An Account Code Overview OR WHAT DO ALL

An Account Code Overview OR, WHAT DO ALL THESE CODES MEAN, WHICH DO I USE, WHEN, AND WHY?

What on Earth is a FOAP? FOAP = Fund, Organization, Account and Program codes Example - 100000 -41011 -6370 -60 Fund = Accounting Entity Organization=Budget Units or Departments Account = Assets, Liabilities, Net Assets, Revenues, Expenses & Transfers Program = Functional categories Activity = Optional code for use by departments

Fund Codes Funds are used for certain reporting entities. Such as operating, restricted or endowment. The fund code is a six digit number. Division of Funds 1 XXXXX – Operating Funds – these fund are the large operating fund used by ACU which are tracked by budget 20 XXXX – Internally Restricted or Designated – These funds are used when an activity sponsored by ACU is self supporting and needs to be tracked separately from the operating budget. An examples would be summer camps

Fund Codes (Continued) Divisions of Funds (continued) 21 XXXX – Restricted funds – these funds are used to track the funds from a donor restricted gift. No expenses should be paid from these funds; they are only used to hold the gift until the funds need to be moved into operations 22 XXXX – Restricted Scholarship Funds – these funds are used the track the funds from a donor restricted scholarship gift. 23 XXXX – Endowment Earnings to be used for operations. The balances from these funds are transferred to operational accounts as needed

Fund Codes (Continued) Divisions of Funds (continued) 3 XXXXX – Grants and Contract Funds 5 XXXXX – Endowment Funds – Used by Investment Services to track individual endowments given to the University 7 XXXXX – Capital Projects Funds – Used for large remodeling or building projects 8 XXXX – Agency Funds – Used to track funds that do not belong to ACU. Examples are student organizations and entities which ACU serves as fiscal agent

Organization Codes are used to track revenues and expenses for a particular department. The budget for a department is tracked using the organization codes

Account Codes Accounts Codes are four digit codes used to track assets, liabilities, net assets, revenues, expenses and Transfers Division of Account Codes 1 XXX – Assets 2 XXX – Liabilities 3 XXX – Net Assets 4 XXX – Revenues 5 XXX – Salaries and Benefit Expenses 6 XXX – General Expenses 8 XXX – Transfers

Account Codes Account codes are used by everyone on campus and are generally not specific to a particular department or activity. For example account code 5006 is used for exempt salaries for all departments See next slide for how to view a listing of account codes

Account Code Hierarchy You can look at listing of account codes – - Online using FTVACCT; searching available through query - Print report FGRACTH; can limit by using account type code is

Basic Financial Statements § Statement of Financial Position (Balance Sheet) Banner Query Form – FGITBSR § Statement of Activity (Income Statement) Banner Query Form – FGIBDSR or FGIBDST

Balance Sheet Elements Assets – Account Codes 1 XXX - Includes cash (1090); do not use - “D” increases assets; - “C” decreases assets Liabilities – Account Codes 2 XXX Net Assets – Account Codes 3 XXX - Net income and expenses - Warning: NEVER, EVER USE

Balance Sheet Principle ASSETS = LIABILITIES + NET ASSETS OR 1 XXX = 2 XXX + 3 XXX

Income Statement Elements Revenue – Account Codes 4 XXX Expenses – Account Codes 5 XXX (Salaries and Benefits) Expenses – Account Codes 6 XXX (Operating Expenses) Transfers – Account Codes 8 XXX

Are There Any Special Situations Or Rules I Need To Know? YES!

Budget Pooling Account Codes Pooling accounts are 3 digits for operating expenses – related only to budget dollars Example: 630 – General Expenses § Used to enter budget transactions § Can not be used for actual transactions § Offset budget code – 675; will be a credit(-)

Budget Pooling Hierarchy Example of Pooling Hierarchy 630 – General Expenses (Budget Pool) 6380 – Postage 6382 – Printing 6386 – Professional Dues 6440 – Supplies - Office

Budget Pool Codes For Restricted Accounts - Offset budget code is 675 - Will be a credit(-) for an expense - Will be a debit(+) for a revenue

Transfer Entries (2 Types) Type 1 - Formal Transfer Between Departments (Transfer In/Transfer Out) § § § Use code 8105 for transfers in & code 8205 for transfers out - cannot mix with any other account codes Transfer In = credit(-); Transfer Out = debit(+) If a transfer from one fund is necessary to pay for an expense in another fund that has not yet occurred (or has not yet been recorded in the other fund), please make a formal transfer as described above.

Transfer Entries Type 2 – Transfers among same category of accounts for different departments § Can be done among expense codes except those between 6800 & 6899 (use as incoming and outgoing) § Can be done among revenue codes (use as incoming and outgoing) § This method is useful when a transaction has already occurred but was coded to the wrong account/fund. § NOTE – Academic depts transferring from restricted accounts to operations must use codes 8105 and 8205

Payments To Other Departments Some departments charge other departments for services provided (interdepartmental services revenue). The department providing services often thinks of transaction as revenue and tries to post to a revenue code – 4 XXX; this should be avoided. The transaction is actually another form of transfer The department providing services should have a special expense account code – for example, 6962; the department providing services should record the transaction as a negative expense to this code.

Ways To Pay Other Depts. Dept 1 - Dr. 8200 Correct Dept 2 - Cr. 8100 Dept 1 - Dr. 8200 Incorrect Dept 2 - Cr. 6353 (transfers out of balance) Dept 1 - Dr. 6300 Correct Dept 2 - Cr. 6370 Dept 1 - Dr. 6803 Incorrect Dept 2 - Cr. 6370 (crossing budget pools) Dept 1 - Dr. 4605 Correct Dept 2 - Cr. 4540 Dept 1 - Dr. 6300 Incorrect Dept 2 - Cr. 4540 (crossing rev & exp) Dept 1 - Dr. 6899 Correct Dept 2 - Cr. 6899

Revenue or Expense? Revenue must be recorded as revenue (except in the limited instance noted earlier for interdepartmental services revenue) Expense must be recorded as expense Revenue may not be moved to reduce expenses Budget adjustments should increase both revenue and expense (net budget should not change)

Example of Budget Revision Through Revenue In a single department: Funds spent Dr. 6300 Cr. Cash Funds received Dr. Cash Cr. 4540 Budget revision Dr. 630 Cr. 4540 Through 8105 Dr. 6300 Cr. Cash Dr. Cash Cr. 8100 Dr. 630 Cr. 810

Scholarships are expenses but not recorded in the category of expenses Treated as a contra or reduction of revenues Special group of account codes – Unfunded – 4091(Gen); 4092(Athletics) Funded – 4096(Gen); 4097(Athletics) Funded – 4098(Grants)

Agency Accounts Identified by fund codes beginning with “ 8”, or 8 XXXXX Do not generate income or expense for the University All transactions recording in special group of liability account codes-2480 through 2492 Include student clubs, Pell, Perkins Loans

Questions or Comments? Call us anytime at ext. 2795 Or email at fmsbrje@acu. edu