Connecting ShulCloud to Financial Software – Syncing to Financial Software
This article requires a basic understanding of the ShulCloud financial system, including how charge types are used and how transactions are entered. The information in this document is independent of the financial software you use; the concepts are the same for all financial software.
Syncing is the regular process of sending information from ShulCloud to your financial software. If you are interested in doing a one-time import from QuickBooks to ShulCloud to get your initial financial history in place, please contact the help desk – this help document does not apply to you.
Overall Summary and Requirements
ShulCloud can transfer (“sync”) batches of transactions to financial software. That is, ShulCloud does not transfer individual transactions on a per-member (customer) basis. What appears in your financial software is a summarized batch of transactions, with debit(s) and credit(s)) to various G/L accounts (summarized based on G/L accounts).
There are two sync methods from ShulCloud to financial software: 1) Cash basis; and 2) Accrual basis. In cash-basis syncing, debits are to a bank account, and credits are to G/L accounts (usually income). In accrual-basis syncing, for charge batches, debits are to an A/R account, and credits are to income accounts. Deposit batches in accrual-basis syncing have debits to a cash (bank) account, and credits to an A/R account.
The ShulCloud financial team must set up the sync for you to accommodate most financial software (e.g., QuickBooks (online and desktop); SAGE, MIP) – while you can create batches of transactions, you will not be able to initiate a sync to financial software without having the ShulCloud financial team complete the setup. There is a one-time fee for this setup, which includes a training to review the necessary steps to implement and maintain the process on an ongoing basis.
Please note that the following conditions must be met to set up the sync to financial software:
- Any imported data in ShulCloud must be final; we can’t set up the sync if there will be any additional data imports. This usually means that there will be a several-day (or week) lag between having your final data imported and when you automate the transfer of financial transaction to your financial software. Synagogues typically simply suspend transfer for a week or two, getting familiar with ShulCloud before allowing ShulCloud to connect to the financial software (obviously, you’ll keep paper or other records during that time as backup until the connection between ShulCloud and the financial software is set up).
- Your financial software must be completely set up, including a robust chart of accounts (with enough income accounts). While you can make do with a limited number of income accounts, and you can certainly add additional G/L accounts later and reconfigure ShulCloud to accommodate the expanded chart of accounts, ShulCloud is not able to set up your chart of accounts, or make any accounting recommendations (beyond what is provided in this document).
- You will need to specify if you are looking for cash-basis syncing or accrual-basis syncing. If you wish to change after the initial sync setup, there will be a one-time change fee.
- You must have several days’ (ideally several deposits worth) of transactions entered into ShulCloud (not from imported data). Without transactions, we are unable to provide adequate training on how to do the sync process. If you are going to be using accrual-based sync (covered later), this means both several day’s charges, and several transactions comprising several deposits.
As there is a requirement to have several days' worth of transactions entered into ShulCloud before setting up the sync, there is typically a lag between going live with ShulCloud and connecting ShulCloud to your financial software. All the ShulCloud data will ultimately be transferred to your financial software, but please expect that there will be a period of time where the general ledger is not entirely in sync with what happens at the bank. We advise that either you begin to create deposit batches right away, or maintain a record of which transactions are included in each physical bank deposit. Some synagogues enter deposits manually into their financial software during this lag period, then delete those deposits after the initial sync is run (to remove duplicates).
Cash-Basis Syncing
In cash-basis syncing (which is the recommended method for most synagogues unless there is an explicit reason to do accrual-basis syncing), you will tell ShulCloud which G/L account each charge type connects to (i.e., where to put the funds in the financial software based on which charge type is used in ShulCloud for the transactions). QuickBooks users can also assign a class to each charge type, if classes are used.
An example of what might be transferred to the financial software under a cash-basis sync is here (this would be the journal entry if you are using financial software other than QuickBooks):
|
In this example, a $5,000 deposit is being made to the operating account, which is comprised of various payments coming from the listed G/L accounts. Note that each of the credit amounts may represent one or more payments, but they have been summarized by ShulCloud to transfer as a batch. Also, note that some of the line items may not be income accounts, they may be other types of accounts (e.g., Charity Appeal might be a liability account; Online Convenience Fee might be an expense account). One thing to understand for cash-basis syncing is that your financial software will not carry an A/R balance; for most synagogues, this is likely not a serious issue, as statements, aging reports, and A/R reports are done directly in ShulCloud – the only reporting done in the financial software is P&L reporting.
In cash-basis syncing, for each charge type you will only specify a linked G/L account. An example of the charge type linkage is shown here (note this is found when editing charge types in My Lists, and will only be visible after the sync is set up by ShulCloud staff):
In the example above, you enter the actual account number from your financial software. If you are using QuickBooks, you will be able to select the linked G/L account from a list, like this:
Note that the list is a drop-down, and can be searched for text strings to make finding the G/L account easier. As shown, ShulCloud can assign QuickBooks classes to line items.
