarterly Budget Allowance
To me, this shows that both the ward and stake receive the projecte quarterly budget allowance report - the stake for all the units in the stake, the ward just for itself.

atticusewig wrote:Also when it says the ward can adjust Budget Allocation percentages does this mean there will be an automated way for the unit to allocate the incoming monies for the quarter. Set 50% to the Bishopric and 10% for each auxillary for example (assuming five auxillaries), so when the money comes in it goes automatically to each Budget subcategory ?

Sorry, but I'm going to guess no. The section you appear to be referring to is in the section giving instructions to the stake on how to allocate budget to their units. Ward budget percentages refer to the stake's assigning disbursement percentages to their units by "budget category", which is the quarterly report allocation categories of sacrament attendance, primary, YM/YW & YSA.

atticusewig wrote:3) What is the default passthrough-to-unit percentage. 0% or 100%. If the Stake Clerk doesn't enter percentages, will all of a unit's allotment passthrough to the unit, or all remain with the Stake?

Won't know for sure until we see it, but I'm going to guess 0. The default is to use the previous quarter's percentages. This first time the stake will have to enter percentages, but then the stake could "fix it and forget it" or, if they want to be more on top of it, could modify the percentages each quarter. Regardless, they'd have to go back in and actually make it 0 for you to not receive a disbursement. Should you happen to miss one because the stake didn't get percentages correct, they would just have to cut your unit a check for the difference. Again from the FAQ:
Q.I missed the deadline and forgot to edit a percent in the budget allocation screen. What do I do now?
A. Update the Budget Allocations screen for future allocations, then write checks for past differences.
atticusewig wrote:4) What will the mechanism be for moving the money from the Budget: Budget Allocation to the other Budget subcategories? Percent-automated as explained in question 2, same as the previous MLS "Set Budget" method, only now the initial allocation is locked, or will the clerk need to do a series of Transfers?

The Budget section of the FAQ states this fairly clearly:
Q.Do I have to enter transfers to change the budget allocations in each subcategory every quarter?
A. Yes, MLS has changed. Budget subcategories will have ending balances. Using the Transfer functionality in MLS, you can move balances to auxiliary subcategories.
As I mentioned above, wards/branches will not have the functionality of automating budget transfers. The portion being referred to is directed to the Stake not the wards. Again, I don't believe the view/edit budget screen as we know it will be there after the transition.

atticusewig wrote:5) In the current unit budget we have an account for YM-YW combined activities; Because there will be mostly locked Budget subcategories, would I need to create a sub-subcategory called Budget:Bishopric:Joint YM-YW Activities to have such a fund ? Putting it as a sub-sub under either the BU:YM or BU:YW subcategory would overstate their overall budget, no ?

I do not believe that there will be "mostly locked" budget subcategories. There will be some new subcategories you cannot edit or remove, but you still have the flexibility to create/keep you own unit-specific sub-categories. From the Subcategories section of the FAQ (emphasis added):
Q.How do I add subcategories?
A. Headquarters controls subcategories. Units may add additional unit-specific subcategories in certain subcategories such as Budget and Authorized Member Financed Activities. Categories or Subcategories with a red X cannot be edited, New unit subcategories can be added under authorized member financed activities and budget by following these steps:
1. Go to the Finances menu and click More. Then click Add/Update Categories.
2. Click on the plus sign (+) next to a category to expand it.
3. Click on the category or subcategory that the new subcategory should be added to.
4. Click on Add.

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nicklewis
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Transition Funds Provisioning

Postby nicklewis » Thu Oct 14, 2010 8:41 pm

I actually have more immediate questions for this transition.

1. How will the budget be provisioned in this first quarter? Will we receive funds based on previous quarterly reports?
2. What happens to the budget monies we were projecting through the end of this year? Will the stake write a check for what our balance is?

Fourth quarter is a busy time for financial transactions for us. Our ward usually purchases all its office supplies in that quarter. It is the time for the annual curriculum order. It is also a time for Christmas activities in organizations. We obligate almost 40 percent of our budget during that quarter. I would not like to find out at the last minute that we only have 25 percent of our annual budget during this transition.
Nick Lewis
Melbourne Ward Clerk
Cocoa Florida Stake

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Postby lajackson » Thu Oct 14, 2010 8:45 pm

nicklewis wrote:1. How will the budget be provisioned in this first quarter? Will we receive funds based on previous quarterly reports?
2. What happens to the budget monies we were projecting through the end of this year? Will the stake write a check for what our balance is?


As we understand it in our stake, each unit has already received three quarterly allocations and is about to receive a fourth.

Under CUBS, we will figure out what they have not yet spent of their four quarterly allocations, and we will write them a check to deposit in their Budget account under CUBS to use for the rest of the year.

Starting in 2011, we will set the stake side of MLS so that the units will receive their allocations directly through the CUBS into their Budget accounts.

The amount of the budget allocation is not changing. It will still be based on the quarterly report from the 2nd prior quarter. Only the method of getting the budget to the individual units is changing.

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Postby crislapi » Thu Oct 14, 2010 9:20 pm

nicklewis wrote:1. How will the budget be provisioned in this first quarter? Will we receive funds based on previous quarterly reports?

Because CUBS transitions after the fourth quarter allocation has been sent to the stake, the wards will not receive an automatic budget disbursement in Qtr 4.
nicklewis wrote:2. What happens to the budget monies we were projecting through the end of this year? Will the stake write a check for what our balance is?


