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Community College Internal Auditor’s Fall Conference October 4, 2012. Community College’s Budget and Accounting manual 2012 edition. Prepared by Heidi E. White, CPA VAVRINEK, TRINE, DAY & CO., LLP. Who is Responsible for Updates and Changes? Why Did the BAM Change? What Was Changed?

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community college internal auditor s fall conference october 4 2012
Community College Internal Auditor’s Fall Conference

October 4, 2012

Community College’s Budget and Accounting manual 2012 edition

Prepared by Heidi E. White, CPA

VAVRINEK, TRINE, DAY & CO., LLP

key components to the 2012 edition

Who is Responsible for Updates and Changes?

Why Did the BAM Change?

What Was Changed?

What was Added

When is it Effective?

Key Components to the 2012 edition
responsibility for updates changes

Education Code Section 70901

    • The Board of Governors of the California Community Colleges shall provide leadership and direction in the continuing development of the California Community Colleges . . . .
  • CA Code of Regulations, Title 5 Section 59011
Responsibility for Updates & Changes
responsibility for updates changes1

College Finance and Facilities Planning Division of the State Chancellor’s Office

  • Association of Chief Business Officials Board
    • Fiscal Standards and Accountability Committee
      • District Personnel
      • State Chancellor’s Office Personnel
Responsibility for Updates & Changes
why did the bam change
Why did the BAM Change?

THE LAST

UPDATE WAS

2000 !!!!!!!

why did the bam change1

To Bring Clarity to Accounting Standards

Provide Consistent Direction to District Personnel

Update Prior Direction to Conform with Current Accounting Guidance

To Give the Fiscal Standards Committee a Project to focus on

All of the Above

Why did the BAM Change?
overall revision concepts

Provide for a open format for more frequent change in the future

    • Each Chapter is a separate document which will allow changes to specific areas rather than wait for another 12 years for an update
  • Provide reference materials to allow District staff to research issues and questions
Overall revision concepts
what was changed

Chapter 1 - Introduction

    • Specific websites for GASB, OMB and the Chancellor’s Office Guidance was included as a hyperlink to allow access for more review and research by District staff.
    • Included budgeting and other dates that are important in the financial reporting requirements
    • Requirements of Accreditation Standard 3 were included
    • References to the California CCR’s included
What Was Changed?
what was changed1

Chapter 2 – Fund/Structure

    • References have been removed related to the General Fixed Asset and General Long Term Debt Account Groups
    • Added additional Funds in the Capital Project Fund Type to reflect the General Obligation Bond Fund (Fund 43) and Other Capital Project Funds (Fund 4X)
    • Provides references to possible Unrelated Business Income within the Enterprise Funds
What Was Changed?
what was changed2

Chapter 3 – Revenue and Financing Sources

    • References to OMB Circular A-21 “cost Principles for Education Institutions”
    • Website reference for the Catalog of Federal Domestic Assistance (CFDA) numbers
    • Provides some guidance on the Redevelopment Funds - - - information is still fluid
    • New guidance from GASB to recognize Bad Debt as a contra-revenue to student enrollment fees – NOT an operating expense
What Was Changed?
what was changed3

Chapter 3 – Revenue and Financing Sources

    • References the Student Fee Handbook that is included on the Chancellor’s Office website
    • Provides guidance for the Student Parking and Transportation Fees to be accounted for within the Restricted General sub-fund.
    • Provides guidance for the Prop 20 Lottery Funds to be included within the Restricted General sub-fund
What Was Changed?
what was changed4

Chapter 4 – Expenditures and Other Outgo

    • Focus is on Activity Codes as well as Object Codes
    • Administrative and Support Activities references language for Faculty reased from instruction
    • Language for Supplies and Operating expenses was clarified for Software and licensing agreements as necessary
    • Mirrors reference for bad debt to be included as a Contra Revenue
What Was Changed?
what was changed5

Chapter 4 – Expenditures and Other Outgo

    • Updated Language for Capital Outlay expenditures to conform to current GASB guidance related to non print media for Libraries and intangible assets such as software and licensing.
    • Updated threshold for an inventory for equipment purchases.
What Was Changed?
what was changed6

Chapter 5 – The Balance Sheet

    • Provides greater guidance and information in defining Fund Balance Classifications in accordance with GASB Statement 54 “Fund Balance Reporting and Governmental Fund Type Definition”. This pronouncement requires fund balance designations for external reporting.
      • NonSpendable Restricted Committed Assigned Unassigned
What Was Changed?
what was changed7

Chapter 5 – The Balance Sheet

    • Provides greater guidance and information in defining Fund Balance Classifications in accordance with GASB Statement 54 “Fund Balance Reporting and Governmental Fund Type Definition”. This pronouncement requires fund balance designations for external reporting.
      • NonSpendable Restricted Committed Assigned Unassigned
What Was Changed?
what has been added1

Chapter 6 – Describes the GASB Statement 35 reporting model.

By placing this in the Budget and Accounting Manual, the emphasis is that the external reporting of the Community College Districts under GASB Statement 35 is the responsibility of the District not the external auditors.

The specific guidance includes discussions related to . . . . .

What has been added?
what has been added2

Chapter 6 – Describes the GASB Statement 35 reporting model.

  • Management’s Discussions and Analysis
    • Introduces the financial statements.
    • Provides an objective and easily readable narrative of the financial activities, programs and services
  • Statement of Net Assets
  • Statement of Revenues, Expenses and Changes in Net Assets
  • Statement of Cash Flows
What has been added?
what has been added3

Chapter 6 – Describes the GASB Statement 35 reporting model.

Required Supplementary Information

Reconciliations of Governmental (modified accrual) Statements to the Entity-Wide (full accrual) Statements

Typical consolidation and Conversion Entries for financial statement reporting

What has been added?
what has been added4

Chapter 7 – Special Accounting Issues

    • Guidance related to Cash Accounts
    • Guidance related to Lease Accounting
    • Designed to be expanded when needed
    • What other issues might be included here?
What has been added?
what has been added5

Subject Index

Glossery

Common Categorical Restricted Programs for both Federal and State

Reference to pertinent Fiscal and Legal Advisories

New reference to current guidance from the Governmental Accounting Standards Board

What has been added?
when is the bam effective

The Board of Governors approved the BAM July 9, 2012

  • Effective date Fiscal year 2011/12
  • Link

http://extranet.cccco.edu/portals/1/CFFP/Fiscal_Services/Standards/BAM/bam2012ed/complete BAM/Budget_and_Accounting_Manual_2012_Edition.pdf

When is the bam effective?
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