ShelbyNext Financials: General Ledger Budgeting

Transcription

1 ShelbyNext Financials: General Ledger Budgeting (Course #F136) Presented by: Erin Ogletree Shelby Contract Trainer 2018 Shelby Systems, Inc. Other brand and product names are trademarks or registered trademarks of the respective holders.

2 Objective This session explains how to enter and monitor your budget for income and expense accounts in the General Ledger module. The following topics are presented in this session: The budget process How does your church budget? Creating a budget in Shelby Next Financials using Manual Entry or Export/Import to Excel Running Budget Reports in Shelby Next Financials Revising the budget in Shelby Next Financials

3 How does your church budget? Pledge-driven Annual pledges determine the overall total budget. Incremental-based This year s budget is used as a basis for next year s budget with a fixed percentage added or subtracted. Zero-based Every program starts at zero dollars, and each ministry determines and justifies what it needs to spend. Modified based All programs are evaluated and funded based on their potential. Staff needs to plan programs before preparing the budget. BUDGET PROCESS Leadership Planning is key, make sure there is a natural flow from planning to the annual budget approval Review Mission Statement and Strategic Plans Establish priorities Talk with staff Define and communicate budget process Provide staff with resources they need to prepare their budget (hint SHELBY), simple templates and instructions sheets, historical information Create OWNERSHIP! Staff What are your ministries Who is responsible for requesting funding for these ministries Who will have access to ministry financial information Staff needs to take ownership of their respective budget numbers Within each department establish budget accounts for both income and expenses Budget for anticipated timing of income and expenses (don t just divide by 12) Each department should include a written summary explaining existing activities, new activities or proposed changes to their budgets Each department should have a list of potential increases or decreases in their budgets 3

4 Assumptions Growth rate - attendance Inflation rate Historical data review past achievements and performance How much can we do with the funds we budget How much do we need to do the job right How much do we need for reserves, is there a policy on the use of cash reserves Income Projections Determine giving potential Tithes and offerings trends Impact of restricted gifts Other sources of income Set the income side of the budget first, based on actual revenue not estimated Do not increase giving to balance the budget Expense Projections Historical spending trends Program costs Facility costs Salary/benefit increase Mission emphasis Fix asset replacement fully fund depreciation Set a time line Do not drag out the budget process Pick a time of the year when there is less going on (hint from Dave) Keep revisions to a minimum Get the budget presentation on the Board s schedule focus on the ministry not just numbers Planning Cycle (fiscal year) February-Leadership sets Strategic Objectives/Goals March-Staff receives instructions April-Budgets sent to Finance Office April-Board and Leadership review draft of budget requests May -Board approval June-Congregation approval June -Staff is informed of their budgets for coming fiscal year 4

5 Practical Cautions Personnel people costs Capital purchases commit to future spending New programs Building programs Watch for negative indicators Have both a short-term and long-term plan What If Do not file it away, review on a monthly basis Budget Reporting Goals Be sure that financial information is recorded in the correct month Reviewed every month Helps your church keep on target for achieving ministry goals Variances from budget can be corrected Don t be afraid to revise the budget during the fiscal year (calendar vs. fiscal) Celebrate successes Share with the congregation Provide information for the next round of budgeting Budget Tools Budget Process Guidelines Ministry Goals Budget Worksheet Shelby Next Financial Export/Import Reporting Shelby Next Financials has many formats Budgeted Financial Statement Financial Spreadsheet Special Reports 5

