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Document Sample
Fiscal Year 2007-08
Year-End Training
Robert E. Byrd, CGFM
County Auditor-Controller
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Table of Contents
Agenda
• Introduction / Objectives
• Fiscal Year-End Budgetary Controls
• Preparing & Submitting Closing Documents
• Receivables
• Inventories
• Accounts Payable
• Reserve for Encumbrances
• Revenue Recognition and Deferred Revenues
• Prepaid Expenses
• Depreciation
• Bank Accounts Controlled by Agencies or Departments
• Treasurer Cash Receipts (TCRs)
• Contingent Liabilities
• Subsequent Events
• Capital Leases
• Revolving Funds
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training
Objectives
• To promote uniformity & consistency in procedures
• To provide accurate, timely & reliable information
• All organizational units under BOS governance are
subject to these requirements
• Most schedules are due to the ACO on or before close
of business July 18, 2008.
Year-End Manual is located at:
http://www.auditorcontroller.org/opencms/yearend/index.html
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 2
Year-End Budgetary Controls
• Pursuant to Government Code §29120,
budgetary units cannot exceed BOS-
approved appropriations
• ACO cannot close fiscal year until
appropriation budget deficits are
eliminated pursuant to BOS-approved
budget action
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 3
Preparing and Submitting
Closing Documents
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 3
Journal Entry (JE) Guidelines
• Submit a copy of your JE with each signed
Year-End Schedule to ―ACO Year-End‖
• Prepare JE to the budgetary level ordinarily
used by business unit to capture accounting
needs of organization
• An accrual entry must include both the accrual
and the reversal entry for posting
• Round amounts to nearest dollar
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 3
Accrual Entry Preparation
1) Date: 06/30/2008
2) Source: ―YE‖
3) Ref. Number: Business Unit
(Example: ACARC)
4) Accounting Period: Verify = 12
5) Fiscal Year: Verify = FY 2008
Note: Riverside County does not use
the “Reversal” feature for this fiscal year.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 3
Accrual Reversal Preparation
1) Date: 07/01/2008
2) Source: ―YE‖
3) Ref. Number: Business Unit
(Example: ACARC)
4) Accounting Period: Verify = 1
5) Fiscal Year: Verify = FY 2009
Note: Use the “Copy Journal” feature for
PeopleSoft 8.8 as outlined in Chapter 3 of
the Year-End Manual.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 3
Schedule N
• Summarizes the closing schedules
• Must accompany each closing package
• Required for each budgetary unit even if
there are no closing schedules
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Receivables Classifications
• Operating Accounts Receivable
• Due From Other Governments
• Due From Other Funds
• Accounts Receivable – Other
• Taxes Receivable (ACO prepares accrual)
• Interest Receivable (ACO prepares accrual)
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Receivables Schedules
• Schedule A – Due From Other Funds
(Governmental Funds)
• Schedule A – Due From Other Funds
(Proprietary Funds)
• Schedule B – Due From Other Governments
• Schedule C – Operating Accounts Receivable
• Schedule D – Accounts Receivable - Other
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Schedule A –
Due From Other Funds
• When a receivable and corresponding payable
exists between County funds on June 30
• Cash is not available to satisfy liability
• Amount is $5,000 or greater
• Business units for both sides of the
transaction must agree
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Schedule A –
Due From Other Funds (cont’d)
• Business unit entitled to revenue is required to:
- Coordinate the transaction
- Prepare Schedule A (GF or PF)
- Prepare journal entry to post accrual and accrual reversal in
PeopleSoft financials
• Only GL Module should be used for recording interfund
transactions.
