Introduction to Federal Accounting
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Introduction to Federal Accounting Presented by: John Reifsnyder, CDFM Graduate School Instructor [email protected] Accounting. The Systematic - Classification - Recording - Reporting - Analyzing - Interpretation. Of the financial records of an enterprise. used to.

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Introduction to Federal Accounting Presented by:John Reifsnyder, CDFMGraduate [email protected]


Accounting l.jpg
Accounting

  • The Systematic - Classification - Recording - Reporting - Analyzing - Interpretation

Of the financial records of an enterprise

used to

- recognize the factors that determine financial condition

- evaluate the progress or failures of an activity


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Common Accounting Terms

  • Accounting Cycle

  • Double Entry Accounting

  • General Journal

  • Ledger Accounts

  • General Ledger

  • Cash and Accrual Basis of Accounting

    details later


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The United States Constitution

“No money shall be drawn from the Treasury but in consequence of appropriations madeby law . . .”

– and –

“. . . A regular statement and account of receipts and expenditures of all public money . . . shall be published from time to time.”

(Article 1, Sec 9, Clause 7)


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Accounting Introduction

Federal accounting framework

  • Budgetary accounting

  • Financial accounting

  • Managerial cost accounting

    Users of Federal Financial Information

  • External users (citizens and Congress)

  • Internal users (agency heads and management)


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Consolidated Statements

UNITED STATES GOVERNMENT CONSOLIDATED BALANCE SHEETAS OF SEPTEMBER 30, 1997

(In billions of dollars)

Consolidated Statements

Assets:

Cash and other monetary assets

Accounts receivable

Loans receivable

Taxes receivable

Inventories and related property

Property, plant, and equipment

Other assets

Total assets

UNITED STATES GOVERNMENT CONSOLIDATED STATEMENT OF NET COSTSFOR THE YEAR ENDED SEPTEMBER 30, 1997

(In billions of dollars)

National defense

Human resources:

Education, training, employmesocial services

Health

Medicare

Income security

Social security

Veterans benefits and services

Total human resources

Physical resources:

Energy

National resources and enviro

Commerce and housing credit

Transportation

Community and regional devel

Total physical resources

Net interest:

Treasury securities held by th

Other functions:

International affairs

General science, space, and te

Agriculture

Administration of justice

General government

Total other functions

Total

Consolidated Statements

UNITED STATES GOVERNMENT CONSOLIDATED STATEMENT OF CHANGES IN NET POSITIONFOR THE YEAR ENDED SEPTEMBER 30, 1997

Liabilities and net position:

Accounts payable

Federal debt securities held by the

Federal employee and veteran ben

Environmental liabilities

Benefits due and payable

Loan guarantee liabilities

Other liabilities

Total liabilities

(In billions of dollars)

Net cost of Government operations

1,603.3

Less:

Financing sources from non-exchange revenues:

Individual income tax and tax withholdings

Corporation income taxes

Unemployment taxes

Excise taxes

Estate and gift taxes

Customs duties

Miscellaneous

Total non-exchange revenues

Other earned revenues

Excess of costs over revenues before unreconciled transactions

Unreconciled transactions affecting the change in net position.

Change in net position

Net position-beginning of period

Net position-end of period

1,247.5

179.8

27.8

55.8

19.7

20.0

26.1

Commitments and contingencie

Net position

Total liabilities and net position

1,576.7

11.6

-15.0

12.4

-2.6

-5,000.4

-5,003.0

Federal Financial Statements

Balance Sheet

Statement of Net Cost

Statement of Changein Net Position

Required Supplemental Stewardship Information - Vol 6B, Chapter 11

RSI - Vol 6B, Chapter 12 (DM)


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Accounting-Related Legislation

  • BUDGET AND ACCOUNTING ACT OF 1921:

    - ESTABLISHED AN EXECUTIVE BUDGET PROCESS - REQUIRED THE PRESIDENT TO SUBMIT HIS BUDGET RECOMMENDATIONS TO CONGRESS EACH YEAR. TO ASSIST HIM, THE BUREAU OF THE BUDGET WAS CREATED - CONGRESS WOULD BETTER COORDINATE REVENUE AND SPENDING DECISIONS - APPROPRIATIONS COMMITTEES JURISDICTION OVER SPENDING WAS STRENGTHENED - GOVERNMENT ACCOUNTABILITY OFFICE (GAO) WAS ESTABLISHED


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Accounting-Related Legislation

1950 BUDGET AND ACCOUNTING ACT

  • Amended the 1921 Budget and Accounting Act.

  • Assigned to the executive branch the responsibility for maintaining accounting systems and producing financial reports.

  • The Comptroller General, in consultation with the Director of OMB, was required to prescribe the principles, standards, and related requirements for accounting to be observed by the executive agencies.

  • Each was given the responsibility for establishing and maintaining systems of accounting and internal controls.

  • Established accounting systems of executive agencies were required to conform to the principles, standards, and related requirements prescribed by the CG.


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Accounting-Related Legislation

  • THE CONGRESSIONAL BUDGET AND IMPOUNDMENT CONTROL ACT OF 1974- Changed the fiscal year to October 1 through September 30 - Established the Congressional Budget Office (CBO) -Established to provide data to the Congress on and analysis of the federal budget

    - Established the House and Senate Budget Committees

    -Charged with development of a “Concurrent Resolution on the Budget”


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Accounting-Related Legislation

  • 1982 Federal Managers’ Financial Integrity Act:

  • Each agency reports the results of a self-evaluation of the adequacy of systems of internal control

  • Assurance that agencies are managed properly

  • Obligations and costs comply with applicable laws

  • Funds, property and other assets are safeguarded against waste, loss, and unauthorized use


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Accounting-Related Legislation

  • Prompt Payment Act of 1982Pay vendors on time or pay interest


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Accounting-Related Legislation

  • Chief Financial Officers Act of 1990 - Required the establishment of CFOs in cabinet departments and specified agencies - CFOs charged with overseeing financial management activities


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Accounting-Related Legislation

  • Government Performance and Results Act of 1993

    Requires agencies:

    • to submit 5-year strategic plans…DoD must update at least every 4 years

    • to submit annual performance plans

      • Now part of Performance Budget

    • to report prior year program performance by November 15th of each year

      • Performance and Accountability Report (PAR) or separate Performance and Accountability reports

      • Shifts focus of programs from workload activities to performance metric outputs and outcomes.


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Accounting-Related Legislation

  • Government Management Reform Act – 1994- Required systems to: -- support the control of cost of government -- support full cost reporting and full disclosure of financial data- Required application of accounting standards to produce consistency in financial reporting


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Accounting-Related Legislation

  • Federal Financial Management Improvement Act – 1996

  • Each agency head establish, evaluate, and maintain adequate systems of accounting and internal control

  • Incorporate accounting standards and reporting objectives

  • Each audit of an agency’s financial statements shall report if the agency is in compliance with the preceding requirements


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Federal Accounting Standards Advisory Board (FASAB)

  • Develops and recommends federal accounting concepts and standards

    • established in 1990

    • 5 Concepts

    • 36 Standards

  • Federal Generally Accepted Accounting Principles (GAAP)


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Implementation of Federal Accounting Standards

Office of Management and Budget (OMB)

Government Accountability Office (GAO)

Department of Treasury


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Types of Government Funds

Department of Defense:

  • Appropriated Funds

  • Reimbursable Funds

  • Revolving Funds

  • Trust Funds

  • Nonappropriated Funds


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Budgetary Accounting

  • Budgetary accounting is often referred to as fund accounting.

  • Budgetary accounts are a set of accounts that are self-balancing and represent different levels of obligational authority for different units.


