Hi Daniel,
I apologize if this is a duplicate - I sent it yesterday, but I didn't
see it show up in the subsequent emails.
This is similar to the "liability" approach. But it works better in my
case because all the numbers I (and others) want to see are grouped
together in the assets section of the balance sheet (statement of
position, in non-profit vocabulary).
As Treasurer of our church, I do something very similar.
This is how it works:
- A parent asset acct 1120 is called "Checking acct after reserves"
- a child acct 1121 is called "Checking acct"
- another child acct 1122 called "Reserve for property tax"
- another child acct 1123 called "Reserve for elevator maintenance"
(I think some people might call these 2 Reserve accounts
"contra-asset" acct's since they normally have a NEGATIVE balance as an
asset)
In the church's case, the reserves are for:
- property tax on the parsonage, which is due every 6 months
- big elevator maintenance work required every 5 years
The acct codes (1120, 1121, etc) help a LOT to keep this clear in the
chart of accts. I'd suggest using acct codes for all accts. See for example:
double-entry-bookkeeping.com/coa/chart-of-accounts-numbering-system/
... or search on "typical chart of accounts numbering system"
Then I take the property tax amount divided by 6 months, and
the estimated elevator maintenance bill divided by 60 months ie 5 years -
... and set up monthly Scheduled Transactions, which:
- CREDIT the "Reserve for something" acct
- DEBIT the appropriate expense acct
... for the amount needed monthly, to have money available to
pay these bills when they come up.
So the "Reserve for something" accounts -which are asset accts- usually
have a negative (credit) balance. This is the amount which has been "set
aside" towards the known upcoming expense.
The expense actually shows up monthly, instead of a big lump at 6 months
for property tax, or at 5 years for the elevator maintenance.
When the "big lump" bill comes due and I pay it, the transaction is:
- CREDIT the checking acct, from which I write the check to pay it,
- DEBIT "Reserve for something" ... which brings the "Reserve" acct
balance back to zero (or pretty close).
Note that this debit does NOT go into the expense acct - because the
expense has already been booked monthly.
So looking at these acct balances in a typical month, it might look like
this:
1120 "Checking acct after reserves" = $6,000 (PARENT)
- 1121 child acct "Checking acct" = $7,250
- 1122 child acct "Reserve for elevator" = -$1000 (Negative balance)
- 1123 child acct "Resv for property tax" = -$250(Negative balance)
What this means:
- 1120 the PARENT "Checking after reserves" is that portion of the
checking acct available for everything else ... AFTER what's been set
aside for the next 5-year elevator maintenance and the next 6-month
property tax payment.
-- 1121 child "Ckg acct" is the ACTUAL amount in the checking acct.
... This is the acct into which I book all deposits and checks
written; and which I reconcile with the bank's statement each month.
-- 1122+1123 "Reserve for XXX" acct's are the amounts "saved up
for" the upcoming big-lump payments, which show up as a negative number.
I coded 1120 "Checking after reserves" as a "placeholder" acct, so it
does NOT show up as a choice when I'm entering transactions. I will not
ever normally enter a transaction directly into this acct.
Everything goes into the actual checking acct 1121, or the reserve
acct's 1122 + 1123.
Hope that helps and God bless!
Chris
------------------------------------------------------------------------
On 8/5/24 12:00, gnucash-user-requ...@gnucash.org wrote:
Message: 3 Date: Mon, 5 Aug 2024 13:27:22 +1200 From: Daniel Sheffield
<d.j.yo...@gmail.com> To: gnucash-user@gnucash.org Subject: [GNC] Fund
management without an actual account Message-ID:
<CAGBFyFUc8nZAFzAbyTWcUWc3QmgRNvJEeBp=hsjz-7a6_y+...@mail.gmail.com>
Content-Type: text/plain; charset="UTF-8" Hi, I'm using gnucash to
manage my personal finances. ... BUT I'm trying to keep track of
savings towards a goal, but without opening an actual account or
making any real world transactions to achieve it. ... Cheers, Daniel S
On 8/6/24 12:00, gnucash-user-requ...@gnucash.org wrote:
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----------------------------------------------------------------------
Message: 1 Date: Tue, 6 Aug 2024 09:54:08 -0600 (MDT) From: Alan
Johnson <a...@argentwolf.org> To: Daniel Sheffield
<d.j.yo...@gmail.com> Cc: gnucash-user@gnucash.org Subject: Re: [GNC]
Fwd: Fund management without an actual account Message-ID:
<3e05dd08-36c6-4dc4-b7e3-91bbcc0ae...@argentwolf.org> Content-Type:
text/plain; charset=UTF-8 I guess I don't understand what you mean by
offset your mortgage. For the other things, things such as gifts and
tithes, they would go into a liability account against the expense
category you choose for them. When you pay / make the gift, you would
transfer from your assett account (checking, savings, etc) to the
liability account to zero it out. The assett (cash) and liability
(gift, tithe, etc) would appear opposite each other on reports. Aug 6,
2024 03:20:24 Daniel Sheffield <d.j.yo...@gmail.com>:
Thanks Alan, I wonder about the roll up figure on the accounts tab -
I have heaps of future transactions scheduled months in advance to
help me forecast. But that means the account tab never reflects the
current balance. So I can't use that to reconcile. Unless there is a
setting somewhere to show up to today only on the accounts tab? I
also wonder about obligatory fund (ie, promised gift, allowance) -
the 2nd Tithe is a big deal for me, I view it as a liability because
I can not spend it on just anything I like. It's essentially on loan
to pay a bill in the future. Most people stick it in an external
account. I'm not doing that so that I can offset my mortgage. In a
nut shell, I really can't have it factor into my net worth because
it's not my money. Sort of like if you paid without?taxes
withheld?and will have to pay at the end of the year. Every time you
get paid, you're increasing your tax liabilities. The other funds,
this notion is not so important, I can scrap the travel money to pay
the bills if I want - so your way could work for that... but if I can
find one way that works, that's even better. But sub accounts on my
checking account seems to be the prevailing view... probably for a
reason... perhaps I should try harder... Cheers, Daniel? -- In the
beginning Kibo created the Internet. Now the Internet was formless,
and empty. Randomness was upon the face of computing, and the Spirit
of ARPA moved upon the face of the computers. Then Kibo said, "Let
there be data": and there was data. Kibo saw the data, and it was
good, so Kibo divided the data from the randomness, and Kibo named
the data Information, and the randomness Clueless. And the
Information and the Clueless were the first Network. On Tue, Aug 6,
2024 at 5:24?PM Alan Johnson via gnucash-user
<gnucash-user@gnucash.org> wrote:
Daniel, I would suggest that you use the second savings account and
it would help with the over spending. I think it would look
something like this, please forgive formatting as I'm on mobile, but
you should get the idea. Checking debit 10k / salary credit 10k
Credit checking 1k / debit savings2 1k Credit savings2 500 / debit
vacationfund [subaccount] 500 Credit savings2 500 / debit toyfund
[subaccount] 500 Need money back in checking to spend? Debit
savings2 300 / credit vacationfund 100 credit toyfund 200 Credit
savings2 300 / debit checking 300 Your roll up of savings 2 in the
accounts list will tell you the amount which should match the
savings statement. There should also, in theory, be a very few
transactions to reconcile, and it keeps the checking account clean.
Alan _______________________________________________ gnucash-user
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