Financial Operations 101

Transcription

1 Financial Operations 101 Chris Shotwell, Director Financial Operations Tina Ward, College Business Analyst Ty Back, Fiscal Compliance Officer Jeremy Teal, Fiscal Compliance Officer

2 Topics QuickBooks (QBO) Online Update Cash Handling Purchasing & Disbursements Equipment Inventory

3 QBO Update Selection of QBO 120 counties surveyed re: current system used >90% already use Inuit product (Quicken or QuickBooks) >65% already using QuickBooks desktop or online Worked with outside CPA to consult on available options Selected QBO because it is designed for small businesses and is fairly easy to use

4 QBO Update Selection of QBO Excellent pricing negotiated (5 year $22/month per county) Will allow us to standardize accounting processes in counties Will allow us to better support the management of EDB funds Will allow us to develop consistent reporting to all stakeholders

5 QBO Update Overview of QBO Accountant view provided to EFO and DD s For monitoring and support purposes Client view provided to appropriate county staff Fiscal contact (manager, facilitator, coordinator) Staff support Outside bookkeeper (if required) Standard chart of accounts to be used by all counties Money in and money out recorded in QBO via standard processes Reports regarding financial matters pre-defined and scheduled

6 QBO Update Overview of Training Agenda Training provided by EFO, Inuit and outside CPA firm Overview/Navigation QuickBooks Online Detailed Training Navigation Security & Backup Master Data Money In

7 QBO Update Overview of Training Agenda QuickBooks Online Detailed Training (continued) Money Out Reconciliation Budgeting Reports Journal Entries

8 QBO Update Overview of Training Agenda Practice Session (continued) Add vendors Add customers Bank deposit Checks Reconciliation Reports

9 QBO Update Tentative training & implementation plan: District 2: trained in Jan w/ Feb 1 Go Live District 1: trained in Feb w/ Mar 1 Go Live District 4: trained in Mar w/ Apr 1 Go Live District 7: trained in Apr w/ May 1 Go Live District 5: trained in May w/ Jun 1 Go Live District 6: trained in Jun w/ Jul 1 Go Live District 3: trained in Jun w/ Jul 1 Go Live

10 Questions

11 Policy & Procedures Cash Handling Cash Handling General UK Treasury Operations Manual (E-2-1) Definitions Cash: US coin and currency Cash Equivalents: Checks drawn on US banks, ACH transactions, credit card sales drafts, wire transfers and foreign funds

12 Policy & Procedures Cash Handling Cash Handling General Extension policies and procedures will be written, or updated, to cover: receiving, recording, safeguarding, depositing and reconciling all cash assets. According to UK policies, each cash handling unit of the University is to institute controls and procedures to ensure the physical security of cash, maximize the use of cash funds, and accurately record the receipt of cash to ensure the reliability of financial data.

13 Policy & Procedures Cash Handling Cash Handling General Separation of duties: Perform functions of receiving cash, voiding transactions, balancing cash, preparing deposits, recording transactions, and reconciling so that no single person has control over the entire process. If staffing levels do not allow for proper separation of duties, unit will establish compensating controls to properly perform this function. Two individuals review and verify cash receipts, deposits and records Management review of cash reports Increased supervisory oversight of all cash handling functions

14 Policy & Procedures Cash Handling Cash Handling General Ideally, someone other than the person receiving the funds should review and approve cash transactions daily or as transaction frequency dictates. EFO will establish additional cash handling policies and procedures specific to office needs.

15 Policy & Procedures Cash Handling Cash Handling - Receiving Create a receipt and carbon form for all sales and give the payer a copy of the receipt. Use computerized point of sale system printed receipts or Use preprinted and pre-numbered receipt forms that can be completed manually.

16 Policy & Procedures Cash Handling Cash Handling - Receiving Receipt forms must include: a) The amount of the payment; b) The mode of payment (e.g., cash or check); c) Name of person making payment; d) Purpose of payment; e) Date of payment; f) Sequential number; g) Account payment applied to, if applicable; and h) Signature of the employee receiving funds for written receipts.

