RE fiscal year end vs Accounting fiscal year end

Sharon Campbell

At the end of every fiscal year (June 30th), I butt heads with Accounting. (Accounting does not use FE.)


Donation was received via mail and postmarked June 30 but received in July: The donor intended the gift for the fiscal year that just ended. Accounting says it doesn't matter: check was received in the new fiscal year and must be a new fiscal year gift. 


We use a 3rd party online donation platform. Someone donated to us using that platform. I use the date of the online gift. Accounting says I have to use the date the 3rd party check is deposited into our account. Again this happened with the gift on June 30th. The 3rd party check has not been received yet.


The donors think they are donating to the fiscal year that just ended. If I enter the gifts with a date of July 1 or later, my reporting will be wrong, their names will not appear as 15-16 donors in the Annual Report we send out in November, and when determining who to solicit for this new year's annual fund, these donors will not show up.


How do you handle this? And if anyone has any documentation that RE is not to be considered as accounting software, I would love to have it. Our auditors seem to think RE should match Accounting's records.

Jen Claudy

We reconcile RE data with Finance (not FE) each month, and our auditors also expect that they will match...or that we can easily explain any discrepancies.


However, our Finance team (and auditors) are completely on the same page as we are with regard to dates.  The postmark or online gift date is the date the IRS uses, and is the date we use.  That is the date on which the donor relinquished control of the funds, no matter when they were received.  Here (unlike previous orgs), I actually send Finance a list of gifts that are received in one month but "belong" in the prior month...every month, not just the end of the FY (or CY).


I actually use 3 dates on Gift Records to keep everything straight.  The Gift Date is the postmark date (or online date).  This is what appears in the acknowledgement letter for the donor's use for tax purposes.  The Receipt Date (since we send ack letters and use that date for that purpose, we don't need a separate set of fields for receipt) is the Deposit Date, which helps in matching up with Finance.  The GL Post Date (we don't actually Post anything...yet, I'm considering that) is the Transaction Date.  Usually the same as the Deposit Date, but when we move something to another month, this is the date that gets adjusted.  All reporting is done using the Post Date (unless Gift Date is needed for a very specific reason).


So a Gift received today could have a Gift Date (Postmark) of 6/29/2016, a Receipt Date (Deposit) of 7/6/2016, and a Post Date (Transaction) of 6/30/2016.  This counts it for FY16, and the Gift will end up with 3 transaction lines in Finance...Deposit on 7/6/2016 then Debit on 7/6/2016 and Credit on 6/30/2016 (to "move" it back to FY16).


At past orgs, we haven't done this on a monthly basis, but certainly at year end (fiscal and calendar).  Because, as you said, that's what the donor expects...and it just makes everything so much easier.


But also, as you mentioned, RE is not Accounting software.  You can't enter a debit or negative amount, and you can't have more than one transaction per gift (you can only change data or use an Adjustment).


If you can't get your coworkers to understand or change their thinking, then I would recommend trying for some system where you use different dates for Development purposes, and document appropriately within RE (i.e. add a Gift Note...you can use a Gift Default Set to do this easily...for those Gifts that need to be considered, from the Development perspective, as being in a different month/year than the norm).

JoAnn Strommen

There is a post that touched on some of the same issues on handling how to record gifts after end of fiscal year:
https://community.blackbaud.com/forums/viewtopic/420/28821


RE is fundraising software, not accounting but not sure where you can pull documentation you need.  BB promotional stuff on FE makes it sound like FE and RE/accounting and fundraising work with 100% compatibility.  That doesn't solve your issue.  In the descriptions for RE, accounting is never mentioned as one of the things it does.


Sometimes accounting staff don't understand why RE users need to record the July 1 gift as previous year.  For the most part it all goes into same GL # and they need to run their reports.  They also may not understand the flexibility RE has.  When we started with RE I had similar discussion with our CEO.  Was a bit hard to explain so it was understood why for donor listings and future solicitation I needed to record gift with previous year's fund.  Worked with accounting some too.  Our solution that we've worked with for 8+ years is that gift date is the date gift is deposited in the bank/hits accounting.  In RE fund can be previous year, current year or even next year (we have that when we kick-off board campaign prior to end of fiscal year).  Gift date for credit card gifts is the date it is processed.  Accounting handles that in some way until payment received - monies receivable/payment deferred.  I'd have to ask them exactly how they record it.

I would be very hesitant to record three different dates on a gift record as was posted.  I really believe in keeping it simple.  The more things there are to mess up - the worse for me.

Carol Abuya

Raiser's Edge is not accounting software, but it could be considered a subledger ot the accounting system. These gifts can surely be booked in the June 30 fiscal year even with the money received after the 30th. It sounds like your finance office may be working on a cash basis.  Most organizations I've worked with use accrual based accounting.  With accrual based accounting you would create a receivable to offset the gift revenue.  Then in July you would debit cash and credit the receivable.