Indiana University Financial Management Services

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Indiana UniversityFinancial Management Services

• Chart of Accounts

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Todays Focus

• I. Chart of Accounts
• Attributes
• Objectives
• Use for Internal Reporting
• II. Year-end Carry forward and Reversion Process

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What is the Chart of Accounts?

• COA is the set of tables that define the codes
  and coding structures within the Financial
  Information System (FIS)
• Multiple Chart of Accounts
• Organizations
• Accounts
• Sub-accounts
• Object Codes
• Sub-object codes
• Levels
• Consolidations

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Chart of Accounts at IU
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Chart of Account Attributes
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Why do we need the Chart of Accounts?

• External Financial Reporting
• IU Chart Consolidated Level
• Internal Financial Reporting
• Responsibility Center Management
• Departmental Management
• Detail by Account
• Internal Control
• Reporting Hierarchy
• Routing
• Budget Construction

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Benefits of Multiple Charts

• Complex Reporting
• Auxiliary Charts are not required to contain
  object codes unrelated to their activities (i.e.
  Tuition, State Appropriations)
• Campus charts are not required to contain object
  codes unrelated to their activities (i.e. Cost of
  Goods Sold, Inventory, etc.)
• Increase Campus Knowledge and Information
• Easy Access to Campus Level or Auxiliary
  Reporting.

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Chart of Account Managers

• Chart Chart Manager e-mail address
• IU Bill Overman woverman_at_indiana.edu
• UA Steve Keucher skeucher_at_indiana.edu
• BL Rozzie Gerstman gerstma_at_indiana.edu
• BA Julie Bauters jbauters_at_indiana.edu
• IA Camy Harrison charriso_at_iupui.edu
• IN Charlie Miller chmiller_at_iupui.edu
• EA Dan Dooley dadooley_at_indiana.edu
• KO Bill Yost wyost_at_iuk.edu
• SB Karen Vargo kvargo_at_iusb.edu
• NW Marilyn Vasquez mvasquez_at_indiana.edu
• SE Mike Kerstiens mjkersti_at_indiana.edu

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Chart of Account Attributes
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Organizations

• Organization
• Example FMOP (FMS Administration)
• Collection of accounts or a collection of other
  organizations.
• An organization may have any of the following
  attributes
• Chart of Accounts, Responsibility Center, Campus,
  Department, Subunit
• HRMS
• Can include all fund groups
• Up to four alphanumeric characters (eg. FMOP)

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Accounts

• Account Number
• Specific identifier for a pool of funds assigned
  to a specific organization for a specific
  function.
• Example 19-126-10 (FMS Administration)
• Reports to org FMOP
• Attributes of an account include the following
• Chart, Organization and Fund Group specific
• Self-balancing
• Seven numeric digits

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Sub-Accounts

• Sub-accounts achieve further division of an
  account for internal reporting purposes.
• Example custr (FMS Customer Service)
• Reports to 19-126-10
• Attributes of a sub-account include the
  following
• Account specific
• Up to five alphanumeric digits
• Assumes all attributes of the account it reports
  to

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Chart of Account Attributes
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Object Codes

• Object Codes are detailed identifiers for Income,
  Expense, Asset, Liability and Fund Balances.
• Chart specific
• Four numeric digits
• Example BL 1504 Animal Care Income
• IN 1504 Card Services Income

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Sub-object Codes

• Sub-object codes achieve further division of an
  object code for internal reporting purposes
• Attributes of a sub-object include the following
• Specific to an account
• Assumes all attributes of the object code it
  reports to

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Levels and Consolidations

• All object codes report to a higher Level code
  and each Level code reports to a higher
  Consolidation code
• Approximately 80 Levels
• Approximately 20 Consolidations
• Example
• Object Code 2403 Exempt Staff
  Salary Savings
• Level PRSA Professional
  Salaries
• Consolidation CMPN
  Compensation

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Hierarchy of COA at IU - Example

• Highest Organization Level
• Organization that is also a Campus
• Organization that is also an RC
• Organization
• Organization
• Account
• Sub Account

IU
UA
VPPF
FMS
FMOP
FMSY
1912610
1912810
aucap
custr
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Management Control and COA

