The members of my club make an administrative payment each year which is then used to pay club expenses. I wanted to reflect the member payments in a suspense account. I went to Accounting --> Accounts-->Create and created an account "Admin Payments Awaiting Use".
As expenses are paid,
Because it is my version of a suspense account, I didn't think the amounts would show up as part of amounts paid on the Member Status report, but they are indeed included!
Please advise: (1) Did I create a suspense account? (2) What does it mean to have a suspense account? and (3) Should I edit what's been done thus far and just use the regular accounts?
Thanks in advance for your help.
VJ
Brooklyn Wealth Collective
Jack Ranby on
VJ
Others will have to answer how to accomplish the mechanics of what you are doing.
My purpose in responding is to urge you to drop the whole concept. Instead think of your club as a business. Administrative expenses, for example bivio subscription, Better Investing dues, room, rent, postage, etc, are all costs of doing business. Just enter them as expenses as they occur. The cash available to pay those expenses comes from three sources: interest and dividends, capital gains on stock sales, and member capital contributions that are not used to purchase stock. The first two categories are "income" to the business. If there is sufficient income, then there will be a profit after expenses. If expenses exceed income, then capital will be used to pay expenses. If the club needs cash to cover the expenses, then members can make capital contributions, which will buy units, to raise the cash. My point is that the simplest system treats all monies paid by members as capital contributions buying units.
As treasurer, I pay all the expenses of the club, usually with my personal credit card. When I pay an expense, I enter the payment as an expense on a suspense account. When the suspense account balance is large enough and there is sufficient cash in the brokerage account, I write a check to myself on the brokerage account and zero out the suspense account.
This topic has been discussed many times in the past, you should be able to find directions on how to account for member payments that are not capital contributions in the prior Club Cafe archives if you really want to continue your current practice. You should also find many others advocating my message in the second paragraph.
Jack Ranby
From: club_cafe@bivio.com [mailto:club_cafe@bivio.com] On Behalf Of V Johnson via bivio.com Sent: Monday, 9 November, 2020 15:49 To: The Club Cafe Subject: [club_cafe] Suspense Accounts
Hello Club Cafe,
The members of my club make an administrative payment each year which is then used to pay club expenses. I wanted to reflect the member payments in a suspense account. I went to Accounting --> Accounts-->Create and created an account "Admin Payments Awaiting Use".
As expenses are paid,
Because it is my version of a suspense account, I didn't think the amounts would show up as part of amounts paid on the Member Status report, but they are indeed included!
Please advise: (1) Did I create a suspense account? (2) What does it mean to have a suspense account? and (3) Should I edit what's been done thus far and just use the regular accounts?
Thanks in advance for your help.
VJ
Brooklyn Wealth Collective
John Rice on
I created an account labeled "Cash set aside for expenses." I calculated the monthly average for all of our expenses for the year and transfer that amount each month into that account. Our members do not make any administrative payments but a small amount of their dues each month gets set aside into that account. When I make expense payments it is deducted from the "Cash set aside for expenses" account.
Others will have to answer how to accomplish the mechanics of what you are doing.
My purpose in responding is to urge you to drop the whole concept. Instead think of your club as a business. Administrative expenses, for example bivio subscription, Better Investing dues, room, rent, postage, etc, are all costs of doing business. Just enter them as expenses as they occur. The cash available to pay those expenses comes from three sources: interest and dividends, capital gains on stock sales, and member capital contributions that are not used to purchase stock. The first two categories are "income" to the business. If there is sufficient income, then there will be a profit after expenses. If expenses exceed income, then capital will be used to pay expenses. If the club needs cash to cover the expenses, then members can make capital contributions, which will buy units, to raise the cash. My point is that the simplest system treats all monies paid by members as capital contributions buying units.
As treasurer, I pay all the expenses of the club, usually with my personal credit card. When I pay an expense, I enter the payment as an expense on a suspense account. When the suspense account balance is large enough and there is sufficient cash in the brokerage account, I write a check to myself on the brokerage account and zero out the suspense account.
This topic has been discussed many times in the past, you should be able to find directions on how to account for member payments that are not capital contributions in the prior Club Cafe archives if you really want to continue your current practice. You should also find many others advocating my message in the second paragraph.
