WAIAPU PARISH ACCOUNTING SCHEME

1. WAIAPU PARISH ACCOUNTINGSCHEME Revised August 2014

2. What do we do? We Offer Accounting and Payroll Services to: • 33 Parishes • Waiapu Board of Diocesan Trustees (the banker and property owner) • Diocese of Waiapu (administration centre) • Bishopric Endowment Trust (Bishop) • 3 Hospital Chaplaincies (Hawkes Bay, Tauranga, Gisborne) • Gisborne Bible in Schools • Anglican School (St Matthews, Hastings)

3. Who are we? Tracey O’Shaughnessy: • Finance Manager - with oversight of the Parish Accounting Scheme • Full Time • Email: finance.manager@waiapu.com Lesley Thomas: • Parish Administrator • Full Time • Responsible for Financial Reports & General Ledger Journals, Parish Bank Transactions, Payroll, Aps, Direct Debits. • Email: parish. administrator@waiapu.com Robyn Owen: • Accounts Payable Clerk • Full Time • 8.30am till 3.00pm • Responsible for all Accounts Payable • Email: accounts.payable@waiapu.com

4. How Much do we Process? Every month we process: • Over 1200 bank statement entries • Over 1300 creditors settled • Over 100 employees paid • Over 40 monthly reports issued • Over 200 phone calls answered • Over 600 emails received What does this mean… • Your instructions need to be timely, clear, and right first time

5. Monthly Timeline • 11th – Start processing bank statements and accounts payable for the month • 16th – All payroll changes, timesheets must be received • 18th – All Invoices for payment at 20th to be received by mid-day • 19th – Payroll sent to Bank • 20th – 20th creditors are paid • 30th – Last creditors are paid • 2nd – Last bank entries processed and bank reconciled (if all documentation has been received) • 4th – Imprest statements to be received • 9th – All Imprest statements to be processed • 10th – Monthly Reports finalised and issued to vestry

6. How can you help us • By using the correct paperwork, completing it correctly, and sending it to us on a timely basis • within 24 hours of deposit • direct debits sent to us as soon as you receive them (these can be ratified by vestry later) • Ensuring you remember our monthly timeline • Blank forms can be downloaded at http://www.waiapu.com/resources/management-information/parish-accounting/forms

7. Deposits • Did you know that all 33 Parishes in the accounting scheme share the same bank account, meaning the source of all deposits must be identified otherwise some other Parish might get credited your income !!! Parish Admin

8. Deposits • All deposits made at the bank must be made using the special deposit book containing your Parish name and number • When you start your last deposit book please contact the Parish Administrator and she will organise for new deposits books to be sent to you. Do not go to the bank direct. Parish Admin

9. Deposits cont’d • Followed up with a coded banking summary (preferably emailed – faxes are unreliable and mail is too slow) • To be received within 24 hours of the deposit • Only need to make 1 deposit per day • 1 deposit per summary • Enter actual date of deposit • Name of Parish • Number of parish in top right hand corner • Enter Code for each line (refer to code list – if in doubt – call us) • If deposit is for Diocese Bank account (ie.Marsden Cross/ Top Parish) use seperate Deposit Summary and cross out Parish Accounting Scheme at top of form and email information to Robyn accounts.payable@waiapu.com

10. Deposit analysis form Parish Administrator

11. Deposits cont’d • If you transfer any money into our account by internet banking please indentify your Parish in the reference field and the code ‘1124’. (and don’t forget to send us a transfer form) • If you are expecting a third party to deposit into our account please let us know (eg cattle sales, cottage rentals). • Send us details: - Who the funds are from - What Parish they relate to - What Code to enter them to - Any Paperwork you have received from the supplier Parish Admin

12. Deposits - codes In the Parish Chart of Accounts Income should normally be coded to: • 2000-2499 Offerings & Donations of various kinds • 2500-4200 All other income including Rent, Interest & Grants • 9000-9099 Op Shop Income • 9300 Ezee Meal Sales • 9800-9899 Capital Projects and items outside budget (ie Grants) • Income should not be coded against any expense codes Parish Admin

