Accounting I: Introduction to University Accounting Accounting I: Introduction to University Accounting


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  • Accounting I: Introduction to University Accounting Accounting I: Introduction to University Accounting

    1. 1. Accounting I: Introduction to University Accounting Susan Moore Accounting & Financial Services General Accounting
    2. 2. A genda <ul><li>Introductions </li></ul><ul><li>Course objectives </li></ul><ul><li>Topics </li></ul><ul><ul><li>Accounting Concepts </li></ul></ul><ul><ul><li>Fund Accounting Overview </li></ul></ul><ul><ul><li>The Chart of Accounts </li></ul></ul><ul><ul><li>Financial Reporting </li></ul></ul><ul><ul><li>Questions and Answers </li></ul></ul>
    3. 3. I ntroductions
    4. 4. <ul><li>By the end of class, you will be able to… </li></ul><ul><ul><li>Talk like an accountant </li></ul></ul><ul><ul><li>Identify and classify university revenues </li></ul></ul><ul><ul><li>Identify and classify university expenses </li></ul></ul><ul><ul><li>Set up an account in DaFIS and find it in the Annual Schedules </li></ul></ul>C ourse Objectives
    5. 5. A ccounting Concepts <ul><li>Accounting Standards </li></ul><ul><li>Balance Sheet: Statement of Net Assets </li></ul><ul><li>Income Statement: Statement of Revenues, Expenses and Changes in Net Assets </li></ul><ul><li>Double Entry Accounting System </li></ul><ul><li>Restricted vs. Unrestricted Funds </li></ul>
    6. 6. A ccounting Standards <ul><li>Why have them? </li></ul><ul><ul><li>Reliability </li></ul></ul><ul><ul><li>Comparability </li></ul></ul><ul><li>What are they? </li></ul><ul><ul><li>GAAP – generally accepted accounting principals </li></ul></ul><ul><ul><li>GASB – Governmental Accounting Standards Board </li></ul></ul><ul><ul><li>FASB – Financial Accounting Standards Board </li></ul></ul><ul><ul><li>NACUBO – National Association of Colleges & University Business Officers </li></ul></ul>
    7. 7. B alance Sheet <ul><li>Statement of Net Assets </li></ul><ul><ul><li>Assets </li></ul></ul><ul><ul><li>Liabilities </li></ul></ul><ul><ul><li>Fund Balance </li></ul></ul><ul><li>Permanent Accounts </li></ul>
    8. 8. A ssets <ul><li>Probable future economic benefit </li></ul><ul><li>What you own </li></ul><ul><li>Normal balance = debit </li></ul>
    9. 9. A ssets <ul><li>Examples: </li></ul><ul><ul><li>Cash </li></ul></ul><ul><ul><li>Buildings & Capital Equipment </li></ul></ul><ul><ul><li>Prepaid Expense/Deferred Expense </li></ul></ul><ul><ul><li>Inventory </li></ul></ul><ul><ul><li>Accounts Receivable </li></ul></ul>
    10. 10. L iabilities <ul><li>Probable future sacrifices of economic benefit arising from present obligations </li></ul><ul><li>What you owe </li></ul><ul><li>Normal balance = credit </li></ul>
    11. 11. L iabilities <ul><li>Examples: </li></ul><ul><ul><li>Accounts Payable </li></ul></ul><ul><ul><li>Salaries </li></ul></ul><ul><ul><li>Deferred Income </li></ul></ul><ul><ul><li>Debt </li></ul></ul>
    12. 12. E xercise: Asset or Liability? <ul><li>Bill for cellular phone service </li></ul><ul><li>Network server from Sun </li></ul><ul><li>Petty cash fund </li></ul><ul><li>Invoice to University of Nebraska for poultry diagnostic services </li></ul><ul><li>Purchase of textbooks for resale </li></ul><ul><li>Purchase of a copier on a lease-purchase agreement </li></ul>
    13. 13. F und B alance <ul><li>Net Assets </li></ul><ul><ul><li>Beginning Balance + Income - Expense = Ending Balance </li></ul></ul><ul><li>What you are worth </li></ul><ul><li>In private = retained earnings </li></ul>
