Debit Account Setup

NOTE: If your church board has decided to obtain and use a debit card, hopefully you will follow our very strong recommendation to open a separate checking account, not connected to the main checking by automatic transfers. This debit account is to be funded by manual online transfers from the main checking account as needed.

Setting Up a New Debit Card Account in Jewel

Go to Maintenance / Edit Accounts, then click on “Add New Account” and set it up like this:

Type: Bank Account

ID: Pick a number, close to your other bank accounts, that is not already in use.

Name: Debit – then the name of your bank

Bank Name: Debit. The rest of the “Bank Information” can be left blank, since you won’t be writing or printing checks on this account.

Statement Frequency: The default is “Monthly.” Leave it that way.

Click the green “OK √” in the top right corner to save and leave.

Things to Consider As You Set Up the Debit Account

• Some banks will require a minimum balance in order to avoid fees. Find out your bank’s practices.
• Ask for end of month statements. Ask for printed and mailed statements, even if there is a small charge.
• Your debit account should not be set up to auto draft from checking if the balance gets too low. Having a separate debit account is so that fraudulent use of your debit card cannot drain your main checking Account. If the two accounts are connected with auto draft, it defeats the purpose of the separate account.
• You do not need to purchase checks – you will not be writing checks from this account. Ideally, you won’t even need deposit slips, since transferring online is the best.
• If possible, set up online banking for yourself as treasurer, so you can quickly and safely transfer funds online from checking to debit when needed.

NOTE: The board should discuss and vote who will use the card(s) and under what circumstances. Review these requirements annually with the board, or with new card holders as they receive their card.

• The debit card should never be used for personal purchases.
• The debit card should never be used to withdraw cash.
• Have the cardholders sign a “Debit/Credit Card User Agreement” when they receive their card.
• Require that a “Debit Card Activity Report” be turned in monthly by cardholders.
• Original receipts for all purchases should be stapled in date order to the “Activity Report,” and turned in to the treasurer no later than the 7th of the following month, without the card holder having to be reminded or asked for missing receipts. The card-holder’s convenience should not exponentially increase the treasurer’s workload.
• Anyone who does not follow the guidelines on the “Debit Card Activity Report” should forfeit the use of the church debit card.

NOTE: To avoid fraud and misuse, set up clear guidelines and stick to them. Card holders will need to know that exceptions will be rare. Be kind but firm. If they are asked by the board to sign the “Debit/Credit Card User Agreement” upon receiving their card, they will have less opportunity to claim ignorance or privilege.

Transferring Funds From Checking to the Debit Account

When you have a separate Bank Account for a church debit card(s), it is really, really, (really!) important that you learn how to transfer funds into it and how to record that transfer correctly in Jewel. Recording it incorrectly can result in overdrawn accounts, wildly incorrect ending balances in both checking and debit accounts and errors in local fund balances, as well as delays while your support person fixes the problem.

This required two-step process is not difficult, once you understand it and learn to use it consistently.

Move the Money at the Bank

Keep track of the actual bank balance of the debit account so you can transfer money from checking before an overdraft occurs. The debit card holders should notify you if they are making an unusually large purchase, so you can ensure there are funds available to cover.

Move money from the checking account to the debit account, using one of the following methods:

1. Online transfer (easiest)
2. Phone call to the bank
3. Visit the bank to request the transfer in person

Record the Transfer in Jewel

Enter transfers into Jewel after you actually make the bank transfer. But then do it, before you forget. Don’t wait, then try to remember if you did it or not. Check your Transfer Report if you're not sure.

Using “Transfer Funds” found on Jewel home page, create a transfer in Jewel to reflect/copy what has already happened at the bank. Do not create a “General Journal Entry.” Always use “Transfer Funds” to record these transfers.

Use the date of the actual transfer, and type "To fund Debit account" in the Memo.

Do the steps in this order. If you create the transfer in Jewel first, then forget to make the actual bank transfer, debit account overdraft is much more likely. If you make the actual transfer at the bank and then forget to enter it in Jewel, your report balances will be off, leading to confusion when it comes time to reconcile.

