Accounting and Reporting

  1. Introduction and Contact Information
  2. Definitions
  3. Accounting System Overview
  4. ChartField Definitions
  5. Reporting
  6. Fiscal Responsibility

1. Introduction and Contact Information

    1. On July 1, 2004 the University officially began using a proprietary accounting system acquired from PeopleSoft. It is a web-based, integrated system that provides real-time information and is known as an Enterprise Resource Planning (ERP) solution. This new system replaced a state legacy accounting system which the University had been operating under for over two decades. Replacing these legacy systems with the PeopleSoft Enterprise Resource Planning (ERP) system was the most significant administrative business process change in the University’s history.
    2. The team assembled to coordinate this PeopleSoft implementation is referred to as the UF Bridges team and was comprised of employees from areas across campus, who worked with University subject matter experts and outside software consultants to ensure the proper transition from the legacy systems to the enterprise resource planning systems.
    3. The intent of the Accounting and Reporting Directives and Procedures is to provide fiscal managers and other users with a basic understanding of the University’s accounting system and its reporting capabilities. General Accounting and Financial Reporting will be glad to assist with issues and can be reached at 352-392-1326.


2. Definitions

    1. Budgetary cost center– A budgetary cost center is a combination of chartfields that reflect the level at which the “authority to spend” is controlled.
    2. Chartfield– A data field that stores accounting information.
    3. Commitment Control– Commitment Control (KK) is an accounting methodology that identifies and reserves (or “commits”) funds for future payment obligations. It is designed to answer “What is my available spending authority?”
    4. Enterprise reporting– A new web-based data warehouse that provides a simple way to view, create, or download reports from existing yet improved data sources, including personnel, financial, payroll history, directory, and student data.
    5. General ledger– A ledger is an account book of final entry. In an accounting system, the general ledger is the place in the system where financial information resides.
    6. Generally Accepted Accounting Principles– A set of widely accepted accounting standards used to standardize financial accounting of public companies and institutions.
    7. Internal controls– Internal controls are a process designed to provide reasonable assurance regarding the achievement of objectives in the following categories:
      • Effectiveness and efficiency of operations
      • Reliability of financial reporting
      • Compliance with applicable directives, laws and regulations

      Fundamentally, controls help to ensure that the university’s assets are being protected. Through effective controls, a department can:

      • Safeguard assets
      • Detect and correct errors and irregularities
    8. Reconciliation– The purpose of the reconciliation process is to compare the transactions entered into the department’s funds in the university general ledger to the department’s input documents or other documents, either electronic or paper, and to determine which are complete, which are outstanding and which are in error and require correction. Reconciliation ensures consistency and accuracy between the department’s records and the university financial reports.
    9. Sub-system – Also known as sub-ledgers include purchasing, payables, billing, receivables, travel, projects and grants. These sub-systems feed information directly to the general ledger.

A glossary of terms located on the Enterprise Systems website identifies the terms and acronyms used in the new systems.