Accrual-Basis Syncing
In accrual-basis syncing, you will tell ShulCloud which G/L account each charge type connects to, AS WELL AS which A/R account is used for that type of income. QuickBooks users can also assign a class to each charge type, if classes are used.
When using accrual-basis sync, two types of batches will be transferred – charge batches, and deposit batches. An example of a charge batch is here:
|
Debit |
Credit |
|
|
Accounts Receivable Account |
$ 4,000.00 |
|
|
Membership Dues |
$ 1,000.00 |
|
|
Shabbat Dinner |
$ 450.00 |
|
|
Building Fund |
$ 500.00 |
|
|
Music Fund |
$ 100.00 |
|
|
High Holiday Seats |
$ 1,250.00 |
|
|
Charity Appeal |
$ 350.00 |
|
|
Youth Donation |
$ 350.00 |
In this example, a batch of charge transactions have been combined into a single charge batch (more on charge batches later). An example of a deposit batch in accrual-basis syncing is here:
|
Debit |
Credit |
|
|
Bank of High Returns Operating Account |
$ 4,000.00 |
|
|
Accounts Receivable Account |
$ 4,000.00 |
In accrual-basis syncing, each charge type will be linked to both a G/L account (typically income), and an accounts receivable account. An example of a (non-QuickBooks) linkage can be found here:
An example of a QuickBooks linkage under accrual-basis sync is here:
In this case, the synagogue has multiple receivables accounts for different elements of income. Again, classes can be assigned. When using accrual-basis syncing, you can also specify a different G/L account to use for reversed transactions (e.g., write-offs). This is an optional feature; most synagogues rely on a report called “Charge Reversals” on the “Reports” menu to report on things such as write-offs and financial aid.
Creating Deposit Batches
Deposit batches are created manually by selecting the transactions that belong in the deposit. To facilitate bank reconciliation, we STRONGLY recommend that deposit batches in ShulCloud EXACTLY match the deposits that are made to the bank. This is the recommendation for check deposits, cash deposits, combined check and cash deposits, and credit card deposits.
To select the transaction that make up a deposit, click on Deposits (from the main menu). Select the correct bank account (every bank account into which actual money is deposited must have a corresponding account in ShulCloud), and select the data of the deposit. A deposit ticket text field is available but is optional. Then, select the specific transactions that are part of the current deposit. There are filters at the top of the list to help narrow the transaction list. Select the transactions by clicking the checkbox next to it, as shown here:
In this example, a deposit of $870 is being made to a bank account, which is comprised of four transactions (in this case, checks). When you confirm that the deposit is correct and complete, click the “Create this Deposit” button at the bottom of the list, and on the next screen, confirm the deposit. Assuming your ShulCloud site is set up to sync, and all the charge types used in the batch are correctly linked to appropriate G/L accounts, the next time a sync is requested, the information will be sent to your financial software.
Credit card transactions work the exact same way, and require the same activity. You may want or need to consult your gateway’s daily settlement file or report to find out which transactions settle together in a single deposit (gateways typically sweep all transactions completed on one day into a single deposit for the day). You should also consult your bank statement (or online statement) to ensure that the deposit batch you create exactly matches the deposit amount actually deposited to your account. We suggest dating your credit card deposit batches with the date of the deposit (which is usually a day or two after the credit card transaction settles).
When reversing a payment that has already been deposited, ShulCloud will create a negative charge batch. If you allow this batch to sync to the financial software, it will create a negative cash transaction (which might be desirable). In some cases, credit card reversals will result in a withdrawal from the bank account. In other cases, a reversed credit card charge will be deducted against a day’s settlement amount. Use the appropriate method to carry these over to financial software:
- If the credit card reversal is treated as its own transaction, create a batch of just that transaction and allow it to sync to the financial software. This will create a reduction in your cash account.
- If the credit card reversal is handled as a reduction of a day’s settlement amount (the deposit is the net of all credit card payments less any reversals), then include the negative payment in the deposit batch so that the deposit amount of the batch matches the deposit amount at the bank. Again, the credit card settlement report or file is your best source for this information.
In either case, if a journal entry needs to be created, ShulCloud will create it as an adjustment batch, and will send it over to your financial software.
In some cases you may need to issue a refund. We suggest creating the reversal in ShulCloud, and then making a batch of the resulting single negative cash transaction. After you’ve created the batch, mark the batch as imported BEFORE syncing so that it isn’t actually sent to the financial software. To do this, go to the Deposits screen, and click on “View Deposit History” at the top left. Find the unimported batch, and click on “Mark/Delete” as below:
Then click “Mark as Imported Record”:
Remember that if a deposit batch includes summarized financial information for a charge type which is not correctly linked to a G/L account, the entire deposit will not sync. This prevents entry of duplicate information.
Deposit batches are most easily viewed in a bank account ledger. Deposit batches all have a unique batch number to help identify them. When transferring to financial software, they will appear with an SC in front of them (e.g., “SCXXXXXX”). Different financial systems will show these deposits differently, some as actual deposits, some as journal entries.
