Annual Budget

Discuss questions around local unit policies for budgeting, reconciling, etc. This forum should not contain specific financial or membership information.
ralitaco
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Annual Budget

Postby ralitaco » Sat Jan 01, 2011 10:30 pm

This is my first January as a Ward Clerk and I am wondering what to do regarding setting up the annual budget. in the past I our ward did not use a budget in MLS, so I have nothing to compare to.
I am now running 3.3.

1. Can I use the "View/Edit Budget"? (I thought there was an issue after the CUBS update)
2. I am planning to transfer the annual budget amounts to their respective budget categories. Any issues with doing this? I know this will result in a negative in the Allocations category, but I figured it would be the easiest way to be able to track each aux's expenses and remaining balance and also eliminate having to figure out how much to transfer each quarter.
3. Can someone elaborate on the release notes regarding budgets? Is this stake or ward level?
Budget Reports and CUBS. If your unit has begun to use Church Unit Banking Services (CUBS), your Budget Report will be updated to reflect the features of CUBS, such as a real dollar amount in your Budget category and estimates of future budget allotments. If you are not yet using CUBS, you will be informed when this transition will begin.

crislapi
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Postby crislapi » Mon Jan 03, 2011 10:55 am

ralitaco wrote:1. Can I use the "View/Edit Budget"? (I thought there was an issue after the CUBS update)

Yes, but then you will want to use the Budget Report to view your budget status and you will want to uncheck (not include) the Budget:Budget Allocations category when running this report. You also will not want to transfer funds from Budget:Budget Allocations to your other categories. This is because the view/edit budget screen adds a "virtual" starting balance to the categories. Transferring funds will give you 2 incomes to the category and throw your balances off. This is also why you don't want to include Budget:Budget Allocations in your reports as your overall balance will be off.


ralitaco wrote:2. I am planning to transfer the annual budget amounts to their respective budget categories. Any issues with doing this? I know this will result in a negative in the Allocations category, but I figured it would be the easiest way to be able to track each aux's expenses and remaining balance and also eliminate having to figure out how much to transfer each quarter.

You have to pick one method and stick to it. You can either use the view/edit budget screen, no transfers, and the budget report or transfers and the income and expense report. Using view/edit budget with transfers will artificially inflate your balances, leading your committees to think they have more money than they really do.

ralitaco wrote:3. Can someone elaborate on the release notes regarding budgets? Is this stake or ward level?
Budget Reports and CUBS. If your unit has begun to use Church Unit Banking Services (CUBS), your Budget Report will be updated to reflect the features of CUBS, such as a real dollar amount in your Budget category and estimates of future budget allotments. If you are not yet using CUBS, you will be informed when this transition will begin.

I imagine this applies to both wards and stakes as all will now receive actual budget amounts. While not clear to me exactly what it means, I suspect it refers to the fact that budgets now are "real". Pre-CUBS, your budget balance was actually always $0. That should be apparent if your ever reconciled. The ending balance of budget was always $0. Now it is not. It will be an actual, real, balance.

nutterb
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Postby nutterb » Mon Jan 03, 2011 11:59 am

crislapi wrote:You have to pick one method and stick to it. You can either use the view/edit budget screen, no transfers, and the budget report or transfers and the income and expense report. Using view/edit budget with transfers will artificially inflate your balances, leading your committees to think they have more money than they really do.


I had a hard time reading what you were intending here, so I'm restructuring it just in case there are others who read like I do

You can either use:

  • the view/edit budget screen, no transfers, and the budget report or
  • transfers and the income and expense report.

crislapi
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Postby crislapi » Mon Jan 03, 2011 12:22 pm

I've previously posted a fairly detailed example of the differences between these two reports. See this post for an example.

russellhltn
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Postby russellhltn » Mon Jan 03, 2011 1:00 pm

Maybe I'm missing it, but how would you use the "transfers and the income and expense report" method to see a "annual" budget rather then "until the end of the quarter"?
Have you searched the Wiki?
Try using a Google search by adding "site:tech.lds.org/wiki" to the search criteria.

crislapi
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Postby crislapi » Mon Jan 03, 2011 1:25 pm

RussellHltn wrote:Maybe I'm missing it, but how would you use the "transfers and the income and expense report" method to see a "annual" budget rather then "until the end of the quarter"?

