FINANCE

1. Making Financial Inquiries in CU's Finance System FINANCE

2. WELCOME This course is part of a suite of courses required for Financial System access at CU. It complements the online Blackboard course, Financial-Inquiry, but also offers trainees: • the opportunity to run financial reports in a practice database • the ability to ask questions specific to individual department environments • key policy overview and additional resources You'll be able to view it online any time you need a refresher; you need not be at a campus computer.

3. Course Overview There's a lot to learn about CU's Financial System...don't worry about retaining all the information we go over today (see the chart below for a subject matter overview); just make sure you remember what documents and help resources are available for you...like this training course, which will always be in its most current status on the web!

4. Fiscal Culture CU's operations are organized into Organizational Units that develop and execute plans to carry out the University's mission and achieve its objectives. These units obtain and utilize resources, the financial impact of which is accumulated and summarized in the University's financial records. Key elements of CU's fiscal culture are: • Public, tax-exempt institution -- • creates greater public scrutiny • subject to more laws and regulations • subject to legislative oversight • subject to State budget process • Elected governing board -- direction subject to political process. • Decentralized accounting structure -- relies on many people with diverse educational and experiential backgrounds for financial statement accuracy. • Federally funded research -- subjects CU to federal regulations. • Confidentialityof sensitive personal information, including protected patient data.

5. Driving Forces – Policy Hierarchy The University has implemented policies at various levels to ensure compliance and accountability. Following are key elements of the policy structure.

6. Driving Forces – CU Regents and External Forces The Regents of the University of Colorado sit atop our policy hierarchy, and create laws and policies that lower level policies, like APS, PPS, and campus-specific policies strive to support: • Laws of the Regents • Policies of the Regents The Sarbanes-Oxley Act of 2002, which defines best-practices in fiscal management (after the accounting and auditing misconduct that took place at the turn of the century - Enron, WorldCom, etc.) is the driving force behind many of CU's Administrative Policy Statements: • Fiscal Roles and Responsibilities • Fiscal Code of Ethics • Fiscal Certification • Officer Disclosure of Interests

7. Driving Forces – Transparency and Accountability Other factors, like the need for transparency and accountability in fiscal management, have impacted Administrative Policy Statements and PSC Procedural Statements: • Propriety of Expenses • Sensitive Expenses • Alcohol Purchase and Provision • Alcoholic Beverages Purchased for University Events • CU Foundation Transfers • Recognition and Training

8. Driving Forces – Sponsor and Campus Policies CU's sponsors, who provide much of our funding, have their own polices, such as: • NSF Proposal and Award Policies and Procedures Guide • NIH Grants Policy Statement It's not necessary for you to become an expert at interpreting sponsor policies - for UCD integrates them into our own campus policies in order to ensure compliance and consistency: • UCD Fiscal Policies

9. Driving Forces – Security and Confidentiality The University has implemented policies concerning the acceptable use of university IT resources, and the security and confidentiality of CU data: Acceptable Use • Use only authorized access • Do no harm • Limit personal use • Comply with statutes, regulations, and policies • Access is conditional upon agreement Data Security and Confidentiality Practice Requirements • Use university data only for university business • Be responsible in the use and release of University data • Maintain security for University data • Protect University software

10. Data Structure - Chartfields Cu's financial data coding structure uses “chartfields", which consist of ten blocks (database fields) of information that tell the system precisely how to record a transaction. Some values are defaulted, some are optional, and the others are required to be entered by the system user: Business Unit - Defaults to UCOLO. Fund - Identifies the source of the money being received and spent. You'll learn much more about funds as we go... Organization - Identifies the campus/department/school/reporting division spending or receiving the funds. Program - Identifies a fiscal-year based University activity. OR Project - Identifies a non-fiscal-year-based University activity. Sub-Classification - Optional - Allows financial tracking of related activities under a main activity. Account - Describes the asset, liability, revenue, expense or transfer in a transaction. This is another important term that we'll discuss quite a bit later in this course. Budget Year - Defaults to the current fiscal year. You'll learn more details about CU's fiscal year later in this course. Statistics Code - Optional - not used. Currency Code - Defaults to the US dollar (USD).