• The offset account must be Due To Other Funds.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 5
Schedule A –
Due To Other Funds (cont’d)
• When a liability and corresponding
receivable exists between County funds on
June 30
• Cash is not available to satisfy liability
• Amount is $5,000 or greater
• Business units for both sides of the
transaction must agree
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Schedule A –
Due From Other Funds (cont’d)
Line # Account Description Base Amount
1 125100 Due From $XXX,XXX
(Governmental)
Other Funds
125200
(Proprietary)
2 7XXXXX Applicable - $XXX,XXX
Revenue
Account
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 5
Schedule A –
Due To Other Funds
Line # Account Description Base Amount
3 5XXXXX Applicable $XXX,XXX
Expenditure
Account
4 206200 Due To Other - $XXX,XXX
(Governmental)
Funds
206100
(Proprietary)
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Schedule B –
Due From Other Governments
• Funds entitled to revenue as of June 30
• Revenue due from Federal, State, City or
other Governmental entity
• Amount due is $5,000 or greater
• Cash is not received in advance
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Schedule B –
Due From Other Governments
• Complete Schedule B
• Prepare accrual and accrual reversal journal entries
• Submit above with supporting documents to ACO
Note: Schedule T-12 should include amounts from
Schedule B.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Schedule B –
Due From Other Governments
(cont’d)
Line # Account Description Base Amount
1 118XXX Due From Other $XXX,XXX
Governments
2 7XXXXX Applicable - $XXX,XXX
Or Revenue or
2301XX Deferred Revenue
County of Riverside ■ Office of the Auditor-Controller
County Of Riverside
DUE FROM OTHER GOVERNMENTS (ASSET ACCOUNT SEQUENCE 118XXX): Account Analysis
Account Analysis as of June 30, 2008
SCHEDULE T-12 Due July 18, 2008
Fund:
Dept. ID:
Receivables expected to be receipted after June 30, 2008:
Claim, Inv., or
Row if Amount Reference Description Date earned Expected
Due From (Governmental Est ( mm / dd / Receipt
No. Acct. Entity) * Due Number of Service yy ) Date
1
2
3
4
Total DFOG to be receipted after
6/30/08 $ -
TOTAL DFOG (MUST TIE TO THE GENERAL LEDGER)
All items on Schedule B should be reported on this schedule, plus any other receivables previously accrued.
Preparer's name (print): Approval signature:
Preparer's title: Telephone number:
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Schedule C –
Operating Accounts Receivable
Amounts owed to the County for
goods or services provided to
• Private individuals
• Businesses
• Organizations
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Schedule C –
Operating Accounts Receivable
Do not include:
• Amounts due from other funds (Schedule A)
• Amounts due from other governmental
entities (Schedule B)
• Receivables based on assessments
(e.g., property taxes, interest, or special
assessments)
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Schedule C –
Operating Accounts Receivable
• Complete Schedule C for:
– Amounts $5,000 or greater
– Revenue is earned (entitled) as of June 30
– Governmental funds expecting to receive revenue
within 3 months
• Create accrual and accrual reversal journal entries in
PeopleSoft financials
• Submit above with supporting documents to ACO
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Schedule C –
Operating Accounts Receivable
Line Account Description Base Amount
#
1 112200 Accounts Receivable $XXX,XXX
(For YE)
2 7XXXXX Applicable Revenue / - $XXX,XXX
Or Deferred Revenue
2301XX
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
What if I’m entitled
to revenue and it
doesn’t fit the definitions
for accrual on Schedule A, B, or C
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Schedule D –
Accounts Receivable - Other
• For receivables not meeting the listed
classifications, accrue as ―Other‖
• Must be $5,000 or greater
• Earned (entitled to) revenue as of June 30
• Governmental Funds – Revenue must be
available within 3 months of fiscal year-end
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
PeopleSoft Billing Module
The last day to enter and process billing
invoices into the Billing Module is July 21st
at the end of business
• The Billing Module can not be used for year-
end accruals
• The appropriate year-end schedules must be
completed to capture your department’s
revenue accruals
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 7
Schedule E - Inventory
Materials and supplies held in the normal
course of operations for future consumption
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 7
Schedule E – Inventory
(cont’d)
• To which entities does the inventory process
apply?
• What is required if the inventory process
applies?
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 7
Schedule E – Inventory
(cont’d)
• Perform a physical inventory count
• Record the count results in PeopleSoft:
– Inventory Management Module
– Online journal ($5,000 minimum adjustment)
• Schedule E is required to document
results of physical count
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 7
Schedule E – Inventory
(cont’d)
Top Portion of Schedule E
As of June 30, 2008
SCHEDULE E
(Refer to Y-E Closing Manual, Chapter 7)
Fund No.: 20008 JE Number:
Fund Name: Transportation Equipment Business Unit:
JE Source: YE Page of
DeptID: 3130700000
Dept Name: Transportation Equipment
Fund Type: (Enter "G" for governmental or "P" for proprietary)
Ending Inventory Value, June 30* $96,854
Less: Beginning Inventory Value, July 1 82,388
Inventory Adjustment Amount (JE required if $5,000 or more) $14,466
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 7
Schedule E – Inventory
(cont’d) Middle Portion of Schedule E
Since the amount is greater than $5,000, please prepare the entries as shown below.
