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Financial Reporting Training: ARRA Period of Availability and Accrual Basis

This training covers key terminology, data elements, obligations, and accrual accounting in financial reporting for ARRA funds. Learn reporting guidelines, obligations vs. accrued expenditures, and importance of accrual accounting for decision-making.

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Financial Reporting Training: ARRA Period of Availability and Accrual Basis

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Presentation Transcript

  1. Reporting Training Help

  2. Period Of Availability Of Funds • PY and FY Funds & Program Income Earned Availability: WIA Formula and Direct Grants • For obligation • For expenditure Liquidation • Of obligations • Of accruals

  3. KEY TERMINOLOGY Total Funds Authorized minus Obligations equal Unobligated Balance Obligations minus Accrued Expenditures (Cash expenditures plus accruals) Remainder equals Unliquidated Obligations Commitments (placeholder)

  4. Financial Reporting • Financial Status Reports (SF 9130) • Must be on the “accrual basis” • Grant funds and program income • Entities accounting system • May be maintained on either “cash basis” or “accrual basis”

  5. ARRA • Cash or Accrual Basis • Different Due Dates • Aggregate data for expenditures/accrued expenditures • VENDORS • SUBS • Reports Due: • Centralized or Decentralized • Responsible party for changes and certifications

  6. ETA Funding Flows To:

  7. Cash To Accrual Reporting • WHY? • In accordance with GAAP • Better information to decision makers • Required by ETA • WHEN? • At least quarterly, but should be continuous • HOW? • Linking spreadsheets (documentation)

  8. What is accrual accounting? • A method of accounting • An entity’s financial position and operating results are measured by the flow of economic resources. • Transactions are recorded in the accounting period in which they occur • Regardless of when the related cash receipts and disbursements take place • (In accordance with GAAP)

  9. Reporting Data Elements • Cash Received • Cash Disbursed • Program Income (earned/Disbursed) • Recipient Share • Mandatory, leveraged and stand in • Other Federal Expenditures (not this grant) • Youth In School and Out-of-school • 30 percent on out-of-school • No more than 70 on in-school

  10. Standard Reporting Data Elements • Federal Funds authorized • By funding period and funding source, including limitations/other requirements, e.g., admin/in-school and out-of-school • Federal Obligations • Unobligated Balance • Unliquidated Obligations • Federal Accrued Expenditures • Other Federal Funds • Federal Real Property Expenditures (states only) • Remarks/Comments

  11. Added Emphasis On Reporting on the Accrual Basis of Accounting • Cost incurred in the reporting quarter for all services and goods received • Examples: Services performed • Employees, training and other contractors, subgrantees, etc. • Examples: Other amounts becoming owed • Indirect costs • Unfunded leave – accrue as it is taken during the grant period/contract period • Insurance claims

  12. Accrued Expenditures • All accrued costs must be reported • All reports must trace to source documentation • IF entity has a cash basis accounting system: • Linking records must be maintained in accordance with GAAP

  13. Contract Obligations • Legally binding • Offer, acceptance, consideration, made by authorized official • In writing • A purpose authorized by law • Properly executed • Before expiration of obligational availability • Specific goods, real property, work, or services.

  14. Contract Obligations • Must contain specific description of goods or services to be acquired • Otherwise, not a recordable obligation • Training vouchers, travel orders • Indefinite/variable quantity • Minimum quantity required • Variable quantity impact depends

  15. Recording Obligations • Federal requirement • Supported by documentation • Recording • Evidences the transaction • Does not create it. • Failure to record • No effect on validity or fiscal year chargeable

  16. Obligation or Accrual • Orders placed • Delivery of goods or services and payment in future • Obligation, not accrual • Delivery of goods or services taken, payment in future • Obligation • Accrued expenditure • Payment & delivery simultaneous • Obligation • Accrued expenditure • Cash outlay

  17. Obligations or Accrued Expenditures? • All accrued expenditures are obligations BUT • Not all obligations are accrued expenditures…..

  18. Administrative Cost Definition • WIA Grants • States – no more than 5% • Locals – 10 % unless some of State 5% is given to locals/Local subs in grant agreement • Other entities on the list in the definition must track administrative cost • Direct Grants as applicable • In grant agreements

  19. The End • …for today!!! Thank You everyone, especially Rodney!

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