11. Data Structure – FOPPS & Speedtypes The unique combination of the chart fields "fund + organization + program or project + subclass" (which you may recall is optional) describes a specific university entity, and is referred to as a FOPPS. Each FOPPS, which could have up to 19 digits, has a shortcut for data entry, called a "speedtype".Speedtypes are 8 digit smart-numbers, that start with the campus code in the first digit position, followed by the fund in digit positions 2 and 3, followed by an auto generated five-digit number. This diagram shows the relationship between a FOPP and a speedtype: You'll recognize which campus a speedtype belongs to by its campus code (the first of the 8 speedtype digits): So, speedtype "13055555" is a Boulder speedtype in fund 30 (sponsored projects fund); speedtype "63412345" is a UC Denver speedtype in fund 34 (gift fund). To learn more about the specific speedtypes you'll be working with, have your supervisor help you fill out "My Speedtypes - Sponsored Projects forms, and the Programs version.

12. Data Structure – Balance Sheet 61099999 – FINANCE OFFICE OPER MCMULLIN, SHAUN 99999 – FINANCE OFFICE 99999 – FINANCE OFFICE OPER An asset is what you own; tangible or intangible property like cash, inventory, accounts receivable, etc. A liability is what you owe, like payroll due or loan payments due Net assets (AKA equity) are the difference between what you own and what you owe The accounting equation (AKA the balance sheet equation states: Assets = Liabilities + Net Assets Net assets (along with assets and/or liabilities) change as revenue is earned and as expenses are incurred.

13. Data Structure – Income Statement 61099999 – FINANCE OFFICE OPER 10 – UNRESTRICTED GEN OPER 99999 – FINANCE OFFICE 99999 – FINANCE OFFICE OPER NO SUBCLASS MCMULLIN, SHAUN MCMULLIN, SHAUN Revenue results from the sale of goods or the rendering of services, and is recorded (and so increases net assets) when earned, not necessarily when payment is received. An expenditure is a cost incurred in order to provide the goods or services an organization provides, and is recorded (and decreases net assets) at the time the cost is incurred, regardless of when payment is made.

14. Data Structure – Income Statement (cont) Budget ledgers: a planned amount of revenue or expenditure. Some speedtypes don’t have budgets so this column would contain zeros. 61099999 – FINANCE OFFICE OPER 10 – UNRESTRICTED GEN OPER 99999 – FINANCE OFFICE 99999 – FINANCE OFFICE OPER NO SUBCLASS MCMULLIN, SHAUN MCMULLIN, SHAUN Actual ledgers: a realized amount of revenue or expenditure. If no actual revenues or expenditures have occurred, the actuals column would contain zeros. Encumbrance ledgers: a planned expenditure that commits University dollars but has not been realized yet. Examples of expenses that are encumbered are employees’ future salaries and benefits and purchase orders that have not been received.

15. Data Structure – Financial Statements • The balance sheet shows what an organization owns (assets) and what it owes (liabilities), and the difference (net assets) at a fixed point in time. The balance sheet changes as revenue and expenses are incurred. • The income statement shows how much money an organization made (revenue) and spent (expenditures) over a period of time. For the same reasons that we balance our checkbooks each month to ensure that the bank recorded our banking transactions correctly, it is imperative that financial managers at all levels review the financial statements related to their departmental activity, at least monthly, to ensure that transactions are recorded accurately and completely.

