Member Wizard for New Treasurers

A Quick Guide to Member Wizard for Treasurers

If you are using Member Wizard for the first time or if you are a first time Treasurer then you may find this information useful.

PART 1 – FOR FIRST TIME TREASURERS

There are two types of book keeping methodologies. The first is a simple single entry system called Cash Book and the second is the more popular and useful Double Entry system. This section provides information on both these systems

CASH BOOK (SINGLE ENTRY) ACCOUNTING

Many non-accounting background Treasurers either use or inherit a system where a Cash Book has been used mainly because it’s simple and easy to set up and run. It is however limited when it comes to providing the committee with the actual financial position of the organisation.  It does not account for outstanding amounts of money which have been invoiced but not yet paid or the other assets and liabilities of your business. It is rarely used by any other than small organisations which do not require auditing or much in the way of management committee reporting.

Organisations using a simple cash book system generally have a hard copy ledger or maybe a spreadsheet into which amounts are entered as purchases and receipts are recorded under various account categories.

Member Wizard does not use single entry accounting as most committees require financial information which is more accessible and reflects a more accurate financial position of the organisation.

Below would be an example of the purchase of a printer for the office for $1000 under a cash book system.

DOUBLE ENTRY ACCOUNTING

Double-entry accounting is a method of bookkeeping that tracks where your money comes from and where it’s going to. Every financial transaction gets two entries, a “debit” and a “credit” to describe whether money is being transferred to or from an account respectively.

Below is a simple example:

Using the same purchase of a printer example as above, your double entry system would show this as

The debit and credit (+ and --) signs are just to illustrate that your cash has been reduced by $1000 while your Office Equipment account has increased by $1000. At first the fact that the purchase is represented by a Credit to the bank is somewhat counterintuitive. Easiest way to think about it is to imagine that the goal was to get to 0 in an account. In this case would this transaction reduce or increase the distance to your objective? If it reduces it then it’s a credit – represented as a (-), as you are closer to your end goal, if it increases it then it’s a debit (represented as a (+).

PART 2 – SETTING UP AND USING MEMBER WIZARD FOR TREASURERS

Step 1   The first step is to set up your Bank Accounts so purchases and receipts can be recorded against each of your various bank accounts (you can set up as many bank accounts as you require). You do this in Settings/Bank Accounts.

Step 2   Next you need to set up your Chart of Accounts. These are all the categories that you want to record income and expenditure or assets and liabilities against. You can find and set up your Chart of Accounts in Settings/Account Categories.

Member Wizard already has a number of Account Categories set up which it needs in order to operate. You cannot delete these however you can hide any you do not need or use by either selecting it in the Account Category list then either clicking Edit from the menu or right clicking your mouse and selecting Edit then unchecking the Active box. You can always reactivate them again by checking the box marked Include Inactive at the top of the Account Categories list. CAUTION: If you make an account category which is used by Member Wizard inactive you may find you will have problems performing some transactions so be judicious with how you adjust these settings.

You will note that Asset and Liability category types have a box marked Current which is checked by default. This simply refers to where the account will appear on your Balance Sheet – as a Current or Non-Current asset or liability.

You will also note that Member Wizard includes your membership types in your Account Categories list which is done for simple convenience.

You can view the transactions recorded against each Account Category by clicking on it and selecting Show Transactions. Transactions can be displayed for a number of periods by changing the Date Range at the top of the list. You can print this list also or export it to Excel.

 Parent and Child Categories

Quite often you want to group together and total several account categories on both your Profit and Loss and your Balance Sheet reports. You do this by firstly creating an Account Category which you name appropriately to be the Parent. For instance you may wish to combine all your Membership Types together and total them under a Parent Category called Memberships.

To do this you need to decide where it is you want the total category to appear on your reports. For instance for Memberships you would want to see them in the Income section of your Profit and Loss so you would create the category from the Account Categories list by clicking +Financial Category calling it Memberships and making it of an Income type. Alternatively if you paid rent on a number of premises you would want it to appear in the Expense section of your Profit and Loss so you would create it as an Expense type.

