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Concept of "Request of internal Money Transfer"

Posted: Sun Mar 06, 2011 11:04 pm
by thadzik
Hello,

because of existing problems in the process of requesting internal money transfer between two church units or in one unit itself, I made up some thoughts, how this process could improve. Please see below the concept of "Request of internal Money Transfer". I would be glad to here from you all some comments about this suggestion. Thanks.

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Concept of "Request of internal Money Transfer”
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Issue:
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Money needs to be either
- transferred between two different (ward/stake) church units (e.g. because of EFY(=youth)-conferences) (one unit ows something to the other) or
- in one church unit money needs to get transferrred from "budget” to “other” account.

This request of internal money transfer comes by a church unit (local finance clerk), but it can be done or approved only by the administration office.


Current process (applies at least to Europe):
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Church units writes to finance staff of headquarter (administration ofice) and describes how money should be transferred.
Administration office enters these information in the financial system (in Europe "LURBS" or in USA "CUBS").

Problem:
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- Too many requests at one time and too less finance people at headquarter/administration office to do it. Not enough time to do it quickly.
- Loss of emails

Suggestion:
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Integrating of “Request of internal Money Transfer” to the MLS-Finance system.

The Financial clerk enters the following input/request:
i. Money transfer from which church unit and which category
ii. Money transfer to which church unit and which category
iii. The amount of money which should be transferred
iv. A short purpose note

The request will be transferred through MLS-system directly to finance headquarter (administration office). The finance staff at headquarter/administration office just have to make a check mark for approve or not approve. (If a church unit request money from another church unit, then this church unit could also give approval or not.) After each party has approved this, this money can get internally transfered.

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Best Regards

Thorsten

Posted: Sun Mar 06, 2011 11:16 pm
by aebrown
thadzik wrote:Current process (applies at least to Europe):
-----------------------------------
Church units writes to finance staff of headquarter (administration ofice) and describes how money should be transferred.
Administration office enters these information in the financial system (in Europe "LURBS" or in USA "CUBS").

There is no such process in the US/Canada. All transfers between units are done by check.

But I would welcome a procedure for doing such transfers. Particularly within our stake, we end up doing a lot of transfers from wards to the stake, or from the stake to each ward, or between wards. Transfers outside the stake are much less common.
thadzik wrote:The Financial clerk enters the following input/request:
i. Money transfer from which church unit and which category
ii. Money transfer to which church unit and which category
iii. The amount of money which should be transferred
iv. A short purpose note

The request will be transferred through MLS-system directly to finance headquarter (administration office). The finance staff at headquarter/administration office just have to make a check mark for approve or not approve. (If a church unit request money from another church unit, then this church unit could also give approval or not.) After each party has approved this, this money can get internally transfered.

One potential problem I see is with step ii. How will the clerk initiating the transfer know what category the receiving unit prefers? With the current system of using checks, the sending unit decides what category to write the check from, and the receiving unit decides what category to deposit the check into. I suppose this problem could be addressed if the receiving unit had the option to specify and/or change the category of the funds once they are received.

In any case, I guess the overall question is the size of the problem vs the cost of the changes. The suggestion could be refined and implemented, but it would require changes to MLS and to the back-end system. Do the current problems justify the costs of those modifications? I don't know.

Posted: Mon Mar 07, 2011 11:05 pm
by thadzik
aebrown wrote: But I would welcome a procedure for doing such transfers. Particularly within our stake, we end up doing a lot of transfers from wards to the stake, or from the stake to each ward, or between wards. Transfers outside the stake are much less common.
In Europe we have a lot of youth conferences across several stakes (regional conferences) and it takes currently almost two to five months in order to get the money from each ward processed.
aebrown wrote:There is no such process in the US/Canada. All transfers between units are done by check.
...

In any case, I guess the overall question is the size of the problem vs the cost of the changes. The suggestion could be refined and implemented, but it would require changes to MLS and to the back-end system. Do the current problems justify the costs of those modifications? I don't know.
All transfers done between two church units are done through an internal booking of the administration office. We do not use checks.
But if you use checks, that would mean to me that the receiving unit has to go to the bank in order to get the money. And if you have a bank involved in this process, then the bank will probable raise some fees for this, or?

In the internal booking is done without any fees or charges. Out of this, it makes a lot of sense to implement something like this, or?

Kind regards

Thorsten

Posted: Tue Mar 08, 2011 12:33 am
by jdlessley
thadzik wrote:All transfers done between two church units are done through an internal booking of the administration office. We do not use checks.
But if you use checks, that would mean to me that the receiving unit has to go to the bank in order to get the money. And if you have a bank involved in this process, then the bank will probable raise some fees for this, or?

In the internal booking is done without any fees or charges. Out of this, it makes a lot of sense to implement something like this, or?
We understand the financial processes are different in the European community. As I understand it checks are a thing of the past in many places. Unfortunately, here in the US, they are still used quite regularly. Handling of checks here are not as you describe. For unit to unit funds transfers with a check there is no cash money involved. The check is deposited with all other donations at a local bank branch office. No service fees or charges are incurred mostly because the bank accounts for all units involved belong to the Church and not the individual units.

The process could be more efficient if electronic transfers or some other internal transfer mechanism within MLS was used. A similar method to that now used for unit Distribution Center charges is what I am thinking of.

Posted: Tue Mar 08, 2011 2:08 pm
by thadzik
Thanks a lot. It is now clear for me.

I forgot to mention, why it is possible in Germany to do an internal transfer rather than making a payment through the bank accounts.

In Germany we have a cash pool in place. So we have one bank (Commerbank, which is not a church owned bank) and each unit has a bank account at this bank. All these bank accounts are linked to one central bank account, which is a bank account from the administration office. What happen is that every evening the bank accounts from each unit will be cleared and any credit amount will be transfered to the central bank account or in case the unit has a debit amount, the central bank account will transfer that amount which is needed to make that account zero again.

So you can still execute payments through your local unit bank account or receive any money, but over night the balance of the account will be zero again. Once a week the finance clerk receives through the bishop the bank statements and enters the individual transaction into MLS. The balance of the bank account is only kept by the MLS-System, not by the bank account.

Because of this linking of all bank accounts, we can do just internal transfers in order to transfer cash from one unit to the other.

Kind regards

Thorsten