• How can I use the chart for organizational
  management?
• Flexibility in Reporting
• Flexibility in making Routing decisions
• Hierarchy for Responsibility Management
• Facilitates internal controls by assigning fiscal
  officers, account managers, account supervisors
  and delegates.
• Tool for measuring the performance of a subunit

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Management Control and COA

• What tools do I have to achieve my reporting
  objectives?
• With the Approval of the Chart Manager
• Organizations
• Accounts
• Object codes
• Sub-accounts (budgeting / spending)
• Sub-object codes (budgeting / spending)
• FDRS Reports
• FIS

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GROUP EXERCISE Creating a Reporting Structure

• IU has decided to add a new academic school
  The School of Engineering.
• Your handout contains a summary of the schools
  activities.
• Develop an organizational and reporting structure
  for the new school using at least one
  organization, one account, and one sub-account.

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Creating a Reporting Structure

• What are your results?

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Org Carry Forward and Reversion

• What is Organization Carry Forward and Reversion?
• Definition Organization Carry Forward and
  Reversion is a year-end General Fund closing
  process that defines how remaining balances in an
  organization are handled at year-end.

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Org Carry Forward and Reversion

• Driven by the Org Reversion Table in the FIS
• Reversion table codes are defined for each
  Organization at a given Consolidation
• Exclusive to the General Fund Only
• Process occurs only at year-end
• Carry Forward / Reversion process for each org is
  at the discretion of the RC with the approval of
  the Campus.
• Table can only be changed by the Campus
  Administration

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Org Carry Forward and Reversion

• How do we define a remaining balance?
• 1) Current Budget Actual
• or
• 2) Current Budget Actual Encumbrances
• Balances can be carried forward or reverted
  BEFORE or AFTER encumbrances.

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Carry Forward / Reversion Table

• What are the options?
• (For each Organization at each Consolidation
  level)
• Code Encumbrances Positive Balance
  Negative Balance
• A Carry Forward Carry Forward
  Carry Forward
• C1 Carry Forward Carry Forward
  Revert
• C2 Revert Carry Forward
  Revert
• N1 Carry Forward Revert
  Carry Forward
• N2 Revert Revert
  Carry Forward
• R1 Carry Forward Revert
  Revert
• R2 Revert Revert
  Revert

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Carry Forward / Reversion Example A

• ORGANIZATION GBPD
• REVERSION TABLE OPTION R2
• DESIGNATED REVERSION ACCOUNT 1000000
• Object Level Budget Actual
  Encumbrance Balance
• Wages 10,000 9,000 0 1,000
• S E 5,000 3,000 1,000 1,000
• Travel 3,000 3,200 0 (200)
• All available positive and negative, budget and
  cash balances REVERT at year-end to account
  1000000 which reports to the RC. No balances
  remain in the Organization after year-end.

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Carry Forward / Reversion Example B

• ORGANIZATION GBPD
• REVERSION TABLE OPTION A
• DESIGNATED REVERSION ACCOUNT 1000000
• Object Level Budget Actual
  Encumbrance Balance
• Wages 10,000 9,000 0 1,000
• S E 5,000 3,000 1,000 1,000
• Travel 3,000 3,200 0 (200)
• All available positive and negative, budget and
  cash balances are CARRIED FORWARD within
  organization GBPD at year-end. No balances are
  reverted to account 1000000, which reports to the
  RC, at year-end.

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Carry Forward / Reversion Example C

• ORGANIZATION GBPD
• REVERSION TABLE OPTION N2
• DESIGNATED REVERSION ACCOUNT 1000000
• Object Level Budget Actual
  Encumbrance Balance
• Wages 10,000 9,000 0 1,000
• S E 5,000 3,000 1,000 1,000
• Travel 3,000 3,200 0 (200)
• All available POSITIVE, budget and cash balances
  are reverted to account 1000000, which reports
  to the RC, at year-end. The negative 200
  balance is carried forward within organization
  GBPD into the next fiscal year.

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Conclusions about the COA

• Accomplishes organizational goal congruence
• Hierarchy
• Flexibility
• Meets Internal and External Reporting
  Requirements
• Carry Forward and Reversion facilitates
  responsibility accounting

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Conclusions about the COA

• Questions?