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How to Read Your Financial Statements. Presented by San Francisco State University Auxiliary Business Services. Components. The Cover Letter Fiscal Year definition Statement of Activity and Changes in Net Assets (The Income Statement). The Cover Letter. Normal

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How to read your financial statements

How to Read Your Financial Statements

Presented by

San Francisco State University

Auxiliary Business Services

SFSU Auxiliary Business Services


Components
Components

  • The Cover Letter

  • Fiscal Year definition

  • Statement of Activity and Changes in Net Assets (The Income Statement)

SFSU Auxiliary Business Services


The cover letter
The Cover Letter

  • Normal

    • Identifies accounting period

    • Provides contact information

  • Exceptional

    • The 2nd paragraph will mention any irregular conditions or constraints.

SFSU Auxiliary Business Services


Fiscal year july 1 june 30
Fiscal YearJuly 1 ~ June 30

  • The fiscal year runs from July 1 to June 30.

  • Personal income tax periods (payroll) are from January 1 to December 31.

SFSU Auxiliary Business Services


Income statement
Income Statement

  • Columns:

    • Budget

    • Open Commitments

    • YTD Actuals

    • Balance Available

    • Percent of Usage

SFSU Auxiliary Business Services


Budget column
Budget Column

Includes:

  • Original Budget &

  • Revised Budget after adjustments

    • Inter-account transfers

    • Mid-Year adjustments

    • Distributions to Organizations & Graduations

SFSU Auxiliary Business Services


Ytd actuals
YTD Actuals

  • What has already been spent

  • Year-to-Date (YTD)

    • cumulative activity from the beginning of the fiscal year to the present period.

SFSU Auxiliary Business Services


Open commitments
Open Commitments

  • Purchase Orders (PO’s) and Contracts

    • are instruments that commit portions of the budget for select purposes.

    • The “open” portion of a PO or Contract is what hasn’t been spent yet.

  • Reasons for open balances:

    • some PO’s & Contracts are encumbered (or committed) for the entire year and expended slowly over time

    • Timing – invoice(s) not received yet

SFSU Auxiliary Business Services


Balance available formula revised budget ytd actual open commitments
Balance AvailableFormula: + Revised Budget - (YTD Actual & Open Commitments)

  • Amount of latest revised budget that hasn’t been spent or earned

    • positive number equals balance available to spend

    • negative number equals amount overdrawn (spent in excess of budget)

SFSU Auxiliary Business Services


Percent of usage
Percent of Usage

  • Percent of the latest revised budget that’s been used or earned

  • Typical exceptions

    • PO or Contract was written for all or majority of year

    • timing: spending is seasonal and not evenly paced throughout the year

    • budget was inaccurate

SFSU Auxiliary Business Services


Program subtotals
Program Subtotals

  • Revenue“credit”(negative number)

  • Personnel Costs“debit” (positive number)

  • Operating Expense“debit”

  • Net Contribution“credit”

    • Revenue exceeds sum of Personnel & Operating Expense

  • Net Subsidy“debit”

    • Sum of Personnel & Operating exceeds Revenue

SFSU Auxiliary Business Services


Consolidated general fund only
ConsolidatedGeneral Fund only

  • Budget % to Date

  • Revenue

    • Student Fees

    • Program Revenue

    • Net Assets Released

      (from Temporarily Restricted Fund to General Fund)

  • Expenses

    • Personnel

    • Operating Expenses

    • Capital Equipment

  • Net -Surplus/Deficit

SFSU Auxiliary Business Services


Consolidated general fund only1
ConsolidatedGeneral Fund only

  • Transfers to/from

    • Reserves

      • Contingencymaintained at 10% of annual Operating Expenses

      • Debt Servicemaintained to secure debt repayment

    • Building Fund

SFSU Auxiliary Business Services


Consolidated budget to date
ConsolidatedBudget % to Date

  • This percentage represents the portion of the fiscal year that has transpired.

    • For example, December is the 6th month of the fiscal year. It is half way through the fiscal year. The budget percentage to date is 50%.

    • This provides a useful reference for the “% of Usage” in the program statements – especially when spending is fairly regular throughout the year (as in salaries).

SFSU Auxiliary Business Services


Asi allowances unallocated portions of budget
ASI Allowancesunallocated portions of budget

  • This shows how much is still available for distribution in the following areas:

    • Operating

    • Personnel

    • Organizations

    • Graduations

SFSU Auxiliary Business Services


Delivery schedule
Delivery Schedule

  • The statements are distributed to the Management and Board via email in PDF format. A hard copy is sent to the Executive Director.

  • They are sent out around mid-month following the reporting month.

SFSU Auxiliary Business Services


The end thank you
The EndThank you!

SFSU Auxiliary Business Services


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