Transitioning from Traditional Accounting to Fund Accounting Software

by Cheryl Smith
(Deep River, Ontario)

Last year our small church began using Sage (formerly Simply Accounting) to do our bookkeeping. I have no bookkeeping experience an unfortunately I had no one to train me. I have been learning as I go. I now realize that Sage is definitely not the best option for us and am evaluating software options that focus entirely on fund accounting.


My problem right now is transferring the year-end balances from one program into the opening balances in the new program. As Sage is focused on profits, it has an account for Retained Earnings which includes the value of our church, land, etc. I've been told that this should equal the total of my funds (unrestricted, etc.) but I don't see how. Where should I stick the R/E in a fund accounting system to make sure everything still balances? Should it become part of the Unrestricted Fund?

Another question pertaining to the Unrestricted Fund: Does Unrestricted = General? Or should I set up the COA to show the General Fund as a sub-category of Unrestricted? If so, would I put the Retained Earnings into Unrestricted and our bank account's year end amount into General Fund? (We have traditionally considered everything in that account as the General Fund as the restricted funds have a separate bank account.)

I apologize if my questions don't make any sense. If that's the case, please feel free to let me know and ask specifics so I can try to make myself clearer. Thank you :)

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May 11, 2015
Traditional vs fund accounting
by: MarcusNtexas

Our church has been using Quick Books since around 1999 and I have been using updated versions of QB since I became treasurer in 2010. In my "humble" opinion, you may be better off by sticking with traditional accounting versus making the switch to fund accounting. I am now using QB Pro Plus 2015 and it seems to be working well. All operating account balances (positive and negative) are automatically transferred into Retained Earnings when the books are closed at December 31 each year. I use QB to account for our operating income and expenses and do not include or "fixed" assets (land, buildings, furniture and fixtures, parsonage etc.)in the QB system.....I was in financial administration in public universities for 40 years where fund accounting was used. I think the traditional accounting works best for me.

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