16. Data Structure – Journal Entries 0000999999 To move Finance Office unearned revenue to A/R for July 2011 DEBIT 1 2 61099999 Finance Office July Unearned Rev Finance Office Oper 61099999 Finance Office July Unearned Rev Finance Office Oper 99999 99999 10 99999 99999 CREDIT Journal entries are used to record financial transactions in the general ledger – the repository of the debits and credits that is used to create financial statements. Some journal entries are performed manually by individual Finance System users, while other are uploaded through automated processes from subsystems. Proper accounting practices seek to maintain the accounting equation – in other words, to balance the books. Each transaction has an equal amount of debits (recorded as positive numbers) and credits (recorded as negative numbers.) This convention is known as “double-entry accounting”, which helps prevent errors and ensures that each transaction keeps the organization’s accounting equation in balance.

17. Data Structure – Fiscal Years and Periods • A fiscal year is a one-year period in which financial activity occurs, is recorded in the general ledger, and is summarized on financial statements. It does not necessarily follow the calendar year. CU’s fiscal year begins July 1st and ends June 30th. • An accounting period refers to a single month in the fiscal year. Since CU’s fiscal year begins in July, July is known as “accounting period 1”, August is “accounting period 2”, and so on.

18. Data Structure – Fund Groups

19. Data Structure – Account Codes Account codes describe the type of transaction being recorded: revenue, expense, etc. CU has over 5000 account codes! You can search for account codes in the Finance system too; you'll learn how in the next section, "Navigation".

20. Navigation To learn how to navigate in the Finance and Procurement System, we'll log in to a practice database, using a log-in name and password that will be provided by your instructor. • CU Business Applications page • COGNOS Practice Database There are step-by-step guides available on the University Controller's website: • Finance System Step-by-Step Guides

21. Reporting – Report Generation Reports are created from the data in reporting databases, after the financial transactions in production databases are copied into them overnight.

22. Reporting – On Demand Reports • Can be run by authorized Finance System users and anyone in a fiscal role at any time once logged in to the system through the portal or through the CU Business Applications (aka the "Planets") page • Can be run for one or more speedtypes within a single report; by speedtype, project, program, org/org node, subclass, or FOPPS • Can be run in a variety of formats: .html, .pdf, .xls, .csv, depending on your preference • Can be run for a variety of date ranges. For example, detail reports can now be run for more than a 12 month period

23. Reporting – Logging In to View Reports

24. Reporting – Logging In (cont) Click on the “CU Resources” tab Under the “Reporting” drop down menu, click on “Public Folders”

25. Reporting – Viewing On Demand Reports You’ll be taken to the public folders section. Once you click the Finance link, you’ll see a list of reports you can run using a variety of parameters: Gives summary of assets, liabilities, and net assets for the period of report Gives summary of budgets, actuals, and encumbrances with available budget amount for period of report

26. Reporting – Viewing On Demand Reports SAMPLE: TRIAL BALANCE SUMMARY

27. Reporting – Report Parameters • Once you’ve decided on the report you want to run, you’ll need to decide on your report parameters. • For detail reports, you’ll select a fiscal year, a “from” and a “to” period, depending on the information you want to see. • For summary reports, you’ll choose the fiscal year and the “through” period value. Detail Reports Summary Reports

28. Reporting - Tutorials You'll have lots of new options when running reports in the Reporting System; check out the narrated movies and documents to view demonstrations of the various features and possibilities. You'll be prompted to install Flash Player if you do not already have it installed to view the movies. If you have any problems, please contact Shaun.McMullin@UCDenver.edu.

29. Reporting – Report Viewing Reviewing reports is a critical internal control for ensuring University Resources are used appropriately and accounted for accurately. Be sure to watch for errors, anomalies and suspicious transactions. Fraud Reporting Be sure report review is performed by someone that does not make deposits or enter transactions.

30. Resources • UCD Finance Office (this site's homepage) • Procurement Service Center • Office of University Controller • Finance FAQs • Reporting Fraud • Policies • Signature Authority PolicyContract Signature Matrix • Presenters: Shaun.McMullin@ucdenver.edu 303-315-2270; Caroline.Kirkwood@ucdenver.edu 303-315-2286; Ryan.Yu@ucdenver.edu 303-315-2256 • Finance Help Desk Linda.Newsome@UCDenver.edu 303-315-2265