Transferring money between accounts and showing as a budgeting item?

Glad to see your post today, DS52.

You can transfer the amounts using a Journal Entry and post it to a clearing account in QuickBooks Desktop. Before doing so, I'd suggest consulting an accountant to guide you on how to record these work and what accounts should be used. Your accountant can provide more expert advice in dealing with this concern.

Here's how to setup a clearing account in QuickBooks:

1. Go to Lists and choose Chart of Accounts.
2. Click the Account button below and select New.
3. Choose Bank as the account type.
4. Click Continue.
5. Enter the Account Name and other necessary information. Leave the Enter Opening Balance blank.
6. Click Save & Close.

Learn more about setting up a clearing account in QuickBooks Desktop through this article: Set up a clearing account.

Once done, you can create a journal entry and apply the clearing account you've recently set up.

Here's how:

1. Go to the Accountant menu.
2. Choose Make General Journal Entries.
3. Fill in the necessary information by adding the account from which you are moving the money.
4. Click Save & Close.
   

Next, create the second entry and add the clearing account as well as the account to which you want to move the money. Then, link the Journal Entries together.

Here's a good reference on how to create a journal entry in QuickBooks Desktop.

If you wish to review the entries, you can do so by going to the bottom pane of the Make General Journal Entries window.

By default, only entries from the last month are displayed. To change or expand the list of entries, click from the List of Selected General Journal Entries drop-down list and select which period.

And you're all set. If there's anything else you need help, just let me know. I'm always happy to assist. Stay safe and have a great rest of the week.

Hello and thank you for getting back to me. I am really new to Quick Books and Our HOA does not have an Accountant.

I read through your explanation but I truly don't understand why all of these steps have  to be taken. I think I need to restate my question. Let me try again to explain it a different way.

At our bank we have a checking, Money Market (Maintenance Reserve) and CD for our Insurance Reserve. All Bank accounts I have set up in QB.

Each year when we establish our yearly budget for expenses we need to add to that amount 10% (required by our state for lending institutions). We show that as line item in our Budget. So in our chart of accounts I have an account for each budget item including one for the Maintenance Reserve.

It is easy to transfer money from our checking to the Money Market (Maintenance Reserve). both registers  in QB show the transfer correctly. I just need a way or procedure to show the amount I transfer at the end of each Quarter on the budget report. Hope this clarifies what I am trying to do. Thanks again

Best

Dave

I'd like to share some steps, Dave.

To add the line item for the 10% amount for your budget, you'll want to create an expense account. This account will show up in your budget report, and you will be able to add the figures from there.

Here are the steps:

1. Go to Lists > Chart of Accounts.
2. Select the Account drop-down menu at the bottom and choose New.
3. Choose the Account Type and click Continue.
4. Enter the Account Name, Description, and then click Save and Close.

Once done, you can go back to Company > Planning & Budgeting > Set Up Budgets. Find the account and enter the figures.

I'm adding this article for future reference: Create a budget or forecast in QuickBooks Desktop.

Please leave a comment on this thread if you need anything else. We are always around to help you some more. Take care. 

Ren,

 Thanks for getting back to me I thought those steps would work but they didn't. I had Already sent up an expense account for the reserve in the chart of accounts with the amount required for the entire year. Since QB requires users to budget monthly I put the totals for entire year in January. This has worked fine thus far when I pay bills and invoices to vendors.

When I transfer the monies from checking to our money market that works fine no problems. The issue is figuring out how to get it to show in that Reserve expense account and in  the Budget Vs. Actual report. When I pull up that report it shows the Budgeted amount but isn't reducing and not showing the monies that I have transferred

when I use you suggestion by placing the amount I transferred on April 1 of this year it increases the total by that amount. and still shows 0.00 in the actual column. I don't know but I am thinking that there might be a way to do this thru a Gen Journal entry. Thanks again for your input I'll keep working on it. New Treasurer here and still new to the nuances of QB and accounting. Much different than using my Quicken ;)

Best

Dave

We're glad to have you back, Dave.

The Journal Entry is a good idea when transferring money to another account a. I would recommend reaching out to your accountant to help and guide you further with this. This is to ensure that everything is accurate. This way, we'll be able to get the things that we want in our book.

Please know that you can tap my shoulder anytime you need help with QuickBooks.

Hello,

I came here with this same question after reading this article about GAAP rules for reserve funding. I don't think the answers offered here quite do the trick. So I came up with this solution.

I already have two bank accounts -- Operating and Reserve.
Invoices and Received Payments for Annual Dues all flow into the Operating account.

First, I created a new "Safety Reserve" other expense account. I entered $XXX in the 2022 budget for January.

Second, I created a new "Prepaid Capital Expenses" long-term liability account in COA. Then right-clicked and opened the register.

I increased Prepaid Capital Expenses, dated 1/1/2022, with the 12/31/2021 balance of the Reserve bank account, selecting Retained Earnings for the account field. This establishes the starting balance.

Next I increased Prepaid Capital Expenses, dated 1/1/2022, for the $XXX amount budgeted in Safety Reserve for 2022, selecting Safety Reserves for the account field.

Last, I transferred $XXX from Operating bank account to Reserve bank account.

The balance sheet now shows equal amounts for the Reserve bank account (asset) and Prepaid Capital Expenses (liability).

In the future, I'll pay for major projects from the Reserve bank account and at the same time I'll transfer an equal amount from Prepaid Capital Expenses back to Retained Earnings.

I think that ticks all of the boxes and conforms to GAAP.