13. Payables – Accounts for payment • All Invoices are paid on the 20th and should be passed as approved at vestry and sent to Diocesan Office by mid-day on the 18th. • They are then sent to Accounts Payable with a coded covering sheet authorising the listed accounts for payment. • All reimbursements should be on the appropriate claim form and should include the supplier’s name, postal address, email address and bank account for payment. Don’t forget to get these authorised by an approved person. • Reimbursements and urgent invoices are to be into the Diocesan Office by 11am Wednesday for payment on Thursday. • Any Accounts being paid by Direct Debit should be clearly separated from those requiring a cheque to be raised. Do not hold these invoices but send these in before their due date for payment. (Remember - You are responsible for coding – please refer to your budget) Payables

14. Payables Schedule of accounts payable

15. Urgent Payments • Urgent Payments can be forwarded to us by 11am on Wednesday for payment each Thursday. Please ensure all documentation is included and contains the correct authorisation. Payables

16. Payables cont’d • GST will only be claimed (reducing the cost to the Parish) where a valid invoice supplied (incl reimbursements) • Payments will not be made on statements, only on invoices. • Where possible supply details of the creditors email address and bank account details (so payment and remittances can be electronic –saving money).

17. Payables – using investment funds • Occasionally Parishes require payments to be made from investments funds rather than the cheque account. • Code the invoice and submit the invoice for payment as normal (if it’s a repair code it to repairs, do not code it to the investment code). • Send through a separate request to action a funds transfer from investment account to the cheque account to cover the payment. (the form is on our website) • We suggest you send us a copy of your vestry minutes approving this transfer.

18. Payables - Codes • All payables should be coded to an expense code. These are typically: • 5000-5999 Personnel Expenses • 6000-6999 Parish Operating Costs • 7000-7999 Assessments & Levies • 8000-8999 Property Costs • 9100-9299 Op Shop Expenses • 9300-9399 Ezee Meal Expenses • 9800-9899 Capital Projects and items outside of budget (they may be moved at year end)

19. Petty Cash – Accounts Payable • Most Parishes have a petty cash float • When the float needs topping up send us the petty cash reimbursement form setting out what has been spent (coded and authorised) and copies of the receipts • We will send you an open cheque to cash to reimburse the float Payables

20. Petty Cash

21. Imprest Account • Why do we have them: • Allow parishioners to pay offerings by automatic payments • To manage debtors invoices sent – i.e. hall hire, wedding/funeral charges • To isolate fund-raising etc. for major long term capital works • To pay small local payments (ie. catering /supermarket purchases) • What you can’t do with an imprest account: • Have an eftpos/debit card on this account • Have a credit card attached

22. Imprest Account • Authority on payments: All payments must be authorised by 2 appointed members of your Vestry. Your Administrator should not have signing authority on this account. • How many imprest accounts do you really need? - One? • You are missing out on interest (Why not place the funds in a call account with WBDT?) • Your Parish Accounting Scheme Bank account may be in overdraft costing you interest.

23. Imprest Account - Transfers • No need to maintain a fixed dollar balance in your Imprest Account anymore. You manage the balance • If you have surplus money write out a cheque and deposit it into the Parish Accounting Bank and send us an Imprest Funds Transfer Form. This gets coded to 1124. • If you need the account funded send us a Imprest Funds Transfer Form stating the account number to be funded and the amount to fund. This gets coded to 1124.

24. Imprest Account Parish Admin

25. Imprest Account - Process • By the 4th of the month you should send us your imprest bank statements for the previous month . We suggest you use the imprest account analysis form - contact us if you are going to be late • Attach copies of all invoices paid through the account (otherwise we won’t claim GST). • If your Parish financial statements have a balance in 1124 at month end your Imprest Account and Parish Bank Account are not processed to same date.

26. Suspense Account - 1125 • If your Parish has a balance in account 1125 at the end of the month this is because we have identified a transaction belonging to your Parish but we do not know what it relates to. Please advise us before the next month end so this account can be cleared. (normally un-identified Deposits and Direct Debits) • Contact us if there is a balance in this code brought forward from a previous month which has not cleared.

27. Cash Management - Parish • It is important than you manage the cash balance of your Parish Bank Account. This is your Vestry’s responsibility! • Any overdrafts will be charged interest on a daily basis and the interest will be shared out between the Parishes in funds. • It is not worth holding large investment accounts or imprest balances if your Parish bank account is in overdraft.

28. How to read financials Parish Accountant

29. How to read financials Parish Accountant

30. How to read financials Parish Accountant

31. How to read financials Parish Accountant

32. How to read financials Parish Accountant

33. How to read financials Parish Accountant

34. How to read financials Parish Accountant

35. How to read financials Parish Accountant

36. Journals – Parish Accountant • Corrections to coding/data entry errors should be completed on correct form and should include reason. • Journals will be dated in the system on the 1st of the month following the original transaction.

