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Glossary

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
asset
Something with residual value in the next year. It could be tangible — for example, a piece of equipment — or intangible — for example, money stored in a bank. Items bought for immediate use, such as stationery, are consumed and do not become assets.
accountable forms
Defined as cheque books, order books and receipt books.
accounting period
Are calendar months. Also see financial year.
accrual accounting
Financial transactions are recognised when the liability or obligation is created. In accrual accounting the expense is recognised when the goods are received. Compare with cash accounting below.
annual financial statements
The set of reports is required to be completed each year. The section 'What to Report' will fully detail the requied documents.
annual turnover registration threshold
The annual turnover registration threshold is based on current or projected turnover (net of GST) for a rolling (backwards or forwards) 12-month period. Total turnover is gross receipts of all activities and subcommittees (for example, Outside School Hours Care (OSHC) subcommittee or uniform shop), but excludes the turnover from sales of food and drink from the tuckshop and specified non-regular fund-raising events such as the annual fete.
auditor
The person appointed by the P&C Association to audit (officially examine and verify) its accounts.
authorised
Someone who has been approved by the P&C (by motion at a meeting) to act on its behalf.

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balance
The amount of funds in a bank account at a point in time. For example, a monthly balance is the amount of funds in the bank account on the last day of the month.
balance sheet
One of the annual financial reports. See Example 8.
blank cheque
A cheque that has the amount or the payee sections blank. Never sign a blank cheque.
bank reconciliation
Verifying that balances in the bank match those recorded in the books of the association and explaining any differences that exist, such as unpresented cheques. This is a critical process in achieving financial accountability. Example 3 details
budget
A planning document to show plans for expenditure and expectations of income for the planning period (usually the financial year of the P&C).
business activity statement (BAS)
An Australian Taxation Office return is required to be lodged by P&Cs that have registered for GST.

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cash accounting
The process of recognising financial transactions only when there is a cash impact as opposed to accrual accounting (see accrual accounting above). In cash accounting an expense is recognised only when the invoice is paid.
cashbook
A book detailing the cash receipts and cash payments. See Example 2.
cash flow
The process of ensuring that funds will be available for planned expenditure at the time the payment is required. Usually done in conjunction with the budget on a monthly basis. While total income may exceed total expenditure, the funds must be available at the time of payment. To avoid a cash flow crisis, it may be necessary to revise the budget or delay expenditure until more income is available.
cash flow statement
A report detailing the timing of receipts and payments. See Example 1.
consolidated statements
Where more than one set of accounts is generated, a combined or summary statement must be produced. This consolidated report is simply the sum of the individual reports, for example, a summary receipts and payments report.
cumulative totals
Cumulative totals are the accumulation of a total with a previous total. This process is used in cashbooks and similar. To show the grand total up to the present (YTD figures).

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daily takings sheet
A daily report completed by the tuckshop, uniform shop or other business activity detailing the gross takings. See Proforma 1.
deficit budget
Where budgeted annual expenditure is greater than budgeted annual receipts.
direct debit
A process where a debt (payment) is taken directly from the bank account. Loan repayments may be arranged to use direct debit from the association's account.

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electronic funds transfer (EFT)
A method of making payments directly into the payee account. Wages may be paid this way. The process saves withdrawal of funds from one account for deposit into another account.
executive members
P&C president, vice president/s, treasurer and secretary.

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financial year
The 12-month reporting period. P&Cs can choose their financial year to be January—December (the preferred option), July—June or October—September.
float
Temporary loan to allow for expenditure before income is returned. A float may be required for a fete, for example, to allow payment of expenses before the fete is held and money raised.

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imprest system
A cash advance system, for example a petty cash float. A process to advance a certain amount to fund the purchase of minor items.
input tax credits
The tax credits available to GST-registered P&Cs on purchases that include GST. These credits are claimed on the quarterly BAS return submitted to the ATO.
input taxed
A non-profit sub-entity that is input taxed does not pay any GST on income received and cannot claim any input tax credits on expenditure.
instalment activity statement
An ATO return that is required to be lodged by a P&C that has employees but does not complete a BAS. P&Cs that are registered for GST and turn over more than $50 000 per year put these details in their BAS.
inventory
Stock on hand.
invoice
The bill associated with ordering goods and services. It should match an order in all details.

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monitoring
In the accounting context, the comparison between planning (budget) and actual results. Monitoring is essential to provide early warning of problems or to show trends.

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night safe
An after-hours deposit box facility provided by banks so that cash taken late in the day can be stored safely in the bank outside banking hours. Never store P&C money in private homes.

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official
Official business relates to the business of the P&C rather than to private business for an individual. Private and official business must never be mixed.

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payment vouchers
Documentation supporting payments, for example, an invoice.
profit and loss
One of the annual financial reports. See Example 9.

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qualified audit
The auditor has had to qualify his/her report because of a problem with the accounts. See Example 6a.

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receipt
Can describe income or payments to the association, but is also the document issued to a person making a payment to the P&C to give proof of payment.
recurring payments
Payments that recur every year. For example, insurance is a recurring payment as opposed to the purchase of a photocopier which is a one-off capital payment.
recoupment
Reimbursement of monies expended. For example, out of a petty cash float of $100, payments which total $55 have been made. A recoupment cheque would be raised for $55 to reinstate the full $100 value of the petty cash float.
register
Used in the manual to describe a list. A register of accountable forms is a listing of all forms and their location or who has possession of them.
reporting year
See financial year above.
revenue programs
A program or activity that generates revenue. For example, a chocolate drive.

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senior internal auditor
An employee of Education Queensland, usually located in a district office of the department.
statement of receipts and payments
One of the annual financial reports. See Example 7.
stock
Merchandise purchased for resale (inventory). Stock control is essential to prevent losses and to monitor value of stock on hand.
subcommittee
The Education (General Provisions) Act 1989 provides for P&Cs to have subcommittees. While they may have other names, such as Swimming Club or Parents' Group, they are still subcommittees and are obliged to comply with this manual in all respects.

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trading activity
An activity that generates a profit or loss, for example, the tuckshop or uniform shop.
trading statements
One of the annual financial reports. See Example 5.
transfer
In the context of this manual, a transfer is the swapping of funds between accounts. These can be internal transfers, such as when profits from the tuckshop are transferred to the main account, or external, such as when invested funds are transferred back to the main account. Internal transfers need to be accounted for in consolidation of annual statements.

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variance
The difference between what was planned and what actually happened. Variances are part of budget monitoring and causes of variances should be found to permit total understanding of the current position.
voucher
Documentation supporting a transaction. For example, an invoice when making a payment to a supplier, for an investment a suitably worded minute, etc.

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year to date (YTD)
Progressive totals for the year (to date).

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