Just curious as to what Accounting packages are being used out there. As many operations are 501c3, they have some unique reporting requirements that require something other than Quickbooks Pro or Peachtree. I used to be familiar with software from Cougar Mountain.

Sharing the good bad and ugly might be useful.

Superheater@beer.com

Basic cash accounting is all that is required. Accrual accounting is for manufacturing Etc. We use Quicken which works just fine. Our CPA is able to pull everything that he needs for our 990 end of the fiscal reporting.

I use the backs of old envelopes and paperclips and a few pencils.

dave

irondave@bellsouth.net

At TVRM we use Peachtree. The CPA pulls out what he needs. What Peachtree and Quickbooks won't do is fund accounting, which the IRS doesn't require, they just want the bottom line. It takes something like Solomon if you are going to keep up with multiple funds.

Tim Andrews

andrewstim@prodigy.net

> Basic cash accounting is all that is
> required. Accrual accounting is for
> manufacturing Etc. We use Quicken which
> works just fine. Our CPA is able to pull
> everything that he needs for our 990 end of
> the fiscal reporting.

The accounting method and software will depend somewhat on the size of the organization and the degree of management information you wish to extract from financial data. I was once involved with an excursion train business (for profit) that used the cash accounting method and Quicken software. It proved inadequate for our needs but once we had elected an accounting method for IRS reporting and had invested in the software, it was too much trouble to change.

I prefer accrual accounting since it reflects income and expenses when incurred rather than when cash is received or disbursed, thus providing a more accurate picture of what is going on, as well as a better audit trail. Most of the off-the-shelf software packages can handle either cash or accrual and with a properly structured chart of accounts you should be able to capture and segregate everything you need for the form 990.

Alan Maples


AMaples@aol.com

> Just curious as to what Accounting packages
> are being used out there. As many operations
> are 501c3, they have some unique reporting
> requirements that require something other
> than Quickbooks Pro or Peachtree. I used to
> be familiar with software from Cougar
> Mountain.

> Sharing the good bad and ugly might be
> useful.

The fund accounting capability isn't common, and most operations don't actually need it if they aren't managing their own investments. (Actually having investments to manage is rare among railroad museums, isn't it?)

If an operation does have assets invested, the money manager typically provides fund accounting services for a fee. There is one accounting package some community foundations use that does fund accounting, but as I recall the price tag is about $20,000 (there may be others, that's the only one I'm aware of.)

JAC

> The fund accounting capability isn't common,
> and most operations don't actually need it
> if they aren't managing their own
> investments. (Actually having investments to
> manage is rare among railroad museums, isn't
> it?)

Unfortunately, given this and prior discussions, I'd say as a group RR preservation is as about as "non-profit" as one could get.

Its a good thing as a group we have time and energy.

One of these days, somebody is going to seriously go after charitable contributions (i hope).



Superheater@rrmail.com

We provide bookkeeping for Orange Empire and do so with Quickbooks. We get all we need for the 990's and everything else. Yes, our endowment investment accounting is provided by the Mgmt company. We post the summaries to Quickbooks.

My beef is in accounting for Restricted Funds. Many expenditures for restoration should be capitalized. When that's done, the transaction won't show up on an income statement by increase the asset's value on the balance sheet. This prevents us from easily showing Income vs those "Expenses" for the various funds. We have solved the problem by creating placeholder expense accounts that we reclassify to capitalizations at year end after we have created the cash flow reports for the funds, by exporting the Income/exdpense info for each of the funds (entered as classes in Quickbooks) and applying it in an Excel file to the balances of the various funds at the prior period end. It works pretty smooth. I hope this is helpful for somebody.


wyld@sbcglobal.net

> My beef is in accounting for Restricted
> Funds. Many expenditures for restoration
> should be capitalized. When that's done, the
> transaction won't show up on an income
> statement by increase the asset's value on
> the balance sheet. This prevents us from
> easily showing Income vs those
> "Expenses" for the various funds.
> We have solved the problem by creating
> placeholder expense accounts that we
> reclassify to capitalizations at year end
> after we have created the cash flow reports
> for the funds, by exporting the
> Income/exdpense info for each of the funds
> (entered as classes in Quickbooks) and
> applying it in an Excel file to the balances
> of the various funds at the prior period
> end. It works pretty smooth. I hope this is
> helpful for somebody.

Sounds very much like a system, that was once explained to me, for accruing ongoing construction costs prior the completion of a project. The ongoing costs would be charged to a "consturction in process" account and then at the end of the project the total would be reversed into the appropriate capital account.

This was in fact used 25+ years ago by the then bookkeeping service for a project at the museum that Mr. Wylde and I know all too well.

But, I wonder about trying to capitalize restoration costs. General standard for museums is that collections are NOT capitalized. Other items such as buildings, furniture, vehicles, office equipment, etc. over a certain amount should be capitalized.

Several years ago the accounting standards board (whatever its exact name is) put out a ruling that museum collections should be capitalized. This was because it perceived that museums were selling off collections to pay for purposes other than collections. The American Association of Museums successfully got the standards board to reverse this ruling. This was one of the few times that a ruling of the standards board was ever reversed.

So, I wonder why there is always a desire to capitalize the collections at railway museums. Is it because the accountants that we use expect to see all holdings of an organization capitalized?

Brian Norden

bnorden49@earthlink.net

> At TVRM we use Peachtree. The CPA pulls out
> what he needs. What Peachtree and Quickbooks
> won't do is fund accounting, which the IRS
> doesn't require, they just want the bottom
> line. It takes something like Solomon if you
> are going to keep up with multiple funds.