You then would create your membership types and check the box marked Has Parent then select the newly created Membership account. In this way all accounts with that parent type will be itemised and totaled in your reports. You can next Parent/child categories within each account down to 2 levels.

See the following example extract from a Profit and Loss Report for a parent/child Membership category totaled to 2 levels.

Memberships

                Annual memberships

                                Annual Full members                     $2000

                                Annual Associate members         $  500

                                                                                Total      $2500

                6 month memberships

                                6 month Full members                  $500

                                6 month Associate members      $100

                                                                                Total      $600

                                                                                                                TOTAL $3100

NOTE: Parent categories cannot contain any transactions. Transactions can only be recorded in CHILDREN of that Parent category. In the above example ”Memberships”, “Annual Memberships” and “6 month memberships” are all Parent categories. These are not used as the categories on receipts. “Annual Full Members”, “Annual Associate members”, “6 month Full members” and “6 month Associate members” are the Child categories. These are the categories against which you enter your receipts.

Member Wizard Reports

The two main reports usually required by management committees from their Treasurer are

1.       Profit and Loss (shows income and expenditure by category). This is the report that shows the committee how much has been either earned or spent against each category for that financial year up to the date you have entered.

2.       Balance Sheet (shows assets – usually bank account balances, and liabilities eg un-acquitted grants. This shows the committee how much money is available left in bank accounts and if there are any liabilities outstanding which need to be allowed for.

If you record all your transactions in Member Wizard then each of these reports are available by the simple click of a button. You can also compare the current against the past year’s figures.

RECEIPTING CASH AND (IN PERSON) CARD PAYMENTS (NOT STRIPE)

When you receive cash or a credit card transaction in person from someone you don’t generally rush straight down to the bank and deposit it. Usually you wait till you have a number of cash transactions to bank and you do them in a single deposit. Similarly if you are using a card reader such as Square you generally close the balance out at the end of the day and it may include several such transactions.

The bank when it produces its bank statement or transaction record will show only the totals of these deposits – it does not know what the individual transactions were which made up that total deposit. For this reason you need to create a deposit in Member Wizard which will reflect what the bank is going to show on its bank statement or transaction record.

To create a Deposit click on Money/Deposit then +Add a deposit. Select the bank account and the date you made the deposit or closed off the Square balance. If you are using Square and your organisation is covering the Square fees you will need to add a negative amount which represents the card fees so that it is deducted from the balance to match the bank's payout figure.

To create this deduction you need firstly to have an Account Category in which to accumulate the fee costs. This would normally be an Expense account category. Receipts only show Income categories when listing available account categories so you need to check the box on the Add Item box which says Show All Categories. You have to enter the amount as a 

Fill out the date and the bank and put in a reference which explains that it is the sum total of the days Square fees. Make sure you have selected Credit Card as the Payment type.

Click Add Item and click the box which shows Show all Categories at the top of the receipt. You need to do this because Square fees are an expense items and this is a receipt you are creating so the system will usually only show income type categories rather than expense categories. Select the Account Category which you use to handle your Square expenses and make the amount a “negative” by using a “–“ in front of it. Click Save

You can now return to your Deposit screen and include this new receipt in your Square deposit. It will reduce the amount you are banking to represent the Square fee and the total will now be the same as that appearing on your Bank statement from your Bank.

RECEIPTING EFT (DIRECT DEPOSIT) RECEIPTS

When you select EFT as the Payment type the system automatically does a deposit for you so you do not need to manually create one as per above. When you come to do your bank reconciliation the amount of the receipt and who it was to will show already on the list waiting to be reconciled.

RECEIPTING STRIPE

If the member pays through Stripe online via an invoice you have sent out through Member Wizard, the receipt and the transfer from Stripe down to your bank account are done automatically. The member is automatically emailed a receipt directly from Stripe.

