Shared funds

You’ll need: Liquidity pools, Memberships — if you cannot see these, the module may be switched off for your business or outside your permissions. An administrator can change either.

Many member organisations pool money and lend it back to members: a savings group, a cooperative fund, a tontine, a credit union in miniature. A liquidity pool is that shared fund.

What a pool holds

A name, a currency, and a share price.

The share price is the unit. Members hold shares in the pool, and a share has a defined value — which is what makes each member’s stake in a growing fund calculable rather than a matter of recollection.

Why shares rather than balances

A shared fund is not a set of individual savings accounts. It is one pot with several owners, and it grows.

Recording each member’s contribution as a balance would leave the growth belonging to nobody. Recording it as shares means each member owns a proportion, and when the fund earns, everybody’s stake is worth more in the same ratio — which is the arrangement members thought they were joining.

   member A   40 shares
   member B   35 shares      one pot, three owners,
   member C   25 shares      proportions that survive growth

One currency per pool

A pool holds one currency, for the same reason a cash account does. If your group saves in two currencies, that is two pools.

This is real money belonging to other people

Worth stating plainly, because it is the difference between this course and every other one in the catalogue.

Everywhere else, a mistake costs your business. Here a mistake costs your members — often people who know each other, in a group that only works because everyone trusts the books.

So the controls from Essentials stop being administrative overhead and become the point:

Second-person approval on anything touching the fund, so no single person can move members’ money alone.
The audit trail, so every change has a name and a date against it.
Nothing deleted, so the record of what happened cannot be tidied away.

If your organisation only turns on maker-checker in one place, turn it on here.

Try it