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Budgetary Accounting

  • Purpose

    • Record appropriation status

    • Record subdivisions of budgetary authorities

    • Record valid commitments, obligations, expenditures, outlays

    • Control use of budgetary authorities

      • Use for appropriate purpose

      • Use during time provided

      • Use within amount provided


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Budgetary Definitions

  • Appropriations

    • Congressional authorization to obligate government and make payment from the Treasury

  • Apportionment

    • Distribution of congressional budgetary authority to a federal agency by OMB

  • Allotment

    • Distribution of apportioned budgetary authority to organizational activities

  • Commitment

    • Administrative reservation of budgetary authority


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Budgetary Definitions (cont’d)

  • Obligation

    • Legally encumbers a specified sum of budgetary authority that requires future payment

  • Outlays/Disbursements

    • Payment for costs incurred, goods and services received

  • Expended Authority

    • Budgetary authority used to fund goods and services received

  • Expired Authority

    • Budgetary authority that is no longer available for new obligations

  • Canceled Authority

    • Budgetary authority that has been closed


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Categories of Appropriations

  • Annual Appropriations

  • Multiyear Appropriations

  • No-Year Appropriations

  • Permanent (Indefinite) Appropriations


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CONGRESS

Flow of Funds

THE PRESIDENT

PRESIDENT AND CONGRESS

AGREE ON THE BUDGET

PRESIDENT SIGNS

APPROPRIATIONS

BILLS

TREASURY

OMB

ISSUE TREASURY

WARRANTS AND

CREATES “BANK

ACCOUNTS”

APPORTIONS THE

APPROPRIATIONS

Units A, B, C

BUDGET

EXECUTION

BEGINS

Agency Hqs.

Agency Divisions


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Fiscal Law

  • An agency may obligate and expend appropriations:

    • Only for a proper purpose

    • Only within the authorized time limits

    • Within the amounts established by Congress for a bona fide need


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Purpose

Proper Purpose Rule:

For the purposes for which they were appropriated

per 31 U. S. C. 1301 (a):

“ Appropriations shall be applied only to the objects for which the appropriations were made except as otherwise provided by law ”


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Time

  • Within the authorized time limits:

    • Expenditure of funds must be incurred within the time for which the appropriation was made available.

    • Do not execute current year funds for prior or future year expenditures.(31 USC 1502)


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Time

  • A valid obligation must be made to an appropriation within the period the funds are available.

    • O&M: One fiscal year

    • RDTE: Two fiscal years

    • Procurement: Three fiscal years

    • MILCON: Five fiscal years

    • SCN: Five fiscal years

    • No Year: Dollar specific, indefinite expiration


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Amount

  • Within the amounts established by Congress:

    • The obligation may not exceed the amount

      appropriated by statute, nor may it be incurred before the appropriation becomes law (31 U.S.C. 1341)


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No-Year Appropriations

  • 31 U.S.C. 1555

    • A No-Year Account is to be Closed If:

      • Agency Head or President Determines Purpose Fulfilled

      • No Disbursements Have Been Made for Two Years


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Flow of Resources

  • Commitments (FMR Volume 3 Chapter 8)

  • Obligations (Bona fide need - FMR Volume 11A 020507)

    • Obligating Documents

      • Contracts, Purchase Orders

      • Travel Orders

      • Requisitions

      • Military Interdepartmental Purchase Requests (MIPR)

        • Project Orders (FMR Volume 11A, Chapter 2)

        • Economy Act Orders (FMR Volume 11A, Chapter 3)

  • Outlays


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Accounting Classification

  • Identifies the source of funding and purpose for which used

  • Creates an audit trail



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Government Definition

  • Orders placed,

  • Contracts awarded,

  • Grants issued,

  • Services received, etc.--

  • -- that will require payments (“outlays”) during the same or a future period.


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OBLIGATION

Undelivered Order

Delivered Order

Unpaid 4801

Paid 4802

Paid 4902

Unpaid 4901

Obligations are Classified as:


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What is an “Accrued Expenditure”?

