YEAR END FINANCIAL PLANNING

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YEAR END FINANCIAL PLANNING Powered By Docstoc
					    YEAR END
FINANCIAL PLANNING
       BACKGROUND

Need to bring year-end balances for all
199xx accounts to within 5% of budget
 so that State of California and UCOP
  better understand the need for, and
     nature of, carry forward funds.
         TARGETED FUNDS
   OP fund numbers 19900-19999
   Both charts 3 and L
   Across all functions (i.e. instruction,
    organized research, cooperative
    extension)
   Extramural funds are NOT included
                PROCESS
   Determine projected year-end balances for
    each targeted account
   Calculate the recommended maximum carry
    forward (5% of permanently budgeted funds
    or 5% of current appropriations for non-
    permanently budgeted funds, such as
    indirect cost recovery funds)
   Create appropriate DaFIS Departmental
    Encumbrance documents (DE) to bring
    account balances to 5% carry forward or less
       So……

where should we start?
     DETERMINE TOTAL BASE
    BUDGET FOR 19900 FUNDS
                          (STEP 1)


   Run Decision Support report #58 with the
    following parameters:
        –   Fiscal Year = current
        –   Fiscal Period = current
        –   Charts = 3, L
        –   Organization Code = 4 character org code
        –   Sub Fund Group = GENFND
        –   Check the Include Pending? box
        –   Check box = BASE BUDGET (for general funds)
        –   Output Format = spreadsheet
DECISION
           ATXC

SUPPORT    GENFND



 REPORT
   #58
PROJECT YEAR-END BALANCES
 FOR TARGETED ACCOUNTS
                            (STEP 2a)

     Run Decision Support report #55 with the
      following parameters:
            Fiscal Year = current
            Fiscal Period = current
            Charts = 3, L
            Organization Code = 4 character org code
            Sub Fund Group = GEN%
            Output Format = spreadsheet
DECISION
SUPPORT
 REPORT    ATXC




   #55     GEN%
PROJECT YEAR-END BALANCES
 FOR TARGETED ACCOUNTS
                        (STEP 2b)

    Add a Pending Documents column to spreadsheet
     generated in Step 1 after the Balance Column
    Record any transactions of significant dollar value
     not yet appearing on ledger (e.g. June payroll for
     term academic employees, anticipated feeds from
     recharge units, etc.)
    Add an Adjusted Balance column to show account
     balance after pending transactions
    Total the Adjusted Balance column
SPREADSHEET
  EXAMPLE
   HERE
      DETERMINE BUDGET
                      (STEP 3)


Using the spreadsheet generated in Step 2 (Report
    #55):
   Add a Budget column
   For 19900 accounts, put (or cut/paste) the total
    base budget from Report #58, from Step 1, into this
    new column
   For 19901-19999 accounts, put the total of the
    appropriations column in this spreadsheet within
    each subfund group into the new Budget column
SPREADSHEET
  EXAMPLE
   HERE
    DETERMINE MAXIMUM
     CARRY FORWARD
                    (STEP 4)

Still using the spreadsheet generated in Step 2
     (Report #55):

   Add a 5% CF Limit column
   Calculate the 5% Carry Forward Limit by
    multiplying the total of the Budget column
    by .05
SPREADSHEET
  EXAMPLE
   HERE
    DETERMINE FUNDS TO
        ENCUMBER
                      (STEP 5)

   Now, add a Minimum Amount to Encumber column
   Calculate the Minimum Amount to Encumber by
    subtracting the 5% CF Limit column from the
    Adjusted Balance Column
   For any account with a positive amount in this
    column, identify funds that can be encumbered to
    reduce the balance
   Prepare DaFIS Departmental Encumbrance (DE)
    documents for identified funds
    WHEW!!!

Wasn’t that fun???
      OK……..

Everybody stand up…..
Take a deep breath…..
Turn to your right and give
the person in front of you a
       shoulder rub.
Turn the other direction
and give that person a
     shoulder rub.
     Ok, have a seat……

there’s more fun stuff to come…
REVIEW OF DEPARTMENTAL
ENCUMBRANCE DOCUMENT
 USE OF THE DEPARTMENTAL
ENCUMBRANCE DOCUMENT (DE)

   Used to reserve funds for specific
    departmental commitments

   Can increase or decrease committed
    amount
THREE TYPES OF ENCUMBRANCES

        Internal encumbrance
        External encumbrance
        Pre-encumbrance



 All encumbrances will carry forward
  to the next year if not specifically
          closed by the user.
EXTERNAL ENCUMBRANCES (EX)

   Official University commitments,
    generated by a Purchase Order

   Not to be used by departmental DaFIS
    users
      PRE-ENCUMBRANCES (PE)

