With the end of the year (both financial and calendar) fast approaching, we thought it a good opportunity to send the first of our new regular Parish Newsletters. These newsletters will provide an opportunity for us to share information on upcoming events or key deadlines, to introduce the team and provide clarification on things we get regular questions on. If you have any queries you think may be useful for inclusion, or suggestions to improve the newsletter, please let us know. Covered in this newsletter:
Year End Processes
IRD Update – Withholding Tax
Bank Account Support
Key Contact Details
Payment Batches – a new option
Parish Accountant profile – Priya Singh
We know there has been a lot of change over the last couple of years. We are happy to meet in person or zoom and run through any query (and the Parish Accounting Manual), especially if you are a new treasurer. If you don’t have a copy of the Manual, please let us know.
Year End Processes
Financial year end (31 December) can be a busy time for both the treasurers and parish accountants. We thought it’d be useful to share some key information about the end of year period to help make life a little easier!
Trust Management Christmas Closedown
Our offices will be closing at midday on Thursday 21 December 2023 and reopening on Monday 8 January 2024. Parish accountants will not be available over this period. If you have any genuinely urgent matters (such as payroll issues) then please call Marie (refer below for contact details).
Our final payment run for 2023 will be made on Thursday 21 December. All invoices (including bank account support (refer below) and approvals) will need to be with us by 9am Monday 18 December. This will be a strict deadline with any urgent payments requiring special approval to go ahead. Our first payment run for the new year will be on Friday 12 January 2024, with payment batches to be with your parish accountant by close of business on Tuesday 9 January 2024. Please manage the expectations of your suppliers as we will not be able to make payments when the office is closed.
Reporting As in previous years, the first reporting you will receive in 2024 will be the January/February combined report. These should include February Month and Year to Date results. Standalone January reports are not prepared as our focus is on finalising the year-end results during January / February.
Information Required We will shortly be sending out emails with requests for information. This is information we need to be able to plan work allocations and deadlines over the busy January / February period. Please read them carefully and let your parish accountant know if you’re unsure about any of the information requested. Delays in receiving the necessary information (such as your meeting dates, year end support or confirmation of transactions) could result in delays in your reporting.
October numbers - getting things right We are looking to reduce the workload for both treasurers and parish accountants over January / February. As such, could we ask you to do a thorough check of the Year-to-Date numbers in your
October reports. We can send a detailed trial balance and/or transaction listing if that would be useful. Could you please send through any corrections / alterations you think need to be made now, rather than waiting for year end. The hope is that when we prepare the year end accounts in January / February, corrections will be minimised and only required for the November / December period.
IRD Update - Withholding Tax – when and why? For certain types of contractors (NOT employees), we are required (by law) to deduct With-holding Tax (WHT), regardless of whether they are GST registered. Further details are below, but in short, the IRD requires us to police people and make sure they’re paying tax. If a contractor:
Provides one of the services outlined on page 3 (including cleaners, entertainers (eg organists), gardeners) the IR330C form (Link Here); and
Does NOT operate through a limited liability company; and
Operates as an individual / sole trader – i.e. they pay their own PAYE at the end of the year, they will likely fall under the WHT requirements.
If WHT does need to be deducted, we will provide you with the IR330C form for them to complete. They need to do this to avoid us having to deduct the highest rate of WHT (45%). They are able to elect their deduction rate (usually between 10 and 100%). The WHT that we deduct gets paid to the IRD and allocated against your contractors personal PAYE account. It is then offset against their year-end PAYE due to the IRD, so they don’t pay twice! It is possible in some circumstances for contractors to obtain an exception from WHT. This form (IR332) can be found on the IRD website. We often hear that your contractors do not have WHT deducted by any other organisation they work for. Unfortunately, we can’t avoid the requirements of the IRD based on whether other organisations/individuals are doing it correctly or not. We have the capacity and systems to deduct and therefore the IRD says we must. To avoid these kinds of suppliers getting a surprise when it comes time to receive their first payment, it pays to get their WHT status confirmed with us at the time of engaging them.
Bank Account Support – why?
We often get asked why we require bank account support to be able to pay new suppliers or employees.
