Configuring Master / Subordinate Funds

Configuring Master / Subordinate Funds

FIMS keeps a complete, internally balanced General Ledger for each Fund and tracks all financial activity at the Fund level.

Even if a Fund is designated for more than one Grant-making purpose, it can be managed within a single Fund record in FIMS. For example, if the Fund agreement stipulates that available dollars are to be distributed to two agencies, one Fund record can track both of these distributions.

Contributions to the Fund cannot be individually designated. Proceeds from endowment contributions or Gifts to available will be distributed to both agencies per the original contract. If contributions to a Fund are designated for different purposes or if contributions and net assets must be categorized separately in General Ledger for some other reason, you should create more than one Fund record in FIMS. For example:

• If a Donor to the City Park Beautification Fund can stipulate whether a contribution is for the East Park or the West Park, you could establish two Fund records in FIMS.

• If you have an agency-designated Fund that is the result of contributions from the agency itself, along with contributions made to the organization by other Donors to benefit the agency, you will need to track the assets in separate Funds to meet the financial presentation guidelines of FASB 136.

While this multiple-Fund technique satisfies certain financial tracking and reporting needs, it raises the issue of combining and presenting the assets and activity of these related Funds as a single Fund on Fund Statements and Columnar Financial Statements. To solve this issue, FIMS allows you to link related Funds as Master and Subordinate Funds.

Note: This is not an issue for Consolidated Financial Statements, which are designed to combine financial data from selected Funds.

1. Create a separate Fund record for each of your Master and Subordinate Funds. Refer to Creating a Fund Record for more information.

2. Open the Fund record that you want to define as the Master Fund and then click the Fund 2 tab.

3. Click the Fund Statement radio button on the Fund 2 tab.
   
   Fund 2 Tab (Fund Statement Section)
   

4. Click the Add Fund button next to the Subordinate Funds field. The Fund Lookup window opens.

5. Select the desired Fund record, and then double-click the selected record to add it to the Subordinate Funds field.

6. Repeat this process for any additional Funds you want to add to the Master Fund.

7. Click the Save button on the toolbar to save the Master / Subordinate link.

Note: When you view the Fund Statement section for each subordinate Fund, the Master Fund will automatically be listed in the Master Fund ID field.

Tip: Creating and Coding Master / Subordinate Funds

• Give your Master and Subordinate Funds alphabetically contiguous Fund ID codes and Sort Names. For example, if the Millvale Avian Sanctuary Fund is an agency-designated Fund that has some assets contributed by the agency (which must be presented as liabilities). The Avian1 Fund could be used to track the contributions of individual Donors, and the Avian2 Fund could be used to track the agency contributions.
• There is a slight reporting advantage if you create a new Master Fund that does not have a General Ledger and make existing Funds (that do have a G/L) subordinate to it. The Fund codes (Division, Fund Class, Fund Type, and Sub Type) for the Master Fund should be similar to the subordinate Funds, but there should be some way to distinguish it from the standard Funds on reports. For example, you could use the Division or Fund Class code for this purpose.
• If you are using the Master / Subordinate Fund technique to conform to FASB 136, you should also uniquely code liability Funds (contributions from the agency) to create consolidated financials that eliminate their assets from net assets. The Division or Sub Type code could be used for this distinction. Please contact FIMS Support to discuss the code strategy that will work best for your organization.

Tip: Creating Fund Statements for Master / Subordinate Funds

• For Fund Statements, Fund Statements Export, and Columnar Financial Statements reports from General Ledger, subsidiary Fund account balances will be combined under the name of the Master Fund.

  Note: You can also choose to print a separate Fund statement for each subsidiary Fund. Refer to the Fund Statements Export for more information.

• When you export a Master Fund via the Fund Statement button in the Fund Management module, the combined balances of the Master and Subordinate Funds will always be exported under the Master Fund name. Subordinate Funds will also be exported if the saved Default includes this option.
• When you export a Subordinate Fund via the Fund Statement button in the Fund Management module, only the balance of the Subordinate Fund will be exported.