At the time of conversion, all unspent budget funds for the entire stake will be sent to the stake account. Therefore, just after conversion, all wards will have a budget balance of $0. Wards should receive a check from the stake for the balance of their 2010 budget. I say should because it is the stakes prerogative to decide how best to handle this.

You will need to be patient, however. Stakes are instructed not to cut checks until they get a final SFS (Good through Oct 17). I suspect the report should be sent sometime in the beginning of November. I would think that means it would be reasonable to expect your check from the stake around the middle of November. I would not hold off on reimbursing members, however.

Here are the pertinent sections of the message:
At the time of conversion the remaining budget allowance balance as reported on your Stake Financial Summary will be deposited into the budget category of the stake account. This amount will show as a transfer to the budget category on the first Church Unit Financial Statement following conversion. The stake will need to write a check to each ward for their portion of this balance and the ward should deposit and record the check as income to the budget category. Both the stake and ward will show a beginning budget balance of zero on their first Church Unit Financial Statement following the conversion.

A final Stake Financial Summary will be run from the current system and sent to the stake. The Stake will have all the ward information through October 17 included on the last Stake Financial Summary. Stake leaders will want to wait for the final Stake Financial Summary and then determine the amount of budget allowance to transfer to each ward via check. All ward budget expenses after the implementation will remain with the Ward account and not transfer to the Stake.
nicklewis wrote:Fourth quarter is a busy time for financial transactions for us. Our ward usually purchases all its office supplies in that quarter. It is the time for the annual curriculum order. It is also a time for Christmas activities in organizations. We obligate almost 40 percent of our budget during that quarter. I would not like to find out at the last minute that we only have 25 percent of our annual budget during this transition.

Because the amount you will get depends on your stake, I would check with them. There are some issues to be aware of, however. Once CUBS is active, you can only work with actual money. If you stake allotments have decreased due to decreased attendance, there might not be enough money in the stake account to supply every ward its remaining balance.

Depending on how your stake chooses to handle it, there is no need to spend all your money at year end anymore either. By default, CUBS will allow wards to carry their balance forward each year, be it positive or negative. See here:
All units will now receive budget allowance as an actual amount in the Budget category. For stakes and wards in the United States and Canada, this means that every three months each qualifying unit will receive an amount in the Budget category that will remain as a balance and will decrease as the unit writes checks against that category. (The timing of the allowance has not changed. Budget will be distributed in January, April, July, and October of each year.) The month-end balance will carry forward, including the December month-end balance carrying forward to the next year.

As an unwanted aside, the DC prefers all curriculum orders be placed by September 15 to ensure timely delivery.

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Postby aebrown » Fri Oct 15, 2010 5:02 am

crislapi wrote:I would think that means it would be reasonable to expect your check from the stake around the middle of November. I would not hold off on reimbursing members, however.
...
Once CUBS is active, you can only work with actual money.


It is basically true that under CUBS, budget checks will be using actual money. But it is also true that CHQ has no problem with a ward being negative in the Budget category. It is almost certain that most wards will be negative for a while after the transition because they will start with a zero balance, and stakes cannot get a budget check to them immediately.

All CHQ cares about is that a stake as a whole has a positive Budget balance, and the fact of whether the stake as a whole is positive or negative will be unaffected by the transition to CUBS. The exact same money will be in the stake (either in the stake's account or distributed among the wards) as would have been remaining in the budget allocation.

I say this to confirm that wards should definitely continue to follow policy and reimburse members promptly, just as they would have without the CUBS transition. If the stake handles the transition correctly, the wards will see no change in their available budget funds -- it will simply be accounted for differently. Don't wait for the check from the stake.
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Postby lajackson » Fri Oct 15, 2010 6:19 am

Alan_Brown wrote:The exact same money will be in the stake (either in the stake's account or distributed among the wards) as would have been remaining in the budget allocation.

I say this to confirm that wards should definitely continue to follow policy and reimburse members promptly, just as they would have without the CUBS transition. If the stake handles the transition correctly, the wards will see no change in their available budget funds -- it will simply be accounted for differently. Don't wait for the check from the stake.


Our stake presidency has authorized our bishop and branch presidents to do exactly as Alan has said, i.e., take care of business as usual within the guidelines of the three quarterly allocations they have received so far and the one they will receive for the 4th quarter.

The actual financial accounting will follow later in the quarter.

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Postby nutterb » Mon Oct 25, 2010 5:18 am

After reading the instructions and then playing with this a bit yesterday, I have to admit I'm a little confused as to how the whole budget allocation thing is going to work now.

There appear to be two ways to assign money to the budget subcategories. You can do it through the "View/Edit Budget" dialog, or you can do it through transfers. Strangely, when I did it through the View/Edit Budget dialog, it created positive balances on my income and expense report. If I specified an allotment of $100 to the Elders Quorum and then transferred $100 to Elders Quorum, the income and expense report showed $200 in the Elders Quorum subcategory.

In the end, I'm left wondering what is really happening. Are we supposed to be making allocations using the View/Edit Budget dialog, or are we supposed to be physically making transfers? Or are these essentially the same thing?

Forgive what's probably a simple question, but as we've seen before, my reading comprehension doesn't always match wits with my practical observations. ;)

Edit and a warning: I'm probably going to have lots of follow-up questions. If you feel the answer is "wait a couple weeks while we learn from experience," I'm okay with that too.


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