    14. 14. I ncome Statement <ul><li>Statement of Revenues, Expenses and Changes in Net Assets </li></ul><ul><ul><li>Statement of how you did each year </li></ul></ul><ul><ul><li>Income and expenses for the year </li></ul></ul><ul><ul><li>Closed at year end </li></ul></ul><ul><li>Temporary Accounts </li></ul>
    15. 15. I ncome Statement <ul><li>Revenues – Expenses = Net Income </li></ul><ul><li>Net Income +/- Other Fund Balance Changes </li></ul><ul><li>=Total Change in Net Assets </li></ul>
    16. 16. R evenues <ul><li>External income to the university </li></ul><ul><li>Examples: </li></ul><ul><ul><li>State appropriations </li></ul></ul><ul><ul><li>Student fees </li></ul></ul><ul><ul><li>Contracts and grants </li></ul></ul><ul><ul><li>Patient fees </li></ul></ul><ul><ul><li>Sales and services to outside entities </li></ul></ul>
    17. 17. E xpenses/Expenditures <ul><li>Goods and services purchased to meet the mission of the university </li></ul><ul><ul><li>Salaries and wages </li></ul></ul><ul><ul><li>Benefits </li></ul></ul><ul><ul><li>Goods and materials </li></ul></ul><ul><ul><li>Services </li></ul></ul>
    18. 18. R echarges <ul><li>Charge to departments for goods and services provided internally </li></ul><ul><ul><li>Like income to department providing the good/service </li></ul></ul><ul><ul><li>Internal rates = Recovery of costs incurred to provide goods/service (no profit) </li></ul></ul><ul><ul><li>When recharge and expense totaled across UC, net effect is original cost </li></ul></ul>
    19. 19. E xpense Reimbursement <ul><li>External payment for specific cost incurred by the university </li></ul><ul><ul><li>Examples: </li></ul></ul><ul><ul><ul><li>Reimbursement by employees for personal telephone calls </li></ul></ul></ul><ul><ul><li>Not a revenue but a reduction of expense </li></ul></ul>
    20. 20. L iens and Encumbrances <ul><li>Firm commitment or obligation placed against funds for goods or services not yet received </li></ul><ul><li>Reduces the balance in the fund </li></ul><ul><li>NOT in the Financial Statements </li></ul>
    21. 21. D ouble Entry Accounting <ul><li>Debits always equal credits </li></ul><ul><li>Every transaction has 2 entries: </li></ul><ul><ul><li>Debit ( + ) </li></ul></ul><ul><ul><li>Credit ( - ) </li></ul></ul>
    22. 22. D ebits <ul><li>Generally shown as a positive (+) number </li></ul><ul><li>Assets </li></ul><ul><li>Expenses </li></ul><ul><li>Examples: </li></ul><ul><ul><li>Cash </li></ul></ul><ul><ul><li>Equipment </li></ul></ul><ul><ul><li>Roads </li></ul></ul><ul><ul><li>Buildings </li></ul></ul><ul><ul><li>Books </li></ul></ul>
    23. 23. C redits <ul><li>Generally shown as a negative (-) number </li></ul><ul><li>Liabilities </li></ul><ul><li>Revenues </li></ul><ul><li>Examples: </li></ul><ul><ul><li>Student fees </li></ul></ul><ul><ul><li>Sale of genetically enhanced mice </li></ul></ul><ul><ul><li>Vacation time earned but not taken </li></ul></ul><ul><ul><li>Cash received before June 30 th for July conference </li></ul></ul>
    24. 24. E xercise: <ul><li>DOUBLE ENTRY ACCOUNTING - </li></ul><ul><li>Putting it all together </li></ul>
    25. 25. F or Profit vs. Not For Profit Governmental Accounting Standards Board (GASB) and Financial Accounting Standards Board (FASB) Financial Accounting Standards Board (FASB) Accounting standards Contributors/tax-payers are essential; management subject to political control Customer satisfaction is essential; management subject to investor control Interest and relationships Percent of receipts expended for stated purpose. Amount of funds obtained. Amount of profit, return on investment, financial condition Measures of success <ul><li>Providing services </li></ul><ul><li>Fund raising </li></ul>Production and sale of products and/or services at a price to exceed cost to make and sell Operations Service to beneficiaries at cost, below cost or at no cost. No Profit! Profit for owners/shareholders Purpose Public University For-Profit Business Attribute
