Re: Friendly Audit / Accountant or CPA Advice Needed | <– Date –> <– Thread –> |
From: Sharon Villines (sharonsharonvillines.com) | |
Date: Mon, 10 Sep 2018 09:46:30 -0700 (PDT) |
I agree with Philip’s comments which I copied below because I think he covers the important points. Accounting and record keeping is important for several reasons including being financially responsible and sustainable, as well as providing transparency and preventing theft-but it isn’t rocket science. It can be easily learned by anyone who has the aptitude (ie tolerance) for numbers and details. No physics or calculus involved. The online services make it incredibly easy and even gratifying work. I much prefer Fresh Books to Quick Books, however, but many already know Quickbooks and thus stick with it. Fresh Books is just a few years old and was designed as an online service. It doesn’t have the legacy features that Quickbooks has had to maintain compatibility with previous software. Most importantly FreshBooks speaks English, not accounting. Sometimes confronting strange language is disconcerting enough to make you feel a subject is impenetrable. Takoma Village still uses a management company to do the finances because we started, in my opinion, with a very conservative finance committee. I had worked with books for non-profit groups of volunteers before and thought it was over kill. I continue to think so. The services for small businesses are numerous and communities can use the same services that the management companies use for processing checks, etc. The most successful set-up I worked with had CPA working on an hourly basis with who initially ensured that we had accounts set up so we could produce the appropriate reports for taxes, etc., and processes for tracking receipts, etc. so we or our parent organization could easily do an audit. The CPA said the important thing, beyond accurate books, was to have a different person handle the checkbook (deposits and payments) and record keeping (accounting). That provided checks and balances. The CPA was also available for financial advise and signing tax returns. A full out audit seems overkill if you have good records. An auditor just checks receipts and whether the books balance. It’s clerical as much as anything. For cohousing communities with a simple income stream and relatively few payments each month, it’s hard to hide money anywhere. And the online services ensure that no one has to interpret handwriting. Ask for sample budgets from other cohousing communities to set up the accounts you might need. > On Sep 8, 2018, at 6:34 AM, Philip Dowds via Cohousing-L <cohousing-l [at] > cohousing.org> wrote: > [snip] Accounting exists mainly to provide quick and accurate answers to the > financial questions that are interesting and important to you. Thus there is > no single correct way to set up a chart of accounts. > On the income side, most of your money comes in from the monthly dues, > and the income accounts can be very simple. But if for some reason your > community owns a rental property or runs a small farming operation, then you > ought to be recognizing that cash flow in separate accounts. > On the expense side, maybe all your money is allocated to, and spent at > the discretion of, committees — so maybe a chart of accounts subdivided > according to committees is what’s most useful to you. Or, maybe your > expenses are organized around functions — utilities, building repairs, > insurance, activities and training, etc — and so that’s the best way to set > up your accounts, AND plan your annual budget. > Maybe some costs or collections are distributed differentially, like, > from the apartments to the townhouses, or from market-rate units to > below-market units. If so, the design of your accounting system should > factor this in. Sharon ---- Sharon Villines Takoma Village Cohousing, Washington DC http://www.takomavillage.org
- Re: Friendly Audit / Accountant or CPA Advice Needed, (continued)
- Re: Friendly Audit / Accountant or CPA Advice Needed Liz Ryan Cole, September 7 2018
- Re: Friendly Audit / Accountant or CPA Advice Needed Liz Ryan Cole, September 7 2018
- Re: Friendly Audit / Accountant or CPA Advice Needed Liz Ryan Cole, September 7 2018
- Re: Friendly Audit / Accountant or CPA Advice Needed Sharon Villines, September 10 2018
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