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Research Project on Finance

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					      Banner Research
        Accounting
         Overview
       Version 0.02
The information contained in this presentation is under
        development and is subject to change.




                       Project LINK
                                                          1
All information is subject to
          change




                                2
                  OBJECTIVES
   Project Scope LINK-Finance

   High level Banner Project/FOAPAL overview

   Define the Finance Grants and Contracts module

   Deferred Grant Processing: Revenue recognition; F&A
    calculation; Cost share

   Grant Events/Reporting/Billing

   Agency Hierarchy/Trail in and trail out periods


                                                          3
PROJECT SCOPE - FINANCE
                General Ledger

          Research/Project Accounting

                  Purchasing

                Accounts Payable

            Fixed Assets Management

               Endowment Accounting

           Non-student Accounts Receivable

                 SCT Workflow

     SCT Finance Data Mart & Brio Reporting

                                              4
           Implementation Team
   General Ledger – Duane Arruti
   Research Accounting – Mike Schwantes
   Purchasing – Julian Sandoval
   Accounts Payable – Shannon Gilbert
   Fixed Assets – Liz Metzger
   Endowment Accounting – Frances Starnes
   Non-student Accounts Receivable – Liesje Kerkmans
   CIRT Technical Leads – Jeff O’Keefe, Oscar Meyer,
    Susan Minter
   Work Groups within each team include many, many
    staff from departments, CIRT, central finance offices

                                                       5
UNM Project LINK
Finance Implementation
July 2002 – June 2003
        Current State Analysis                                                            Oct ‘03
                                                              Future State Analysis

                                                            Attend SCT
                                                            Conference
July                                         Jan
       Aug   Sept    Oct     Nov      Dec             Feb      Mar       Apr      May     June
2002                                         2003



                                                                    COA
                                                                    Loaded in
                                                                    Development
                                    SCT Implementation Team
                                    Banner Finance Training              Systems Validation
                                                                                           Dec ‘03


                                 Ongoing Planning & Communication




                                                                                            6
  UNM Project LINK
                                                                                 Finance
  Finance Implementation
                                                                                 Go-Live
  July 2003-Aug 2004                                                             July 1,
                                                                         Future 2004
                            Load Pre-Production Data
                                                                         Budgets
                            Conduct System Unit Testing
                                                                         Loaded to
                                                                         Banner
                                            Data
                                            Migration
July                                 Jan                                          July
       Aug Sept Oct   Nov     Dec            Feb    Mar    Apr   May       Jun              Aug
2003                                 2004                                         2004




                                                                        End User Training

                                                   Core Dept Training


                              Ongoing Planning & Communication




                                                                                                  7
                            Future State
Finance System


                              Accounts
                                                      Student and
  Purchasing
                              Payable
                    Fixed                             Financial Aid
                   Assets
                                          Accounts
                                         Receivable   Systems
  Grants and
  Contracts
                   COA
                    General
                     Ledger                           Human
               Endowment
                                                      Resources and
               Management
                                                      Payroll System
                                                                  8
        Banner and the Ledgers
  Information is stored in:
             Operating Ledger (Income Statement)
COA          General Ledger (Balance Sheet)
General
 Ledger
             Encumbrance Ledger (Commitments)

Grants and
Contracts    Grants Ledger (Inception to Date)


                                                 9
Ledgers and Chart of
  Accounts (COA)

All Ledgers are updated
       using the
   Chart of Accounts



                          10
                   •   Specific instance of Banner Finance System
                        •   One Digit
R       CHART           •   Zero Levels
E
Q          C
U                  •   Balance Sheet
I                       •   Six Digits
R       FUND            •   Five Levels
E
D         F
                   •   Budget Units, Departments
S                       •   Six Digits
E   ORGANIZATION        •   Eight Levels
G        O
M                  •   Assets, Liabilities, Fund Balance, Revenue,
E
N    ACCOUNT           Transfers, Expenditures
                        •   Six Digits
T       A               •   Four Levels
S

                   •   Mission and Facilities & Administration
     PROGRAM
                        •   Six Digits
        P
                        •   Five Levels
O
P    Activity      •   User Assigned Classification
T       A               •   Six Digits
I
O                       •   Zero Levels
N
A    Location      •   Physical Places, sites
L       L
                        •   Six Digits
                        •   Five Levels                          11
Introduction to the New
         COA
• The new Chart of Accounts consists of an accounting
  string called FOAPAL
• Other acronyms frequently surrounding our chart are:
       • C-FOAPAL
       • FOP
       • FOAP
       • FOPA
       • FOPAL
• These acronyms are made from the names of the
  accounting string segments
                                                         12
    CHART
       C
               What is a Segment?
    FUND
                • The FOAPAL is a string of seven
      F
                  parts called segments
ORGANIZATION
     O
                • Each segment contains part of the
 ACCOUNT
    A             information held in a FOAPAL

 PROGRAM
    P           • Not all segments are required by
                  Banner for a transaction to be
 Activity         recorded
    A



 Location
    L                                                 13
   Hierarchies in Banner
         Segments
Many of the segments
   in Banner have
multiple levels, known
    as hierarchies.



