Wing Banker Solution Consolidating Unit Finances Into Wing Finances

1
Wing Banker SolutionConsolidating Unit Finances
Into Wing Finances

• C. Warren Vest, Lt Col, CAP
• Director of Finance, Virginia Wing
• Robin M. Vest
• Wing Financial Analyst, National Headquarters
• (Lt Col, CAP)

2
Wing Banker Solution

• What is the problem?
• What is the solution?
• What are the advantages and disadvantages?
• What is involved in the implementation?

3
At the Unit

• Situation
• Units maintain own bank accounts and finance
  records
• Units submit own financial reports to wing
• Units operate iaw CAPR 173-1 on cash basis
• Units depend on volunteer finance officer
• Problem
• Poor compliance because of misunderstandings of
  requirements and inadequate time and training

4
At the Wing

• Situation
• Wing operates iaw CAPR 173-2 on accrual basis
• Wing consolidates all unit financial reports
• Wing subject to audit each year
• Wing has Administrative Assistant to help on
  daily basis
• Problem
• Inconsistency and inaccuracy in unit reports

5
At National

• Situation
• National operates on accrual basis
• National consolidates wing reports
• National subject to audit, OMB standards, and
  Congressional reporting
• Problem
• Auditors consider unit funds, taken together, to
  be material
• Qualified audit opinion because units not audited
  and not on accrual basis

6
2005 Financial Audit Opinion and Results

• Independent Auditors Report (Pg. 1)
• Type of reports issued Qualified
• Reason for qualifications Financial statements
  do not include the accounts and financial
  transactions of units below Wings
• Note 2, pg. 10 (assets of 4,801,692 revenue of
  7,070,052)

7
Wing Banker Solution

• Bring all unit financial
• transactions to wing
• Receiving and disbursing of funds
• Accounting
• Reporting

8
Advantages

• Unit
• Out of the accounting and reporting business
• Unit still manages own funds by determining own
  expenditures and instructing wing
• Wing
• All accounting and reporting accomplished by wing
  iaw CAPR 173-2 in lieu of units using CAPR 173-1
• National
• As close to accrual accounting for units as you
  can get
• Wing audit includes all unit transactions
• Unqualified opinion in wing audit
• Unqualified opinion in national audit

9
Disadvantages

• Unit members may resent wing because they can no
  longer touch and feel their own money
• More work at wing
• In a large wing with units conducting numerous
  financial transactions, the transition will be
  more difficult

10
Implementation at the Unit

• Each unit writes a check to wing for its entire
  bank balance and then closes bank account(s)
• Each unit closes its books and submits its final
  report for the year on CAPF 173
• Thence each unit forwards bills, payment
  vouchers, and receipts to wing as received
• Units can be provided with deposit slips in order
  to make deposit and then must provide detail to
  wing headquarters

11
Implementation at the Unit

• Maintain unit Finance officer
• Maintain unit Finance Committee
• Unit has to instruct wing
• what bills to pay and should
• continue following the approval
• requirements in CAPR 173-1

12
Implementation at the Wing

• Unit funds deposited in separate bank account
  from main wing account(s)
• May be at the same bank that wing uses
• Wing classes each transaction with unit
  designator in QuickBooks Pro
• This step is the key to the whole process!
• Wing processes all unit transactions
• Units forward all bills and receipts/deposits to
  wing
• Wing pays all bills from unit funds account at
  wing
• Wing makes all reports and is audited

13
Implementation Steps

• Open new bank account for unit funds
• Create new account in QBPro for bank account
• Create more new accounts in QBPro
• One for each unit
• One for wing headquarters (optional)
• One for unclaimed deposits
• Make these subaccounts under the new bank account
• NOTE You do not need any new liability,
• capital, income or expense accounts.

14
Receiving a Unit Bill

• Make sure you get adequate documentation
• To identify the unit
• To identify the expense
• Book it normally as an account payable making
  sure to class it to the unit
• NOTE If the unit is paying a corporate
• aircraft expense, you cannot class it both
• by N-number and by unit. Class it by unit.

15
Receiving a Unit Deposit

• Make sure you get adequate documentation
• To identify the unit
• To identify the income
• Book it normally as account receivable or income
  received making sure to class it to the unit
• Deposit it in proper unit subaccount
• You cannot mix receipts for different units
  together in one deposit

16
Paying a Unit Bill

• Make sure you have necessary approvals
• Unit, wing, and maybe Finance Committee
• Open bill payment screen
• Select all bills for only one unit
• Select that units subaccount for source of funds
• Close bill payment screen
• Repeat previous step for each unit with bills to
  pay

17
Printing Checks

• On checks to print screen select all checks
  paying only unit bills
• Load checks for the unit funds bank account in
  the printer
• Print checks
• NOTE Your best opportunity to make
• a mistake is loading the wrong checks
• into the printer.

18
Reconciling Bank Statement

• You will find a deposit that you know nothing
  about
• Book it as Miscellaneous Income
• New sub-account under acct 5420000 called
  Unclaimed Unit Deposits
• Class it to VA??? or something indicating unit
  is unknown
• Credit it to Unclaimed Deposits subaccount

19
Reconciling Bank Statement

• Proceed with reconciliation in normal manner
• NOTE All activity in unit subaccounts
• will roll up into the primary account that
• matches the bank account.
• Once you identify your unclaimed deposit,
  either correct original entry or make adjusting
  journal entry

20
Reporting to Units

• Report Navigator
• Accountant Taxes
• Transaction Detail by Account
• Modify Report
• Filters
• Date (define period of interest)
• Account (select unit subaccounts)
• OK

21
Questions?