    26. 26. R estricted Resources <ul><li>Generally unique to non-profit/public </li></ul><ul><li>Limitations on use </li></ul><ul><ul><li>External conditions </li></ul></ul><ul><ul><li>Cannot restrict internally </li></ul></ul><ul><li>Examples: </li></ul><ul><ul><li>Donors </li></ul></ul><ul><ul><li>Contracts </li></ul></ul><ul><ul><li>Federal or other governmental entities </li></ul></ul>
    27. 27. U nrestricted Resources <ul><li>No external conditions </li></ul><ul><li>Examples: </li></ul><ul><ul><li>State Appropriations </li></ul></ul><ul><ul><li>Gifts without conditions </li></ul></ul>
    28. 28. D esignated Resources <ul><li>Not Restricted </li></ul><ul><ul><li>Conditions placed by the University of California Regents, Office of the President or Chancellor </li></ul></ul><ul><ul><li>Examples: </li></ul></ul><ul><ul><ul><li>Faculty Research Grants </li></ul></ul></ul><ul><ul><ul><li>Opportunity Funds </li></ul></ul></ul>
    29. 29. F und Accounting Overview <ul><li>Tracks the receipt and use of resources by the source of the funds </li></ul><ul><li>Defines the “color” of the money </li></ul><ul><li>Used by all Higher Education institutions </li></ul>
    30. 30. F und Groups Summary <ul><li>Current </li></ul><ul><li>Loan </li></ul><ul><li>Endowment </li></ul><ul><li>Annuity and Life Income </li></ul><ul><li>Plant </li></ul><ul><li>Agency </li></ul>
    31. 31. C urrent Funds <ul><li>Educational and general </li></ul><ul><li>Auxiliary enterprises </li></ul><ul><li>Hospital </li></ul><ul><li>Affiliated organizations </li></ul>
    32. 32. S ources of Current Funds <ul><li>State appropriations </li></ul><ul><li>Tuition and fees </li></ul><ul><li>Grants and contracts </li></ul><ul><li>Gifts </li></ul><ul><li>Endowment income </li></ul><ul><li>Overhead recovery funds </li></ul><ul><li>Sales and services </li></ul>
    33. 33. S tate Appropriations <ul><li>General Funds (19000-19XXX) </li></ul><ul><ul><li>Appropriations from State General Fund as part of annual State budget process </li></ul></ul><ul><ul><li>UC General Funds </li></ul></ul>
    34. 34. S tudent Fees <ul><li>Registration Fee (20000) </li></ul><ul><li>University Extension </li></ul><ul><li>Continuing Education </li></ul>
    35. 35. O ther Fees <ul><li>Professional Degree Fees </li></ul><ul><li>Student Approved Mandatory Fees </li></ul><ul><li>Course Material Fees </li></ul>
    36. 36. E xtramural Funds <ul><li>Contracts and Grants </li></ul><ul><li>Gifts </li></ul><ul><li>Endowment Income </li></ul><ul><li>Managed by Extramural </li></ul>
    37. 37. I ndirect Cost Recovery Funds <ul><li>Educational Fund (05397) </li></ul><ul><li>Garamendi Funds – for research facilities </li></ul><ul><li>Off-the-Top Funds (69750) </li></ul><ul><li>Opportunity Funds (07427) </li></ul>
    38. 38. S ales & Service : Educational Activities <ul><li>Definition: </li></ul><ul><ul><li>Revenue related only incidentally to the conduct of teaching, research and service </li></ul></ul><ul><li>Funds (income) supports the activities </li></ul>
    39. 39. S ales & Services: Auxiliary Enterprises <ul><li>Residence halls </li></ul><ul><li>Student union </li></ul><ul><li>Parking and transportation </li></ul><ul><li>Bookstore </li></ul><ul><li>Athletics </li></ul><ul><li>Revenues Must Cover Expenses </li></ul>