17 Policy & Procedures Cash Handling Cash Handling - Receiving Count cash and balance to the totals of the cash receipts at the end of each day and/or offsite event. Report any difference in the total of the actual receipts and the total of the receipt forms as a shortage or overage on the log or transmittal form. Two employees must not work out of the same cash drawer or bag. Restrictively endorse checks immediately upon receipt as follows: For Deposit Only

18 Policy & Procedures Cash Handling Cash Handling Safeguarding Limit access to cash and keep funds secure at all times Restrict access to areas where cash is counted or handled to persons directly involved and restrict visibility by the public in areas where money is handled. Never leave cash unattended. If an employee leaves his or her workstation for any reason, regardless of how briefly, appropriately secure cash in a locked place.

19 Policy & Procedures Cash Handling Cash Handling Safeguarding Keep working funds to a minimum at all times. All other cash must be in a locked safekeeping device. Keep all cash in a safekeeping device that cannot be easily removed from the premises. Keep safe doors closed during business hours when the safe is in use, and locked when it is not in use. Keep safes locked at all other times.

20 Policy & Procedures Cash Handling Cash Handling Safeguarding Give safe combinations/keys to a minimum number of employees and only to those whose functions require access. When staffing levels permit, to prevent access to secured cash after normal business hours, no one employee should have access to both a key to a door to an office and the safe combination. Where staffing levels do not permit this preferred internal control measure, the supervisor must develop a plan and exercise control to maintain the proper level of security over cash.

21 Policy & Procedures Cash Handling Cash Handling Safeguarding Two people must be present at all openings and closings of safekeeping devices. The two people will initial a safe log that documents the safe s opening and closing activity, as well as the contents of the safe at close and open.

22 Policy & Procedures Cash Handling Cash Handling Recording Record all receipts of cash in accounting system as they are received. Receipts should be recorded by someone different than the person who received the cash. Receipts should be deposited by someone different than the person who received the cash.

23 Policy & Procedures Cash Handling Cash Handling Depositing Order and use pre-printed deposit slips. Prepare a separate deposit slip for each log or transmittal. Cash or checks must be summarized on the deposit slip. EFO will be developing a standardized log/transmittal to be used across the state.

24 Policy & Procedures Cash Handling Cash Handling Depositing Make all deposits as follows: daily, if cash receipts accumulate to $500, although more than one deposit a day is not required; each time during the week deposits accumulate to $500 if receipts are less than $500 per day; on the last working day of the week if cash is on hand; or by the local bank s cut off time on the last working day of the month if cash is on hand in order to ensure that activity is included in the correct accounting period.

25 Policy & Procedures Cash Handling Cash Handling Reconciling Conduct periodic reviews of cash activities, including reconciliations, to determine that all systems are functioning as intended and that all applicable policies and procedures are being followed.

26 Questions

27 Policy & Procedures - Purchasing & Disbursements Purchasing & Disbursements UK Purchasing Business Procedures (Section B) UK Disbursement Business Procedures (Section E-7)

28 Policy & Procedures - Purchasing & Disbursements Purchasing & Disbursements All Extension Offices are delegated procurement authority for ordering goods and services. County Offices may use Price Contracts established by the Purchasing Division of the University of Kentucky and may order directly from these vendors. Prompt payment for purchases will ultimately result in better vendor relations, improved service and lower prices.

29 Policy & Procedures - Purchasing & Disbursements Purchasing & Disbursements Payment Vouchers must be properly documented, including a detailed description of the activity/program purchase is for and detailed original receipts and/or invoices. Bills should not be paid by Treasurer without a Payment Voucher and a detailed receipt. Employees must use Payment Voucher form or TRIP with detailed receipts attached. Even auto payment bills need a Voucher.

30 Policy & Procedures - Purchasing & Disbursements Purchasing & Disbursements The Fiscal Contact authorizing a purchase or expenditure is responsible to assure funds are available for payment of all obligations made under this authority. Each Payment Voucher should be reviewed and signed by the Fiscal Contact before the check is written When reviewing the voucher, is the expenditure coded to the correct line item? No reimbursement will be made to individuals for purchase of alcoholic beverages.

31 Policy & Procedures - Purchasing & Disbursements Purchasing & Disbursements The fiscal contact is the responsible person for each budgeted expenditure account and therefore must approve transaction documents. EFO is developing a standard delegation of authority matrix and related delegation form.

32 Policy & Procedures - Purchasing & Disbursements Purchasing & Disbursements All requests for reimbursement must be submitted to the appropriate Treasurer or through TRIP within 30 days after expense is incurred. Agents, assistants, office secretaries or other Extension employees should not sign checks or be authorized to sign checks.