Charges…that reflect liabilities incurred and the need to pay for:

  • services…

  • goods…received…

  • amounts becoming owed under programs for which no current service or performance is required (such as annuities, benefit payments..)*

    Expenditures accrue regardless of when cash payments are made…*

    *GAO, “Glossary of Federal Terms Used in the Federal Budget Process”, 1981.


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OBLIGATION

Expenditure

Delivered Order

PAID

UNPAID

Expenditures in the Budget




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  • A payment of an obligation

  • Once all payments are made, the obligation goes away (is “liquidated”)

  • Outlays during a fiscal year may be for payment of obligations incurred in prior years or in the same year


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OBLIGATION

Undelivered Order

Delivered Order

UNPAID

PAID

OUTLAY

PAID

UNPAID

Outlays are Paid Obligations


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Reimbursements

  • Project Order (41 U.S.C. 23):

    • Placed with and accepted by:

      • A DoD Government Owned and Government Operated (GOGO) establishment.

      • Shipyard, arsenal, ordinance plant or other manufacturing plant or shop.


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Project Orders

  • Same as a commercial contract to the customers’ appropriation

    • Extends beyond the life of the appropriation. Up to five years after the appropriation expires for new obligations

    • Over-billing may create a 31 USC 1517 violation

  • Normally issued for the overhaul or manufacturing of a specific number of items within a specific time frame for a specific price

  • Performing activity should incur costs of not less than 51% of the total costs of performing the work

  • The performing activity must not accept the project order if the requirements of the project order regulations are not met

  • A Military Interdepartmental Purchase Request (DD 448 Form) is used to issue project orders


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Project Order Characteristics

  • Specific regarding work to be done

  • Single purpose with identification to a final product or end item

  • Includes a production schedule

  • Includes funded cost per item

  • Usually mission oriented

  • Be performed in house

  • Bona fide need in the year executed

  • Commence work within a reasonable time (90 days)

  • Return orders for cancellation if work financed by an expiringappropriation is not started by 1 January


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Economy Act Orders

  • Must be closed-out by 30 September.

  • Change in dollar amount requires:

    • An amendment to the original MIPR (DD Form 448).

    • Acceptance (DD Form 448-2) of the amendment by the performing activity.

    • Adjust the obligation in accounting based on the acceptance of (DD Form 448-2).


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Non-Economy Act Orders

  • Non-Economy Act orders are for intra-governmental support, where a DoD activity needing goods and services obtains them from a Non-DoD agency.

  • Specific statutory authority is required to place an order with a Non-DoD agency for goods or services, and to pay the associated cost.

  • If specific statutory authority does not exist, the default will be the Economy Act, 31 U.S.C. 1535.


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Customer/Provider Scenario

  • Customer (ordering agency) prepares MIPR requesting the repair and overhaul of 400 widgets for a total cost of $ 1,300,000. The MIPR was issued as a Project Order and is funded with an annual O&M appropriation

  • Performing agency accepts the MIPR and prepares a MIPR acceptance, DD Form 448-2

  • Based on the MIPR acceptance the ordering agency records an obligation in their accounting records and the performing agency records an order received in their accounting records in the amount of $1,300,000


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Reimbursements Earned

Collections

Unfilled Orders

Orders Received

$ 1.216M

Billed to Customer based on Cost In support of the Project

(SF 1080 bill submitted)4251/4220 R.E./UFO

1310/5200 A/R - REV

$ 1.216M 4252/4251 R.E. COLL./R.E 1010/1310 FWTT/A.R.