    40. 40. M atch Revenue to the Source <ul><li>Sale of genetically enhanced mouse </li></ul><ul><li>“ Autopsies of the Rich and Famous” continuing medical education </li></ul><ul><li>Faculty research grant </li></ul><ul><li>Sale of parking decal </li></ul><ul><li>Grant from National Science Foundation </li></ul><ul><li>Auxiliary </li></ul><ul><li>General Funds </li></ul><ul><li>Sales and Services- Educational Activites </li></ul><ul><li>Contracts and Grants </li></ul><ul><li>Student Fees </li></ul>Answers: 1-C, 2-E, 3-B, 4-A, 5-D
    41. 41. O ther Fund Groups <ul><li>Loan </li></ul><ul><li>Endowment </li></ul><ul><li>Plant </li></ul><ul><li>Agency </li></ul>
    42. 42. L oan Funds <ul><li>Resources loaned to students, faculty or staff </li></ul><ul><li>Interest usually charged </li></ul><ul><li>Principal must be repaid </li></ul>
    43. 43. E ndowment and Similar Funds <ul><li>Endowment funds </li></ul><ul><li>Term endowment funds </li></ul><ul><li>Quasi-endowment </li></ul><ul><li>Earnings (interest) moved to current funds to spend </li></ul>
    44. 44. P lant Funds Subgroups <ul><li>Unexpended </li></ul><ul><li>Renewals and replacements </li></ul><ul><li>Retirement of indebtedness </li></ul><ul><li>Investment in plant </li></ul>
    45. 45. A gency Funds <ul><li>Funds held for others </li></ul><ul><ul><li>Student organizations </li></ul></ul><ul><ul><li>Other third-party </li></ul></ul><ul><li>At year-end </li></ul><ul><ul><li>Income less expenses = Cash (Asset) </li></ul></ul><ul><ul><li>Cash held for others = Liability </li></ul></ul><ul><ul><ul><li>The money does not belong to UC </li></ul></ul></ul>
    46. 46. I dentify the fund source … … by the OP Fund Number!
    47. 47. OP Fund Numbers <ul><li>5 digits </li></ul><ul><li>Identifies the source of the revenue </li></ul><ul><li>Restricted vs. non restricted </li></ul>
    48. 48. U se of Funds <ul><li>Instruction </li></ul><ul><li>Research </li></ul><ul><li>Community Service </li></ul>
    49. 49. C urrent Funds Expenditures <ul><li>Expenditures defined by: </li></ul><ul><ul><li>Higher Education Function Code (HEFC) and </li></ul></ul><ul><ul><li>Uniform Accounting Structure (UAS) </li></ul></ul><ul><li>Applied to all Higher Education institutions </li></ul>
    50. 50. C urrent Funds Expenditures <ul><li>Expenditure Categories </li></ul><ul><ul><li>Education and General </li></ul></ul><ul><ul><li>Auxiliary (Self Supporting) </li></ul></ul><ul><ul><li>Hospital </li></ul></ul>
    51. 51. E ducation and General <ul><li>Instruction </li></ul><ul><ul><li>General Academic </li></ul></ul><ul><ul><li>Departmental Research </li></ul></ul><ul><ul><li>Continuing Education </li></ul></ul><ul><ul><li>University Extension </li></ul></ul>
    52. 52. E ducation and General <ul><li>Research – Sponsored Projects </li></ul><ul><ul><li>Principal Investigator </li></ul></ul><ul><ul><li>Period of performance </li></ul></ul><ul><ul><li>Set scope of work </li></ul></ul><ul><ul><li>Reporting requirements </li></ul></ul>
    53. 53. E ducation and General <ul><li>Public Service </li></ul><ul><ul><li>Community service </li></ul></ul><ul><ul><li>Cooperative extension services </li></ul></ul><ul><ul><li>Outreach </li></ul></ul>
    54. 54. E ducation and General <ul><li>Academic Support </li></ul><ul><ul><li>Academic administration </li></ul></ul><ul><ul><li>Course and curriculum development </li></ul></ul><ul><ul><li>Libraries </li></ul></ul>
    55. 55. E ducation and General <ul><li>Student Services </li></ul><ul><ul><li>Admissions </li></ul></ul><ul><ul><li>Student records </li></ul></ul><ul><ul><li>Student health services </li></ul></ul>