The members of my club make an administrative payment each year which is then used to pay club expenses. I wanted to reflect the member payments in a suspense account. I went to Accounting --> Accounts-->Create and created an account "Admin Payments Awaiting Use".
As expenses are paid,
Because it is my version of a suspense account, I didn't think the amounts would show up as part of amounts paid on the Member Status report, but they are indeed included!
Please advise: (1) Did I create a suspense account? (2) What does it mean to have a suspense account? and (3) Should I edit what's been done thus far and just use the regular accounts?
I created an account labeled "Cash set aside for expenses." I calculated the monthly average for all of our expenses for the year and transfer that amount each month into that account. Our members do not make any administrative payments but a small amount of their dues each month gets set aside into that account. When I make expense payments it is deducted from the "Cash set aside for expenses" account.
Others will have to answer how to accomplish the mechanics of what you are doing.
My purpose in responding is to urge you to drop the whole concept. Instead think of your club as a business. Administrative expenses, for example bivio subscription, Better Investing dues, room, rent, postage, etc, are all costs of doing business. Just enter them as expenses as they occur. The cash available to pay those expenses comes from three sources: interest and dividends, capital gains on stock sales, and member capital contributions that are not used to purchase stock. The first two categories are "income" to the business. If there is sufficient income, then there will be a profit after expenses. If expenses exceed income, then capital will be used to pay expenses. If the club needs cash to cover the expenses, then members can make capital contributions, which will buy units, to raise the cash. My point is that the simplest system treats all monies paid by members as capital contributions buying units.
As treasurer, I pay all the expenses of the club, usually with my personal credit card. When I pay an expense, I enter the payment as an expense on a suspense account. When the suspense account balance is large enough and there is sufficient cash in the brokerage account, I write a check to myself on the brokerage account and zero out the suspense account.
This topic has been discussed many times in the past, you should be able to find directions on how to account for member payments that are not capital contributions in the prior Club Cafe archives if you really want to continue your current practice. You should also find many others advocating my message in the second paragraph.
The members of my club make an administrative payment each year which is then used to pay club expenses. I wanted to reflect the member payments in a suspense account. I went to Accounting --> Accounts-->Create and created an account "Admin Payments Awaiting Use".
As expenses are paid,
Because it is my version of a suspense account, I didn't think the amounts would show up as part of amounts paid on the Member Status report, but they are indeed included!
Please advise: (1) Did I create a suspense account? (2) What does it mean to have a suspense account? and (3) Should I edit what's been done thus far and just use the regular accounts?
Thanks in advance for your help.
VJ
Brooklyn Wealth Collective
--
Mark Eckman
polymerguy on
We've been running a suspense account since inception in the 90's. Better Investing had a good handbook for investment club accounting which we used to establish the process and still reference when needed. Unfortunately, I cannot find a good online reference that covers the subject nearly as well as the handbook and the book is long out of print.
From: club_cafe@bivio.com <club_cafe@bivio.com> On Behalf Of Mark Eckman via bivio.com Sent: Monday, November 09, 2020 7:08 PM To: club_cafe@bivio.com Subject: Re: [club_cafe] Suspense Accounts
I created an account labeled "Cash set aside for expenses." I calculated the monthly average for all of our expenses for the year and transfer that amount each month into that account. Our members do not make any administrative payments but a small amount of their dues each month gets set aside into that account. When I make expense payments it is deducted from the "Cash set aside for expenses" account.
Others will have to answer how to accomplish the mechanics of what you are doing.
My purpose in responding is to urge you to drop the whole concept. Instead think of your club as a business. Administrative expenses, for example bivio subscription, Better Investing dues, room, rent, postage, etc, are all costs of doing business. Just enter them as expenses as they occur. The cash available to pay those expenses comes from three sources: interest and dividends, capital gains on stock sales, and member capital contributions that are not used to purchase stock. The first two categories are "income" to the business. If there is sufficient income, then there will be a profit after expenses. If expenses exceed income, then capital will be used to pay expenses. If the club needs cash to cover the expenses, then members can make capital contributions, which will buy units, to raise the cash. My point is that the simplest system treats all monies paid by members as capital contributions buying units.
