Our church needs to track multiple funds within one bank account. I can see multiple ways to do this, and I'd like some advice on which way is best.
The funds we're tracking include money held in reserve for an employee that will be paid at a later date. Another fund is money earmarked by our Board to give to people who request help with travel costs to attend events and services. Both these funds decrease periodically as money is paid out. They increase annually when the Board earmarks more money for the travel fund, and monthly in the case of the employee fund.
So one way to track this would be to create liability accounts for each fund. I like the way this shows up as a liability line on the Balance Sheet. This is better than where it's been showing up as a sub-account of the Bank account under Assets. My question about this is if it's legit to take the opening balance for this fund from an equity account. We report all previous years net income and our opening equity on one line, so I can take it from opening equity. QB won't let me use the Retained Earnings or Net Revenue lines in equity to fund the new liability account, that's why I used opening balance equity.
The other way to do this would be to use classes, but I'm not sure if that's appropriate here.
As always, thanks in advance for any guidance you can provide.