Welcome to BUDGET 101 presented by - PowerPoint Presentation

1. Welcome toBUDGET 101presented bySeattle Central College Business Office

2. Where we’ll take first steps in learning to read aBUDGET REPORT!

3. To do this, we need a general sense of something called ….

4. “Fund Accounting” - its concepts, as an overriding system -

5. AND – very importantly, we’ll begin developing an understanding of the .…

6. “Account Structure”(this is literally the key to all fiscal reports)

7. Fund AccountingAccounting records are how we keep track of what we do with money.

8. Fund Accounting is a method of organizing the accounting records by collecting them into Accounting Containers called “Funds”.

9. Thinking of an Accounting Fund as a container is a pretty accurate way of visualizing it

10. 10There is a FUND for each type of thing we do:

11. Notice that each fund has a numeric identifier.

12. A brief “Big Picture” moment:Legislature, OFM, SBCTC, CTC, SCD, SCC

13.

14. We’ll come back to the concept of Funds when we discuss the Account Structure.

15. 15Money In, Money Out

16. MONEY IN: State Appropriations, Tuition, Fees, Grants, Gifts, etcMONEY OUT: Payroll, Purchases of Various Goods, Services, etcMONEY NEUTRAL: Transfers between SCC departments (money neutral to the college as a whole).16MONEY IN: is generally called REVENUE OR REIMBURSEMENTMONEY OUT: is generally called EXPENDITUREMONEY NEUTRAL: is generally called INTERDEPT TRANSFERS

17. To make a PLAN for money movement, we CREATE a BUDGETWhen money MOVES (in, out, neutral) we CREATE an TRANSACTIONWhen each Transaction HAPPENS, we must CREATE an Accounting RECORD

18. ACCOUNT STRUCTURE(working definition)“The framework underlying our method of using numbers and letters to record what we do with money.”

19. ACCOUNT STRUCTUREIt is difficult to overemphasize the importance of understanding the Account Structure – it is the key to understanding Budget Reports.

20. By design, both our Budget system and our Accounting systememploy the same Account Structure Methodology(as does the entire CTC System)

21. Primary Account Structure Elements& Their Abbreviations21

22. What’s an INDEX anyway?22

23. What’s an INDEX anyway?23A field (column) of data intentionally designed/defined and populated (filled) to enable us to quickly:SearchSortGroupAggregate (Sum)CompareBased on our understanding of the data element (the data in the Index itself), and the question we are trying to answer.

24. What’s an INDEX anyway?24A BRIEF DEMO:

25. Primary Account Structure Elements& Their Abbreviations25

26. TRANSACTION CODETRANS REVERSEAPPROPRIATION INDEXPROGRAM INDEXORGANIZATION INDEXOBJECTSUB OBJECTSUB SUB OBJECTREVENUE SOURCEREVENUE SUB SOURCETCRAPPRPRGORGOBJSOBJSSOSRCSSRCAccount Structure Elements and Abbreviations laid out in the generally accepted order of use.

27. – Forms in which we use the Account Structure –eForms,ENSRC, Invoice Voucher, Purchase Req, Travel Req, IDC, etc.&FMS Query27

28. eForms Budget Section:

29. IDC CHARGE AND CREDIT SECTIONS:EXPENDITURE TRANSFER CODINGREVENUE TRANSFER CODING

30. You Create a Query (Question) to FMSQ – by Inputting Account Structure Elements

31. ACCOUNT STRUCTURE COMPONENTSONE-BY-ONE

32. TRANSACTION CODE (TC)The Transaction Code tells the Accounting system what to do, by telling the system to make a specific entry (a Debit and a Credit) to specific accounting ledgers.The TC is like the verb in a sentence – it determines what ACTION the accounting system should take.We’ll come back to this in a short exercise.32