    56. 56. E ducation and General <ul><li>Institutional Support </li></ul><ul><ul><li>Executive management </li></ul></ul><ul><ul><li>Fiscal and business operations </li></ul></ul><ul><ul><li>General administrative and logistical services </li></ul></ul>
    57. 57. E ducation and General <ul><li>Operation and Maintenance of Plant </li></ul><ul><ul><li>Building maintenance and custodial services </li></ul></ul><ul><ul><li>Landscape and grounds maintenance </li></ul></ul><ul><ul><li>Major repairs and renovations </li></ul></ul>
    58. 58. E ducation and General <ul><li>Scholarships and Fellowships </li></ul><ul><ul><li>Student grants </li></ul></ul><ul><ul><li>Trainee stipends </li></ul></ul><ul><ul><li>Tuition and fee waivers </li></ul></ul>
    59. 59. A uxiliary Enterprises <ul><li>Provide goods and services to students, faculty and staff </li></ul><ul><li>Charge a fee directly related to costs </li></ul><ul><li>Managed as a self supporting activity </li></ul>
    60. 60. H ospital <ul><li>Direct patient care </li></ul><ul><li>Health care supportive services </li></ul><ul><li>Hospital administration </li></ul><ul><li>Hospital physical plant operation </li></ul>
    61. 61. R eserves <ul><li>Used to accumulate funds from the net revenue of self supporting activities for the purchase of new equipment, buildings and other capital projects </li></ul>
    62. 62. E xpenditure Classification <ul><li>Breast Cancer Research Program Award &quot;Regulations of Estrogen Response by Corepressors&quot; </li></ul><ul><ul><li>Organized Research </li></ul></ul><ul><ul><li>Instruction </li></ul></ul><ul><ul><li>Academic Support </li></ul></ul>MULTIPLE CHOICE QUESTIONS
    63. 63. E xpenditure Classification <ul><li>Utilities purchased by facilities for recharge to campus units. </li></ul><ul><ul><li>Academic Support </li></ul></ul><ul><ul><li>Student Services </li></ul></ul><ul><ul><li>Operation and Maintenance of Plant </li></ul></ul>
    64. 64. E xpenditure Classification <ul><li>Approved research project budget that includes graduate student stipend. </li></ul><ul><ul><li>Organized Research </li></ul></ul><ul><ul><li>Scholarships and Fellowships </li></ul></ul><ul><ul><li>Academic Support </li></ul></ul>
    65. 65. E xpenditure Classification <ul><li>New faculty start up costs including research equipment and furniture. </li></ul><ul><ul><li>Organized Research </li></ul></ul><ul><ul><li>Academic Support </li></ul></ul><ul><ul><li>Instruction </li></ul></ul>
    66. 66. E xpenditure Classification <ul><li>Seminar on Pests and Pest Management given by the Cooperative Extension Master Gardeners. </li></ul><ul><ul><li>Organized Research </li></ul></ul><ul><ul><li>Public Service </li></ul></ul><ul><ul><li>Instruction </li></ul></ul>
    67. 67. C hart of Accounts <ul><li>A systematic measurement of the source and use of funds. </li></ul>
    68. 68. W hat is the Chart of Accounts? <ul><li>Blueprint for the accounting system </li></ul><ul><li>Sorts and classifies transactions </li></ul><ul><li>Allows for identification of: </li></ul><ul><ul><li>Restricted vs. Unrestricted </li></ul></ul><ul><ul><li>Purpose or use of funds </li></ul></ul><ul><ul><li>Ownership vs. Agency </li></ul></ul><ul><li>“The keys to the kingdom” </li></ul>
    69. 69. C hart of Accounts <ul><li>Full Accounting Unit (FAU) </li></ul><ul><ul><li>Chart </li></ul></ul><ul><ul><li>Account </li></ul></ul><ul><ul><li>Object </li></ul></ul><ul><ul><li>Optional fields (in DaFIS) </li></ul></ul><ul><ul><ul><li>Sub account </li></ul></ul></ul><ul><ul><ul><li>Sub object </li></ul></ul></ul><ul><ul><ul><li>Project </li></ul></ul></ul>