3. Accounting System Overview

    1. General ledger – As the final record for any entity, a general ledger must maintain reliable information. The steps preceding the final entry of transactions into a general ledger ensure the accuracy and completeness of the general ledger records. These steps are what make up the accounting process. The general ledger not only maintains accurate and complete records but consolidates transactions from multiple sources, should deliver easy-to-read reports, and provides full auditing capabilities.
    2. Sub-systems – Sub-systems feed information directly to the general ledger as transactions within the sub-system are posted.
      1. Accounts Payable—Accounts payable is a module in the myUFL Systems which provides for a method to pay suppliers and vendors for goods and services purchased by the University.
      2. Accounts Receivable—Accounts receivable is a module in the myUFL Systems used to record deposits to the general ledger.
      3. Asset Management—Asset management is a module in the myUFL Systems which provides the means to track and account for property of the university. Each piece of tracked property has a property tag and is scanned periodically by Property Records and compared with information stored in the myUFL Systems.
      4. Grants—Grants is a module in the myUFL Systems which allows for the creation, viewing or submitting of proposals for awards.
      5. myUFL Systems—The myUFL portal links several systems together into a seamless collection of services and on–line business processes for UF users. The myUFL systems include the portal, a Finance System, a Human Resource System and an Enterprise Reporting System.
      6. Payroll—Payroll is a module in the myUFL Systems used to process payroll, setup payroll distributions and provide for a method of compensating employees.
      7. Purchasing—Purchasing is a module in the myUFL Systems to establish encumbrances for goods and services needed by the university community.
      8. Travel and Expense—Travel and expense is a module in the myUFL Systems that allows for the reimbursement of travel-related expenses to university travelers while performing travel related to university business.
    3. Commitment Control – Commitment control (KK) is integrated with the financial applications and provides valuable tools for controlling budgets and tracking revenues and expenses. Commitment control provides “real time” expenditure checking against budgets and provides error and warning messages to fiscal managers responsible for budgets.Several instructional guides are available in the myUFL Toolkit that will provide guidance in determining available spending authority within a budgetary cost center.
    4. Ledger groups—Available spending authority in PeopleSoft is divided into five categories or ledger groups. Each ledger group is related to a different source of funds, each with different rules governing spending. The UF ledger groups are:
      • APPROP – State appropriations
      • CASH_BASED – Cash based
      • STUGOV – Student Government
      • CONST – Construction
      • KKGMCHD – Sponsored Programs


4. ChartField Definitions

    1. A chartfield is a data field that stores accounting information. All accounting systems consist of codes used to identify transactions and track financial activity. Chartfields are the codes in PeopleSoft that perform this function. A transaction will be identified in the system by the unique combination of chartfields rather than by any one chartfield. In myUFL, a list of current Chartfields can be found by navigating to Main Menu > Financials > Set Up Financials/Supply Chain > Common Definitions > Design ChartFields > Define Values > ChartField Values. Click on the appropriate Chartfield hyperlink to search for a list of values. Follow instructions to search for available values. Note: The search will yield a maximum of 300 rows, and if it does, additional criteria will need to be added to narrow the search to yield appropriate results.Additional information on Chartfields is available here.
    2. Chartfields
      1. Business Unit – For the PeopleSoft general ledger, the business unit represents a legal entity for reporting and auditing purposes. This value will always be UFLOR.Note: The purchasing module uses the first 4 digits of the department ID as its sub-system (purchasing) business unit.
      2. Set ID – Identifies the set of tables that define the accounting structure and rules, such as the chart of accounts and accounting calendars. For now, only one Set ID is being used and it is UFLOR
      3. Fund – Is an independent fiscal and accounting entity with a self-balancing sets of accounts recording cash and other financial resources, together with all related liabilities and residual equities or balances, and changes therein, which are segregated for the purpose of carrying on specific activities or attaining certain objectives in accordance with special regulations, restrictions, or limitations. A list of funds is available.
      4. Department ID (DeptID) – Used to represent organization structure and to designate the accountable unit. The first four digits indicate the major department within a college or unit. A list of DeptIDs is available.
      5. Account – Used to classify financial activities and balances within the General Ledger. The first digit of the account will indicate the account type:
        1. Assets
        2. Liabilities
        3. Fund Equity
        4. Revenue-Operating
        5. Revenue-Non-operating
        6. Expenses-Personnel
        7. Expenses-Operating. These are the ones that should almost always be used for requisitions, PCard, and vouchers.
        8. Expenses-Non-operating

        A list of All Account codes and documents covering Account Groups and Definitions are available.

      6. Budget Reference – The budget reference chartfield is designed to identify the components of the state appropriations budget. There are two values:
        1. CRRNT – The default value on all transactions and represents the current year state appropriation.
        2. CYFWD – Carry forward identifies budget accumulated and not spent in prior years.

        All financial transactions will require a budget reference value. The funds that do not require the classification above will be automatically defaulted to CRRNT.