33. Appropriation IndexThis continues our earlier discussion of Funds and Fund Accounting.

34. Each of the Accounting Funds has a Code and a NameThe 3 Digit Code is Called the Appropriation Index34

35. The Appr Index Tells the System:What container we are trying to funnel our accounting (transaction) record into.The general source of the funding we will be receiving/using.If there are specific rules that apply to its use, we can find out by way of the Appr. It’s the “great dot connector” that puts charges on our budget into the right container (and taps the right funding source).35

36. APPR INDXFUNDING SOURCETYPE OF MONEYHOW WE RECEIVE IT101STATE APPROPRIATIONSTATEREIMBURSEMENT149TUITION REVENUESTATEREVENUE    145GRANTS & CONTRACTSPUBLICREVENUE148SELF-SUPPORTPUBLICREVENUE522S&A FEESPUBLICREVENUE524BOOKSTOREPUBLICREVENUE528PARKINGPUBLICREVENUE569FOOD SERVICESPUBLICREVENUE570ENTERPRISEPUBLICREVENUE    840AGENCYFEDUCIARY“DONATION”846FINANCIAL AIDPROPRIETARYVARIESAPPROPRIATION INDEXES: Working List36

37. APPR INDEXES : Example College Programs37101STATE APPROPRIATION148SELF SUPPORT569FOOD SERVICES STATE OPERATING BUDGETS ALL LAB FEES FOOD SERVICESUTF123WORKER RETRAININGE LEARNING570ENTERPRISESTATE OPERATING BUDGETSMAC INTENSIVE ENGLISH PROG149TUITION REVENUEFACILITIES RENTALS STATE OPERATING BUDGETS448PRINTING FUNDOTHER RENTALS145GRANTS & CONTRACTS460MOTOR POOL840AGENCY INTL STUDENT PROGRAMS VARIOUSALL FEDERAL GRANTS522S&A FEESALL STATE GRANTS ALL STUDENT PROGRAMS846FINANCIAL AIDALL OTHER GRANTS VARIOUSALL CONTRACTS524BOOKSTORE  849STUDENT LOAN147LOCAL CAPITAL PROJECTS528PARKING850WORK STUDY

38. Program Index (PRG) The Program Index identifies what program within the colleges operations is involved in the transaction.There are two pieces – the Major Program (first two digits) and the Sub Program (third digit)----------------------------------------------------------------------Example: “011”Major Program is 01 “Instruction”Sub Program is __1 “Academic Instruction for credit only”38

39. Major Program Index Examples39

40. PROGRAM INDEX: EXAMPLES40

41. ORGANIZATION INDEX (ORG)The Organization Index identifies the Campus, and Department (to a certain degree)The combination of your Program Index and Organization Index is you Budget NumberThat combination is unique in the SCD District - there is only one such combination in the accounting and budget systems41

42. StructurePRG INDXORG INDEXCode0112G03TranslationInstruction- Credit ProgramsCentral Campus HumanitiesORG INDX - FIRST CHARACTERDESCRIPTIONADISTRICT OFFICE OPS1DISTRICT-WIDE OPS2CENTRAL3NORTH4SOUTH5SVIORG INDEX: FIRST CHARACTER CONVENTIONBUDGET NUMBER EXAMPLE: 011-3G0342

43. An Analogy You Might Try, to help remember construct - Think Area Code and Phone Number:APPR PROG-ORG148 011-2708AREA CODE PHONE-NUMBER206 934-5660As we’ll see in a minute, you need to remember to “dial in” the right APPR to transact correctly.

44. Expenditure Objects are DescriptiveOBJECT (OBJ)OBJECT TITLE (DESCRIPTION)A SALARIESB BENEFITSC CONTRACTED SERVICESE GOOD & SERVICESG TRAVELJ EQUIPMENTK COMPUTER EQUIPMENTN CLIENT SERVICESP LEASESS INTER-AGENCY REIMBURSEMENTST INTRA-AGENCY REIMBURSEMENTS44Object level is used more in Budget Plans, and in summarizing data than in recording transactions