    70. 70. F ull Accounting Unit - Chart <ul><li>2 Locations </li></ul><ul><ul><li>UCD Campus </li></ul></ul><ul><ul><li>Systemwide </li></ul></ul><ul><li>UCD Campus Charts </li></ul><ul><ul><li>3 - Campus </li></ul></ul><ul><ul><li>S - School of Medicine </li></ul></ul><ul><ul><li>H - Teaching hospital (UCDMC) </li></ul></ul><ul><li>Systemwide </li></ul><ul><ul><li>L - Agricultural & Natural Resources (ANR) and Multiple Research Units (MRU) </li></ul></ul>
    71. 71. F ull Accounting Unit - Account <ul><li>DaFIS Account </li></ul><ul><ul><li>7 character alphanumeric </li></ul></ul><ul><li>Tied to: </li></ul><ul><ul><li>OP Fund Number (fund source) </li></ul></ul><ul><ul><li>OP Account Number (account purpose) </li></ul></ul><ul><li>Account attributes </li></ul><ul><ul><li>Describes the purpose & the owner of the account </li></ul></ul><ul><ul><li>Contains the financial attributes to properly record and report transactions </li></ul></ul>
    72. 72. D aFIS Account Attributes <ul><li>Organization </li></ul><ul><ul><li>4 character alphanumeric </li></ul></ul><ul><ul><li>Every DaFIS account is tied to an organization </li></ul></ul><ul><ul><li>Normally the unit incurring the transactions in the account </li></ul></ul>
    73. 73. D aFIS Account Attributes <ul><li>OP FUND </li></ul><ul><ul><li>5 digits that identifies the fund source of the DaFIS account. </li></ul></ul><ul><ul><li>Assigned by Award document, OP, Extramural or General Accounting </li></ul></ul><ul><ul><li>OP funds grouped into sub funds – a general classification of the fund source </li></ul></ul>
    74. 74. D aFIS Account Attributes <ul><li>OP Account </li></ul><ul><ul><li>6 digits that identify the transaction classification </li></ul></ul><ul><ul><ul><li>Balance sheet = 1XXXXX </li></ul></ul></ul><ul><ul><ul><li>Revenue accounts = 2XXXXX </li></ul></ul></ul><ul><ul><ul><li>Expense accounts = 4XXXXX to 79XXXX </li></ul></ul></ul><ul><ul><ul><li>Agency accounts = 8XXXXX </li></ul></ul></ul>
    75. 75. B uilding an OP Account
    76. 76. OP Accounts <ul><li>First 2 digits = Higher Education Function Code </li></ul><ul><li>Second 2 digits are the School/College </li></ul><ul><li>Last 2 digits are the Department </li></ul>
    77. 77. OP Accounts <ul><li>OP Account also has </li></ul><ul><ul><li>Account Group Code (Account Group) </li></ul></ul><ul><ul><li>Uniform Accounting Structure Code (UAS) </li></ul></ul><ul><ul><li>Academic Discipline (Acad Disc) </li></ul></ul><ul><ul><li>National Science Foundation Code (NSF POS) </li></ul></ul><ul><ul><li>Annual Report Code (Report Code) </li></ul></ul><ul><ul><li>Organization Code (ORGN) </li></ul></ul>
    78. 78. OP Accounts <ul><li>Why? </li></ul><ul><ul><li>REPORTING </li></ul></ul><ul><ul><ul><li>Financial statements </li></ul></ul></ul><ul><ul><ul><li>Surveys </li></ul></ul></ul><ul><ul><ul><li>Management Decisions </li></ul></ul></ul><ul><ul><ul><li>State government budget decisions </li></ul></ul></ul><ul><ul><ul><li>Funding agencies </li></ul></ul></ul>
    79. 79. OP Accounts – UAS Code <ul><li>UAS Code is similar to the HEFC. </li></ul><ul><li>Provides a uniform presentation of expenses across all university campuses </li></ul><ul><li>See Annual Schedule B </li></ul>
    80. 80. OP Accounts – Annual Report Code <ul><li>Annual Report Code – used to describe major programs in Schedule C and Schedule C – Overhead </li></ul><ul><li>The same Annual Report Code can be used for more than one OP account </li></ul>
    81. 81. OP Accounts - Organization <ul><li>Each OP Account is “owned” by an organization </li></ul><ul><li>Expenditures associated with an OP account reported under the school or college of the OP account </li></ul>
