May 21, 20071 Budget Activity Budget Roll Forward Relationship to Reserves Year End Training May 21,...

May 21, 2007 1

Budget ActivityBudget Roll Forward

Relationship to Reserves

Year End TrainingMay 21, 2007

May 21, 2007 D. Brothwell, CPSLO 2

Same World Different Perspective

The view of the world

by the Budget Office

The view of the world by the

accounting office


Systemwide Allocation Transfers - SWAT

• SWAT documents are a notice to the campus budget office that additional cash will be deposited into the campus CSU Operating Fund– Budgets should be recorded to reflect the

new revenue and the corresponding spending authority – net zero• The revenue will be recorded in FIRMS object

code 506100– Funds could also be transferred out - 680100 would

be used


SWAT Accounting Entries

Either a CPO or an AD-NOAT

never both, CPO =

Cash/Investment entry, AD-NOAT

= FBC entry. Both credit the same revenue

account (506100)


SWAT Budget EntriesBudget is posted to 506100

regardless of the method of deposit (AD-

NOAT or CPO) then recorded for expenditure in the receiving

departments accounts


Balance in SWAT accounts should be zero


Definitions• Budget Balance Available (BBA) CSU

Fund 485• Budget – Actuals – Encumbrances = BBA• If Revenue and Expenditures Budgets NET to Zero,

then BBA + Encumbrances = Fund Balance


Establishing Reserves in Actuals Ledger 485 – CSU Operating Fund

• Reserve Entire 305002 Fund Balance– Ensure the merry-go-round has stopped

• Accounting - no more entries to impact Fund Balance• Budget Office - no more entries to impact BBA

– Allow Time to Calculate Each Reserve Amount– Includes all your CMS Funds within 485– This is a Journal Entry in Actuals Only before

Close– The 304XXX Object Codes Must Net to Zero


Budget Considerations

• Does your campus sweep budget balances (BBA) to contingency or roll them forward to the department– PeopleSoft Fund does not change from

year to year so any differences between what was accrued and what is paid in the subsequent year will be processed within the users account


Budget Considerations

• Managing Contingencies– Campuses historically manage contingencies

thru the budget process. • Prior year savings will be a reserve amount in

fund equity• Budget offices will more than likely establish a

budget for this in order to manage the allocations and the transfers to departments in the subsequent year

• This budget will not be recorded in the reserve account

• Pre-closing reserve entries per “Interim Guidelines”


Required Reserve FIRMS Object Codes for CSU fund

485• 304018 – Reserve for Encumbrance• 304016 – Campus/Dept

Commitments• 304015 – Designation and

Contingency Reserve• 304099 – Reserve Offset


Cal Poly


Sample Reserve Account Definitions (Cal Poly

Perspective)• 304018 – Reserve for Encumbrance

– Amount equals the total encumbrances in the SAM 6 for the CSU Operating Fund (CSU Fund 485)

• 304800 – Reserve for Division Commitments– Amount is equal to the budget balance available for

roll forward to campus divisions (304016 AAT Key)• 304801 – Reserve for Campus Obligations

– Amount is equal to the budget balance available for roll forward to campus contingency (304016 AAT key)

• 304802 – Unallocated Campus Reserves– Represents amounts that will not be budgeted in the

subsequent year and are truly unallocated (304015 AAT key)


Sample Reserve Accounts AAT Mapping (Cal Poly

Perspective)

Amounts in 304017, 304800 and 304801 will be budgeted in the subsequent year, $7,739,846.


Sample Year End Report – Cal Poly Perspective

Budget Expense Encumbrance Balance AvailExpense 201,000,000$ 192,260,154$ 5,375,689$ 3,364,157$ Tranfer in GF (141,625,000)$ (141,625,000)$ -$ -$ Total Expense 59,375,000$ 50,635,154$ 5,375,689$ 3,364,157$

Revenue (59,375,000)$ (59,375,000)$ -$ -$

Net -$ (8,739,846)$ 5,375,689$ 3,364,157$

Net income will close to fund balance in the amount of $8,739,846 Encumbrances

plus balance available equal

the amount to be reserved (Fund

Balance)


Trial Balance by FundFor Year to Date through July 1, 2007 For Fund: SL001 -- CSU Operating Fund

Account Description Current Period Current YearAssets 47,241,756.22

Liabilities (38,501,910.22)

305002 Fund Balance-Continuing Approp (8,739,846.00)304018 Reserve for Encumbrances (5,375,689.00)304800 Reserve for Division Obligations (1,567,800.00)304801 Reserve for Campus Obligations (796,357.00)304802 Unallocated Campus Reserves (1,000,000.00)304099 Reserve Offset 8,739,846.00

Fund Balance (8,739,846.00)