   Do not actually put a hold or lien on
    departmental funds
   Will only show on Decision Support reports if
    Pre-Encumbrance check box is checked
   For information and planning purposes only.
   Not recommended for use by departmental
    DaFIS users
INTERNAL ENCUMBRANCES (IE)

   Unofficial liens established and
    maintained by the departments

   Recommended for use by Departments
    DEPARTMENTAL
ENCUMBRANCE DOCUMENT



                                 IE



    Encumbrance types are also
     referred to as Bal Types.
           Default is IE.
   FISCAL PERIODS



How many fiscal periods
 are in a fiscal year?
           FISCAL PERIODS

 Each fiscal year has 13 periods
 Period 1 = July
 Period 2 = August



 Period 12 = June Preliminary
 Period 13 = June Final
             FISCAL YEARS


   Which of the following is FY 2003?


    A. July 1, 2002 through June 30, 2003

    B. July 1, 2003 through June 30, 2004
         FISCAL YEARS


        The Answer is “A”

      Fiscal Year 2003 is from
July 1, 2002 through June 30, 2003
    DEPARTMENTAL
ENCUMBRANCE DOCUMENT




    Fiscal Period/Fiscal Year Here
                   REVERSAL DATE
   Is an optional field

   Identifies the date that the encumbrance entry will be
    automatically reversed on your ledgers

   When entering a reversal date, remember that payroll and some
    TP transactions do not show on the ledger until the first week of
    the next month, which delays the close of fiscal periods until
    after the first week of the following month

   So, make sure you choose a reversal date that will be after the
    close of the prior fiscal period, such as the 20th of the month, to
    ensure that your encumbrance reverses in the correct fiscal
    period

   For example, we can be relatively sure that the June Final
    ledger will be closed by August 20, 2002
    DEPARTMENTAL
ENCUMBRANCE DOCUMENT


                          08/20/02




     Reversal Date Here
      WHAT SHOULD BE
       ENCUMBERED?

 Start up funds
 Lab renovation funds
 Bridge funding
 Multi-year projects
 Other categories (your ideas???)
        THINGS TO REMEMBER

   Enter a meaningful description (e.g..
    Start up funding-Johnson)
   Enter specific details of the transaction
    in the explanation field
   Do not change the default balance type
    of IE
           THINGS TO REMEMBER
         WHEN CREATING ENCUMBRANCES

   When CREATING a new encumbrance, enter a
    positive line amount and no prior document number.




   If the date the encumbrance should be reversed is
    known, enter that date in the reversal date field.
    (Remember the rules about choosing reversal dates)
 EXAMPLE #1
Start Up Funding
    Create
Encumbrance with
No Reversal Date
           THINGS TO REMEMBER
         WHEN CHANGING ENCUMBRANCES

   When INCREASING an encumbrance…
    – Template the original DE document
    – Enter a positive line amount
    – Enter the prior DE document number

   When DECREASING an encumbrance…
    – Template the original DE document
    – Enter a negative line amount
    – Enter the prior DE document number
    Decrease
  Encumbrance
(Lab Renovation)

             05   2003
          QUESTION ????
   Who needs chocolate about now?

   Caffeine, anyone???

   A vacation?????
THE REAL QUESTION ……

       When should the
     encumbrance for the
   purchase of equipment be
          removed?
   Decrease
 Encumbrance
(Lab Equipment)

             02   2003
           THINGS TO REMEMBER
        WHEN REMOVING ENCUMBRANCES

   When REMOVING an encumbrance….
    – Template the original DE document
    – Enter a negative line amount
    – Enter the prior DE document number
    – Make sure the reversal date is blank.
 EXAMPLE #2
Bridge Funding
    Create
Encumbrance with
No Reversal Date
  Remove
Encumbrance
             EXAMPLE #3
         Multi-Year State Grant
Five-year   state grant awarded
Grant   period July 1, 1999 – June 30, 2004
Funding  for all five years of the grant was
 received May 15, 1999
Year3 of grant will end next week---June 30, 2002
Need to encumber Years 4 and 5 funds
  Create Year 4
Encumbrance with
 Reversal Date
  Create Year 5
Encumbrance with
 Reversal Date
Additional information about the
 Departmental Encumbrance
  document may be found at:

http://dafis.ucdavis.edu/olrm/inde
           x.cfm?doc=DE
       MANAGING
     ENCUMBRANCES

Think about how you might want to use
    the tracking number to manage
encumbrances using Decision Support
               Report #46
DECISION
SUPPORT
REPORT
  #46
DECISION SUPPORT
   REPORT #46
QUESTIONS ???????