Assets- Checking Accounts

[LindaW]

We use a payroll service.
With in that service there were 2 departments set up... the church (dept1) and the school (dept2).
The departments work off of 2 separate budgets but one federal tax ID#.
Both departments deposits money into a bank account (let's say account # 1120) and the payroll service withdraws from it.

I do the bookkeeping for the church (dept1) and use bank account 1110 for the day to day stuff.
So on the church side I transfer money from 1110 to 1120(via a bank transfer) for payroll and then the service takes it out.
The 1120 account is impossible to reconcile because the church and school both use it.

So here's the thing... I (the church) had to create the 1120 checking account.
It shows up in my current assets.
This is throwing our numbers off. It shows that we have 40,000 in that checking account when in reality it is at zero every time the payroll service withdraws their money.

How in the world do I correct this?

[Matt]

When the payroll for the church is paid via the payroll service are there any entries being made in the Payroll module in PC+ to record the payroll? And if so, are these entries being posted to Fund Accounting?

[LindaW]

No we are not using PC payroll module at all.

[Matt]

Well, this explains why there is a $40,000 balance in the 1120 checking account per PC+, when in reality there is no balance. Even though you are using a payroll service to process your payroll you still need to record and post the payroll in the Payroll Module and Fund Accounting. Otherwise, the salaries expense and other payroll-related expense accounts are not correct, along with the 1120 checking account balance.

[LindaW]

I DO record and post the wages-taxes-housing allowances etc in Fund Accounting.
My budgeted line items are all correct.

Matt...Are you saying I HAVE to use the payroll module?
I am ignorant to the payroll side of PC.
We have always had a payroll service.

[Matt]

If you are recording the wages-taxes-housing allowances in Fund Accounting, what account are you crediting when you make these entries? It should be the 1120 checking account. If so, there's definitely a disconnect somewhere if a $40,000 erroneous balance has built up.

You don't have to use the payroll module, especially since you are using a payroll service. However, if you don't use the payroll module you still need to record the payroll in Fund Accounting (as it sounds like you are doing) so that the accounts are updated.