As treasurer, I pay all the expenses of the club, usually with my personal credit card. When I pay an expense, I enter the payment as an expense on a suspense account. When the suspense account balance is large enough and there is sufficient cash in the brokerage account, I write a check to myself on the brokerage account and zero out the suspense account.
This topic has been discussed many times in the past, you should be able to find directions on how to account for member payments that are not capital contributions in the prior Club Cafe archives if you really want to continue your current practice. You should also find many others advocating my message in the second paragraph.
The members of my club make an administrative payment each year which is then used to pay club expenses. I wanted to reflect the member payments in a suspense account. I went to Accounting --> Accounts-->Create and created an account "Admin Payments Awaiting Use".
As expenses are paid,
Because it is my version of a suspense account, I didn't think the amounts would show up as part of amounts paid on the Member Status report, but they are indeed included!
Please advise: (1) Did I create a suspense account? (2) What does it mean to have a suspense account? and (3) Should I edit what's been done thus far and just use the regular accounts?
Thanks in advance for your help.
VJ
Brooklyn Wealth Collective
--
Mark Eckman
Tim Hoyman on
I agree with Jack with doing the least amount possible from club funds, for many reasons. Our club has it down to paying for Bivio and the club annual dues to Better Investing. Each member is responsible
for paying their dues to BI and for SSG's. If we have a party or eat out, we just pay in cash there as appropriate. This is SO much easier for the Treasurer.
Tim Hoyman
The Mozart of Real Estate
303-669-2676
IMPORTANT NOTICE: Never trust wiring instructions sent via email. Cyber criminals are hacking email accounts and sending emails with fake wiring instructions.
These emails are convincing and sophisticated. Always independently confirm wiring instructions in person or via a telephone call to a trusted and verified phone number. Never wire money without double-checking that the wiring instructions are correct.
CONFIDENTIALITY NOTICE: This email message and any attached files contain confidential information intended only for the person(s) to whom the transmission is addressed. If you receive this
message and you are not the addressee, do not read the message or any attached files. Any unauthorized use, disclosure, copying or distribution is strictly prohibited, and no rights are waived. If you are not the person(s) to whom the message is addressed,
please return the email to the sender by sending an email reply, and delete the message from your computer system. Please also contact the sender at The Denver 100, LLC, 385 Inverness Pkwy, Suite 270, Englewood, CO 80112, 303-669-2676. Thank you.
From: club_cafe@bivio.com <club_cafe@bivio.com> On Behalf Of
Mark Eckman via bivio.com Sent: Monday, November 9, 2020 5:08 PM To: club_cafe@bivio.com Subject: Re: [club_cafe] Suspense Accounts
I created an account labeled "Cash set aside for expenses." I calculated the monthly average for all of our expenses for the year and transfer that amount each month into that account. Our members do not make any administrative payments
but a small amount of their dues each month gets set aside into that account. When I make expense payments it is deducted from the "Cash set aside for expenses" account.
Others will have to answer how to accomplish the mechanics of what you are doing.
My purpose in responding is to urge you to drop the whole concept. Instead think of your club as a business. Administrative expenses, for example bivio
subscription, Better Investing dues, room, rent, postage, etc, are all costs of doing business. Just enter them as expenses as they occur. The cash available to pay those expenses comes from three sources: interest and dividends, capital gains on stock sales,
and member capital contributions that are not used to purchase stock. The first two categories are "income" to the business. If there is sufficient income, then there will be a profit after expenses. If expenses exceed income, then capital will be used to
pay expenses. If the club needs cash to cover the expenses, then members can make capital contributions, which will buy units, to raise the cash. My point is that the simplest system treats all monies paid by members as capital contributions buying units.
As treasurer, I pay all the expenses of the club, usually with my personal credit card. When I pay an expense, I enter the payment as an expense on a
suspense account. When the suspense account balance is large enough and there is sufficient cash in the brokerage account, I write a check to myself on the brokerage account and zero out the suspense account.
This topic has been discussed many times in the past, you should be able to find directions on how to account for member payments that are not capital
contributions in the prior Club Cafe archives if you really want to continue your current practice. You should also find many others advocating my message in the second paragraph.
The members of my club make an administrative payment each year which is then used to pay club expenses. I wanted to reflect the member
payments in a suspense account. I went to Accounting --> Accounts-->Create and created an account "Admin Payments Awaiting Use".