6 BUDGET PROCESS GUIDELINES GENERAL GUIDELINES Document your ministry goals for the upcoming fiscal year and be prepared to demonstrate how they fit into the vision and mission of the Church and the ministry you are leading. It is the goal of the Church to meet all ministry area needs. Some wants and desires may also be fulfilled but make sure you are able to distinguish the difference. This will help us bring our budget into balance if we have to make cuts from the combined ministry proposals. Do not be afraid to propose something completely different from what is already in your current budget if you feel that God has opened an effectual door of ministry to you. The Process Pray. We need God s revelation to develop our Ministry Areas. Ask Him for vision and direction so that God s work can come through the ministry he has called you to lead. We begin our budgeting process in March by reminding EACH ministry leader that their budget PROPOSAL is due by April 1. Formulate your goals for the year and develop an actual calendar of events. A calendar of events must occupy the budget to 'justify' the budget. Turn your calendar in with your budget when you submit it. Be prepared to discuss your budget with the Administrator and Finance Committee. After the preliminary budget is completed, the Finance Committee will finalize it and then present it to the Deacons and finally to the congregation at-large. BUDGET MAINTENANCE Learn how to access your monthly budget numbers on SHELBY NEXT FINANCIALS on a regular basis to verify where you are in terms of your actual expenses versus your allotted budget at any given time. Details are important. Please spend an appropriate amount of time learning how to stay in control of your budget and your expenses. Spending more than has been allotted to you is not a sign that you are more spiritual than the committee that approved your budget; it is a sign that you may have not managed the financial area of your ministry well this year. If you find you do not have adequate funds for a particular project this year, make note of it and be prepared to make request for additional funds for the next year s budget. 6

7 Ministry Goals Ministry Goals is your ministry s to do list for the year. It tells what you want to see accomplished through your ministry in fiscal year. Review your ministry s past Ministry Goals. Writing these goals will help give each ministry a purpose for ministry, a motivation for ministry, and a tool for measuring ministry. Tips for developing Ministry Goals: 1. Review last year s goals. What successes can we celebrate? Which goals have we achieved? Which goals need to be modified or adjusted? What have we done well that we can do better? Which of last year s unmet goals need to be included in this year s goals? Which of last year s goals were unrealistic and need to be dropped? 2. Brainstorm about new goals. Ask yourselves What needs aren t being met that we could meet? What problems need to be solved? What are some new and innovative ideas for ministry? 3. As you write your goals make sure that they are Specific Measurable Realistic Things that you are willing to be responsible for carrying out. 7

8 Adding a Budget in Shelby Next Financials The process starts when you create a new year. From the Home > General Ledger screen select Modify > Year and Periods From the Year Period screen select Add New Year On the next screen confirm the Begin Date, End Date and Period Information. Then click Update 8

9 When you create a new year, you are prompted to set up the account structure and accounts. You are presented with the following Copy From options: Prior Year: This option copies account structure and accounts from the previous fiscal year of the same company. Another company or fiscal year: This option lets you select which company and fiscal year from which you wish to copy your structure and accounts. Templates: This option allows you to set up account structure and accounts from a predefined template. Do not copy. Create manually If you copy from the Prior Year you also have the option to Copy Budgets (let us talk about this). Once you have made your selections click the Update button to perform the selected operations or the Cancel link to return to the Year Period page The next screen confirms the Account Structure and Budgets added to the new year. Click OK to continue. 9

10 The new year has been created; click Update to save You will receive a message that the Update is completed 10

11 How to enter your budget manually into Shelby Next Financials Modify Budget Information allows you to set up or modify budgets for your income and expense accounts. Check your Current Financial Settings. Be sure you are in the correct Company and Year. From the Home > General Ledger screen select Modify > Budget Information. Filters Use your level filters as desired and you can also use Account Range to select a group. Select a Budget Revision period from the drop-down list if you want to alter the budget for that period (we will talk about this later). When ready click the Search button to display the grid. The Reset link undoes all changes since the last time the page was updated and the Cancel returns you to the main General Ledger page. You must make a selection for each level before clicking the Search button. These filters cannot be blank. 11

12 Budget Grid The budget grid contains the following columns: 1. Account # 2. Name 3. Account Type 4. Distribution Type 5. Current Budget: If the Distribution Type is Annual, you can click the amount in this column and edit the Annual Budget. Click the Update button to change the budget or the Cancel link to return to the previous page without changing the budget. If the Distribution Type is not Annual, you can click the amount in this column to Edit. Original Budget: This column only appears if you have a selected a Budget Revision in the Filters area other than Original History: 6. Click the History icon to display the Account History window. 7. VB: Place a check if this account has a variable budget. (we will talk about this later) 8. Note: Hover over the Note icon to preview the note. 9. Import/Export Budget (we will talk about this later) 12

