; -*- ledger -*-

; -*- coding: utf-8 -*-

;

; config-tags.ledger: The Ledger CLI tag declarations for NPO use-case.

; Copyright © 2013, Bradley M. Kuhn.

;

; The copyright holders wish that this document could be placed into the

; public domain.  However, should such a public domain dedication not be

; possible, the copyright holders grant a waiver and/or license under the

; terms of CC0-1.0, as published by Creative Commons, Inc.  A copy of CC0-1.0

; can be found in the same repository as this README.md file under the

; filename CC0-1.0.txt.  If this document has been separated from the

; repository, a [copy of CC0-1.0 can be found on Creative Commons' website at

; http://creativecommons.org/publicdomain/zero/1.0/legalcode

; ################################# TAGS ################################

; The Statement, Receipt, and Invoice tags' values should always a be a

; relative path names.  Note that we "check", but do not "assert" that the

; file name match a standard Unix-like path syntax, without spaces in the

; file name.

tag Statement

    assert value =~ /[^\/].+/

    check value =~ /[^\/][^ ]+(\/[^ ])+/

tag Receipt

    assert value =~ /[^\/].+/

    check value =~ /[^\/][^ ]+(\/[^ ])+/

tag Invoice

    assert value =~ /[^\/].+/

    check value =~ /[^\/][^ ]+(\/[^ ])+/

; IncomeType refers to the types of income a non-profit can receive.  In this

; example, it's for the categorizations on the USA Form 990.  This could be

; changed to accomodate other jurisdictions around the world.

tag IncomeType

    assert value =~ /^(Donations|RBI|UBTI)$/

; Program tag must match the general format of a ledger account as an

; assertion, but we at least check known names of programs, so that warnings

; are produced if a new program never seen before is encountered.

tag Program

    assert value =~ /[ A-z0-9\-]+(:[ A-z0-9\-]+)*/

    check  value =~ /^(Main Org:(Overhead|Direct Fundraising))$/

; Entity tag is just a string, but shouldn't have spaces, just letters,

; numbers and dashes.

tag Entity

    assert value =~ /[ A-z0-9\-]+(:[ A-z0-9\-]+)*/

tag TaxImplication

fiscally sponsored projects.

NPOs that don't need this feature can, in most cases, use the methods

described herein to deploy Ledger CLI, but should leave out the `:General:`

and `:ProjectNAME:` parts of the account hierarchy, since these are the

primary mechanisms used herein to handle the fiscal sponsorship structure.

### Earmarked Accounts

Many fiscal sponsor NPOs keep earmarked accounts for their member/affiliated

projects.  Furthermore, these projects often may either (a) terminate their

agreement with the NPO, and thus deserve a copy of their books that they can

"take away" with them, or (b) might be affiliated with *other* NPOs that also

hold accounts.  This system of earmarked accounts is designed to make it easy

for projects to have a copy of their own accounts, but not interfere with nor

even be aware of (a) the books of other member/affiliated projects, and (b)

the overall books of the entire NPO.

On the latter point, this system utilizes a directory structure and separate

`.ledger` files to separate out the different projects into different

structures.  This allows member/affiliated projects to take their data and

run `ledger` commands against it, separately and without access to the other

`.ledger` files of the NPO.

Proper Documentation For All Transactions

-----------------------------------------

Ledger CLI offers a flexible structure of tagging any entry, including

separate tags for parts of a split transaction.  This system uses those tags

to ensure proper documentation is included for each financial transaction

that occurs for the organization.

Note that since Ledger CLI is a complete double-entry accounting system, each

transaction can correspond to multiple entries in the general ledger.  The

data entry format of Ledger CLI lists each double-entry accounting

transaction in a text file.

