Final Exam Flashcards
Three Basic Functions of Accounting
Recording (Bookkeeping)
Presentation (Reports)
Interpretation (Managing)
What is our operating fiscal year?
October 1 - September 30
Who is responsible for all the finances at the corps level?
Corps Officer
How many signatures are required on our checks by our bylaws?
two
Credit
means owed TO me or asset of…
Debit
means trust or belief in or owed BY me…
Asset
Accounts Receivable
Something of value / future economic benefit
Liability
Accounts Payable
present obligations / claims against
Fund Balance
Accounting Equation
Net Worth
Assets = liabilities + fund balance
Cash Basis Accounting
income recorded when received
expenses recorded when paid out
Does not conform to GAAP
Accrual Basis Accounting
Income recognized (recorded) when earned
Expense recognized (recorded) when earned
==whether or not cash received or paid out==
Conforms to GAAP
Board Designated Group Funds
Major Corps Group Activities (10% of budget)
generally self supporting and/or activities that account for material volume of income and/or expeditures
Example of Board Designated Groups
Home League Women's Ministries Men's Club Music, Band, Songsters Girl Guards, Boys Adventure Corps
Who can approve a board designated group?
Command Finance Council
What are board designated groups not?
community-service oriented
Week Period
Week ends on Sunday
Final week of Month:
Extends to the last day of the month
Gift in Kind
“gift of anything (goods or services) other than money.”
Examples of Gift in Kind
Donated bread, canned goods
Donated toys at Christmas
Donated office supplies
What are you to do with Gift in Kind?
keep a list of in-kind donations at fair market value.
entered into Shelby monthly
Designated gifts
donations give to the church with specific instructions for their use.
What we change names on our bank account, what legal document has to be completed?
Power of Attorney
Counting Cash
donations are counted with donor
two people always count
record on activity income report with responsible signatures
income is always deposited as given
Safeguarding Income
Once counted, the income should be secured in an authorized safe.
Funds are not to be held overnight
Funds are to be deposited weekly.
When a receipt is requested by a donor:
a receipt book can be used -
- *has original and at least one duplicate, pre-numbered
- *include name, date, amount and purpose
IRS Receipt requirements
for a donor to claim a tax deduction for a donation of $250 or more a written acknowledgement must be provided to the donor.
Petty Cash definition
Relatively small amount of cash kept at hand for making immediate payments for miscellaneous small expenses.”
Petty Cash Improper Use
any income that has not yet been deposited to pay expenses.
Access to Petty Cash
Individual is responsible at all times
Cash/vouchers kept in a locked box
Kept in Main safe at night.
At all times the box should total the amount of the Petty Cash between vouchers/cash
When fare welling, the Officer must refund full amount back into Corps Bank Account through a separate deposit.
Signature Counter signers
ALL SALVATION ARMY ACCOUNTS REQUIRE TWO SIGNATURES. Main Power of Attorney signature: Corps Officer and/or Spouse Countersignature: Local Officer, Employed Bookkeeper
Bank Deposits
All funds given to The Salvation Army must be promptly and fully deposited in authorized account.
All check endorsements must clearly indicate:
“for deposit only to
The Salvation Army
_______Account”
Bank Reconciliations
Bank Reconciliations are done on a monthly basis
Commanding Officer is required to endorse every bank statement by signing the completed reconciliation form.
Errors should be noted to the bank promptly.
Support Service - National Policy
10% of all income less items given special exemption.
Calculating Support Service
Total Income
-Allowable Exemptions
=Net income subject to support service
Multiply net income by 10% (.10)
Corps Operating Reserves
Corps General Deposit Reserve (Cash on Deposit)
Corps Operating Reserves
These are held at DHQ
Specific Corps Operating Reserves
Automobile Corps Property Upkeep Quarters Property Upkeep Equipment Furnishings Computers
Quid Pro Quo
You give me something, I’ll give you something
Payroll Equation
Gross earnings
-Total deductions
= Net Pay
When you have a petty cash fund and you farewell a corps, what do you do with that petty cash fund?
Deposit it back out of your name
Types of Donations
designated
quid pro quo
restricted