NOTE: Creating a transfer in Jewel does not move money at the bank. Jewel does not communicate with your bank. You must move the actual funds between bank accounts, then create a transfer in Jewel to reflect what actually happened at the bank.

Once you have correctly created this transfer, no other entries are needed. You can reconcile both checking and debit accounts from this one transfer, because both debit and checking accounts are involved and both will have entries that show up on their bank rec screens.

NOTE: If, while reconciling, you believe you need another entry to complete the reconcile, stop and get auditor assistance. If you have followed the instructions so far, you should never need an additional “General Journal Entry” or “Transfer” in order to complete the reconciliation in either checking or debit accounts. In fact, using a “General Journal Entry” to create a “Transfer” can cause a lot of chaos in your reports.

Reconciling the Debit Account

Reconciling the debit card account should be done monthly without fail, so that any fraudulent charges are quickly discovered, reported and reversed. If reported after the grace period that your bank gives (which varies, but can be as little as 30 days), full recovery of the stolen funds may not be possible, which means your church forfeits that money.

To reconcile, you will need:

• The debit account bank statement for the month that you are closing.
• End of month “Debit Card Activity Reports” from all debit card holders, including one from yourself, if you hold a card.

Entering Debit Purchases

Enter all the debit purchases for the month by going to “Write Checks” in Jewel. Make sure to change the bank account to your debit card account (whatever it is called in your database) on each payment as you enter it. You do not want these payments showing up on your checking account reconcile page.

Check #: Ignore it. The check # will disappear once you click the “Electronic Payment” box.

Date: Enter the exact posting date from the bank debit statement.

Amount: The total of the payment on the bank statement.

Pay to the Order Of: The names on the statement can sometimes be abbreviated. Figure them out and enter the correct name.

Memo: Create a memo for each entry, using the debit receipts that have been turned in, to describe both the purchase and the purpose. Be specific. Use date ranges for utility bills.

Account: Post each purchase to the correct local fund.

Electronic Payment: Finish by making sure the “Electronic Payment” box is clicked.

If you have another debit payment to enter, use the “New Check” button on the right side of the screen to continue.

NOTE: If you find you have entered a check under the wrong bank account, go find that check and edit it right then. Use the red “Previous” arrow on the right side of the Write Checks screen, or find and click on the payment in your Check Report. Don't create a second one. Fix the one you already created before you close the month.

Editing a Payment's Bank Account

Find the check that is posted to the wrong bank account. You can click the red "Previous" arrow on the right side of the Write Checks screen, or find and click on the payment in your Check Report. Click on “Edit Check”. Using the drop down box in the upper left corner, choose the correct bank account. Click on the “OK √” in the top right corner to save and close.

Recognizing the Transfer During Reconciliation

When reconciling the checking account, look for a minus amount in the “Deposit and Interest Earned” section of the bank rec page that matches the transferred amount that is on the statement. If your memo is descriptive and consistent it will help you to recognize it.

The minus deposit will act as a withdrawal as you reconcile.

If you don’t see it and you know you already created it in Jewel, do not create a new transfer so you have something to check off. Contact tech support for assistance so we can figure out what happened.

When reconciling the debit account, look for the transfer in the “Deposits and Interest Earned” section of the bank rec page, matching the transferred amount that is on the statement. If your memo is descriptive and consistent it will help you to recognize it.

If you don’t see it and you know you already created it in Jewel, do not create a new transfer so you can check it off. Contact tech support for assistance so we can figure out what happened.

When You Have Many Debit Transactions

Pro tip to speed up debit card entries: Before starting the debit card bank rec process, if you have a number of debit transactions to enter, do the following.

• Go to Maintenance / Properties / Accounts tab
• Using the drop-down menu, temporarily change the “Default Checking Account” from checking to the debit card bank account, so that the electronic payments that you are about to enter will all post to the debit account, without you having to reset the bank account for each check individually.

IMPORTANT: When finished entering all the debit charges, return to Maintenance / Properties / Accounts and reset the “Default Checking Account” back to checking. Otherwise your next checks will post to the debit account and you will need help to fix them if you don't catch the error before closing the month.