Documentation may in fact differ for entries within the transaction.  Ledger

CLI's tagging structure is flexible in this regard: each portion of a

double-entry transaction can carry the same tag or a different tag.  For

example, in this entry:

    2012-05-03 Sir Moneybags

            ;Entity: Sir-Moneybags

            ;Invoice: accounts/documentation/org/invoices/2012-05-30_moneybags-invoice_as-sent.txt

        Accrued:Accounts Receivable:Conservancy  $100,000.00

        Income:Main Org:Donations               $-100,000.00

            ;IncomeType: Donations

The portion of the transaction that credits the `Income:Main Org:Donations`

has three tags: [`Entity`](#entity-tag), [`Invoice`](#invoice-tag) and

[`IncomeType`](#income-type).  The `Entity` and `Invoice` tags, since they're

listed at the top of the transaction, propagate through and apply to both

sides.  But, the `IncomeType` tag, which has no meaning for `Accrued:`

accounts, so it is applied only to the `Income:Main Org:Donations` part of

the transaction.

Below you'll find detailed descriptions of all the possible tags that are

used in this system.  The actual declarations and enforcement of rules of

these tags can be found in the file `accounts/config/config-tags.ledger` in

this project.

### Documentation Tags

Documentation tags are tags that link to other backup documents that provide

evidence and details that justify a particular ledger entry.  The value of

the tag is a relative path name of a file elsewhere in the same repository

that documents the specific expense.  For example, an entry like this:

     2012-02-05 Office Supply Galore - Online Order

         Expense:Main Org:Office Supplies      $35.00

             ;Receipt: accounts/documentation/org/receipts/2012-02-05_office-supply-galore.txt

         Liabilities:Credit Card:Visa         -$35.00

shows that a purchase was made at Office Supply Galore's online store for

$35.00, and the file

`accounts/documentation/org/receipts/2012-02-05_office-supply-galore.txt`

contains the receipt from that purchase.

#### Receipt Tag

The `Receipt:` tag refers to receipt of some sort.  Typically, this is a

document that shows clear confirmation that the transaction has already

occurred.  The value of the `Receipt:` tag is always a valid pathname in the

repository to the document, [as described above](#documentation-tags).

Some examples of appropriate uses of the `Receipt:` are:

* a point-of-sale credit card receipt from a purchase, given by a cashier or

  sent via email after the purchase has occurred.

* a deposit slip given at the bank upon making an over-the-counter deposit of

  paper checks.

* a confirmation document showing an outgoing wire transfer made by a bank.

* a confirmation document showing transfer of funds between two bank

  accounts.

* A pay advice document generated upon payment of an invoice.

#### Invoice Tag

The `Invoice:` tag refers to an actual invoice, either generated by the

organization or received by the organization.  Typically, this is a document

that is a request for payment, rather than documenting an actual payment that

has occurred.  The value of the `Invoice:` tag is always a valid pathname in

repository to the document, [as described above](#documentation-tags).

Some examples of appropriate uses of the `Invoice:` tag are:

* an actual invoice as sent by a vendor to the organization.

* a request for payment sent by the organization to someone else.

* a reimbursement request submitted by an employee, contractor, or volunteer

  for expenses they've already incurred and would like the organization to

  reimburse (e.g., an expense report, requesting for reimbursement of travel

  expenses).

#### Statement Tag

The `Statement:` tag refers to any sort of written statement received from an

external party (or even perhaps generated internally) that provides document,

insight, or other information about the transaction.  The value of the

`Statement:` tag is always a valid pathname in the repository to the

document, [as described above](#documentation-tags).

Some examples of appropriate uses of the `Statement:` tag are:

* bank statements, as received from the banking institution.

* written reports of travel.

* blog posts made by a contractor documenting their work.

* written organizational policies about the expense.

* just about anything that is clearly not an [invoice](#invoice-tag) nor a

  [receipt](#receipt-tag), but definitely is valid backup documentation for

  the transaction.

### Information Tags

In contrast to documentation tags, information tags can more traditionally be

considered pure "meta-data" for a ledger entry.

#### Entity Tag

The `Entity:` tag is required for many types of ledger entries.  The value of

the `Entity:` tag is a unique moniker that identifies the organization,

company, person, or legal entity that is the external party for the

transaction.

Note that there is no database of these monikers, so typos can cause

trouble.  However, you could implement checks in

`accounts/config/config-tags.ledger` using a regular expression to verify no

typos have occurred.  This would be somewhat cumbersome, since Ledger CLI

would likely require that the monikers be encoded into a regular expression.

Barring that, the

[integrity of your data should be periodically checked](checking-integrity-of-tag).