> Tim Andrews

Depends on whether you stay in sync with FASB 116 and 117 --

If you're accepting restricted donations for specific projects, you need to use fund accounting...

Quickbooks can handle this by using what they call "classes" and like Quicken, I've found it relatively easy to use.

Bob H



Heavenrich@yahoo.com

Though I would think working on a cash basis would be better for museums as you most likely only have donations and gate reciepts rather than invoicing people and having a large recievables to deal with. Cash or Accrual can be easily reversed in Peachtree or Quikbooks Pro or by and accountant . To go from accrual to a cash basis you just back your recievables out of Assets ( Credit ) and reduce your income ( Debit ) by the same amount and the same with payables ( Debit) and expenses (Credit).

What is lacking in both those programs is true job cost accounting linked with applied budgets. That right there would be very useful on keeping multiple restorations, capitol improvments ect, on budget and provides the general office a way to quickly look up what certain jobs are really costing up to the minute or by how much they are over. Though this feature is used usually for billing a client for work provided on a job for a museum there would just not be any invoices generated as it is internal or you could charge certain departments ( Buildings, Steam , Deisel , Traction), Track Maint...) accounts out of thier allotted budgets for the diufferent projects costs. Also accounting programs of this nature also create data bases of jobs where one could put in the scope of the project and it will produce an estamate based on the specs entered from all jobs with simalar specs or from idividual components of all jobs. Granted no two restoration jobs are the same but it gives a really good starting point and would certainly be useful for forcasting maintenance budgets for the next year.

RichA Young¿

Here are the two packages Danah is familiar with that will handle fund accounting:

http://www.nposolutions.com/main/produc ... /index.htm

http://www.blackbaud.com/solutions/acctg.asp

JAC

As the Executive Director at a museum that almot closed because of a cash accounting system - DONT USE IT. While it is true most museums don't have a lot of receivables, that is only part of the equation. Museums have A LOT of payables and the only way you can truly see the complete financial picture is to be aware of all the bills you might not have the money to pay. In a cash system, you only see what you cut a check for. For anyone dealing with Restricted Grant money, fund accounting is a must. You do not, however, need a true fund accounting packge. Most packages allow for the construction of a generla ledger account number that can contain a designator either at the front or the end of the GL number to designate the fund. The only advice I can give you is ACCRUAL, ACCRUAL, ACCRUAL. BY the way, on the revenue side you need to accrue donations as they are pledged, not as they are received. This includes grant money - as long as it is an "unconditional promise to give".

Thanks

Scott Cessna
Railroaders Memorial Museum

> Though I would think working on a cash
> basis would be better for museums as you
> most likely only have donations and gate
> reciepts rather than invoicing people and
> having a large recievables to deal with.
> Cash or Accrual can be easily reversed in
> Peachtree or Quikbooks Pro or by and
> accountant . To go from accrual to a cash
> basis you just back your recievables out of
> Assets ( Credit ) and reduce your income (
> Debit ) by the same amount and the same with
> payables ( Debit) and expenses (Credit).

> What is lacking in both those programs is
> true job cost accounting linked with applied
> budgets. That right there would be very
> useful on keeping multiple restorations,
> capitol improvments ect, on budget and
> provides the general office a way to quickly
> look up what certain jobs are really costing
> up to the minute or by how much they are
> over. Though this feature is used usually
> for billing a client for work provided on a
> job for a museum there would just not be any
> invoices generated as it is internal or you
> could charge certain departments (
> Buildings, Steam , Deisel , Traction), Track
> Maint...) accounts out of thier allotted
> budgets for the diufferent projects costs.
> Also accounting programs of this nature also
> create data bases of jobs where one could
> put in the scope of the project and it will
> produce an estamate based on the specs
> entered from all jobs with simalar specs or
> from idividual components of all jobs.
> Granted no two restoration jobs are the same
> but it gives a really good starting point
> and would certainly be useful for forcasting
> maintenance budgets for the next year.

> RichA Young¿


director@railroadcity.com

> As the Executive Director at a museum that
> almot closed because of a cash accounting
> system - DONT USE IT.

TAKE SCOTT'S ADVICE!!!!!!!!!!!!!!!!!

There's almost nowhere cash basis accounting works well. It doesn't match revenues and costs as they happen and even though many accruals and depreciation are on occasion somewhat arbitrary, the numbers they give are better than cash.

I've heard non-profit folks in the past say depreciation is a tax-gimmick,we don't pay taxes, ergo we don't need to depreciate.

The reality is acounting statements always contain "significant estimates by management". Estimates are still better than cash.


Superheater@beer.com

>
> > But, I wonder about trying to capitalize
> restoration costs. General standard for
> museums is that collections are NOT
> capitalized. Other items such as buildings,
> furniture, vehicles, office equipment, etc.
> over a certain amount should be capitalized.

> Several years ago the accounting standards
> board (whatever its exact name is) put out a
> ruling that museum collections should be
> capitalized. This was because it perceived
> that museums were selling off collections to
> pay for purposes other than collections. The
> American Association of Museums successfully
> got the standards board to reverse this
> ruling. This was one of the few times that a
> ruling of the standards board was ever
> reversed.

> So, I wonder why there is always a desire to
> capitalize the collections at railway
> museums. Is it because the accountants that
> we use expect to see all holdings of an
> organization capitalized?

As a general rule, accounting students are in-grained with the idea that if the useable life of an asset is extended, it should be capped. However, they are also trained to follow Generally Accepted Accounting Principles. FASB 116, 117 and 124 define GAAP for non profits. As those pronouncements are about 10 years old, no excuse not to be aware of them.


Superheater@beer.com