The Standard Chart of Accounts in NSW

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The Standard Chart of Accounts in NSW Information
Sessions For Financial Managers of nonprofit
organisations Venue Date Presenter Morri
Young Matrix on Board www.mob.com.au
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Program

• Handouts
• What we wont be doing
• What we will be covering
• Overview of the Standard Chart of Accounts
• Why do we need a SCOA?
• What are the implications for staff in your
  organisation?
• How will funders relate to the SCOA?
• Understanding of and implications to the
  Financial Statements
• Implementing the SCOA.

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Overview of the Standard Chart of Accounts

• Who is involved CPNS, Matrix on Board, NSW Human
  Services Cluster
• How did we get to this point?
• CNPS and NFP Treasurers Handbook
• Survey of Government funders
• Refining and consultations
• International comparisons

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Overview of the Standard Chart of Accounts
continued
Slide 4

• Applying best practice financial management
  across funded, nonprofit organisations
• Consistent exchange of information with funders
• Transparent reporting for improved
  decision-making in organisations
• Portability for staff between organisations
• What is a Chart of Accounts? And when do we use
  it?
• What is in the Standard Chart of Accounts

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Slide 4
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Why do we need a SCOA?

• For non-government organisations...
• Provides a guide to bookkeepers and treasurers
• Broader understanding of legal requirements
• Reduces administrative reporting duplication
• Enhances consistency of bookkeeping practices
• Simplifies reporting process
• Theoretically can reduce the costs of funding
  acquittal compliance

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Why do we need a SCOA?

• For funders
• Better understanding of what funds are spent on
• Simplifies reporting process
• Theoretically can reduce the costs of funding
  acquittal compliance
• Allows comparisons amongst funded services for
  benchmarking purposes

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What are the implications of the SCOA

• Adoption of the SCOA is voluntary
• There will need to be additional time for
  setting up the new SCOA
• Staff who code transactions will need to have
  access to the Data Dictionary
• Staff may need access to the SCOA Help Desk
• Reporting formats may need to match the SCOA
• Funders will need to redesign their acquittal
  processes

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How will funders relate to the SCOA

• All funders in the Cluster are committed to
  converting to the SCOA for acquittal purposes
• All funders have agreed that the SCOA is entirely
  voluntary for funded services
• There is now consistency between NSW and
  Queensland on the SCOA, and possibly with
  Victoria and the Federal government in the near
  future.

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Implications for Financial Reports

• Reporting formats primarily driven by accounting
  software used
• Reduced risk of redundant and nonsensical
  accounts
• Reduced errors with better informed bookkeeping
• Improved cost centre reporting
• Consistency from year to year
• Benchmarking with other organisations

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Minimum Financial Reports

• Balance Sheet
• Profit Loss Statement (Consolidated Cost
  Centres)
• Budget Analysis (Actual/Budget Variance)
• Bank Reconciliations
• Payables and Receivables
• Cash Flow Analysis
• Directors Report on financials for the month

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Reviewing Financial Reports

• An Accountable Officer (Treasurer) analyses the
  reports to check that
• Current Assets always exceeds Current Liabilities
• Cash at Bank amount on Balance Sheets equals the
  total of the Bank Reconciliation
• Total of the Banks statement matches the Bank
  Reconciliation
• Aged Debtors (Receivables) report matches Balance
  Sheet
• Balance Sheets accumulated earnings (from the P
  L Statement) are not trending downwards -
  without acceptable explanation
• Taxes (GST/PAYG/Superannuation) have been paid on
  time

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Implementing the SCOA

• Methods of changing from the current Chart of
  Accounts to the SCOA.
• Manual mapping COA to SCOA
• Electronic download into accounting software

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Implementing the SCOA

• Manual Conversion
• Use the SCOA printed copy or download the PDF
• Take time to manage the mapping.
• Make sure you print a Trial Balance of the
  system.
• Backup all the time.
• Use three documents.
• 1. Printed SCOA
• 2. Printed current COA from the system.
• 3. Trial Balance
• Spend time, and take the current and the SCOA,
  and divide into three
• List of dormant, empty accounts tidy up (Put a
  cross against these)

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Implementing the SCOA

• Accounts you are definitely going to use (put
  ticks against these)
• Question marks for not sure.
• Try and ensure your bookkeeper is doing the
  transition (but involve the Treasurer)
• The job can be done in bits (doesnt all need to
  happen on the same day)
• Agree the ticks and the crosses
• Attack the question marks to convert to a tick or
  cross.
• Use the SOCA as the Source document.

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Implementing the SCOA

• Follow the process by going through the existing
  documents and re-number the accounts, and bring
  the balance from the old account into the new
  account.
• All the balances should begin to shift into the
  new accounts, and then make the empty redundant
  accounts to the 8 and 9 accounts.
• Wait until the audit is over before deleting
  accounts, so the auditors can see what was done.
• Then run another Trial Balance, and check that
  all the accounts agree and are where you want
  them to be.

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Implementing the SCOA

• Make sure you use Jobs and Categories, not the
  COA to pick up cost centres.
• Electronic version
• Easiest... but only relevant one time in the
  year.
• Just download the file into the datafile in QB or
  MYOB, and it overlays the existing COA.

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Supporting the implementation

• Website support olt.qut.edu.au/bus/dyo/ or
  www.mob.com.au
• Manuals for Generic, MYOB and Quickbooks
• Training broadcast
• List server
• FAQs
• Help Desk (to 6 October 2007)
• Email to scoa_at_mob.com.au
• Fax and Voice message to 02 8572 5330
• Post to SCOA, PO Box 418, Broadway NSW 2007