As expenses are paid,
Because it is my version of a suspense account, I didn't think the amounts would show up as part of amounts paid on the Member Status report,
but they are indeed included!
Please advise: (1) Did I create a suspense account? (2) What does it mean to have a suspense account? and (3) Should I edit what's been
done thus far and just use the regular accounts?
Thanks in advance for your help.
VJ
Brooklyn Wealth Collective
--
Mark Eckman
Laurie Frederiksen on
This explains what a Suspense account is and what it is used for:
All money that is part of your club valuation, no matter what it will be used for or what account you have it recorded in, belongs to your club members.
If you do not record money contributed as member payments, their ownership will not be tracked correctly.
Laurie Frederiksen Invest with your friends! www.bivio.com
I agree with Jack with doing the least amount possible from club funds, for many reasons. Our club has it down to paying for Bivio and the club annual dues to Better Investing. Each member is responsible
for paying their dues to BI and for SSG's. If we have a party or eat out, we just pay in cash there as appropriate. This is SO much easier for the Treasurer.
Tim Hoyman
The Mozart of Real Estate
303-669-2676
IMPORTANT NOTICE: Never trust wiring instructions sent via email. Cyber criminals are hacking email accounts and sending emails with fake wiring instructions.
These emails are convincing and sophisticated. Always independently confirm wiring instructions in person or via a telephone call to a trusted and verified phone number. Never wire money without double-checking that the wiring instructions are correct.
CONFIDENTIALITY NOTICE: This email message and any attached files contain confidential information intended only for the person(s) to whom the transmission is addressed. If you receive this
message and you are not the addressee, do not read the message or any attached files. Any unauthorized use, disclosure, copying or distribution is strictly prohibited, and no rights are waived. If you are not the person(s) to whom the message is addressed,
please return the email to the sender by sending an email reply, and delete the message from your computer system. Please also contact the sender at The Denver 100, LLC, 385 Inverness Pkwy, Suite 270, Englewood, CO 80112, 303-669-2676. Thank you.
I created an account labeled "Cash set aside for expenses." I calculated the monthly average for all of our expenses for the year and transfer that amount each month into that account. Our members do not make any administrative payments
but a small amount of their dues each month gets set aside into that account. When I make expense payments it is deducted from the "Cash set aside for expenses" account.
Others will have to answer how to accomplish the mechanics of what you are doing.
My purpose in responding is to urge you to drop the whole concept. Instead think of your club as a business. Administrative expenses, for example bivio
subscription, Better Investing dues, room, rent, postage, etc, are all costs of doing business. Just enter them as expenses as they occur. The cash available to pay those expenses comes from three sources: interest and dividends, capital gains on stock sales,
and member capital contributions that are not used to purchase stock. The first two categories are "income" to the business. If there is sufficient income, then there will be a profit after expenses. If expenses exceed income, then capital will be used to
pay expenses. If the club needs cash to cover the expenses, then members can make capital contributions, which will buy units, to raise the cash. My point is that the simplest system treats all monies paid by members as capital contributions buying units.
As treasurer, I pay all the expenses of the club, usually with my personal credit card. When I pay an expense, I enter the payment as an expense on a
suspense account. When the suspense account balance is large enough and there is sufficient cash in the brokerage account, I write a check to myself on the brokerage account and zero out the suspense account.
This topic has been discussed many times in the past, you should be able to find directions on how to account for member payments that are not capital
contributions in the prior Club Cafe archives if you really want to continue your current practice. You should also find many others advocating my message in the second paragraph.
The members of my club make an administrative payment each year which is then used to pay club expenses. I wanted to reflect the member
payments in a suspense account. I went to Accounting --> Accounts-->Create and created an account "Admin Payments Awaiting Use".
As expenses are paid,
Because it is my version of a suspense account, I didn't think the amounts would show up as part of amounts paid on the Member Status report,
but they are indeed included!
Please advise: (1) Did I create a suspense account? (2) What does it mean to have a suspense account? and (3) Should I edit what's been
done thus far and just use the regular accounts?
Thanks in advance for your help.