Revenues 0.00 0.00

Expenditures 0.00 0.00

Sample Trial Balance for CSU Operating Fund as of 7-1-2007

Sum of the 304XXX FIRMS Object

Codes must net to zero


Sample New Year Budget

Trial Balance by FundFor Year to Date through July 1, 2007 For Fund: SL001 -- CSU Operating Fund

Account Description Current Period Current YearAssets 47,241,756.22

Liabilities (38,501,910.22)

305002 Fund Balance-Continuing Approp (8,739,846.00)304018 Reserve for Encumbrances (5,375,689.00)304800 Reserve for Division Obligations (1,567,800.00)304801 Reserve for Campus Obligations (796,357.00)304802 Unallocated Campus Reserves (1,000,000.00)304099 Reserve Offset 8,739,846.00

Fund Balance (8,739,846.00)

Revenues 0.00 0.00

Expenditures 0.00 0.00

The sum of 304018,

304800 and 304801 is

$7,739,846.


Sacramento State



(continued)

• 304018 - Encumbrance Balance at June 30th

– Ledger KK_DTL_ENC – Query from Ledger_KK• Can Obtain JE Detail by PS Fund Value

– Needed if you are using multiple CSU 485 Funds

• SAM 6 – Encumbrances Column • SAM 7 – State Accruals Column

Balances



(continued)• 304016 - Determine amounts Designated

for Program, Project or Organizational Unit– BBA for these areas per Campus Policy

• Departmental Level• Division/Program Center Level• Sweep to Central Pool

– Sac State Perspective• Program Centers (like Colleges, HR, Student

Affairs, etc.)– Budget Balance Available Adjusted for

» All University Expenses (AKA Designated-Line Items)» Work Study Excess



(continued)

• 304015 - Remaining amount will be designated for Operations and Contingencies

– Sac State Perspective• Fund Balance less 304018/304016 Reserves• Amount not rolled into next year’s budget

• 304099 – Fund Balance Offset– Debit amount to = 304018 + 304016 + 304015– 304099 Debit Amount = 305002 Credit Amount


Establishing Reserves in 485 (cont.)

Fund Balance 6/30 305002 -180 -155

485 Fund FIRMS Object Codes 06/07 07/08

FB Reserve for Encumbrances 304018 -15 -20

FB Designated for Program, Project or Organizational Unit 304016 -25 -18

FB Designated for Operations and Contingencies 304015 -140 -100

FB Designated - new categories per CABO? 304NEW n/a -17

FB Offset for Designated Reserves 304099 180 155

Total of 304XXX Must Equal Zero 0 0

Reserve June 30 Balances after Pre-Closing Year-End Journal Entry in Actuals


Sacramento State’s Perspective

• Reserve amounts are determined at Year End in Fund 485 (CSU Operating Fund)– Encumbrance Reserve (Object Code 304018)

• SAM 6 (Encumbrance column total)• KK_DTL_ENC table

– Query Amounts by Chart Fields it against SAM 6 Total

– Program/Project/Organizational Unit (Object Code 304016)

• Calculated Budget Balance Available to Divisions• University-wide Use Fund

– Operations & Contingencies Reserve (Object Code 304015)

• Amount not budgeted for use in the next fiscal year



2006/07 Budget Actuals Encumbrance BBA

Revenue Fees ($66,500,000) ($66,500,000) $0 $0 Other ($1,000,000) ($1,000,000) $0 $0

Total Revenue: ($67,500,000) ($67,500,000) $0 $0

Expense-Payroll $159,000,000 $159,000,000 $0 $0Expense-Other $67,500,000 $65,000,000 $400,000 $2,100,000Transfer In GF ($159,000,000) ($159,000,000) $0 $0

Total Expenses: $67,500,000 $65,000,000 $400,000 $2,100,000

Net $0 ($2,500,000) $400,000 $2,100,000

Object Code Description Begin Bal CY Chgs Ending Bal304018 Encumb Reserve $0 $400,000 $400,000304016 Univ Org Reserve $0 $2,000,000 $2,000,000304015 Contingency Res $0 $100,000 $100,000

Campus Activity as of 6-30-07

At Year End



• To Zero Out Budgets or Not to Zero Out Budgets…That is the Question– Our campus chose Not to Zero Out

Budget Amounts• Revenue budget is less than expense budget

– Not budgeting PY roll forward reserve on revenue side

• Under the SAM6 Budget Column:– Net Budget = Prior year budget roll forward

reservesor

– Net Budget = 304018 + 304016



• Revenue Budget Setup in Fund 485– Building Your 2007/08 Budget

• Fee Revenue Projections $67.5 M

• Other Revenue $1.5 MTotal: $69.0

M



• Revenue Budget Setup – Fund 485Object Code Description Begin Bal CY Chgs Ending Bal