    82. 82. OP Accounts - Organization <ul><li>Check your OP Account organizations to make sure they are reporting to your school/college </li></ul><ul><li>Resources: </li></ul><ul><ul><li>DS226 Annual Report Codes by Organization </li></ul></ul><ul><ul><li>TP – Reference Tables – Account </li></ul></ul><ul><ul><ul><li>Click on OP Account and any attribute </li></ul></ul></ul>
    83. 83. D aFIS Account - Recap <ul><li>Identifies: </li></ul><ul><ul><li>Source of Funds – OP Fund </li></ul></ul><ul><ul><li>Use of Funds – OP Account </li></ul></ul><ul><ul><ul><li>Higher Education Function </li></ul></ul></ul><ul><ul><ul><li>School/College </li></ul></ul></ul><ul><ul><ul><li>Major programs </li></ul></ul></ul><ul><ul><li>Account owner </li></ul></ul>
    84. 84. F ull Accounting Unit - Object <ul><li>4-character alphanumeric </li></ul><ul><li>Every transaction must have an object code </li></ul><ul><li>Attributes </li></ul><ul><ul><li>Describes the activity and type of the financial transaction </li></ul></ul><ul><li>Summarized and reported on the Financial Report </li></ul>
    85. 85. D aFIS Object Attributes <ul><li>Object Consolidations </li></ul><ul><ul><li>4-character alphanumeric </li></ul></ul><ul><ul><li>Summary object code used for budget documents </li></ul></ul><ul><ul><li>Examples: </li></ul></ul><ul><ul><ul><li>BLSH (Balance Sheet) </li></ul></ul></ul><ul><ul><ul><li>INCO (Income) </li></ul></ul></ul><ul><ul><ul><li>SUBG (General Assistance) </li></ul></ul></ul><ul><ul><ul><li>SUB3 (Supplies & Expense) </li></ul></ul></ul>
    86. 86. D aFIS Object Attributes <ul><li>Object Type </li></ul><ul><ul><li>Categorizes each transaction for financial statement presentation. </li></ul></ul><ul><ul><li>Examples: </li></ul></ul><ul><ul><ul><li>AS (Assets) </li></ul></ul></ul><ul><ul><ul><li>LI (Liability) </li></ul></ul></ul><ul><ul><ul><li>FB (Unexpended balance) </li></ul></ul></ul><ul><ul><ul><li>IN (Income) </li></ul></ul></ul><ul><ul><ul><li>EX (Expense) </li></ul></ul></ul>
    87. 87. D aFIS Object Attributes <ul><li>Other Object Code Attributes </li></ul><ul><ul><li>Object Level </li></ul></ul><ul><ul><li>Object Sub Type </li></ul></ul><ul><li>Used mostly for ad hoc reporting </li></ul>
    88. 88. B alance Sheet Object Codes <ul><li>Always used in balance sheet accounts </li></ul><ul><ul><li>Inventories (0470) </li></ul></ul><ul><ul><li>Unexpended balance (0000) </li></ul></ul><ul><li>Sometimes used in expense accounts </li></ul><ul><ul><li>At year-end, moved to balance sheet accounts, then reversed in new year </li></ul></ul><ul><ul><ul><li>Account Receivable (0299) </li></ul></ul></ul>
    89. 89. R evenue Object Codes <ul><li>Can be used in revenue accounts (IN) or expense accounts (EX) </li></ul><ul><li>Examples: </li></ul><ul><ul><li>Income = 0060 </li></ul></ul><ul><ul><li>Campus assessments/NUD = 0066, 0068, 0076 </li></ul></ul><ul><ul><li>Over/short cash = 0056 </li></ul></ul><ul><ul><li>No income in General Funds </li></ul></ul>
    90. 90. E xpense Object Codes <ul><li>More than 5,000 expense object codes </li></ul><ul><li>Hospital & School of Medicine have most specific object codes </li></ul><ul><li>Examples: </li></ul><ul><ul><li>7xxx Series – Services </li></ul></ul><ul><ul><li>8xxx Series – Supplies </li></ul></ul><ul><ul><li>9xxx Series – Equipment Expenses </li></ul></ul>
    91. 91. O ptional FAU Fields <ul><li>Allow departments to meet internal reporting needs </li></ul><ul><ul><li>Sub account </li></ul></ul><ul><ul><li>Sub object </li></ul></ul><ul><ul><li>Project </li></ul></ul><ul><li>Not used in external reporting </li></ul>