37. Budgets • Why do we need them: • Help us ensure you have considered your income and expenditure for the year and have a plan in place. • Variances to budgets highlights potential issues for your Vestry to consider. • Items outside budget should be approved by vestry before processing.

38. Payroll • Your Parish Vestry has responsibilities under the Employment Relations and Holidays Acts as well as other legislation • http://www.dol.govt.nz/er/ • Timesheets, Leave Applications, Payroll Changes, Termination documents must be received by the 16th. They must be authorised by an approved person. • Blank forms are available on http://www.waiapu.com/resources/management-information/parish-accounting/forms

39. Payroll – cont’d • New Employees must provide the following documents before they will be paid: • Signed Employment Agreement • Full Job Description • Completed “New Employee” form • Bank Deposit Slip • IR330 (Tax Code Declaration) • Kiwisaver Declarations – KS2 and KS10 if opting out • Personal Email Address for payslips Minimum Adult Wage $13.75 p/hr http://www.dol.govt.nz/infozone/myfirstjob/employers/checklist.asp Parish Administrator

40. Payroll – cont’d • Common issues with paperwork - Sending start and finish times rather than hours worked eg 8.30am to 4.00pm - Including hours paid last month on current timesheet - Sending details of hours worked by volunteers • Payments to Clergy/Organists and others for services must go through payroll • http://www.ird.govt.nz/non-profit/np-staff/honoraria/ Parish Administrator

41. Payroll – Timesheet, variable hours Parish Administrator

42. Payment for Service Honoraria • Honoraria are payments made for services provided where no fixed payment would normally be made.  They are treated as wage payments for tax purposes. • Examples – running a Op Shop, playing the organ at services, taking services. Taxing honoraria • If you are paying honoraria to an employee, we need to put these through payroll so please send us all the details • http://www.ird.govt.nz/non-profit/np-staff/honoraria/

43. Payment for Expenses Reimbursing expenses • Volunteers often incur expenditure associated with their voluntary activities. This could be from the activity itself or their travel to or from the activity. • Reimbursement payments are treated as tax-exempt income for the individual if they are based on: • actual expenditure, or • a reasonable estimate of the likely costi.e. mileage claims Payables/Parish Admin

44. Waiapu Board Investments • If you have surplus funds or ear marked gifts that are not needed in the short term you can earn interest on the funds with the Waiapu Board. • The Board operates 2 funds, a income fund (suits short to medium term investments), and a permanent fund (suits deposits of greater than 1 year in length). Parish Accountant

45. Income Fund • Last year paid 4.75% pa • Invest a $1 and get back $1 + interest • Interest Paid annually on 31st March • Value of the fund $17m • Invested in Bank Call Accounts, Corporate Bonds, and Mortgages

46. Permanent Fund • Last year paid 11.0% per unit(or 4.89% per $1 invested) • Invest a $2.25 and get 1 unit • Sell the unit and get the exit price at the time • Interest normally Paid annually on 31st March • Value of the fund $13m • Invested in Corporate Bonds, Equities, and Commercial Property

47. Responsibility Wardens are responsible for all activities of the Parish including: • Financial Management and Reporting • Budgeting • Financial Audits Vestry is responsible for: • Employment and Legislation (being good employers) • Providing consistent, mission focused and future orientated planning of finances, property maintenance, leadership succession. By • Following Process • Transparency of Transactions

48. Best Practice Moving towards best practice means consolidating processes between Diocese/parishes Separation of duties • Ensure that payment documents are processed correctly by having different people involved in the payment process. This principle is called separation of duties. • Best practice is to have different people: • Approve purchases – Vestry, minutes • Receive ordered materials • Approve invoices for payment – Warden/Treasurer • Review and reconcile financial records – Wardens/Vestry Parishes

49. Best Practice cont’d • Potential consequences if duties are not separated: • Erroneous or fraudulent invoices approved for payment • Unauthorized payments made to non-existent vendors • So transparency in all transactions is essential. If we ask a question it will be from an audit point of view. Compliance + Accountability + Transparency + Consolidation = Efficiency We are here to assist.. So please call us!

50. WHAT NOW? • Website – forms upgrade • Website – copy of this power point loaded • Payroll • review of employment agreements • standard job descriptions coming