VJ
Brooklyn Wealth Collective
--
Mark Eckman
V Johnson on
Thanks all and I appreciate the suggestions. I had previously read the explanation of Suspense Accounts but I'm still not clear on how amounts in "suspense" show up in the club valuation and member status reports. As mentioned in my email of yesterday, I was surprised to see amounts recorded in a suspense account included in amounts paid on the Member Status Report.
Any clarity on this would be helpful.
VJohnson
On Tue, Nov 10, 2020 at 2:40 PM Laurie Frederiksen <laurie@bivio.biz> wrote:
This explains what a Suspense account is and what it is used for:
All money that is part of your club valuation, no matter what it will be used for or what account you have it recorded in, belongs to your club members.
If you do not record money contributed as member payments, their ownership will not be tracked correctly.
Laurie Frederiksen Invest with your friends! www.bivio.com
I agree with Jack with doing the least amount possible from club funds, for many reasons. Our club has it down to paying for Bivio and the club annual dues to Better Investing. Each member is responsible
for paying their dues to BI and for SSG's. If we have a party or eat out, we just pay in cash there as appropriate. This is SO much easier for the Treasurer.
Tim Hoyman
The Mozart of Real Estate
303-669-2676
IMPORTANT NOTICE: Never trust wiring instructions sent via email. Cyber criminals are hacking email accounts and sending emails with fake wiring instructions.
These emails are convincing and sophisticated. Always independently confirm wiring instructions in person or via a telephone call to a trusted and verified phone number. Never wire money without double-checking that the wiring instructions are correct.
CONFIDENTIALITY NOTICE: This email message and any attached files contain confidential information intended only for the person(s) to whom the transmission is addressed. If you receive this
message and you are not the addressee, do not read the message or any attached files. Any unauthorized use, disclosure, copying or distribution is strictly prohibited, and no rights are waived. If you are not the person(s) to whom the message is addressed,
please return the email to the sender by sending an email reply, and delete the message from your computer system. Please also contact the sender at The Denver 100, LLC, 385 Inverness Pkwy, Suite 270, Englewood, CO 80112, 303-669-2676. Thank you.
I created an account labeled "Cash set aside for expenses." I calculated the monthly average for all of our expenses for the year and transfer that amount each month into that account. Our members do not make any administrative payments
but a small amount of their dues each month gets set aside into that account. When I make expense payments it is deducted from the "Cash set aside for expenses" account.
Others will have to answer how to accomplish the mechanics of what you are doing.
My purpose in responding is to urge you to drop the whole concept. Instead think of your club as a business. Administrative expenses, for example bivio
subscription, Better Investing dues, room, rent, postage, etc, are all costs of doing business. Just enter them as expenses as they occur. The cash available to pay those expenses comes from three sources: interest and dividends, capital gains on stock sales,
and member capital contributions that are not used to purchase stock. The first two categories are "income" to the business. If there is sufficient income, then there will be a profit after expenses. If expenses exceed income, then capital will be used to
pay expenses. If the club needs cash to cover the expenses, then members can make capital contributions, which will buy units, to raise the cash. My point is that the simplest system treats all monies paid by members as capital contributions buying units.
As treasurer, I pay all the expenses of the club, usually with my personal credit card. When I pay an expense, I enter the payment as an expense on a
suspense account. When the suspense account balance is large enough and there is sufficient cash in the brokerage account, I write a check to myself on the brokerage account and zero out the suspense account.
This topic has been discussed many times in the past, you should be able to find directions on how to account for member payments that are not capital
contributions in the prior Club Cafe archives if you really want to continue your current practice. You should also find many others advocating my message in the second paragraph.
The members of my club make an administrative payment each year which is then used to pay club expenses. I wanted to reflect the member
payments in a suspense account. I went to Accounting --> Accounts-->Create and created an account "Admin Payments Awaiting Use".
As expenses are paid,
Because it is my version of a suspense account, I didn't think the amounts would show up as part of amounts paid on the Member Status report,
but they are indeed included!
Please advise: (1) Did I create a suspense account? (2) What does it mean to have a suspense account? and (3) Should I edit what's been
done thus far and just use the regular accounts?
Thanks in advance for your help.
VJ
Brooklyn Wealth Collective
--
Mark Eckman
Laurie Frederiksen on
Amounts in all accounts on the Accounting>Accounts page show up in the total club valuation and member status reports. They are all part of your total club assets.