33 Policy & Procedures - Purchasing & Disbursements Purchasing & Disbursements For many county Extension offices, there are personal service needs such as lawn care, cleaning, maintenance of equipment, etc. These services may be acquired on a contract basis if they are not provided by Extension staff. Personal service contracts for professional services must include use of their own equipment and materials (not those owned by the Extension District Board). Please note that if payment is over $600, an IRS Form 1099 must be given at the end of the calendar year.

34 Policy & Procedures - Purchasing & Disbursements Purchasing & Disbursements When a contract for personal services $20,000 or less is required, it is recommended that the office informally solicit proposals, make a determination of the best qualified contractor and establish a PSC contract. When a contract for personal services greater than $20,000 is required, the office must conduct a formal bid process (KRS ) County Fiscal Court purchasing policies may be more restrictive Extension Employees are not to sign contracts on behalf of the Extension District Board. All contracts should be reviewed by the District Board and perhaps the County Attorney before presented to the contractor.

35 Questions

36 Policy & Procedures Equipment Inventory Equipment Inventory UK Property Business Procedures (Section E-12) Capitalization Policy: Equipment Inventory Policy:

37 Policy & Procedures Equipment Inventory Equipment Inventory Definitions: Capital asset: any physical resource that benefits a program for more than one year, including buildings, fixed equipment, land, land improvements, moveable equipment, computer software, and vehicles Equipment: moveable property having a useful life of two (2) years or longer, and which retains its identity as a separate and identifiable item. An item loses specific identity when attached to another item as a component part or when attached as a permanent part of a building.

38 Policy & Procedures Equipment Inventory Equipment Inventory Definitions: Land improvements: enhancements to land other than buildings, such as fencing, paving, roadways, walks, parking facilities, retaining walls, shrubs, underground sewers, water lines, yard lighting, etc. Repairs: restoration of a capital asset that has deteriorated to its original condition (excluding normal wear and tear). Examples include replacing a roof, replacing a water fountain or HVAC system, replacing worn parts on a piece of equipment.

39 Policy & Procedures Equipment Inventory Equipment Inventory Definitions: Maintenance: the recurrent, day-to-day work required to preserve a capital asset in its original condition (excluding normal deterioration) without materially increasing its usefulness or life. Costs include cleaning, lubrication, parts, material and labor. Charge such costs to current expenses.

40 Policy & Procedures Equipment Inventory Equipment Inventory The University capitalizes assets in its financial records as follows: Land at cost; gifts capitalized at fair market value at the time of donation Buildings, building improvements, fixed equipment, infrastructure assets and land improvements costing $100,000 or more at cost, or in the case of a gift, at fair market value at the time of donation. Moveable equipment purchased from vendors or fabricated by the University costing $5,000 or more Expenses incurred for additions, improvements, or betterment to movable equipment at cost

41 Policy & Procedures Equipment Inventory Equipment Inventory The University capitalizes assets in its financial records as follows: Equipment meeting all the criteria for equipment but costing less than the capitalization limits are not capitalized but controlled by the office. Offices are encouraged to track noncapital equipment. Maintenance or repair costs to equipment not capitalized EFO will be developing a standardized equipment policy that will cover both capital and non-capital items. County Fiscal Court capital thresholds may be more restrictive

42 Policy & Procedures Equipment Inventory Equipment Inventory Office must: Verify the accuracy of the inventory records for equipment during the annual inventory process and throughout the year Report surplus or obsolete property Report lost, stolen, and destroyed equipment items Maintain reasonable precautions in protecting all property (capital and non-capital)

43 Policy & Procedures Equipment Inventory Equipment Inventory Office must: Maintain control of all items of furniture, equipment, vehicles and other moveable property assigned to the areas, regardless of cost. Use the proper general ledger account when requisitioning equipment. Control and record the location of property. Complete the annual physical inventory of property in the possession of, or under the supervision of, the office by the assigned deadline.

44 Policy & Procedures Equipment Inventory Equipment Inventory In accordance with University policy and Commonwealth of Kentucky regulations, all capital equipment must be physically counted annually. Each office is responsible for completing its inventory.

45 Policy & Procedures Equipment Inventory Equipment Inventory EFO will be preparing a standardized process/procedure for equipment inventories and verification of same The use of the University s ebars system is available and one possible option

46 Questions