If however you wish to accept a Stripe payment face to face then simply create the invoice in Member Wizard, this will then show an amount against the member’s record in the Member List. Highlight the member and click the Pay by Stripe option in the page menu. Type in the card details and click SAVE.

RECONCILING YOUR BANK ACCOUNT WITH YOUR BANK STATEMENT

This is usually carried out at the end of each month or immediately before you are required to present updated figures to your committee. A bank reconciliation is an accounting requirement to show that you have correctly accounted for every expense and income item and that your tally corresponds with that of your banks.

To create a Bank Reconciliation click Money/Bank reconciliation in the main menu. Click +Add at the top then select the Bank Account you wish to reconcile. You should reconcile every bank account and Petty Cash fund on a regular basis as it become difficult if you try to do several months at a time. If you select to reconcile Stripe the system will connect to Stripe, match the receipts against the Stripe payouts and will either allow you to simply click Reconcile if all receipts and transfers are present or give you a list of missing transactions in Member Wizard. If you click on one of these missing transactions you will be able to add it and it will disappear from that list and appear in the Reconciled column of the Bank Reconciliation.

After you have selected the Bank Account, you will see all the transactions – receipts, expenses and bank transfers – you have created in the system appearing in the left hand column. The right column will usually be empty.

Enter from your bank statement the closing bank balance at the top of the form under Closing Balance. Then using your bank statement one by one go through and tick off every item on the statement that appears on your screen and click on the item on your screen and drag it across to the right hand column.

As you do this you will notice the greyed out field called Difference change either up or down depending on if it’s a receipt or an expense. If you find a transaction on your bank statement that is NOT in your system you can use the buttons marked Add Receipt, Add Deposit or Add Expense at the top of the form.

When you have accounted for all the items on your bank statement the Difference should show 0 and the button at the bottom right of the screen will change from SAVE to RECONCILE. Click this and you have reconciled your statement for the month.

If you find you can not complete your reconciliation because you need to go check something in your system or you run out of time etc remember to click the SAVE button or you will have to start all over again when you return.

ACCOUNTING FOR GST

If you pay/collect GST you can add or include GST on any receipt or expense item by highlighting each line of the receipt or expense and clicking either the +Add GST or -GST buttons below the Item box. Your GST Report will record all GST transactions.

MEMBER WIZARD FINANCIAL REPORTS

The reports you will generally take to your committee meeting as Treasurer are the Profit and Loss and the Balance Sheet. These are automatically generated by clicking Reports/Profit and Loss or Reports/Balance Sheet from the main menu. It is wise to check that the balance on your Balance sheet actually does match your current bank balance.

You can also prepare a GST report if you are registered and recording GST on your receipts and expenses.

LIST OF TRANSACTIONS ENTERED AGAINST AN ACCOUNT CATEGORY

To obtain details in a list of transactions which have been entered against a particular account category go to Money/Account Categories. Select the account of interest and right click on it and select Show Transactions or select Show Transactions from the left hand menu. You can print this list if required by selecting Print Account List. If you double click on any of the entries it will open to show you the receipt or expense which relates to the entry. You can also export all transactions to Excel.

ACCEPTING PAYMENTS ONLINE

Member Wizard offers two online payment transactions systems.

Stripe: will allow your members to pay their membership dues or for classes or events online through either email or on your organisation’s website.

Stripe requires setup and integration into your system before being able to use it. Details on how to do so are given in the Help File accessible by clicking the HELP button in the top right of the Settings/Member Payment Details page.

Direct Debit: Members can pay by transferring funds directly into your bank account provided you have set up your bank account details in Settings/Bank Accounts. They will be given a reference number to accompany their payment to make it easier for you to identify payments on your bank statement.

NOTE:   Members who pay using Stripe for membership will automatically receive a receipt for their payment and their new membership Paid to Date will be automatically incremented.

Members who use Direct Deposit to pay their membership will require you to issue a receipt when you have identified the payment on your bank statement. The issuing of the receipt for membership will then automatically increment their Paid to Date.