304018 Encumb Reserve $0 $400,000 $400,000304016 Univ Org Reserve $0 $2,000,000 $2,000,000304015 Contingency Res $0 $100,000 $100,000

2007/08 Budget Actuals Encumbrance BBARevenue Fees ($67,500,000) ($67,500,000) Other ($1,500,000) ($1,500,000)

Total Revenue: ($69,000,000) $0 $0 ($69,000,000)

At Prior Year End 6-30-07

Campus Revenue Budget as of 7-1-07



• Expense Budget Setup in Fund 485– Using a Global DeptID

•Distribute 2007/08 Budget - $228 M:– State Appropriation = (-$160 M using

690003)– Fee Revenue = $66 M– Other Revenue = $1.5 M

•Distribute your Reserve Budgets



• Expense Budget Setup – Cont’d– Create CMS Expense Accounts to Separate

your Reserve Amounts (e.g. $2.4 M)•660884 Encumbrance (304018)•660885 Division/Organizational Unit

(304016)•660886 University-wide Use Fund (304016)• Map Accounts to 660003



• Spreading the Reserves:– 660884 Encumbrance $400K

• Allocation Process in CMS (Ledg_KK_Enc)• Query and upload into CMS

– 660885 Division/Organizational Unit $1.5M• Use Unique Scenario Chart Field to spread

budget to Divisions

– 660886 University-wide Use Fund $500KTotal: $2.4M



• Expense Budget Setup – Fund 485



• Total Budget Setup – Fund 485



• Differences Between Zeroing Out and Not Zeroing Out Budgets on SAM6 Report– Zero Out Budget

• Net Budget Column = 0

– Don’t Zero Out Budget• Net Budget Column = Prior Year Roll

Forward Reserve Budget– Sum of 304018 + 304016

• Total Expense Budget Balance Available = Net Budget Balance Available



• Sample 2007/08 Year End Snapshot:



• Sample comparison spreadsheet– Zero Out vs Don’t Zero Out Reserve

BudgetsSee EXCEL attachment

Microsoft Excel Worksheet


CSU Monterey Bay

May 21, 2007 37

CSUMB PerspectiveYear End & Year Beginning

• Most decision points for budget operations are the same or similar to SLO and Sac State– In 2006-07, revenue & expense budgets

net to zero– At year-end, revenue budget adjusted to

equal actuals– Expenditure BBA plus encumbrances =

fund balance (after obligations)

May 21, 2007 38

CSUMB Nuances Related to Sweeping Balances

• Revenue Required in Fund 485– “Remap” trust projects to Fund 485

• New fund code in old FNAT mapping• Change FNAT key to Fund 485 for historical

fund code• Journal entry from historical fund code to

new fund code, thereby satisfying beginning year fund balance edits

• Historical fund code journal entry has transfers in and no beginning fund balance

– Impact to Fund 485 – Multiple Fund Codes

May 21, 2007 39

CSUMB: RESERVE ENTRIES

• Definitions Similar to SLO and Sac State– 304018 – Reserve for Encumbrances – 304820 – Reserve for Campus/Dept

Obligations– 304840 – Reserve for Campus Contingency– 304099 – Fund Balance Offset– Net to Zero

May 21, 2007 40

CSUMB: RESERVE ENTRIES

• All Entries Now 3-Dimensional Analysis Due to Multiple Fund Codes and Entered at Fund Code Level– Reserve for Encumbrances

• SAM 6 (Encumbrance column total) – Represents Total of All 485 Campus Fund Codes

• KK_DTL_ENC table – 485 Campus Fund Code Specific– Query Amounts by Chart Fields Total against SAM 6

Total

– Reserve for Campus Obligations• Queries set up in advance for trust project fund codes for

revenue and expense actuals as well as main operating fund

– Reserve for Campus Operations & Contingency

May 21, 2007 41

CSUMB: 2007-08 BUDGET POSTING

MAIN OPERATING FUND• Current Year Revenue and Expense

Budget Will NOT Net to Zero

• Budget Equal to Encumbrance Reserve Posted with Unique Scenario– Exploring Distribution in Arrears to

Payment

• Budget Equal to Reserve for Campus Obligations Posted and Distributed with Unique Scenario

May 21, 2007 42

CSUMB: 2007-08 BUDGET POSTING

MAIN OPERATING FUND

End up looking the same as non-sweep campusesHOW we get there is different…..and HOW we administer

reserves is different

2007-08 Budget Revenue Fees (10,048,838) Other (1,175,000) Revenue Total (11,223,838) Expense Payroll 51,735,382 OE&E 12,933,846 Encumbrance Reserve 500,000 Campus Obligations Reserve 2,000,000 Transfer In General Fund (53,445,390) Expense Total 13,723,838 Net Total Budget 2,500,000

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May 21, 20071 Budget Activity Budget Roll Forward Relationship to Reserves Year End Training May 21,...

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