You could transfer an amount equal to the annual budget amount to each category. This will cause your Budget:Budget Allocation subcategory to go extremely negative at the beginning of the year. Hopefully your quarterly allocations will make it positive or at least $0 by the end of the year. This is clearly one limitation to doing a yearly budget with this approach: you cannot guarantee you will actually receive an amount equal to what you've transferred.

russellhltn
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Postby russellhltn » Mon Jan 03, 2011 2:15 pm

I thought about that after posting. Thanks for the confirmation.

crislapi wrote:This is clearly one limitation to doing a yearly budget with this approach: you cannot guarantee you will actually receive an amount equal to what you've transferred.


Well, you cannot guarantee you will actually receive an amount equal to your expected annual budget either, so I don't see that factoring in the decision. It is something to be aware of in either method.

Another problem to be concerned about is sending the overall balance negative because of spending before the money comes in. I could see this happening for summer camps, etc. Everything would be fine by the end of the year, but when summer comes around the ward has only gotten half of the annual money. But that's nothing new. What is new is that now CHQ will see the ward going negative. Before it only knew when the stake went negative.
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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mlh78
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Postby mlh78 » Mon Jan 03, 2011 2:59 pm

RussellHltn wrote:Another problem to be concerned about is sending the overall balance negative because of spending before the money comes in. I could see this happening for summer camps, etc. Everything would be fine by the end of the year, but when summer comes around the ward has only gotten half of the annual money. But that's nothing new. What is new is that now CHQ will see the ward going negative. Before it only knew when the stake went negative.


The bishops in our Stake raised this concern. We addressed it by agreeing to advance the 3rd quarter allotment when we pay the 2nd quarter allotment. Of course this only works if (1) the Stake has a sizeable surplus and (2) you go against the grain by zeroing out allotments in MLS and transferring funds to units by check.

russellhltn
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Postby russellhltn » Mon Jan 03, 2011 3:13 pm

mlh78 wrote:The bishops in our Stake raised this concern. We addressed it by agreeing to advance the 3rd quarter allotment when we pay the 2nd quarter allotment. Of course this only works if (1) the Stake has a sizeable surplus and (2) you go against the grain by zeroing out allotments in MLS and transferring funds to units by check.


I think a simpler method is to have the stake advance each ward a reserve fund. It would be expected to be placed in it's own subcategory. It's only purpose is to keep the ward from going negative during the year. The ward would be responsible for making sure they have enough reserve going forward. If they end up spending it, then they'd have to trim their mid-year spending.

However, one concern is that this information would be lost in the normal turnover of leadership and the funds would be spent without realizing the impact of it.

The stake could help by going after any wards that were below the reserve funding.
Have you searched the Wiki?

Try using a Google search by adding "site:tech.lds.org/wiki" to the search criteria.

crislapi
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Postby crislapi » Mon Jan 03, 2011 3:35 pm

mlh78 wrote:The bishops in our Stake raised this concern. We addressed it by agreeing to advance the 3rd quarter allotment when we pay the 2nd quarter allotment. Of course this only works if (1) the Stake has a sizeable surplus and (2) you go against the grain by zeroing out allotments in MLS and transferring funds to units by check.

CHQ is only going to intervene if the stake as a whole goes negative. If that has not happened in the past, it should not happen now. I have decided to address this concern in my stake by 1) giving all wards an increased amount in their 2010 Q4 disbursement and 2) giving larger than normal disbursements for the first 3 quarters of 2011. The intent is to allow them to build up funds so that they can cover their summer expenses.

CHQ will not intervene when wards go negative. It is the stake's responsibility to monitor and handle these situations.


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