$ 84

Should complete work by

30 Sept. 2015

MIPR ACCEPTANCE $ 1.3M

FY ’10 – 15 – Available

To complete Work thru

30 Sept., 2015

Assumes O&M customer4220/4210 Unfilled Orders/Anti.Reimb & Other Income

Cost

Payment / Liquidation

Unliquidated Obligations

Obligations

$ 1.216 M

Based on SF 1080 Bill4801/4901

6100/2110

3100/5700

$ 1.216 M4901/49022110/1010

$ 84

Must be de-obligated if not

Completely liquidated by

30 Sept. 2015

MIPR ACCEPTANCE $ 1.3M

Project Order

(DD 448-2)4610/4801

Order Impact On Customer/ Provider Books

Provider Books

Customer Books


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How do we Link to the Budget?

  • Accounting events are assigned unique identifiers from a standard government-wide list (U.S. Standard General Ledger)

  • All federal agencies are required to use these standard accounts in order to properly link to the Budget


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USSGL Chart of Accounts

  • 1000 Assets

  • 2000 Liabilities

  • 3000 Net Position (Capital)

  • 4000 Budgetary

  • 5000 Revenues and Financing Sources

  • 6000 Expenses

  • 7000 Gains and Losses

  • 8000 Memorandum Accounts


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Flow of Budget Authority

President signs appropriation into law, thereby creating budget

authority - the authority for an agency to obligate the

government to pay for goods and services

Accounting processes now come into play

OMB prepares to apportion

Treasury prepares agency warrant

OMB apportionment

Agency request

Agency headquarters

apportionment

allotment

Major Organizations

Sub-allotment or allocation

Subordinate organizations


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Flow ofBudget Authority (continued)

Organization may commit to reserve budget authority for actual obligation later in the fiscal period

Organizational element with allotment or allocation

Obligate for goods and services

Cost

Consumable supplies = cost

Supplies for inventory issued/consumed = cost

Equipment in revolving fund:

Capitalized/depreciated = cost(in some accounting systems)

Expenditure

Receipt of goods/services:

cancellation or undelivered orders

Outlay

Cash from the Treasury pays for goods/services


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Budgetary Accounting

RESOURCES = STATUS OF RESOURCES

4450 Unapportioned

4510 Apportionments

4610 Allotments

4700 Commitments

4801 Undel Order, Unpaid

4901 Deliv Order, Unpaid4902 Deliv Order, Paid

4650 Expired Authority

4350 Canceled Authority

4119 Appropriations

4201 Total Actual Resources Collected


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Proprietary Accounting

  • Purpose

    • Accounting for assets and liabilities

    • Accounting for revenues and expenses

    • Determining financial position

    • Determining results of operations

  • SFFAS NO. 7


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Proprietary Accounting

  • Balance Sheet

    • Assets = Liabilities + Net Position

    • 1000 Assets = 2000 Liabilities + 3000 Net Position (Capital)

  • Statement of Net Cost

    • Expenses – Exchange Revenue = Net Cost of Operations


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The Historical Cost Concept

  • Generally accepted accounting principles (GAAP) requires that assets always be stated at their actual cost rather than at their current market values

  • Accounting is concerned with what you paid for something, not what it is worth today


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The Matching Principle Concept

  • Expenses of a period that are recorded and reported are only those incurred to produce the revenues generated for the same period

  • Some expenses require periodic adjustment to reflect only the amount of expenses for the financial period

  • Examples:

    • Prepaid Insurance

    • Prepaid Rent

    • Depreciation of Capital Assets


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Cash versus Accrual Accounting

  • Cash accounting --

    • revenue is recorded when cash is received and expenses when cash payment is made

    • fails to match revenue with related expenses, therefore does not lead to logical income measurement




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Accrual Accounting (cont.)