                           14
           Banner Hierarchies
• Provide for flexible grouping and
summarization of information
• Permit high level roll-up and detailed
drill-down to facilitate reporting at all levels
in the organization

•Typically, lower levels of hierarchies will
be data enterable
                                             15
Sample of Banner Hierarchy
Level 1                President/Governing Board


Level 2                     Executive Level


Level 3                     College/Campus


Level 4                      Classification



Level 5 (Data Entry)          Department



Level 6 (Data Entry)        Sub Department



Level 7 (Data Entry)         Organization



Level 8 (Data Entry)    Reserved for Future Use
                                                   16
    C-F-O-A-P Definition
This section deals with the first five
             segments:
                Chart
                Fund
             Organization
               Account
              Program

      They are required in
         every operating
       ledger transaction          17
CHART
 C
                       Chart
         The CHART code refers to a specific
         instance of the Banner Finance System.


                   U is the chart code for
                UNM’s Chart of Accounts

     •An institution can have multiple charts each with a
     unique chart code
     •The chart code designates a finance instance that
     replaces the current FRS system.
                                                          18
    FUND                 Fund
     F




   Designates a fiscal and accounting entity with a
    self-balancing set of accounts

      Balance Sheet

        Required for tracking Assets and Liabilities
         other than Fund Balance and Claim on Cash

      Fund, to some extent, replaces the General Ledger
      segment (six digits) of the FRS account number
                                                          19
    UNM Fund Hierarchy
Fund Type: Level 1   Fund Accounting Category



           Level 2          Fund Entity



Fund Code: Level 1   Fund Classification/Source



           Level 2    Fund Sub Class/Agency




           Level 3      Fund Detail/Project



                           Project Year
           Level 4
                            Sub Project
           Level 5
                                                  20
ORGANIZATION
     O
                 Organization

      • Used to track the financial activities by
         functional reporting units
      • Designates a department or unit of budgetary
         responsibility

      • Accommodates reporting at any level of
         organizational hierarchy

      Organization replaces the UNM organization
      code attribute                                21
Organization Hierarchy
Level 1                President/Governing Board


Level 2                     Executive Level


Level 3                     College/Campus



Level 4                      Classification


Level 5 (Data Entry)          Department



Level 6 (Data Entry)        Sub Department



Level 7 (Data Entry)         Organization



Level 8 (Data Entry)    Reserved for Future Use
                                                   22
ACCOUNT
   A
                      Account

• Designates asset, liability, equity, revenue,
   expenditure, and transfer account classifications
•
• Hierarchy has built in the reporting requirements
   related to Governmental Accounting Standards
   Board (GASB) Financial Statements

          Account will replace the FRS 4 digit account
                      control/object code.

                                                         23
ACCOUNT
          Account Codes
   A      6 digits / 4 levels of hierarchy


 • Users will not be able to create ad-hoc
   user defined account codes as currently
   can be done in FRS(sub codes)
 • All account codes must be pre-defined
   and established in Banner before they
   are available for use

                                             24
PROGRAM
            Program
   P




 PROGRAM designates NACUBO functional
 classifications such as:

          • instruction
          • research
          • public service
          • sub-classifications


                                    25
           Program and Mission
PROGRAM
   P              6 digits / 5 levels of hierarchy

• The major Mission category will be at Level 1 of
  the hierarchy

• The Facilities & Administration subcategory will be
  at Level 2 of the hierarchy

• We are exploring the possibility of Levels 3, 4, and
  5 being used by departments/units

• NSF Checking is allowed at all budgeted program
  levels
                                                     26
    The Rest of FOAPAL!
This section covers the last two segments in the
               FOAPAL string:

                     Activity
                        A



                     Location
                        L



  Activity and Location are not required to
complete any transaction and many times will
              not be used at all

                                             27
Activity
                       Activity
   A
             6 digits / 0 levels of hierarchy


 • Designates temporary units of work, subsidiary functional
   classifications, or short duration projects

 • Reduces the need to create separate FOAP’s to track activities

 • Replaces some uses of shadow systems and user defined
   object codes created to track activities

 • Activity codes are available to the end user only after they are
   added by central administration

                                                              28
Location
                       Location
   L
                   6 digits / 5 levels of hierarchy


           • Location is used mainly for fixed assets

           • The Location Workgroup is defining
             location codes
           • This segment is optional and not needed
             for many transactions


