Take some pressure off your January 2021

If your church or not-for-profit organisation operates on a calendar year, you will soon be preparing your accounts for the annual audit or assurance review.

But this year is different.

This year, on top of all the month end and year end reconciliations and reports and getting ready for audit, many of us have JobKeeper and much more to do for that as well. On top of an already extremely busy month!

So, what can you do now to take pressure of January??

At Benkorp we are dealing with this now as well.

So what can we do now?

1. Decide on the AGM date & tell your auditor

Make it as late as you can to take some pressure off yourself – don’t try to be an accounts  martyr!

Then, make sure that you tell your auditor the AGM date and discuss when they require the  accounts to be ready for audit.

2. Obtain, calculate and update the Property and Land Valuations

If your church includes property values in the accounts and on the balances sheet, now is the time to check for updated values.

For Sydney Anglican Diocesan churches. The most recent updated property and content valuations report is available on the Sydney Diocese portal. Access this and update the property and content valuations on your balance sheet now.

Land valuations for your church properties can be obtained from the Valuer General’s website: https://www.valuergeneral.nsw.gov.au/services/addr-inquiry.htm

Access your property land valuations and update the land valuations on your balance sheet now if there is any change.

3. Make sure the month end Wages Payable/Payroll Clearing account balance is zero.

An essential account to check now is the balance of the Wages Payable/Payroll Clearing account ensure it equals zero at the end of November.

Do this after you have processed the all the payroll and the bank reconciliations for November. It can mean several things If the balance is not zero. The actual payroll bank entry maybe incorrect. Or people have not been paid the correct amount or the payroll is incorrect. It could be a hangover from last year or maybe it is just a timing issue and the actual pays were paid out of the bank on 1st December.

Regardless, the Wages Payable/Payroll Clearing account balance, at the end of December ,, must be zero. If there are any discrepancies, investigate and sort it out now!

4. Review the account balances of the PAYG & Superannuation Payable accounts

Make sure that the balances equal what you understand to be what is owing to the ATO & the Super funds for your employees.

To check, In Xero, run the Payroll Activity Summary Report for the period that the PAYG and/or the Super that has not yet been paid. The account balances for the PAYG & Super payable must equal the amounts on the reports. If not, investigate and correct as necessary.

5. Review any outstanding balances in your Donations Received for Payment account. Now is the time to pay out any amounts that your organisation has received to be given to others.

6. Old outstanding Accounts Receivable Invoices

In Xero, go to Business and then Invoices. Click on the Awaiting Payment tab and sort by transaction date.

Are there old Invoices that need to be followed up?

    • If you think they have been paid, check to see if the payments have been entered as a Receive Money transaction rather than being applied to the invoice.
    • Do you need to talk to your Wardens or church council to decide on the next steps?
    • Should they be written off?

7. Old outstanding Accounts Payable Bills

In Xero, go to Business and then Bills to Pay. Click on Awaiting Payment tab and sort by transaction date.

Are there old bills that need to be checked?

    • If you think they have been paid, check to see if the payments have been entered as a Spend Money transaction rather than being applied to the bill.
    • Are they still owing?
    • Have been entered as duplicates?

Now is the time to correct any of these.

8. Check your Bank Reconciliation reports

In Xero, run the Reconciliation Report for each bank.

    • Are there old outstanding/unpresented transactions that need to be checked. Check if they have been entered twice.
    • Also check that the Bank Statement Balance equals the actual bank balance. Now is a good time to investigate this if these do not equal.

9. Check Leave Balances

    • Keeping on top of leave accruals can be tricky. Everything must be processed correctly. Opening balances, accruals and leave taken.
    • Ask your staff to submit their leave requests for their December/January holidays now.
    • Then you will be able to review the leave balances as at the 31 December in preparation for the calculation of leave accruals.
    • Check that the number of hours or days leave owing at the end of December is correct.
    • Check that the staff agree that these number of hours or days leave is the same as their understanding – ask each staff person. Avoid any surprises of staff asking for leave that they may or may not have accrual/entitlement

This is the best time to sort out if there are any disagreements about leave owing.

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