13 Use the Account History Column Options link to add historical budget columns to the Account History window. You can access the Account History window by clicking the History icon in the History column. The columns that display on the Account History grid can be modified by clicking the Account History Column Options link. Select to view Current and Prior years, Budget, Actual, or Variance (dollar or percent) figures by dragging and dropping the column names to the Selected Options box. When you are finished, click the Apply button to save your changes. 13

14 Hovering over the Chart icon by each account in the grid shows graphical representations of budget information. You can also place checks next to accounts you want to see then select the View Selected option to view only those accounts in the grid. To modify the budget for an account, click the Edit icon next to it. 14

15 On the next screen 1. The columns that display on the Budget Entry page and bars that appear on the graph can be modified by clicking the Column and Graph Options link. Select to view Budget figures, Actual figures, or any combination of both Budget and Actual figures. NOTE: You do not need to change the Column and Graph options for each account. Once they are changed while viewing one account, they display when viewing other accounts. 2. Change the budget allocation from "Annual" to another distribution by clicking the Distribute Budget drop-down. Note: You may budget different accounts using any of the distribution methods. Annual: General Ledger divides the amount entered in the Annual Amount evenly by the number of periods your company uses. By Period: Enter the amount for each period and General Ledger calculates the annual budget. By Prior Year percentage: Enter in the Annual Amount and General Ledger distributes amounts in the same percentages by period as last year's actual totals. This option can only be used if prior year information exists. By Prior Budget percentage: Enter in the Annual Amount and General Ledger distributes amounts according to the percentages from the prior budget. This option can only be used if a prior budget existed. By Defined percentage: Enter in the Annual Amount and then enter the budget percent for each period. 15

16 3. Enter the budget amounts for each period by tabbing from one period to the next. All budget amounts are entered as positive numbers. 4. When you are finished entering the budget figures for one account, click the Next button to move to the next account or Previous to go back. Or click Done if finished. If you have an account with an Annual budget, simply enter the amount in the Annual Amount field. Or on the budget grid, simply click on the Current Budget amount field. Then enter the Annual Budget amount and click Update. 16

17 In addition to the Detail tab, there are two other optional tabs on the Budget Information > Update screen. 1. Attachments - Documents such as a Budget Request Form or other files can be attached to a budget. To do this, click the Attachments tab and then click the Add New Attachment link. Then select or scan an attachment and then click the OK button. 2. In addition, you can add a Note to your budget. Click the Note tab and enter your note in the box. When finished click Done. 17

18 The Variable Budget (VB) check box is found on the Budget Update grid for each account. The check box serves as a marker indicating to the system which accounts are variable and which are not. This check box applies when running the Budgeted Financial Statement report: it is a what if report. (We will run the report later.) If the box is checked, it serves two functions when running the report. The first is to include or exclude the variable budgets from the report The second is to use the percentage Adjustment for Budget Account Only field to print the report with and increase or decrease in the budget, without revising the budget. 18

19 Using the Budget Import/Export Option There is also a process to export all or part of your budget to a spreadsheet file and then import the file back into your General Ledger after making some changes. Confirm your Current Financial Settings before you start. Select the Levels (Funds, Departments, etc.) that you would like to export, and then click Export. 19

20 Open the exported file (BudgetExport.xlsx) in Excel or whatever spreadsheet program you have that allows you to edit the latest version of Excel files. NOTE: If using Excel, you may need to click the Enable Editing button. Enter Periodic (monthly) amounts in each field corresponding to the period name. NOTE: All budget figures import as "by Period" unless the amounts are evenly distributed across the periods. In that case, they import as an "Annual" distribution type. Any rounding should be added to the first period. For example, if you enter $33.33 in each period and enter $33.37 to the first period, this account imports as an Annual budget of $ Budgets are entered for credit balance accounts (Income accounts) in the program using positive amounts. In the spreadsheet, you need to enter negative amounts for credit balance accounts (Income accounts) so that they are imported properly back into the program. Formulas are created for you. 20

21 Once you have completed entering your budget, be sure to save your changes as either an xls or xlsx file. From the Import/Export page 1. Check the Current Financial Settings, Company and Year. 2. Click the Choose File button on the right-hand side of the page. Verify that the file chosen is correct. 3. Click the Import button. The Import Budget window appears and allows you to close if you do not want to import. Click the Import Budget button to import and overwrite the budget figures for the Fiscal Year you are working in. A notification message appears when your budget is finished importing. 21