      7. Program Code – A program code provides for the functional classification of a transaction. This follows the NACUBO classifications such as, instruction, research, institutional support, etc. A list of Program Code Definitions and a list of Programs are available.
      8. Source of Funds – Source of funds is used to track both revenue and expenditures as they relate to a specific outside funding source. A list of Source of Fund Values is available.
      9. Dept Flex – The dept flex field is an optional user-defined field in PeopleSoft (can be required on some types of transactions.) It is a ten-digit field used by departments to further classify transactions. A list of Dept Flex Values is available.
      10. UF ID – Optional user-designed field that allows departments to track transactions based on a specific UFID of an employee.
      11. Project – The project chartfield is used to identify project related activity for the construction fund group and the contracts and grants fund group. It allows for the segregation and tracking of project and grant activity at differing levels of budgetary control.
      12. CRIS – Required field for IFAS departments and designed to meet the unique federal reporting requirements for units that cross funds, departments and projects.
    3. Required chartfields:
      1. Business Unit, Fund, Department ID, and Account are required on all transactions. In addition to these, the University requires other specific chartfields depending on the fund. Details on required chartfields for each fund are available.
    4. Chartfield Changes and Maintenance
      1. When a University department or office undergoes an organizational change, such as a transfer to a new college/VP area or a merger with another unit, it is sometimes necessary to establish new DeptID codes, to track its financial activity. As you might imagine, changing everything (HR, purchase orders, Pcards, etc.) to the new chartfields can be labor-intensive, and such changes should be carefully considered. Requests for new DeptIDs can be made by completing the Chartfield Request form. Completed forms should be emailed to:
      2. The above form can also be utilized for the addition of department-based chartfields, such as, flex field and Combination Codes (separate worksheets within the spreadsheet).
      3. Requests for additional accounts should be directed to General Accounting and Financial Reporting at 352-392-1326.


5. Reporting

  1. There are two types of reports used to facilitate the reconciliation process, delivered reports and prompted reports. Delivered reports are run monthly once the GL and sub-systems have closed, approximately the 10th business day of the month. Prompted reports can be run at any time but are limited to only the current and prior period data. The navigation to these reports is Main Menu->Enterprise Reporting->Department Reports
  2. Reports
    1. Appropriations Summary – lists the fiscal activity for a budget-based departmental budgetary cost center summarized at an account code level so departments understand the associated available spending authority and all related components that impact that calculation.
    2. Cash Summary – lists the fiscal activity for a cash-based departmental budgetary cost center summarized at an account code level so departments understand the associated available spending authority and all related components that impact that calculation.
    3. Transaction Detail – lists the monthly transaction details for a departmental budgetary cost center subtotaled at an account code level so departments understand the specific fiscal activity that impacted the departmental budgetary cost center’s available spending authority.
    4. Open Encumbrance – lists the amount for each encumbrance for a departmental budgetary cost center subtotaled at an account code level so departments understand what funds are remaining for any open encumbrance.
    5. Payroll Cost Distribution – lists individual employee payroll costs for a budgetary cost center with all applicable deductions for a given departmental budgetary cost center so departments understand the personnel expense attributed to their payroll costs paid.
    6. Projected Payroll Cost Distribution – lists the projected payroll remaining in the fiscal year for each employee in a departmental budgetary cost center subtotaled at an account grouping level so departments understand the cost of each employee’s employer paid payroll earnings, benefits, and taxes.
    7. KK to GL Summary Comparison – lists the monthly expenditure totals in the commitment control (KK) ledger and the general ledger in a departmental budgetary cost center subtotaled at an account grouping level so departments understand any expenditure variances between KK and GL.