Journal Entry for Governmental Fund :
Note to user Account Description Debit or (Credit)
170100 Inventory Of Materials & Supp 14,466
(Enter applicable A/C) 52XXXX (14,466)
To adjust inventory and related expenditure account per YE inventory count.
(Enter applicable FB A/C) 3XXXXX 14,466
303100 Reserve For Inventory (14,466)
To reserve the portion of FB that is not available to finance current current
expenditures.
Journal Entry for Proprietary Fund :
Note to user Account Description Debit or (Credit)
170100 Inventory Of Materials & Supp 14,466
(Enter applicable A/C) 52XXXX (14,466)
To adjust inventory and related expense account per YE inventory count.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 5
Accounts Payable Categories
• Due To Other Funds
• Due To Other Governments
• Accounts Payable – Other
• Operating Accounts Payable
(ACO prepares accrual)
• Salaries and Benefits Payable
(ACO prepares accrual)
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 5
Accounts Payable
• Current liabilities resulting from the
receipt of goods or services
• Payment is not expected to be made until
a subsequent accounting period
The Auditor-Controller’s Office will create
AP accrual journal entries for July and for
August.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 5
Determining the Proper Invoice Date
YES
Is the invoice for the Enter the date goods
receipt of goods? were received
NO
06/04/2008-07/03/2008
Enter 06/30/2008
Does the invoice show a YES Which fiscal year does the FY08
service date with a range? range include the most?
(e.g., 06/01/2008-06/30/2008) FY08 or FY09? FY09
06/25/2008-07/24/2008
Enter the las t day in the
NO range
Does the invoice have a YES
Enter the last day of the
service month?
Month
(e.g., the month of June)
NO
Does the invoice not
reference any date?
NO
Contact vendor and/or
responsible manager to
identify service period
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 5
Accounts Payable
In order for a voucher to get picked up in the AP
accrual process, you must enter 06/30/2008 in the
Invoice Date field in the Voucher Header panel.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 5
Accounts Payable
The AP accrual process will include
two Journal Entries:
• 7/31/08 for vouchers posted from
7/1/08 through 7/25/08.
• 8/29/08 for vouchers posted from
7/26/08 through 8/25/08.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 5
Schedule G –
Due To Other Government
• Amount due to a federal, state or other
local governmental entity
• A liability resulting from services received
or unexpended resources provided by
another government entity
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 5
Schedule G –
Due To Other Government
• Complete Schedule G
• Prepare accrual and accrual reversal
journal entries
• Submit above with supporting documents
to ACO
Note: Schedule V-12 should include
amounts from Schedule G.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 5
Schedule G –
Due To Other Government
Line # Account Description Base Amount
1 5XXXXX Applicable $XXX,XXX
Expenditure
Account
2 2081XX Due To Other - $XXX,XXX
Governments
County of Riverside ■ Office of the Auditor-Controller
County Of Riverside
DUE TO OTHER GOVERNMENTS (LIABILITY ACCOUNT SEQUENCE 2081XX): Account Analysis
Account Analysis as of June 30, 2008
SCHEDULE V-12 Due July 18, 2008
Fund:
Dept. ID:
Amounts expected to be paid after June 30, 2008:
Claim, Inv., or
Row if Amount Reference Description Date incurred Expected
Est
No. Acct. Due to (Governmental Entity) * Owed Number of Transaction ( mm / dd / yy ) Payment Date
1
2
3
4
Total DTOG to be paid after
6/30/08 $ -
TOTAL DTOG (MUST TIE TO THE G/L) $ -
All items on Schedule G should be reported on this schedule, plus any other payables previously accrued.
Preparer's name (print): Approval signature:
Preparer's title: Telephone number:
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training
BREAK!!!
The presentation will resume
in 15 minutes
County of Riverside ■ Office of the Auditor-Controller
???? Questions ????
