Budget

Budget Allocation

Why Make a Church Budget? It is highly recommended by the "Local Church Accounting Manual" that your church set up a Budget for each year. Making a budget will help guide your financial decisions as a church and will help you to be more aware of how you are spending your money and whether changes need to be made. The steps for making a church budget are as follows, as described in the "Local Church Accounting Manual." (If you are reading this while setting up Jewel and your church already has a church budget made, please follow the instructions in the next section for entering your budget into Jewel.)

How to Make a Church Budget

1. Start planning your upcoming year's budget in November of the current year. Print a Financial Summary in Jewel (Main Screen → Reports and Graphs → Financial Summary), selecting "This fiscal year to date" as the dates for the report. Multiply the amounts on this report by 1/5 and add to report numbers - this will make up for the amounts spent in the next 2 months. An alternative method is to select the report dates for November of the previous year to October of the current year. Use this report to guide your budget for the following year.
2. Discuss prospective needs for the upcoming year with the church board, and include these possibilities when drafting the proposed budget.
3. If your Church Budget includes both church expense as well as organizations of the church, be sure to include the organizations in the budget.
4. Make a tentative Budget to present to the church board for consideration, modification, and approval.

How Budget Allocations Work in Jewel

Jewel allows budgeting in two ways - by dollar amounts, and by percentages. The recommended method is to use dollar amounts, because it is simpler and more accurate. However, you have the option to allocate by percentages. If you choose to use percentages, then the accounts for which you enter a percentage will receive funding only after all the dollar amounts have been allocated. For example, if Church Budget received $1500 during the month, and the Monthly Allocation Total cash amount is $900, the difference of $600 will be divided between the Percentage accounts.

Jewel will use the values you enter to create the reports "Monthly Budget" and "Annual Comparison" which can be used to monitor how your spending compares to your budget throughout the year.

Budget Allocation Set-up

1. On the Menu Bar, select Maintenance → Edit Budget Allocations from Menu at top of the screen.
2. Select the year for which you are making your budget. At this point, you can either edit your current year's budget, or enter the new budget for the next fiscal year.
3. Enter the Total Annual Budget.
4. Under "From Account," select the account that is serving as the source for budgeted funds. This will usually be Church Budget, depending on how your church's accounts are set up.
5. Under "To Account(s)," enter the monthly amounts budgeted for each account. Select the accounts either by selecting from a list with the down arrow, or by typing in the account name or ID. You can also add accounts by clicking on the small (+) sign next to the down arrow. When typing in the amount budgeted for each account, you can either use percentages (%) or dollar ($) values. To enter percentages, simply type the percent number followed by the percent sign (%). Jewel will calculate the actual value for each month based on total annual budget and the percentage values you have entered. To enter a dollar amount, simply type the amount and Jewel will default to a dollar sign. As you enter the values, watch the "Monthly Allocation Totals" in the middle of the screen. They will change according to the values you enter. When you have finished, the dollar amount should equal the Total Annual Budget and the percentage should read as 100%.
6. Click OK to complete your budget and let Jewel store the values you have entered. After presenting your budget to the board, any changes can be made by going back to Maintenance → Edit Budget Allocations, making the appropriate changes and clicking OK.

Jewel will evenly distribute the totals you have entered among the 12 months of the year. For example, if you entered a $12,000 Total Annual Budget, Jewel will distribute a total of $1,000 for each month, and likewise with the values you entered into each sub account. Jewel will use these values to make the reports "Monthly Budget" and "Annual Comparison" which can be used to monitor how your spending compares to your budget throughout the year.

FAQs

I need to change the total projected annual budget amount. Will this affect my dollar ($) amounts?

No. This will only affect % amounts. You can make changes to the budget allocation at any time under Maintenance → Edit Budget Allocations.

Can accounts in Budget Allocations be transferred to Conference Funds?

No. Budget Allocation is only for LOCAL funds. If you have mistakenly put a conference fund in budget allocation, leave them as local funds, and then make a manual transfer when ready to make a payment to the conference. In order to do this, go to Properties → General Tab and make sure "Allow transfer to Conference" is checked.

Our church does quarterly budget allocations instead of monthly. How can I do this in Jewel, since it is set up for monthly allocations?

It is possible to do quarterly allocations in Jewel. Each month you do NOT want to do a budget allocation, change all the dollar ($) amounts to 0, and then fill in the appropriate amounts during the months you DO want to allocate. Your other option is to just leave everything in the budget allocation blank and fill it in each quarter.

Our monthly budget was not met. How does this affect the monthly budget allocation?

You can proceed with the monthly allocation. The dollar amounts will be allocated, and the % amounts allocated with the remaining balance. The church budget account will have a negative balance. The negative balance will hopefully be made up for in future months. If not, the church board may need to reevaluate its budget and spending. If Jewel will not even proceed with the allocation due to insufficient funds, you will need to change the total amount to allocate to equal the fixed ($) amounts (there will be none left over for % amounts).

How should I prioritize our church's Budget Allocation?

For items that must be paid each month, set up as dollar ($) amounts. Set up items that are only paid if there is sufficient income as percentages (%). (Jewel allocates $ amounts first, then divides the % amounts with left over funds.) The budget allocation can be changed at any time during the month up until allocations have been made. Changes will only affect future allocations.