[Busmanagers] CO OPERATIVE LOANS

[Tewkesbury, Beverley D]

Hi Tracey,

 

Here is a copy of a load of info I have which may be useful to you but
the coding will probably be different in CASES21.

 


Guidelines for recording tax deductible Library Funds and Building Funds
on CASES


Schools can apply to the Australian Tax Office (ATO) for permission to
operate a tax deductible library or building fund account.  A key
condition for ATO approval is that the school council must open and
maintain a separate bank account.  (Refer Public Ruling 95/27.)

The majority of donations to tax deductible accounts are made at the
beginning of the school year.  Parents often pay for a variety of school
fees and charges with a single cheque.  An administrative problem arises
where a portion of the cheque amount includes a tax deductible donation
for the library or building fund.  The amount of the donation cannot be
receipted separately and banked directly into the library or building
fund account.

The ATO have agreed in writing to the following procedures:

*      When the receipt is exclusively for an amount of money donated to
the tax deductible account, the funds must be receipted, recorded and
banked directly into the designated account.

*      When a school receives a cheque for voluntary contributions,
class materials, excursions, etc., as well as a donation to a tax
deductible library or building fund, the money can be receipted and
banked into the Official account, providing that:

1.        Periodically, all money receipted into the Official account on
behalf of the tax deductible account is transferred into the library or
building fund from the Official account.

2.        The person making the donation receives official written
confirmation of the donation.  Normally this will be the receipt from
the tax deductible account.  However, where the receipt is issued from
the Official account, and only a portion of the amount relates to the
tax deductible donation, a form letter can be provided.  (See
'Administrative Procedures' below.)

3.        All payments relevant to the library or building fund must be
paid by cheque directly from the library or building fund bank account.

The ATO requires:

*      Bank account number (of the separate library or building fund
account)

*      Where tax deductible funds are originally receipted into the
Official account, proof/justification for the transfer of funds from the
Official account into the library or building fund account.  (Use the
program budget variance report, the flexible transaction report, or the
General Ledger transaction report for the designated program account at
Chart Level 4.)

*      A cheque book that is solely for the library or building fund
bank account.

*      A receipt book that is solely for the library or building fund
bank account.

Administrative Procedures

(a) Parent issues a cheque solely for a tax deductible donation to the
library or building fund:

If the cheque is made-out to the school for just the amount of the
donation to the building fund, or if the donation is in cash, then the
donation must be receipted directly into the library or building fund
trust account.

(b) Parent issues one cheque for a variety of payments including a tax
deductible donation to the library or building fund:

The school receipts the total funds into the Official account in the
usual manner and issues a receipt.  To enable the parent to claim a
taxation benefit for the donation, it is recommended a 'Form Letter'
could be issued to the parent.  This letter (prepared on school
letterhead) would be a standard form.  The date, receipt number, payee's
name and amount donated could be completed and signed by the bursar or
business manager when each donation is received.

Illustrated below is a suggested format of the 'Form Letter':

 

[SCHOOL LETTERHEAD]

Date............

Contribution to School Building Fund

The following details confirm that a donation was received by the school
council for the [SCHOOL NAME] approved Building Fund.  All donations to
this fund over $2.00 are tax deductible.

Receipt Number................................................

Name.............................................................

Contribution to Building Fund...$............................

Signature..........................................................




Note:

If the school issues a separate receipt for the library or building fund
donation, and another for the payment of excursion fees, subject
contributions, etc., it is not necessary to issue a 'Form Letter'.

Ensure a file is started to hold a copy of correspondence and ATO
approval for the tax deductible bank account.  Details of all periodic
receipts and payments transferring trust funds from the Official account
to the library or building fund should be filed.  All related reports
including the program budget variance reports and transaction reports
are kept in this file for reference.  This will make research easier if
or when the tax office makes enquiries.

CASES Procedures

Chart Level 1

If it does not already exist, create an account code for library or
building fund bank account.

Chart Level 2

Code 0049 under 'Locally Raised Funds' called Donations is to be used
for receipting funds. 

Chart Level 3

Create an account code under 'Miscellaneous Expenditure' for the
movement of funds from the Official account to the library or building
fund account.  E.g. 0141 Library/Building Fund Transfers.

This level 3 account code should only be used for the transfer of funds
from the Official account to the library or building fund account.  It
should not be used when making payments for goods received directly from
the library or building fund bank account.

Chart Level 4

A Building Fund program, 458, has been established to record
transactions relating tax deductible community donations. For those
schools who have a Library Fund a code can be established for the
recording of transactions.


Transferring funds from the Official account into the approved library
or building fund account.

When moving funds from the Official account into the library or building
fund account, the school should process the transaction as a payment
from the Official account and a receipt into the library or building
fund account.

THIS TRANSACTION SHOULD NOT BE PROCESSED AS AN INVESTMENT TRANSFER.

Illustrative Examples

Payment for goods received using library or building fund account money.

All payments that relate to the library or building fund must be made
directly from the library or building fund bank account using the
appropriate expenditure line item.

When paying for goods received, do not use the level 3 account code that
has been established for the transfer of funds between the Official
account and the library or building fund account.

Example transaction codes

Assume a building fund was authorised by the ATO and the school created
0003 as the bank account on chart level 1, and the level 3 code created
for the movement of funds was 0141.  The following transaction codes
would be appropriate in the examples illustrated.

1.  School receives a cheque for $120 from a parent, including $45 for
the building fund.

Official account transaction code for donation =3D  0002  0049  0000  458
000

2.  School has accumulated $1,200 in Program 458 Building Fund and
wishes to transfer the funds from the Official account to the building
fund bank account.

Official account payment transaction code =3D 0002  0001  0141  458  000

Building fund account receipt transaction code =3D 0003  0049  458  000

3.  School is purchasing a door from the building fund account.

Building Fund payment transaction code =3D 0003  0001  0101  458  000

 

 

 

Bev Tewkesbury

Relieving Business Manager

Lilydale Heights College

email: tewkesbury.beverley.d at edumail.vic.gov.au
<mailto:tewkesbury.beverley.d at edumail.vic.gov.au> 

Phone:  9735 7004

Fax:      9739 5463

 

 

 

________________________________

From: busmanagers-bounces at edulists.com.au
[mailto:busmanagers-bounces at edulists.com.au] On Behalf Of Green, Tracey
T
Sent: Monday, 3 July 2006 1:37 PM
To: busmanagers at edulists.com.au
Subject: [Busmanagers] CO OPERATIVE LOANS

 

Good afternoon everyone and welcome back.

We are looking at Cooperative loans does anyone have one and how do they
work. Any information would be great!!

 

Cheers

Tracey  :-)

Tracey Green

Business Manager

Ashwood College

green.tracey.t at edumail.vic.gov.au

Ph: 9807 1333 Fax: 9888 1441 

 

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