22 To view the results, go to Manage > Budget Information set your Filters to view a specific department or range of accounts and then click the Search button. Caution: Three mistakes that can be made with importing budgets. 1. Selecting and importing the excel file in the wrong year. 2. Adding account lines into the excel budget and not including them into your COA. 3. Not entering income accounts as a credit using the minus key in excel. 22

23 Reports Preliminary Budget Report This report is used in conjunction with preparing your budgets for the next year. You are provided with information to help you in determining what the budget figures should be. From the General Ledger Home Base screen select Reports -> Preliminary Budget. This report runs based on your currently selected Year. Change the currently selected Year to run the report for the proposed budget year. On the Filters tab select the levels you want to include on the report in the Account Structure area. The Account Number filter allows you to narrow down further which accounts you want to display on the report. Selecting any option other than Show All displays fields so you can input the numbers. 23

24 Options - you have several choices here, Report Options, Page Breaks and Report Type. Under Report Type choose your report. Summary Detail (Month By Month) Total Lines Only Detail (Actual vs. Proposed Budget) Detail (Budget vs. Proposed Budget) You can also customize what you want to display on the report by using your mouse to drag options horizontally between Available Options and Selected Options. You can also drag options vertically to re-order the Selected Options column. We recommend you drag items between the columns rather than using the ">>" and "<<" buttons since those buttons move all items. You can also choose to Use Revised Budget. (Let s talk about Revised Budget later) 24

25 Detail vs. Actual Budget provides a column for Prior Year Actual and Proposed Budget Summary provides a column for Proposed Budget and Prior Budget 25

26 Budgeted Financial Report Format The Budgeted Financial Report is one of the more frequently used reports. This report provides a side-by-side comparison of an organization s proposed budget for each account and the actual activity for each account. Using Modify Budgeted Financial Formats you can create custom statement formats to get just the information you want to see on the report. Check your Current Financial Settings. On the Filters tab select the Account Type to display on the report: All Income and Expense Accounts, Fixed Budget Accounts Only, or Variable Budget Accounts Only. In the Account Structure area select the levels you want to include on the report. The Account Number filter allows you to narrow down further which accounts you want to display on the report. Selecting any option other than Show All displays fields so you can input the numbers. 26

27 On the Options tab you can customize the Report Name and select the Report Template. There are a number of Report Templates already setup for you. You can set up and edit new templates under Modify Budgeted Financial Formats. (We will talk about this later.) The report uses the Period specified on the Current Financial Settings as the ending period. You can select Yes for the Adjust Variable Budgets option and enter a percentage to increase or decrease the budget for the report only. This does not actually change the current budget and only accounts marked as Variable Budgets are affected. The option to Adjust Variable Budgets is typically used when you wish to run the Budgeted Financial Statement against a scenario in which the budget amounts in the variable accounts are adjusted up or down. Select desired Report and Page Break Options. The click Run Report 27

28 Sample Budget Report You can drill down. Click any total on the report to display the Posted Journals page in a new browser tab. This page displays all the journal detail that comprises the total you click. Note: The Drill Down functionality only applies to 'Actual' columns. In addition, percentage based columns do not have this feature. 28

29 Budgeted Financial Formats Modify Budgeted Financial Formats allows you to add, edit, or delete custom formats for the Budgeted Financial Statement. You would normally use this option if the standard formats were not adequate for your needs. Shelby enhanced this report to allow you to compare figures to any number of previous years and to create your own formulas for the creation of new columns. You can also supply custom column names for built-in and user-defined column descriptions. The number of prior years varies based on the number of years of history for that company. To start a new empty template, click the Add New Template link. To start a new template from an existing template, click the template you wish to copy on the right panel then click the Make a Copy link. To add columns, drag them into the Selected Columns grid from the Available Columns area. Columns in the grid can be edited by clicking the Edit icon. This allows you to customize the Column Header. Use the pipe symbol (the vertical line: ) to add a line break for long titles. Click the check mark to save your changes or the "x" to discard changes to the Column Header. Clicking the Delete icon by a column prompts you to delete that column. Adding a formula column to the grid allows you to click Edit Formula to customize it. Click Update when completed. To make a copy of an existing Format, simply choose the closest preferred outcome. In this example you are using the Standard Format. Then simply use the red X to eliminate the columns you do not want to use for our preferred Budgeted Financial Statement. 29