Send your questions via email to:
ACOYearend@Co.riverside.ca.us
Or
Look for Yearend, ACO in your email
address book
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 5
Salaries and Benefits Payable
Amounts Due For:
• Employee salaries
• Employee benefits
- Retirement
- Flex benefits (Medical/Dental)
• Compensated Absences due upon
termination
- County share of Social Security
- Medicare taxes
• Other accrued payroll costs
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 5
For liabilities that either do not fit
the definition of vendors, other
funds, and other governments, or
are non-traditional AP type
transactions…
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 5
Schedule I
Accounts Payable — Other
Line # Account Description Base Amount
1 5XXXXX Applicable $XXX,XXX
Expenditure
Account
2 201200 Accounts - $XXX,XXX
Payable - Other
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 6
Schedules K and K-1
Reserve For Encumbrance
• Encumbrances are commitments related
to unperformed / unfulfilled purchase
orders or contracts for goods or services
• BOS approval is required to:
- Create the Reserve for Encumbrance
- Adjust new year appropriation amounts
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 6
Schedules K and K-1
Reserve For Encumbrance (cont’d)
• Fund balance should be reserved to reflect the
commitment of resources no longer available for other
purposes
• If you wait until the commitment is fulfilled (goods/
services received) to record a liability, funding
(appropriations) may not be available in the new fiscal
year
• County allows departments to bring committed prior
year appropriations into the new year
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 6
Schedules K and K-1
Reserve For Encumbrance (cont’d)
Only commitments with available budgeted appropriations
can be encumbered. Requests for Reserve for Encumbrances
cannot exceed approved Net County Cost.
Approved Net County Cost Actual Net County Cost
Budgeted Appropriations Actual Expenditures
Less: Est. Dept. Revenues Less: Actual Dept. Revenue
= Budgeted Net County Cost = Actual Net County Cost
Cannot Exceed
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 6
Events Not Qualifying For
Reserve For Encumbrances (cont’d)
• Goods or services received prior to June 30
- These become liabilities
- Pay through PeopleSoft by August 31, 2008 or
- Accrue on Schedule A, G, or I
• Undelivered goods or services as of June 30
that are less than $5,000
• Requisitions are requests, not commitments
nor obligations
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 6
Schedules K ~
Purchase Orders Only
Schedules K-1 ~
Other Commitments such as
Contracts, Form 11s, MOUs,
and Form 5s, etc
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 6
To Request Reserve for
Encumbrance
Prepare YE Schedules K or K-1
Submit schedules to your analyst in
the Executive Office for approval by
7/18/08
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 6
Schedule K and K-1
Reserve For Encumbrance (cont’d)
Preparing the Schedule
Step 1: Log into the Riverside County
Auditor-Controller's Office website.
This can be done by going to the
County's home page and selecting
Auditor-Controller from the drop-down
menu.
http://www.auditorcontroller.org/opencms/home/index.html
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 6
Step 2: From the Riverside County Auditor-
Controller's Office website select "Year End"
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 6
Step 3: From the "Year-End Publications" list,
select "Schedule K Listing".
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 6
Step 4: From the list of business units, select
your business unit. A listing of Schedule K
reports will be displayed. Each listing is a link
to Excel files that can be either saved to your
own computer or printed.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 6
Schedules K and K-1
Reserve For Encumbrance (cont’d)
• Save your Business Unit to your
Computer
• There will be a tab for each of the reports:
• RVPOA621B ~ Sorted by Business Unit & PO
and give PO Description (Detail)
• RVPOA621C ~ Sorted by Business Unit, Fund,
Dept ID & Account #
• RVPOA621D ~ Sorted by Business Unit, Dept
ID and Account (Summary)
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 6
Schedules K and K-1
Reserve For Encumbrance (cont’d)
• Review all three Schedule K Reports
• Determine appropriate encumbrance
amounts
• Complete Schedule K
• Submit all three to your analyst in the
Executive Office by Friday, July 18, 2008
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 6
Schedules K and K-1
Reserve For Encumbrance (cont’d)
• Approved Schedules K and K-1 are to be provided from the
CEO to the ACO by 7/25/08 for consolidation and
calculation of:
- FYE Reserve for Encumbrance amount
- New year departmental increase in appropriations
amount
• ACO to provide summary data for FYE Reserve for
Encumbrance and new year departmental increase in
appropriations to CEO by 8/29/08
• CEO to prepare and submit Form 11 for Board approval on
9/23/08
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 4
Criteria for Revenue Recognition
• Accrual Basis of Accounting
(Proprietary Funds only – Internal Service Funds,
Enterprise Funds)
• Modified Accrual Basis of Accounting
(Governmental Funds only – General Fund, Special
Revenue Funds, Capital Project Funds, Debt
Service Funds)
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training– Chapter 4
Revenue Recognition
• Proprietary funds recognize revenue when
earned regardless of when cash is received.
