Former FMC Treasurer Phil Glasson gives some simple advice on how to make your club accounting as quick and easy as possible. If you or your club wants to add to this resource, or assist us building resources about any topic for the Outdoor Community, then drop us a line!
The aim is to;
- Get rid of trips to the bank
- Get rid of writing cheques
- Get rid of cash
- Make the preparation of reports for the Committee and the AGM a simple task
Which takes two steps
- Move to online banking
- Switch to Xero
Online Banking for payments
First step is to find out if your club’s bank offers on line banking for organisations. This is normal practice for businesses and some banks make it quite easy for Not For Profit organisations (NFP) to join this service.
You need to discuss it with your bank and make sure that they offer an exemption from fees to NFP.
FMC is aware that Westpac offer their Business Banking option to NFPs with no fees. Other banks in NZ may do so and we would like to hear about them so we can add their name here.
With the Westpac system the treasurer can set up a payment (eg FMC Subs !) but the payment won’t be made until a second person, authorized by the club, has logged in and approved the payment. Exactly the same as the Treasurer writing a cheque and then getting another person to sign it.
Once you have this system up and running it’s good bye to cheque books !!
Online banking for deposits
This step is easy. Just give your bank account number to everyone who pays you money and ask them to make the payment online or to go the bank themselves and deposit the funds into the club account.
The one downside to this is club members who do not identify themselves in the payment and the treasurer has to become a detective to find out who made the payment.
Receipts are not needed in accounting these days as evidence of the deposit in the bank is enough.
It will take a year or so to establish the practice in your club but eventually everyone will come to accept that they don’t pay by cash but pay on line.
Xero works hand in hand with online banking. It is easy to learn the basics of Xero. Once your club has set up Xero then all your account transactions are recorded almost automatically, the need to match a bank statement each month with your account books vanishes and all the reports you might need are readily available. The need to file paper copies of bank statements, invoices and receipts disappears and life is a whole lot simpler.
If you give access to Xero to your financial reviewer there is no need to hand over books for a period after the end of the financial year. Everything your reviewer needs is online and instantly accessible.