Laurie Frederiksen Invest with your friends! www.bivio.com
Thanks all and I appreciate the suggestions. I had previously read the explanation of Suspense Accounts but I'm still not clear on how amounts in "suspense" show up in the club valuation and member status reports. As mentioned in my email of yesterday, I was surprised to see amounts recorded in a suspense account included in amounts paid on the Member Status Report.
Any clarity on this would be helpful.
VJohnson
On Tue, Nov 10, 2020 at 2:40 PM Laurie Frederiksen <laurie@bivio.biz> wrote:
This explains what a Suspense account is and what it is used for:
All money that is part of your club valuation, no matter what it will be used for or what account you have it recorded in, belongs to your club members.
If you do not record money contributed as member payments, their ownership will not be tracked correctly.
Laurie Frederiksen Invest with your friends! www.bivio.com
I agree with Jack with doing the least amount possible from club funds, for many reasons. Our club has it down to paying for Bivio and the club annual dues to Better Investing. Each member is responsible
for paying their dues to BI and for SSG's. If we have a party or eat out, we just pay in cash there as appropriate. This is SO much easier for the Treasurer.
Tim Hoyman
The Mozart of Real Estate
303-669-2676
IMPORTANT NOTICE: Never trust wiring instructions sent via email. Cyber criminals are hacking email accounts and sending emails with fake wiring instructions.
These emails are convincing and sophisticated. Always independently confirm wiring instructions in person or via a telephone call to a trusted and verified phone number. Never wire money without double-checking that the wiring instructions are correct.
CONFIDENTIALITY NOTICE: This email message and any attached files contain confidential information intended only for the person(s) to whom the transmission is addressed. If you receive this
message and you are not the addressee, do not read the message or any attached files. Any unauthorized use, disclosure, copying or distribution is strictly prohibited, and no rights are waived. If you are not the person(s) to whom the message is addressed,
please return the email to the sender by sending an email reply, and delete the message from your computer system. Please also contact the sender at The Denver 100, LLC, 385 Inverness Pkwy, Suite 270, Englewood, CO 80112, 303-669-2676. Thank you.
I created an account labeled "Cash set aside for expenses." I calculated the monthly average for all of our expenses for the year and transfer that amount each month into that account. Our members do not make any administrative payments
but a small amount of their dues each month gets set aside into that account. When I make expense payments it is deducted from the "Cash set aside for expenses" account.
Others will have to answer how to accomplish the mechanics of what you are doing.
My purpose in responding is to urge you to drop the whole concept. Instead think of your club as a business. Administrative expenses, for example bivio
subscription, Better Investing dues, room, rent, postage, etc, are all costs of doing business. Just enter them as expenses as they occur. The cash available to pay those expenses comes from three sources: interest and dividends, capital gains on stock sales,
and member capital contributions that are not used to purchase stock. The first two categories are "income" to the business. If there is sufficient income, then there will be a profit after expenses. If expenses exceed income, then capital will be used to
pay expenses. If the club needs cash to cover the expenses, then members can make capital contributions, which will buy units, to raise the cash. My point is that the simplest system treats all monies paid by members as capital contributions buying units.
As treasurer, I pay all the expenses of the club, usually with my personal credit card. When I pay an expense, I enter the payment as an expense on a
suspense account. When the suspense account balance is large enough and there is sufficient cash in the brokerage account, I write a check to myself on the brokerage account and zero out the suspense account.
This topic has been discussed many times in the past, you should be able to find directions on how to account for member payments that are not capital
contributions in the prior Club Cafe archives if you really want to continue your current practice. You should also find many others advocating my message in the second paragraph.
The members of my club make an administrative payment each year which is then used to pay club expenses. I wanted to reflect the member
payments in a suspense account. I went to Accounting --> Accounts-->Create and created an account "Admin Payments Awaiting Use".
As expenses are paid,
Because it is my version of a suspense account, I didn't think the amounts would show up as part of amounts paid on the Member Status report,
but they are indeed included!
Please advise: (1) Did I create a suspense account? (2) What does it mean to have a suspense account? and (3) Should I edit what's been
done thus far and just use the regular accounts?