                                                      29
C-FOAPAL
                                •   Specific instance of Banner Finance System
Segment                              •   One Digit
                     CHART
Definition
             R
                                     •   Zero Levels
             E
Summary      Q          C
             U                  •   Balance Sheet
             I                       •   Six Digits
             R       FUND            •   Five Levels
             E
                       F
             D                  •   Budget Units,Departments
                                     •   Six Digits
             S
                 ORGANIZATION        •   Eight Levels
             E
             G        O
             M                  •   Assets,Liabilities,Fund Balance,Revenue, Transfers
             E                      Expenditures
             N    ACCOUNT            •   Six Digits
             T                       •   Four Levels
                     A
             S
                                •   Mission and Facilities & Administration
                                     •   Six Digits
                  PROGRAM
                                     •   Five Levels
                     P
             O                  •   User Assigned Classification
             P    Activity           •   Six Digits
             T       A               •   Zero Levels
             I
             O                  •   Physical Places, sites
             N
                                     •   Six Digits
             A    Location
                                     •   Five Levels
             L       L

                                                                              30
          Introducing the Index or
               Speed Dial Key

• Shortcut key to the FOAPAL String--Input an
  index and elements of the FOAPAL will
      default

• Used in lieu of the old FRS Account number in
  legacy and feeder systems, i.e. HRS,
  telecommunications, etc.
• Example:
     The Index will be put on Personnel Action
     Notices (PAN’s) to identify labor distribution
                                                  31
Banner Research Accounting

   Common system for financial transactions and
    processing billings and aging receivables

    Event tracking of billings, reports, and other
    reminders will assist PI with stewardship and
    accountability of funds.

   Reporting functionality will allow users to roll up
    related project funds on a single report and show
    related receivables.
                                                          32
           Banner Research Accounting
                   Definition
The banner “Research Accounting” module consists of the
  Grant Ledger which:

   Provides inception to date accounting for grants and
    projects.

   Accounting, reporting and billing functions after receipt of
    the grant/project award include:
    –   indirect cost
    –   cost share calculations
    –   tracking expenditures (billed & unbilled)
    –   generating bills and reports for sponsors
    –   and processing payments received from sponsoring agencies


                                                                    33
    Deferred Grant Process (FRRGRNT)
   This process defines when Banner will perform
    following calculations:
    – Facilities & Administrative Costs (F&A or IDC)
    – Cost share
    – Revenue recognition calculations


   Can be set to calculate multiple times per
    month(cash management) and the order of
    calculating cost share vs. F&A can be changed.



                                                       34
Deferred Grant Processing T Account example




                                          35
Calculating F&A then Cost Share




                                  36
            Banner Research Events

   Banner allows for linking events (billing,
    reporting and other reminders) to grants and
    contracts which are date driven.

   UNM can specify who is responsible for
    indicating when the event is finished (satisfied)
    and Banner will send reminders to the responsible
    person or people.

   Common events can also be grouped by sponsor
    and linked to a grant or project.


                                                        37
Grant Events Example(FRVEVNT)




                                38
Grant Events Form (FRAEVGA)




                              39
                      Research Fund Hierarchy
Research Fund Code Hierarchy



Lvl 1 Lvl 2  Lvl 3 Lvl 4 Lvl 5        Suggestion/Scenario:
3FED                                  Data enterable code is "*"
      3DOA
              3000                    ##       Recurring/1 Department
                    30001                  *                    3 3AAAAA
                          30001A ??   %%       Recurring/2 or more Departments
                          30001B ??                             3 3AAAA
              3001                         *                    4 3AAAAa
                    3001A %%          $$       Multiple years/1 Department
                    3001B %%                                    3 3AAAA
      3HHS                                 *                    4 3AAAA#
              3002                    ??       Multiples years/2 or more Departments
                    30021 $$                                    3 3AAA
                    30022 $$                                    4 3AAA#
4FED                                       *                    5 3AAA#a
4IND
      4PFIZR                                   where:
              4000 ##                          A=Alphanumeric
                                               a=Alpha Only
                                               #=numeric


                                                                                       40
         Agency Hierarchy
In addition to the fund hierarchy in
FOAPAL, there is an agency hierarchy in the
Grants Module
 Reduces the number of funds required
 Consists of 5 levels which define the sub
  agencies.


                                              41
Agency Hierarchy




                   42
              Trail in/Trail out periods

   Trail in – Allows costs to be incurred prior to
    the project start date.

   Trail out – Allows costs to be incurred after
    the project end date.

   The fund(s) associated with the grant/contract
    contains the dates which will determine when
    transactions will be allowed to post.

                                                      43
New Grant Cover Sheet




                        44
          Questions to Ponder
•How will this information effect the way we operate?

•How do we communicate the info to our work group(s)?

•How do we communicate the info to those who interface
with us and have a need to know?

•How does this effect what I currently do?

•What effect does this have for people outside the Finance
community?

•What can I do to ensure a smooth transition?

                                                         45
    Research Accounting Challenges

   Conversion: Inception to date expenditures,
    outstanding invoices, receivables and
    deferred revenues.

   Identifying and meeting reporting
    requirements of departments and the
    principal investigator (this includes events).

                                                 46
Any Questions?




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