    6. Fiscal Responsibility

    1. Internal Controls – Internal controls are a process designed to provide reasonable assurance regarding the achievement of objectives in the following categories:  Effectiveness and efficiency of operations, Reliability of financial reporting, Compliance with applicable directives, laws and regulations.  Fundamentally, controls help to ensure that the university’s assets are being protected. Through effective controls, a department can safeguard assets and also detect and correct errors and irregularities.
      1. Basic Internal Controls
        1. There should be an audit trail for each financial transaction. Documentation can be in either electronic or paper form.
        2. Accounting data must be checked to ensure that it is accurate and reliable.
        3. All financial data must be checked against departmental source documents. For financial data to be validated, it must be reconciled.
        4. During the reconciliation process, departments must ensure that only expenses related to their budgetary cost center are recorded in that budgetary cost center. The department must follow up on all inaccurate charges. Reconciliation is a critical step in ensuring that the university properly manages its resources.
      2. Segregation of Duties for Reconciliation
        1. Segregation of duties is critical. Segregation deters fraud and detects errors.
        2. Appropriate authorizations must be in place.
        3. Authorization of expenditures and recording of expenditures should be segregated duties.
        4. Reconciliation of financial transactions and the recording of those transactions should be segregated duties.
        5. If a department is too small to have two or more employees who can segregate duties, then the department administrator must frequently review departmental transactions.
      3. Documentation
        1. Millions of financial transactions are recorded annually into the University’s general ledger. Required documentation is not the same for all transactions. For example, an adjustment to an expense between account codes within a department is not as critical from the perspective of internal controls and risk as processing additional pay in the human resources system.
        2. Documentation must be aligned with internal controls and level of risk, therefore, required documentation for transactions depends closely on the level of risk associated with the transaction. Documenting general ledger entries are based on the following considerations:
          1. Minimal documentation is required when:
            1. There are system controls that minimize errors. Examples are transactions that have workflow associated with them. These transactions are reviewed and approved by someone other than the initiator before it posts to the general ledger.
            2. The transactions can be fully documented in the system itself. Comments describing the transaction and its purpose as well as the operator ID of the person who initiated the transaction are available in the on-line system. The transaction can be audited from the system itself.
          2. Increased documentation is required when the transaction:
            1. is for a large dollar amount.
            2. is part of a legally binding contract.
            3. is created via the purchasing card.
            4. in part of the procurement process.
            5. pertains to personnel actions.
    2. Reconciliation
      1. Ledger summaries and supporting detail ledgers are provided to departments on a monthly basis and can be run more frequently through the FIT cube. These ledgers provide the department with information regarding their financial operations and conditions. They also are used by department fiscal staff to verify or check to ensure that the information they contain is accurate and reliable. This process is often referred to as “Reconciliation” and is an important overall University control process. This process must be performed at least monthly after the ledgers are received.
      2. Since department size and complexity varies significantly, there is not one set of specific fiscal procedures that fits all departments. However, there are certain important fiscal requirements that all departments are required to meet. These requirements help ensure that management is properly informed of their fiscal operations and condition, but that proper controls are in place to ensure that revenues are maximized, prudently spent, that University funds are properly safeguarded, and that proper accountability is maintained.
          • Reconciliation to source documents is required to be performed for all transactions $100 and over.
          • For transactions under $100, reconciling consists of spot checking at least 25% of the budgetary cost center transactions to the source documents.
          • Contracts and Grants funds need reconciliation at a more detailed level.
      3. The reconciliation process is accomplished by tracing summary ledger information to detail transaction ledger (from myUFL) information and then to appropriate supporting documentation to ensure the accuracy of the financial information contained in the ledgers. Departments must ensure that all financial data on their ledgers is traced or checked back to the source documentation (ex: receipts, billings, expenditures, encumbrance changes, transfers, budget changes, etc.). Departments must ensure that only appropriate transactions are charged or recorded against their budgetary cost center and that adequate documentation to support all transactions is maintained in the department. Department Business Administrators are responsible for identifying financial problems and resolving errors before the following month end. It is critical the Department Business Administrators understand the transaction information contained in their ledgers.
      4. Appropriate documentation must be retained to support the reconciliation process has been performed and an audit trail maintained. All reconciliation documentation must be kept for the current and two prior fiscal years.