How does my business handle accounting for Bay Bucks?
Treat Bay Bucks just as you would cash. Because the government views local currencies as a cash equivalent, no special accounting procedure is needed. However, until Bay Bucks are accepted for deposit at area banks, you will need to total these separately from U.S. Currency. Many businesses count and use local currency as petty cash.
How should my business set an acceptance policy?
Some businesses accept 100% Bay Bucks for a transaction and are able to spend them as quickly as they earn them. Other businesses may choose one day a week or some specific service or item for which they accept 100% Bay Bucks.
If you run a business that plans to accept Bay Bucks, you'll want to set a reasonable acceptance policy. This can be a percentage of Bay Bucks you'll accept on any given transaction, or it can be a set dollar amount of Bay Bucks. For example, a computer repair service may choose to accept 50% in Bay Bucks or simply say they'll accept 25 Bay Bucks per job.
Accept more for services than for goods. For example, an auto mechanic might accept 50BB + $30 per hour, but not accept Bay Bucks for parts.
Accept more Bay Bucks during slow business times. For example, a local restaurant could accept 25% Bay Bucks every day but Wednesday, when they accept 100%.
Accept more Bay Bucks for slow moving items or items connected to vendors that are members of Bay Bucks. For example, a winery can accept more Bay Bucks on last year's stock, or for a ìpicnic kitî that combines wine with local processed foods or plates from a local potter.
How do I pay employees with Bay Bucks?
First, make sure employees are happy to accept a portion of their pay in Bay Bucks. Have them sign an acceptance contract (download a sample here). Assure them they can opt out at any time, and encourage them to consider how they will spend their Bay Bucks before they accept a high percentage.
Remember that you need to consider how many Bay Bucks your business will bring in as well as what the employees will accept.
At payroll time, figure the employee's pay exactly as you normally would. Calculate the regular taxes and other deductions and determine the net pay. Now, subtract the amount in Bay Bucks each employee has agreed to accept. Most payroll programs have an "after-taxes deduction" space for medical savings accounts or other payments; include amount in Bay Bucks here. The resulting paycheck can be written, printed and direct deposited as usual. Now pay the remainder in Bay Bucks.
If you find your business doesn't have enough Bay Bucks to meet payroll needs, adjust the ratio of apy as needed (and raise your acceptance level).
You can also give end of year bonuses in Bay Bucks, and employees can trade U.S. dollar tips for Bay Bucks.
Some businesses have used their Bay Bucks to reimburse consenting employees for out-of-pocket expenses that would normally be paid with petty cash.
How do I work with Bay Bucks at the cash register?
Bay Bucks come in four denominations: BB1, BB5, BB10 and BB20. Store the bills beneath the U.S. dollars of the same denominations.
Use Bay Bucks to make change for purchases in Bay Bucks. You may offer Bay Bucks as change on any transaction if the customer agrees. Lots of tourists will be curious about northwest lower Michigan's beautiful money and may view it as a souvenir.
While you may use U.S. dollars to make change for purchases in Bay Bucks, it is not recommended, particularly for businesses that have a low acceptance rate. Making change in U.S. dollars for purchases in Bay Bucks is like setting an acceptance rate at more than 100% and could result in receiving more Bay Bucks than your business can easily spend.
At the end of the day, during the daily accounting, treat Bay Bucks like cash. The only difference is that instead of going in to the deposit envelope, they should stay on site as a type of petty cash.