  • Example: $10,000 payroll that is split between two reporting periods:

  • A portion is earned but not paid at end of the month:

    • 4 days ($4,000) earned in September

    • 6 days($6,000 to be earned in October)

    • $4,000 is recorded as a payroll expense in September. $4,000 is recorded as a liability (salaries payable)


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Flow of Accounting Data

Recognized A Transaction HasOccurred

Prepare ASourceDocument

Analyze and

Prepare a JournalEntry

Process (Record)Into AccountingRecords

Close the Books

Prepare A Trial Balance

Make Period EndAdjustments and Accruals

PrepareFinancial Statements(Reports)


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The Accounting Process (Cycle)

The Cycle Involves:

  • Work Performed During The Period

    • JOURNAL ENTRIES

    • POSTING TO LEDGER ACCOUNTS

    • DETERMINING UNADJUSTED BALANCES

    • ESTABLISHING A TRIAL BALANCE AND COMPLETING WORKSHEET

  • Work Performed At The End Of The Period

    • JOURNALIZE AND POST ADJUSTING AND POST CLOSING ENTRIES

    • PREPARE POST CLOSING TRIAL BALANCE AND FINANCIAL STATEMENTS


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General Journal

  • “Original” day-to-day record showing the “debit” and “credit” effect of each event

  • Includes a brief explanation for each event

  • Used to update the general ledger accounts


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Ledger Account

  • Means of accumulating in “one place” all information regarding changes in a specific account

  • Comprised of three elements

    • title

    • left side which is called the debit side

    • right side which is called the credit side

  • Commonly referred to as a “T Account”


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General Ledger

  • All ledger accounts are maintained within the general ledger

  • Federal government general ledger account structure is established, maintained, and updated by the Treasury Department


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Accounts And Ledgers

  • Accounts Are Classified As Follows:

  • Assets - (What Is Owned)

  • Liabilities - (What Is Owed)

  • Costs/Expenses - (What Is Spent)

  • Revenue/Income - (What Is Earned)

  • Equity - (Assets –Liabilities =

  • Net Worth)Gains/LossesBudgetMemorandum


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The Accounting Equation

  • Assets = Liabilities + EquityOr

  • A = L + EOrA – L = EGiven The Accounting Equation, With Any Two Of The Three Factors, We Can Determine The Third Factor


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Double Entry Accounting

  • Forms the basis for most current day accounting operations

  • Every business transaction affects two or more accounts

  • Equal debit and credit entries are made for every transaction

  • Total of all debit entries must equal the total of all credit entries


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Normal Account Balance

  • Refers to the Debit (left side) or Credit (right side) of a ledger account

  • Assets normally have debit balances

  • Liabilities and net position accounts normally have credit balances

  • Expense accounts normally have debit balances

  • Revenue accounts normally have credit balances



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Reference

Debit

Credit

APPROPRIATIONS

Account Title and Explanation

Appropriations-Realized Resources

4119

100,000

Unapportioned Appropriations

4450

100,000

Funds With Treasury

1010

100,000

Unexpended Appropriations

3101

100,000

General Journal


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Reference

Debit

Credit

OMB APPORTIONMENT

Account Title and Explanation

Unapportioned Authority

25,000

4450

25,000

4510

Apportionment

General Journal


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Reference

Debit

Credit

ALLOTMENT

Account Title and Explanation

Apportionments

20,000

4510

20,000

4610

Allotments-Realized Resources

General Journal


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Reference

Debit

Credit

COMMITMENT

Account Title and Explanation

Allotments-Realized Resource

2,000

4610

2,000

4700

Commitments

General Journal


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Reference

Debit

Credit

OBLIGATION

Account Title and Explanation

Commitments

2,000

4700

4801

Undel. Orders – Obligs. Unpaid

2,000

General Journal


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Reference

Debit

Credit

RECEIPT OF MAT’LS ORDERED

Account Title and Explanation

Undel. Orders – Obligs. Unpaid

4801

2,000

Del. Orders – Oblig. Unpaid

4901

2,000

Operating Materials Held for Use

1511

2,000

Accounts Payable

2110

2,000

Unexpended Appropriation

3107

2,000

5700

2,000

Expended Appropriation

General Journal


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Reference

Debit

Credit

PAYMENT OF INVOICE

Account Title and Explanation

Delivered Orders Oblig. Unpaid

4901

2,000

Delivered Orders Oblig - Paid

4902

2,000

Accounts Payable

2110

2,000

Fund Balance With Treasury

1010

2,000

General Journal


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Managerial Cost Accounting

  • Is the process of:

    - Accumulating - Measuring - Analyzing - Interpreting- Reporting Cost

    Source: SFFAS No. 4


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Managerial Cost Accounting

  • Full Cost

    • Direct Costs (Direct Labor/Direct Material)

    • Indirect Costs (Overhead)

    • Intra-entity Costs (General and Administrative)

    • Inter-entity Costs

      • Cost of goods and services received from other entities

      • Providing entity responsible for providing cost data

      • Recognition limited to material amounts


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Working Capital Funds

  • Established to satisfy recurring DoD requirements using a businesslike buyer-and-seller approach.

  • Have a goal to breakeven over the long term.

  • Use the funds collected to pay for acquisition of resources needed to operate the fund.

    Reference - 10 U.S.C., Section 2208DoDFMR Volume 3, Chapter 19


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DEFENSE WORKING CAPITAL FUND How it Works

CUSTOMERS

OPERATING FORCES

READINESS COMMANDS

APPROPRIATES

$ FUNDS

PLACE

ORDERS

BILL FOR

COSTS/ SERVICES

PAY

REVOLVING

FUNDS

WORKING

CAPITAL $$

CONGRESS

APPROPRIATED

$ WORKING

CAPITAL AT INCEPITON OF THE FUND

FINANCES COST OF PERFORMING WORK

PRODUCTION

OVERHEAD

GENERAL &

ADMINISTRATIVE

LABOR COSTS

DIRECT MATERIAL


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Objectives of Federal Financial Reporting

  • Budgetary Integrity

    • Funding properly spent?

  • Operating Performance

    • Outputs and outcomes?

  • Controls

    • Safeguarding assets?


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Federal Financial Reporting

DoDFMR Volume 6B

  • Balance Sheet (Chapter 4)

  • Statement of Net Cost (Chapter 5)

  • Statement of Changes in Net Position (Chapter 6)

  • Statement of Budgetary Resources (Chapter 7)

  • Statement of Custodial Activity (Chapter 9)


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Statement of Net Costs

  • Also Referred to as:

    • Statement of Operations

    • Income statement

  • Purpose

    • intended to provide revenue and expense details

    • reports results (net profit or net loss)

  • Prepared on basis of general ledger 5000 and 6000 account balances



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Statement of Changes in Net Position

  • Reports the

    • beginning net position

    • effect of those transactions that caused the net position to change

    • ending net position

  • Prepared on the basis of the Statement of Net Costs and the “Financing Sources”


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ITEMS THAT INCREASE NET POSITION

Excess of revenue over cost (net income)

Legislative appropriations

Property obtained from another govt. agency for which no reimbursed is required

ITEMS THAT DECREASE NET POSITION

Excess of cost over revenue (net loss or net cost of operations)

Property provided to another agency for which no reimbursement is expected

Funds returned to the Treasury

Appropriations returned

Statement of Changes in Net Position


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Statement of Financial Position

  • Also referred to as the Balance Sheet

    • assets

      • dollar amount of future economic benefits owned and managed by the agency

    • liabilities

      • dollar amounts owed by the agency

    • net position (equity)

      • the difference between assets and liabilities


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Statement of Financial Position

  • Summarizes the net worth or liquidity of an entity at a particular time

  • Changes from day to day

  • Accounts on this statement are permanent accounts

  • Is a summary of accounting equation

  • Assets = Liabilities + Government Equity



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Statement of Budgetary Resources

  • Provides information on how budget resources were made available as well as their status at the end of the reporting period.

  • Should be reconcilable to the budget execution information reported on the SF 133 Report on Budget Execution and Budgetary Resources.


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SF 133 Report on Budget Execution and Budgetary Resources

The SF 133 consists of the following sections:


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Questions?

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Good Luck and Happy Trails

[email protected]


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