30 When choosing the Preferred Budgeted Financial Statement, First choose the Departments that are part of the Budgeted Financial Format then Go to the Option Tab and pull down the name of your Modified Format (Ex. Monthly Financial Statement) 30

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32 In the following example the report creates a two-year comparison. It includes the Prior Year s (2016) Actual YTD and Budget YTD. Note the pipe symbol (the vertical line: ) to add a line break. There are no formulas in this report. 32

33 Financial Spreadsheet Actual, Budget & Revised Budget To run the Financial Spreadsheet, start at the General Ledger Home Base and select Reports > Financial Spreadsheet. The Financial Spreadsheet uses your currently selected period as the ending period for the report. Change the currently selected period to run the report on a different range; normally this would be set to the Audit Period. On the Filters tab select the Accounts to Print: Balance Sheet and/or Income Expense. The Account Number filter allows you to narrow down further which accounts you want to display on the report. Selecting any option other than Show All displays fields so you can input the numbers. In the Account Structure area select the levels you want to include on the report. 33

34 On the Options tab select your Report Type: Actual, Budget, or Revised Budget. If you select Budget or Revised Budget you can select to Use Actuals For Closing Periods. This replaces budget columns with actual dollars if the month is marked as closed. You then have several Report Options: Suppress Zero Balances Wrap Account Description Use Reverse Signs: This causes the reverse signs to be used for Income accounts. Show Whole Dollars Only Show Sub Accounts Select the Line Spacing and then select your Page Break Options: None or Department Name. You then select your Print Format of Wide or Narrow. Click Run Report 34

35 Sample Report using Report Type > Budget 35

36 Select the Budget radio button under Report Type and select the Use actuals for closed periods check box. The report shows actuals for any periods that are closed and budget amounts for any periods that are not closed. 36

37 Budget Revisions Budget Revisions allow you to make modifications to an account's budget multiple times during the fiscal year without changing the original budget figures. This is particularly useful during periods of unexpected fluctuations in funds. From General Ledger > Budget Information > Filters select your level filters as desired and you can use Account Range to select a group. Select a Budget Revision period from the drop-down list if you want to revise the budget for that period forward. Click the Search button to display the grid. Then select the account to enter the revised budget 37

38 The Budget Information > Update page allows you to edit the budget of the selected account. When entering a budget revision you select the Adjustment percentage and whether to use Original Budget or Revised Budget to do the calculation. Or you can edit each Period individually. Click the Apply button to adjust the budget. Click the Next button to go to the next account or the Previous button to go to the previous account. Click the Done button to save your budget changes, the Reset link to undo all changes since the last time the page was updated, or the Cancel link to return to the main Budget Information page. 38

39 Note: When making changes, using the Budget Revisions function does not change your original budget. Budget Revisions create a completely separate, secondary set of budgets that you choose to use in lieu of (or in addition to) your original budgets by choosing that option on the report. Revised Budget information is available on three reports: Budgeted Financial Report Financial Spreadsheet Preliminary Budget Report Budgeted Financial Report Columns are available in the Budgeted Financial Formats for Revised Budgets. Select the columns you need for the Revised Budget report. 39

40 Financial Spreadsheet Select the Revised Budget radio button on the Financial Spreadsheet Option screen. Preliminary Budget Report Select the Use Revised Budget for Prior Year check box on the Preliminary Budget Report Option screen. 40

41 Q&A Class Discussion 41

42 Erin Ogletree Shelby Trainer/Consultant Erin has 13 years of experience serving churches as a Shelby trainer and currently is a Shelby Master Trainer. Over the years she has learned the benefits that Shelby Systems has to offer the various ministries and programs of the church through maintaining up-to-date information on members, visitors, and finances. Having also been on staff as a user of Shelby v.5 in her church for 16 years, Erin brings a wealth of knowledge to her training. Erin is excited about sharing that knowledge and experience with customers as she leads them through the most current best practices of Shelby v.5 and ShelbyNext.