(accrual)
• Governmental funds should recognize revenue
only when the revenue is both measurable and
is expected to be received within ―availability
period‖. (modified accrual)
- Generally 3 months
- 12-month if expenditure-driven grant
- 60 days for taxes (including sales tax)
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 8
Revenue Recognition
What if a potential revenue transaction
does not meet both the ―measurable‖
and ―available‖ criteria for recognition in
the current period?
Answer.
For governmental funds, if revenue is earned but
not available, or available but not yet earned,
the revenue transaction should be recorded as
a deferred revenue.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 8
Instances To Record
Deferred Revenue
• Schedule L-1
When Cash is received in advance
of the earning (entitlement) process
• Schedule L-2
When earned by a Governmental
Fund, but not available
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 8
Cash Received In Advance Of
The Earning Process (Schd. L-1)
• Cash is received prior to:
– Providing goods or services
– Having a legally enforceable claim
– Eligibility requirements being met
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 8
Eligibility Requirements
• Restrictions on the use of resources
(allowable costs)
• Time requirements to expend or start
expending resources
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 8
Prepare Schedule L-1 (Advance)
• Schedule L-1 (Advance) is used to identify
cash received in advance of revenue
recognition
• An entry is required when a department has
already booked unearned amounts to revenue
Note: Schedule S-12 should include amounts
from Schedule L-1.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 8
Cash received in advance
Example:
On March 15, 2008, Dept. ABC received $500,000
from the State for use in road repairs project.
The department recorded revenue upon cash
receipt and the amount is not yet been earned.
Account Debit Credit
Cash (101100) $500,000
Revenue (7XXXXX) $500,000
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 8
Cash received in advance
Example: (Cont.)
On June 30th, only 50% of the project has been
completed. A reclassification entry is then needed
to account for the outstanding liability of $250K
since only 50% of the project has been earned.
The entry to record deferred revenue and should
be reported on Schedule L-1 and S-12:
Account Debit Credit
Revenue (7XXXXX) $250,000
Deferred Revenue (230XXX) $250,000
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 8
Prepare Schedule L-2
(Unavailable)
Schedule L-2 (Unavailable) is used to
identify amounts that have been earned,
but are not available.
Schedule S-12 should include amounts
from Schedule L-2.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 8
Schedule L-2 (Unavailable)
(cont’d)
Line # Account Description Base Amount
1 1XXXXX Receivable $XXX,XXX
(Classification
Dependent On Who
Owes Money)
2 2301XX Deferred -$XXX,XXX
Revenue
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 8
Revenue is earned, but not available
Example: (L-2)
On June 15, 2008, a governmental fund provided services to
a City for $500,000. An invoice billing was sent to the City
for the services provided and the proceed is not expected to
be received until Oct. 15, 2008.
The entry to record earned but unavailable revenue on
June 30 (Period 12):
Account Debit Credit
Receivable (11XXXX) $500,000
Deferred Revenue (230XXX) $500,000
Submit your reversal entry with Schedule L-2
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 9
Schedule M -
Prepaid Expenses
• Amount paid for a product or service that
has not been fully used as of fiscal year-
end.
- Insurance premiums paid in advance
- Rents that are paid in advance
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 9
Schedule M -
Prepaid Expenses (cont’d)
• Schedule M allocates the total amount paid
between current FY expense and amount
capitalized for future FY expense
• Journal entry is required to capitalize
amount of expense not used
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 9
Capitalization of
Prepaid Expense
Line # Account Description Base Amount
1 140200 Prepaid $XXX,XXX
Expense
2 5XXXXX Applicable - $XXX,XXX
Expenditure
Account
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 10
Depreciation
Proprietary funds—
Depreciation posts to
proprietary ledger, then closed
to Actuals ledger at year-end.
