How do I transfer an amount from a reserve or benevolent fund to pay for a member's subscription?

How do I transfer an amount from a reserve or benevolent fund to pay for a member's subscription?

Accounting for membership dues paid via a reserve or benevolent fund requires careful tracking because you are essentially moving money between two internal "buckets" (or funds) while also recognising the member's 'paid' status.

This transaction requires more than a simple Fund Transfer since both the expense and receipt must be accounted for in your Income & Expenditure (P&L) Report:

• Reserve/Benevolent Fund Expense: The goal of this fund is to provide assistance. Paying a membership is a charitable expense and must be recorded as such as an expense.

• General Fund Revenue: Your organisation must show the true value of memberships provided during the year and all related revenue must be recognised, even if your organisation is paying for it.

In Clubtreasurer, you will create these as:

1. A Receipt transaction to record the membership receipt income against the member and your 'General Fund' (since this is the receiving fund) 
2. A Payment transaction to record the expenditure from the 'Reserve/Benevolent Fund' balance. 

Importantly, since you are not receiving or spending any actual cash, we'll use the "CONTRA" clearing/suspense account for these transactions.

1. Receipt Transaction

• Date: Transfer Date
• Account: CONTRA 
• Cost Code: 'Membership Receipts' (or equiv)
• Fund: General Fund
• Member: Member 
• M'Ship Billing Line: Select outstanding membership billing line
• Amount = Membership Fee paid

2. Payment Transaction 

• Date:  same as above
• Account: CONTRA
• Cost Code: 'Benevolent Fund Payments/Grants' (or equiv)
• Fund: Reserve Fund
• Member: N/A
• M'Ship Billing Line: N/A
• Amount = Membership Fee paid

Pro Tip: Your CONTRA clearing/suspense account should always balance to 0 when all transactions are entered.