The reason why
Trust Management is responsible for handling other people’s money – for the parishes, but also for our other clients and our funds that organisations invest in. As such, we are regulated by the Financial Markets Authority to ensure we have effective controls over how we make payments from other organisations bank accounts. In addition, our duty of care to our clients means we have to take all reasonable steps to protect your assets.
One of these controls is that ALL payments to suppliers, staff, etc need to have the bank account number verified by agreeing it back to a bank created document (see below for types of support). Fraudsters are becoming increasingly sophisticated and are now able to intercept emails carrying invoices and change bank account details to their own account. Our checks (including obtaining support for new suppliers, and telephone confirmation with suppliers where bank account details change) ensure that ALL parties (yourselves, the supplier and us) are protected from potential fraud. This is a control we are NOT able to make exceptions for.
The best way to ensure suppliers don’t get a surprise is to let them know when you first engage them that this information will be required. This way they can provide it at the time of your first invoice (or earlier if possible).
The types of support we can and can’t rely on
The support we need must be a bank created document – showing the bank logo, the bank account number and the bank account name (NOT an editable nickname). The name on the bank account must be the same as the name on the invoice. The best examples of these are:
A banking deposit slip
The top of a bank statement (your supplier can cover up all other information so we’re only getting info that’s already on their invoice – name, address, bank logo and account number)
A snip / screenshot from online banking (NB – making sure it’s the formal bank account name and not an editable name on that’s showing)
A letter or stamped slip of account confirmation from the bank.
We will come back to you if any support provided does not meet our requirements.
Paying Suppliers – improving the process
The current payment batch process, while straight forward to compile and have approved at a parish level, does come with a risk of human error. Each invoice is manually typed into our finance system by our Accounts Payable administrator, descriptions are either left blank or guessed based on the content of the invoice and parish accountants need to pull out any WHT contractors. Across the 90 parishes, numerous trusts and other Trust Management entities, there are hundreds of invoices that need entering each week.
Parish Accountants review the final batches carefully, however with handwritten documents and often very large batches, there is a chance of an error being missed. We have looked at a number of ways to improve our current accounts payable processes. We have bought on board an additional resource (Johanna Snyman) whose role is combination parish accountant and accounts payable support. We are also developing an automated AP system that will make invoice approval and loading much easier (more on this in our next Newsletter!). Finally, we have introduced a spreadsheet that should help reduce a lot of the human error. Parishes can enter their invoice details (including descriptions that make sense for them) and send it with invoice copies to their parish accountant. This spreadsheet will then be uploaded directly into our finance system – removing the need for manual entering. If you are interested in using this upload spreadsheet, please let your parish accountant know. We have a few parishes who have been using it for a number of months (both big and smaller parishes) who have found it works well.
Key Contact Details We understand sometimes it can be hard to get in touch with people when something urgent comes up. In the first instance, all queries should be directed to your parish accountant. Each parish accountant has a mobile so you can reach them whether they are working in the office or at home. If you’re not sure of your parish accountant’s number, please ask them to provide it to you. If your parish accountant isn’t able to assist with a query, they will reach out to the relevant team member for support and update you on progress. If for any reason you can’t get hold of your parish accountant and your matter is urgent, your next port of call should be Marie Nickalls (Parish Finance Manager) – her email is mnickalls@trustmanagement.co.nz and her mobile is 021820649. (Please note that Grace Sun is no longer working with the parish accounting team so will not be able to assist you with any queries.)
Should all of these avenues fail you can reach out to our CFO Sarah Hipkiss (shipkiss@trustmangement.co.nz). Please note that the Trust Management is not part of the Diocesan team. Any Diocesan-related queries should be directed to them, and any questions related to your parish accounting should come to us.
Get to know your Parish Accountants
Meet Priya
Beach or snow? Definitely, the beach coming from Fiji
Favourite thing about your role? Solving problems, it’s like solving a puzzle
What was your first job? An internal auditor at EY
Favourite movie? Harry Potter is a lot of fun
Best holiday destination? Dubai – such a different culture and amazing surroundings
Any Fur babies or human babies? – human baby – 8 year old son.
Share a quote with us: Mother Teresa “If you want to change the world, go home and spend time with your family”