No Year-end Governmental funds—
Accrual Depreciation posts to
Needed governmental ledger. Expense
used for government-wide
financial statements only.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 11
Schedule P
Bank Accounts Controlled by Agencies
and Departments
DUE AUGUST 8, 2008
Complete Schedule P for all bank accounts:
• Open during the year (new & existing)
• Closed during the year
• List top 10 sites where cash and checks
are collected
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 11
Schedule P
Bank Accounts Controlled by
Agencies and Departments (cont’d)
Required attachments:
• June bank statement
• June bank reconciliation
• Authorized signature card
• Request to establish the account
• Top 10 collection sites
• Schedule P questionnaire
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training
Treasurer Cash
Receipts
For Fiscal Year 2008
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training
Types of Treasurer Cash Receipts
• Cash Deposits
- Money deposited into the County Treasury
• Zero Balance Accounts (ZBA)
- Money deposited into an authorized bank
institution or pick up by armor
transportation
• Wire Transfers
- Money wired out of the County Treasury
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training
Wire Transfers
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training
Cash Deposits
Cut-off date
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 13
Schedule R
Contingent Liabilities
• May become liabilities as a result of an
existing condition, situation, set of
circumstances, and
• There is a reasonable expectation that a
loss has occurred
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 13
Accounting for Contingent
Liabilities
• If Probable & Estimable = ACCRUE
• If Probable, but not estimable = DISCLOSURE,
but not accrued
• If Reasonably Possible = DISCLOSURE, but
not accrued
• Remotely Possible = No disclosure, No
accrual
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 13
If Contingent Liability
Requires Accrual or
Disclosure
Complete Schedule R
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training
Subsequent Events
• Significant events or transactions
considered material to the financial
statements of the County that occur after the
end of the Fiscal Year but prior to the
issuance of the annual CAFR.
• Require Note disclosure.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 12
Capital Leases
Substantially all the risks and benefits
of ownership are assumed by the
lessee.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 12
To qualify as a Capital Lease, only
one of the following criteria must
be met:
1. Transfer of ownership at end of lease
2. Bargain purchase option
3. Lease term is equal to 75% or more of
estimated life of leased property
4. Present Value (PV) of minimum lease
payments = at least 90% of the asset’s fair
value
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 12
Capital Leases (cont’d)
If none of the capital lease criteria is met, the
lease is classified as an operating lease.
Use the capital lease test at the ACO website, to
properly classify the lease.
Link:
http://www.auditorcontroller.org/opencms/forms/Capital_Lease_Test.xls
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 14
Revolving Funds
• Definition
A Revolving fund is an authorized amount
of cash in the form of currency, a bank
checking account or both. Revolving
funds are established for specific
operational needs to facilitate certain
expenditure and cash transaction
throughout the County departments
County of Riverside ■ Office of the Auditor-Controller
Revolving Funds (cont’d)
• An Example of a Revolving Fund :
ABC Department has established a Revolving
Fund account for the amount of $500 and their
Custodian is John Deer. The $500 is kept in a
lockbox at their location. The monies are being
used for miscellaneous expenses. For example,
postal stamps, employee reimbursement, office
supplies and etc.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 14
Revolving Funds (cont’d)
• California Government Code Section 29321.1
requires the Auditor-Controller to render a
written report to the Board of Supervisors at
the end of each fiscal year identifying the
revolving funds in existence during the fiscal
year, the amount of such fund, and the officer
using the fund.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training – Chapter 14
Revolving Funds (cont’d)
• Schedule W has been created for you to
identify:
– Your Revolving Fund Number
– Revolving Fund Amount
– Location of Revolving Fund and
– Revolving Fund Custodian
• Schedule W is due on July 18th unless you have
a checking account outside the Treasury, you
may then submit Schedule W on August 8th
along with your Schedule P.
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training
Mail Year-end Packets To:
Attention:
ACO Year-End
Mail Stop #1050
County of Riverside ■ Office of the Auditor-Controller
2008 Year-end Training
Hand Deliver
Year-End Packets To:
ACO Year-End
11th Floor
County of Riverside ■ Office of the Auditor-Controller
???? Questions ????
Send your questions via email to:
ACOYearEnd@co.riverside.ca.us
Or
Look for Yearend, ACO in your
email address book
County of Riverside ■ Office of the Auditor-Controller
The End
County of Riverside ■ Office of the Auditor-Controller