#### IncomeType Tag

The `IncomeType:` tag is used for all `Income:` accounts.  This refers to the

type of income.  The value of the `IncomeType:` tag is always a string.

Since this particular system is designed for USA non-profit entities who file

USA Form 990, the following `IncomeType` values are supported:

* `Donations`, which refers to standard charitable donations.

* `RBI`, which refers to "related business income".

* `UBTI`, which refers to "unrelated business taxable income.

Not that donor-advised funds and government grants don't currently have their

own `IncomeType`.  It's possible this might be necessary; the authors aren't

familiar with how to handle those items on the Form 990.  It would be a

relatively simple change to `config-tags.ledger`, though, to support other

income types, or to change it entirely to handle use-cases other than USA

Form 990 filing.

#### TaxImplication Tag

The `TaxImplication:` tag is used for all `Asset:` accounts when the

transaction includes a payment of $10.00 or more leaving the account.  This

tag catalogs any tax implications that might occur on outgoing funds.

The most important USA-related issue tracked by this tag are contractors who

go along with a TaxImplication tag.

The possible values for this field are:

* `1099`, indicating the amount paid requires issuance of a USA Federal Form

  1099 for the `Entity` involved.

* `Accountant-Advises-No-1099`, indicating that the circumstances and rules

  seem to indicate a USA Federal Form 1099 should be issued for the `Entity`

  involved, but an outside accountant advised that no 1099 need be issues for

  this `Entity`.

* `Bank-Transfer`, indicating that the amount is a transfer between two

  banking accounts under the control of the NPO itself.

* `Foreign-Individual-Contractor`, indicating that the NPO has established

  that the `Entity` is a contractor residing outside the USA who is not a USA

  citizen and does not for any reason pay taxes in the USA.

* `Foreign-Corporation`, indicating that the NPO has established

  that the `Entity` is a corporation outside the USA.

* `USA-Corporation`, indicating that the NPO has established that the

  `Entity` is an incorporated entity the USA (i.e., "Inc."), and therefore no

  1099 is required.

* `USA-501c3`, , indicating that the NPO has established that the `Entity`

  has federal 501(c)(3) status in the USA, and therefore no 1099 is required.

* `Refund`, indicating that the amount is a refund owed to the `Entity` from

  an amount previously paid to the NPO.

* `Reimbursement`, indicating that the amount is a reimbursement of expenses

  incurred by the `Entity` and thus it is not income to the `Entity`.

* `Tax-Payment`, indicating this is a tax payment to a taxing authority (such

  as the state or federal government) (e.g., a unrelated business income tax

  payment).

* `USA-LLC-No-1099`, indicating that the `Entity` is an LLC, but not the type

  of LLC for which the USA requires issuing a 1099.

* `Loan`, indicating that the `Entity` is receiving these funds as a Loan

  that is expected to be paid back.

#### Program Tag

The `Program` tag is used primarily to track program activity for `Income:`

and `Expense:` accounts.  This allows for knowing what particular initiative

initiated the income (e.g., a specific fundraising campaign) and/or what

particular program activity an expense is toward (e.g., funding travel to

some specific conference).

The Program tag is always a string with the same format as a Ledger CLI

account (primarily for use with Ledger CLI's `--pivot` and `--group-by`,

[as described later](#testing-program-success).

### Account Type Documentation Requirements

Each account type has different documentation requirements.  Based on the

type of the account, it requires a different set of tags.

When Ledger CLI's `--pedantic` option is used, these rules are enforced by

ledger itself via the configurations found in `config-tags.ledger` and

`config-accounts.ledger`.

#### Expense Account Documentation

Each `Expense:` account entry must be tagged with the following tags:

* One of: [`Invoice:`](#invoice-tag) [`Receipt:`](#receipt-tag), or

  [`Statement`](#statement-tag).  (The only exception to this rule: an entry

  does not need an `Invoice:`, `Receipt`, nor a `Statement` tag if the

  [payee was never charged](#never-charged-payee).

* A [`Program:`] tag.

