Should Quickbooks Funds/Classes have beginning Balances?

by Brian Donnell
(Boston MA)

I have just been appointed Treasurer/Bookkeeper of a church which converted to Quickbooks Pro as of July 1, 2011.

They set up the "classes" as the funds (unrestricted, temporarily and permanently restricted) with the named sub-funds as sub-classes and have been booking activity to these throughtout the year.

I have noticed, however, that beginning balances were input to these classes/funds by journal entry as of June 30, 2011, and am confused as to why.

Shouldn't beginning balances only appear in the various funds under the net assets on the balance sheet?

I thought that only current year activity should appear in the classes/funds then zero out and be debited or credited to the net assets at year end?

Do you think that the original journal entry was incorrect? I'm confused. Thanks for any help.

2Comments

Beginning balances and net assets

AAnonymous

Beginning balances should be the net asset of a fund - that is correct. By doing it this way the net asset under that fund automatically moves to the new year because anything that affects the net assets (eg: revenue coming in, expenses going out, fund transfers, etc).

Quickbooks Pro

AAnonymous in NC

This writer is not experienced in Quickbooks Pro, but the logic in your question seems to be sound. The best way to know for sure is to contact the Quickbooks Pro software sellers where you made your purchase. There probably is an 800 number on the package you can call. Please post what you find out as I am interested in what the answer is as well.
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