45. Add a Second Character (Sub-Object), and the Description becomes more DetailedObjectSub –ObjectSubObject LevelDESCRIPTIONE_EGOODS & SERVICESEAEASUPPLIES & MATERIALSEBEBCOMMUNICATIONSECECUTILITIESEDEDRENTALS & LEASESEEEEREPAIRS/ALTER/MAINTEFEFPRINTING & REPRODUCTEGEGEDUCATION & TRAININGEJEJSUBSCRIPTIONSEKEKFACILITIES & SERVICEELELDATA PROCESSING SRVCEMEMATTORNEY GENERAL SRVENENPERSONNEL SERVICESEPEPINSURANCEERERPURCHASED SERVICES45

46. Account Structure ElementsExpenditure Transaction w/o Structure:0021480112700EG $125.00002 1480112700 EG   TCRAPPRPRGORGOBJSOBJSSOSRCSSRCTransaction with Structure:46Translation: An expenditure transaction in the self-support fund, budget 011-2700, for registration fees in the amount of $125.00

47. Account Structure Elements (fill in the blanks)Expenditure Transaction w/o Structure:0021480112700EG $125.00     TCRAPPRPRGORGOBJSOBJSSOSRCSSRCTransaction with Structure:47Translation: An expenditure transaction in the self-support fund, budget 011-2700, for registration fees in the amount of $125.00

48. Revenue Source Codes (SRC)Revenue Source code tells us exactly that – the source of the revenue received. And, to a certain degree, tells us something about how the money should be used.Examples: 0424 – Tuition Revenue0430 – Dedicated Student Fee (e.g. lab fees)48

49. SRC REV ExamplesSRC REVDESCRIPTION0384DEPT OF EDUCATION0402INCOME FROM PROPERTY0424TUITION & FEES0430DEDICATED STUDENT FEES0485IMMATERIAL ADJ-PRIOR0499OTHER REVENUE0541CONTRIBUTIONS & GRANTS0542LOCAL GOV CONTR/GRNT0543ST GOVE CONTR/GRANT0621FUND TRANSFERS - IN0622FUND TRANSFERS - OUT0782INTRA-FUND TRANSFER0999OPENING ENTRIES49

50. Revenue SubSource (SSRC)The SSRC helps us separate the revenue sources more exactly. The SSRC is “tied” to the Revenue Source (SRC) and to individual budgets.The SSRC is also known as FEE CODE (they are the same thing).50

51. Revenue Transaction w/o Structure:02314801127000430HR $70.00023 1480112700   0430HRTCRAPPRPRGORGOBJSOBJSSOSRCSSRC51Transaction with Structure:Translation: An revenue transaction in the self-support fund, budget 011-2700, for dedicated student fee, Electronics Lab - in the amount of $70.00

52. Revenue Transaction w/o Structure:02314801127000430HR $70.00    TCRAPPRPRGORGOBJSOBJSSOSRCSSRC52Transaction with Structure:Translation: An revenue transaction in the self-support fund, budget 011-2700, for dedicated student fee, Electronics Lab - in the amount of $70.00REV Transaction: Fill in the Blanks

53. 002 1480113700 EG   Transaction CodeTrans ReverseAppropriation IndexProgram IndexOrganization IndexObjectSub ObjectSubSub ObjectRevenue SourceRevenue SubSourceTCRAPPRPRGORGOBJSOBJSSOSRCSSRC023 1480113700   0430HRTransaction CodeTrans ReverseAppropriation IndexProgram IndexOrganization IndexObjectSub ObjectSubSub ObjectRevenue SourceRevenue SubSourceTCRAPPRPRGORGOBJSOBJSSOSRCSSRCExpenditure TransRevenue Trans53

54. Budget is Your PlanAccounting is RealityThis is important to remember….

55. Your Budget is the result of constructing your plan to spend money. When put online, your budget also represents an approval to spend and its limits.