    92. 92. F inancial Reporting <ul><li>Who Cares? </li></ul><ul><ul><li>Management </li></ul></ul><ul><ul><li>University of California Office of the President (UCOP) </li></ul></ul><ul><ul><li>Regents, State legislators </li></ul></ul><ul><ul><li>Other Stakeholders (Donors, Creditors) </li></ul></ul><ul><ul><li>External Users (Other universities, researchers, analysts) </li></ul></ul>
    93. 93. F inancial Reporting <ul><li>Two Major Reports </li></ul><ul><ul><li>Annual Report </li></ul></ul><ul><ul><li>Annual Financial Schedules </li></ul></ul>
    94. 94. A nnual Report <ul><li>Financial Condition of the university </li></ul><ul><li>Management discussion and analysis </li></ul><ul><li>Comparable to other public universities </li></ul><ul><li>Used to determine the value of a potential investment (donors and creditors) </li></ul>
    95. 95. A nnual Financial Schedules <ul><li>Schedule A </li></ul><ul><ul><li>Revenues by fund source </li></ul></ul><ul><li>Schedule B </li></ul><ul><ul><li>Expenses by Uniform Accounting Structure and Academic Discipline </li></ul></ul><ul><li>Schedule C </li></ul><ul><ul><li>Expenses by School/College, Higher Education Function and Annual Report Code </li></ul></ul><ul><li>Schedule D </li></ul><ul><ul><li>Expenses by fund source </li></ul></ul>
    96. 96. A nnual Financial Schedules <ul><li>Uses: </li></ul><ul><ul><li>Overhead distribution (Schedule C – Overhead) </li></ul></ul><ul><ul><li>Research expenditures </li></ul></ul><ul><ul><li>Comparability of revenues/expenses to other UC campuses and other universities </li></ul></ul>
    97. 97. T est your knowledge !!
    98. 98. T o review… <ul><li>An asset is… </li></ul><ul><ul><li>What you own </li></ul></ul><ul><ul><li>Cash </li></ul></ul><ul><ul><li>Accounts receivable </li></ul></ul><ul><ul><li>All of the above </li></ul></ul>
    99. 99. T o review… <ul><li>A liability is… </li></ul><ul><ul><li>Office supplies </li></ul></ul><ul><ul><li>Accounts payable </li></ul></ul><ul><ul><li>Prepaid expenses </li></ul></ul><ul><ul><li>None of the above </li></ul></ul>
    100. 100. T o review… <ul><li>Fund balance is… </li></ul><ul><ul><li>Same as unexpended balance </li></ul></ul><ul><ul><li>Accumulation of net revenues </li></ul></ul><ul><ul><li>Debt on new building </li></ul></ul><ul><ul><li>A & B above </li></ul></ul>
    101. 101. T o review… <ul><li>University Fund Groups do not include… </li></ul><ul><ul><li>Current </li></ul></ul><ul><ul><li>Agency </li></ul></ul><ul><ul><li>Putnam </li></ul></ul><ul><ul><li>Plant </li></ul></ul>
    102. 102. T o review… <ul><li>Sources of current fund revenue include… </li></ul><ul><ul><li>Retirement party donations </li></ul></ul><ul><ul><li>Revenue from sale of sweet potato crop </li></ul></ul><ul><ul><li>Nonresident undergraduate tuition </li></ul></ul><ul><ul><li>B & C above </li></ul></ul>
    103. 103. T o review… <ul><li>True or False: </li></ul><ul><li>OP accounts classify expenses by Higher Education Function. </li></ul><ul><li>TRUE </li></ul>
    104. 104. T o review… <ul><li>What financial reports are used by external stakeholders… </li></ul><ul><ul><li>Annual financial report </li></ul></ul><ul><ul><li>Annual financial schedules </li></ul></ul><ul><ul><li>Decision Support transaction report </li></ul></ul><ul><ul><li>A & B above </li></ul></ul>
    105. 105. N ow you can… <ul><ul><li>Speak the language of accounting </li></ul></ul><ul><ul><li>Identify and classify university revenues </li></ul></ul><ul><ul><li>Identify and classify university expenses </li></ul></ul><ul><ul><li>Set up an account in DaFIS and find it in the Annual Schedules </li></ul></ul>
    106. 106. T ime for… Questions ???
    107. 107. Thank You !