Creating Charge Batches
Charge batches are only used with accrual-basis syncing. ShulCloud creates charge batches automatically – there is no action required to create them. Under normal circumstances, a charge batch is created for every day there is at least one charge in the system. A charge batch can contain the summarized information for one or more charges.
You can view the charge batches in your system by going to the Deposits screen and clicking on Charge Batches. It may take a few minutes to load this screen as the system only creates the charge batches when either a sync is requested, or the page of charge batches is loaded. If you are not set up for syncing or you are set up for cash-basis syncing, this page will not be available. A snippet of charge batches, most imported and one not imported yet, appears here:
Occasionally, ShulCloud may create multiple charge batches in a day. There is no harm to this, it is simply another entry in the A/R account(s) in your financial software. The usual reason for this is if you sync your batches, and then create additional charges.
If you have need to create a charge reversal (i.e., a dues abatement or tuition scholarship), ShulCloud will create the associated adjustment (reducing A/R and debiting income) as a journal entry and send it to the financial software, just as it does for deposit batches.
Charge batches are most easily viewed in your financial software in the A/R ledger. Charge batches all have a unique number which does get sent to the financial software.
Sync Errors
Sync errors can occur for several reasons. The sync process will provide information about resolving and sync errors. The most common error is a result of not correctly linking a charge type to the associated G/L account. If you receive this error, you can click a link in the error log (or in the email you receive after the sync) to take you to the batch, and from there you can see if a charge type is not linked. If you click the charge type, it will take you to the proper place in My Lists to make the correct linkage. Other errors may be a result of a transaction date being outside of when the books are open (e.g., prior to the most recent close date), or other limitations on entering certain data into a specific financial system. The possible errors are well-documented in the ShulCloud help system.
Unapplied Payments
Many synagogues receive occasional (or frequent) overpayments, or payments “on account”, that are essentially credits on account. This can also happen following a stock donation, where the value credited to the member for the stock exceeds all open charges. Some synagogues have a historical practice of always assigning these credits to “Dues” temporarily. While this is possible in ShulCloud, it will temporarily incorrectly overstate your dues income. The recommended approach is to leave the overpayment or credit amount on the member’s account as an open credit, or unapplied credit (don’t check off any charges when entering the payment).
ShulCloud offers the ability to select which G/L account in the financial software will hold the unapplied payments. This setting will always be accessible from a button on the Deposits page. It is widely recommended that unapplied payments be held in a liability account, as they are not technically funds the synagogue has earned yet. It is important to set the connected G/L account for unapplied payments because if it is not set, any deposit or charge batch that has an unapplied component will not sync. Also, be aware that ShulCloud uses this account for certain clearing purposes when some reversals are made. Usually we will set up this linkage during the sync setup.
One thing to note is that synagogues often begin using ShuCloud with a prior balance in the equivalent of unapplied payments. Many synagogues didn’t previously explicitly direct this to a liability account, so those funds might be found (incorrectly) in an A/R account, or an Undeposited Funds account. We recommend writing those amount off (using a journal entry, possibly against Owner’s Equity). Alternatively, you can create a journal entry in your financial software moving those unapplied payments to the new liability account. Please consult your accounting professional as to how to manage this change.
A Word about Accounts Receivable Accounts in QuickBooks
QuickBooks has some known limitations for the use of the accounts of type “Accounts Receivable” that are outside of ShulCloud’s control. For instance, you can not have a transaction that has a debit to an A/R account and a credit to another balance sheet account (this is a common occurrence in synagogues). As such, we strongly recommend that you create pseudo accounts receivable accounts by creating “other asset accounts” in QuickBooks and using those as the A/R account(s) instead. This may require a journal entry to move data in your “old” A/R account(s) to the new (asset) A/R accounts.
Syncing to Financial Software other than QuickBooks
For the time being, the ShulCloud to QuickBooks methodology is the most robust (either online or desktop); all elements of the sync (other than actually triggering it each day) are automated – no manual importing is required. As indicated above, ShulCloud will keep a list of the Chart of Accounts internally, to facilitate linking charge types with G/L accounts (as part of every sync with QuickBooks, ShulCloud updates the chart of accounts). As well, ShulCloud will automatically mark batches (deposit and charge) as imported, to prevent duplicates from being sent over to QuickBooks.
Syncing with other financial software, while fairly simple, is a multi-step process. You will have to export a CSV from ShulCloud, and then import that file into the financial software (the method for your specific financial software will be explained during the sync setup training). Then, you must manually mark the batches (deposit and charge) as imported, to prevent importing the financial information again.
Setting up the Sync
If you are ready to set up the sync to your financial software, please contact ShulCloud support to schedule your session.
Please Note: nothing in this document is intended to be accounting advice. Please rely on your own accounting and tax professional(s) to determine the appropriate financial needs of your synagogue.