Lesson 6.8: Fund Balancing Entries and Registers
In standard commercial accounting, a single set of self-balancing books is maintained for the entire company. However, nonprofit accounting often requires maintaining multiple separate “Funds” (e.g., Unrestricted, Temporarily Restricted, Building Fund), each of which must be self-balancing.
FastFund Online automates this complex requirement through Fund Balancing Entries. Additionally, to help you research and manage the thousands of transactions you enter, the system provides Control Registers and a General Journal Register. This lesson explains how the system keeps your funds balanced automatically and how to use registers to locate and edit historical data.
Automatic Fund Balancing
When you enter a transaction that affects more than one fund (a “cross-fund” transaction), the system must generate additional entries to ensure that Debits equal Credits within each individual fund.
How it Works:
• The Scenario: Imagine you write a check from your Operating Fund (Fund 01) bank account to pay for an expense that belongs to a Grant Fund (Fund 02).
• The Problem: You have credited Cash in Fund 01 and debited Expense in Fund 02. Neither fund is balanced.
• The Solution: FastFund automatically creates a “Due To/From” journal entry. It credits “Due To/From” in the Grant Fund (recording a liability to the Operating Fund) and debits “Due To/From” in the Operating Fund (recording a receivable from the Grant Fund).
Key Rules:
• System Account: These entries use the “Due To/From Other Funds” liability account defined during your Chart of Accounts setup.
• Automation: You do not enter these manually. The system creates them instantly when you save the cross-fund transaction.
• Editing: You cannot edit or delete a Fund Balancing entry directly. If you edit the original transaction (e.g., change the expense account to a different fund), the system automatically updates or removes the balancing entry to match.
Using Control Registers
The Control Register is your primary tool for viewing the detailed transaction history of your control accounts: Bank accounts, Undeposited Funds, Accounts Payable, and Accounts Receivable. It acts like a digital checkbook register or ledger card.
Accessing the Register:
1. Navigate to Transactions > Registers > Control Register.
2. Filter Criteria:
◦ Date Range: Select the period you want to review (e.g., “This Month”, “Last Fiscal Year”).
◦ Account: Select the specific control account (e.g., “Operating Checking” or “Accounts Payable”).
◦ Optional Filters: You can search by Name (e.g., a specific vendor), Transaction Type (e.g., only Deposits), or Amount.
3. View Results: Click Filter to generate the list.
Drill-Down and Editing: The register is not just for viewing; it is the hub for editing.
• To Edit: Double-click the blue Transaction Type link (e.g., “CD”, “AP-Bill”) for any line item. This opens the original transaction window where you can make changes (subject to closing date restrictions).
• To View Entity: Click the blue Name link to open the Vendor, Client, or Other Name record.
Link Back Info: The register displays a “Link Back Info” column. This tells you where a transaction went next.
• Example: On a Vendor Invoice (AP-Bill) line, the Link Back Info will show the Date and Check Number of the payment that paid that bill.
The General Journal Register
While the Control Register tracks specific asset and liability accounts, the General Journal Register tracks all Journal Entries (JEs), including manual adjustments and the automatic Fund Balancing entries mentioned earlier.
1. Navigate to Transactions > Registers > Journal Register.
2. Filter: You can filter by date or specific JE types (e.g., “Year End Entry”, “Reversing Entry”, “Fund Balancing Entry”).
3. Usage: Use this to review monthly accruals, depreciation entries, or to audit the automatic inter-fund balancing entries generated by the system.