#### NEVER CHARGED Payee

The only exception to the standard tagging requirement is when the payee has

been modified to indicate that the expense was `NEVER CHARGED`.  This is an

historical special-case.  The solution was originally design for the

following scenario:

Suppose an expense was expected — for example, a situation where you

gave a credit card number to charge something and the charge never came

through — but it turns out the charge never happened.

The recommended way to resolve this problem in the system is to just delete

the entry entirely from the Ledger file, and allow the VCS to log the fact

that the charge was expected, but the vendor never billed the credit card.

The reason the `NEVER CHARGED` payee text was added was to handle the

situation where the books included this charge, but the books were already

closed for the financial period (e.g., the books had already been audited).

Changing the payee was a method for documenting the expense.  You might use

it like this:

    2011/05/28 My Bad Billing Hosting - NEVER CHARGED

        Liabilities:Credit Card:Visa            $-100.00

        Expenses:Conservancy:Hosting             $100.00

    2012/01/01 My Bad Billing Hosting - REVERSAL - NEVER CHARGED

        Liabilities:Credit Card:Visa             $100.00

        Expenses:Conservancy:Hosting            $-100.00

However, going forward, you'd likely never enter anything the ledger

**until** you had real proof via an Invoice, Receipt or Statement that showed

the Expense did/should occur.  This use of `NEVER CHARGED` in the payee is

thus deprecated.

#### Income Account Documentation

Each `Income:` account must have the following tags:

* One of: [`Invoice:`](#invoice-tag),

  [`PurchaseOrder:`](#purchase-order-tag),

  [`Statement:`](#statement-tag) or

  [`Contract`](#contract-tag).  (Exceptions to this requirement are as follows:

     + the income generated from the transaction is less than $800, or

     + the `IncomeType` is `RBI` and the income is for a defined, public

       program (such as conference registration)

* An [`Entity:`](#entity-tag) tag, *iff.* the Income for the transaction is

  for more than $800.

* An [`IncomeType:`](#incometype-tag) tag.

* A [`Program:`](#program-tag) tag.

Analysis of the Data

--------------------

If this methodology is followed, Ledger can be used to analyze the financial

data for the organization.

### Testing Program Success

If you use the [`Program`](#program-tag) tag effectively, you can easily test

the successes of various fundraising programs with a command like this:

    $ ledger -f accounts/books.ledger --pivot Program bal '/^Income/'

Meanwhile, using the  [`Program`](#program-tag) tag for Expenses can help

track what programs are costing with commands like hese:

    $ ledger -f accounts/books.ledger --group-by 'tag("Program")' reg '/^Expense/'

FIXME: example output

### Checking Integrity of a Tag

[As mentioned](#entity-tag), the `Entity:` tag is one example among many

where the value is a wide range, but since Ledger CLI isn't backed by a more

complete ERP system, it's possible during data entry for typos to make a

serious problem.  One work around to this flaw is to periodically run a

command like:

    $ ledger -f accounts/books.ledger -F '%(tag("Entity"))\n' reg|sort|uniq|less

which will show all unique `Entity:` values currently in use.

Copyright and License of This File

----------------------------------

This specific document, the README.md file for npo-ledger-cli, is copyrighted:

  Copyright © 2013, Bradley M. Kuhn

This document's license gives you freedom; you can copy, modify, convey,

propagate, and/or redistribute this software under the terms of either:

    * The GNU General Public License as published by the Free Software

      Foundation, Inc.; either version 3 of the License, or (at your option)

      any later version (aka GPLv3-or-later).

    * *or* the Creative Commons Attribution-ShareAlike 3.0 United States

      license, as published by Creative Commons, Inc. (aka CC-By-SA-USA-3.0)

In addition, when you convey, distribute, and/or propagate this document

and/or modified versions thereof, you may also preserve this notice so that

recipients of such distributions will also have both licensing options

described above.

A copy of GPLv3 and CC-By-SA-3.0-USA can be found in the same repository as

this file under the filenames GPLv3.txt and CC-By-SA-3.0-USA.txt.  If this

document has been separated from the repository, a

[copy of GPL can be found on FSF's website](http://www.gnu.org/licenses/gpl.txt)

and a

[copy of CC-By-SA-USA-3.0 can be found on Creative Commons' website](http://creativecommons.org/licenses/by-sa/3.0/us/legalcode).