Business Finance Assistant is designed to help you efficiently manage your charity's finances by categorising and reconciling your bank transactions. It's essential to categorise and confirm all bank transactions for accurate financial reporting.
Customising Categories for Charity Operations
To tailor the platform to your charity's needs, you can create new sub-categories under existing main categories. For instance, you might create sub-categories such as "Sales - Charity Shop," "Sales - Room Rental," "Sales - Fundraising Events," or "Sales - Drinks." These custom categories allow you to track various revenue streams with precision. Learn more about customising sub-categories
Similarly, you can set up new categories for other types of income like donations, membership subscriptions, or grants. By linking these to the 'Income' category instead of 'Sales,' you'll ensure they appear correctly on your Profit & Loss (P&L) statement. See an example of setting up income categories.
Managing Expenses
You can also create specific categories for expense transactions, such as "Rent - Head Office" or "Rent - Supported Housing." Make sure to assign these sub-categories to the appropriate parent category to keep your financial records organised.
Tracking Donors and Contributions
Consider adding each donor or funding body as a "new customer" for detailed donor/funding management. This allows you to view individual donor statements, including invoices and account balances. Video: Add a new customer. You can also refer to this guide to learn how to view customer statements, including quotes, invoices, and credit memos related to each donor. View customer statement instructions.
Searching and Exporting Expenses
From the 'Expenses' page, you can easily locate all expenses associated with a particular donor or customer using the search bar. If needed, you can export a list of these expenses by pressing the three dots next to the 'New Expense' button. Learn how to search for and export expenses.
Generating Financial Reports
To keep track of your charity's financial health, generate reports from the 'Reports' page. For access to more advanced financial reports, you can enable accountant-level features. Find out how to enable accountant-level access.
Handling Complex Transactions
If a single bank transaction covers multiple categories, you can 'split' the transaction to allocate the amounts accordingly. This ensures accurate tracking across different categories within the same transaction. Learn how to split transactions.
Managing External Bank Transactions
If transactions occur outside your main business bank account, you can manually import them by creating new bank accounts within Business Finance Assistant. Discover how to create a statement or cash account.
Generating Financial Reports for the Charity Commission:
Ensure that you have reconciled and confirmed your bank transactions in each account. You can then enable more of the financial reports by enabling the 'Accountant-Level' permissions: Enabling and Accessing Accountant-Level Features in Business Finance Assistant
You’ll generate specific reports to meet the Charity Commission's requirements. Here's how your charity's reports correspond to standard financial reports in Business Finance Assistant:
Annual Accounts: Profit and Loss and Balance Sheet
Profit and Loss Report (Income and Expenditure Statement):
- This shows all income (e.g., donations, grants) and expenses (e.g., staff costs, project expenses) for the year.
- Equivalent to the Statement of Financial Activities (SoFA) required for charities using accrual accounting.
Balance Sheet (Statement of Financial Position):
- This provides a snapshot of the charity’s assets, liabilities, and reserves at year-end.
- It helps demonstrate the charity's financial health.
Trustees' Annual Report: Narrative, Not Software-Generated
- The Trustees' Annual Report includes qualitative information. It must be written separately, although your accounting reports will help you detail financial achievements.
Steps to Generate Reports in Business Finance Assistant:
Profit and Loss Report:
- Navigate to the "Reports" section and select "Profit and Loss"
- Customise the date range to match your financial year.
Video: View profit and loss report
Balance Sheet:
- Go to the "Reports" section and select "Balance Sheet" or "Financial Position."
- Ensure the data reflects your charity’s financial year-end.
Export and Format:
- Export these reports to a spreadsheet or PDF.
- Depending on your charity's reporting needs, use the data to prepare the required SoFA or Receipts and Payments format.
What to Check Before Submission: - Ensure your reports align with charity accounting guidelines:
- Income categorised (e.g., donations, grants, investments).
- Expenses grouped appropriately (e.g., staff, fundraising, project costs).
- Include details of any restricted or unrestricted funds in line with charity reporting standards.
- If you're unsure, consult with a financial advisor experienced with charity accounts.