56. The Accounting Record (of revenue and expenditure transactions) displays the reality of what has actually happened.

57. Generally speaking…. we have two types of “fiscal reports”:Budget Status Reports – reports that combine Budget (Plan) with summarized (added up) data from Accounting (Reality) transaction-by-transaction detail reports.Accounting Only Reports - detail revenue and expenditure reports (including Payroll reports) that contain transaction-by-transaction records of what has happened (i.e. ground level view).

58. FMS Query 17-18 Budget ReportAPPRPRG-ORGSOBJ SSOBSRC REVDESCRIPTIONPERM BDGTTEMP BDGTFISCAL YR BDGTEXP/REV AMOUNTENCUMB AMTBALANCE1490432J00AB01 PERY, JACQUELINE75,589075,58955,752.44019,836.56149 AC99 VARIES045,57845,57818,383.58027,194.42149 AD01 VARIOUS1,88601,886768.9401,117.06101 AK04 GUY, GEORGE B45,828045,82821,768.32024,059.68101 AK05 TIANT, LUIS19,758019,75813,995.2505,762.75101 AK06 KOEPCKE, JULIANNE39,516039,51621,939.60017,576.40101 AK07 HART, BETH35,040035,04022,906.86012,133.14101 AK10 MCNEISH, CHIPPY38,556038,55626,346.62012,209.38101 AK11 SUNDQVIST, WILLE37,404037,40424,820.00012,584.00149 AM01 VARIOUS10,540010,54016,546.900-6,006.90Object: A Total:  304,11745,578349,695223,228.510126,466.491490432J00BA OASI23,65214,42238,0747,255.38030,818.62101 BA OASI84,078084,0789,776.27074,301.73101 BB RETIREMENT & PENSION00012,193.220-12,193.22149 BB RETIREMENT & PENSION0007,203.870-7,203.87149 BC MED AID & IND INS000806.050-806.05101 BC MED AID & IND INS0001,312.440-1,312.44101 BD HEALTH LIFE & DISAB00033,672.900-33,672.90149 BD HEALTH LIFE & DISAB00013,059.400-13,059.40Object: B Total:  107,73014,422122,15285,279.53036,872.471490432J00E  5,72505,7250.0005,725.00149 EA SUPPLIES & MATERIALS0002,602.460-2,602.46149 EF PRINTING & REPRODUCT0001,126.520-1,126.52149 EG EDUCATION & TRAINING000880.000-880.00Object: E Total:  5,72505,7254,608.9801,116.021490432J00G  2,56502,5650.0002,565.00149 GC PRIVATE AUTO MILEAGE000553.420-553.42149 GD OTHER TRANSPORTATION000150.860-150.86149 GF OUT-OF-ST SUB&LODGIN000818.440-818.44149 GG OUT-OF-ST AIR TRANS0001,033.600-1,033.60Object: G Total:2,56502,5652,556.3208.68PRG_ORG: EXAMPLE BGT 17-18 Total:420,13760,000480,137315,673.340164,463.66FYR (17-18) Total:420,13760,000480,137315,673.340164,463.66Grand Total:420,13760,000480,137315,673.340164,463.66

59. FMSQ 17-18 Budget Rpt with Columns Identified

60. FMSQ 17-18 Budget Only (w/o Transaction & Balance Columns)

61. FMSQ 17-18 Budget Columns ONLY

62. The next segment pertains to what we call “Revenue Budgets”, which are for programs that receive revenues directly for services provided.(e.g., Int’l Programs, Continuing Educ, S&A Programs, Lab Fees, the MAC, etc.)

63. Why + and Why -

64. Why + and Why -

65. Why + and Why -This an “Accounting Thing”The system differentiates between Debits and Credits by using positive (+) and negative (-) valuesDebits are recorded as positives + Credits are recorded as negatives – This enables us to quickly tell if we are in balance

66. Increases in Expenditure are recorded as Debits (+ values)Increases in Revenues are recorded as Credits (– values)When Expenditures Equal Revenues, the sum is ZeroDebits are recorded as positives + Credits are recorded as negatives – This enables us to quickly tell if we are in balance