1. Reading Account Statements & Expenditure Processing February 17, 2011 Sponsored Programs Accounting

2. Workshop Goals/Objectives Overview of which documents PI receives on monthly basis and what they are How to understand your monthly statements Understand Expense Processing (purchasing card / travel) Answer any questions

3. Where can I find help? Call us! Really – we’re friendly people! 487-2244 Reference manual at: http://www.mtu.edu/research/references/training/docs/reference-manual.pdf Our website www.mtu.edu/research/adminstration/accounting

4. Monthly Statements – Who gets them? Beginning of Month statements are sent to: Principal Investigator / Financial Manager Department Coordinator These reports are sent via Email

5. What are these reports??? Budget vs. Actual Report Shows a summary of the budgeted line items as well as current month and project to date expenses Organization Detail Report Lists all transactions (expenses) for the period

6. What are these Reports??? Open Encumbrances Report Lists all open encumbrances Gross Earnings Report Lists Employees on project, hours worked and amount charged

7. Budget Vs. Actual Report

8. Open Encumbrance Report

9. Organization Detail Report AKA: Transaction Detail

10. Gross Earnings Report 

11. How are these reports related?  All reports tie together!  Total Payroll Expenses are found on: Budget vs. Actual, Gross Earnings & Org. Detail 

12. How are these reports related?  Non Payroll expenses can be found on the Budget Vs. Actual and the Organization Detail  Total Encumbrances can be found on the Budget Vs. Actual and the Open Encumbrance Report 

13. Tying it all Together Actual Vs. Budget Report Transaction Detail Report Gross Earnings Report

14. Tying it all Together Actual Vs. Budget Report Transaction Detail Report Note that the $210.15 charge shown on the Actual Vs. Budget Report is comprised of two different charges, as shown on the Organization Detail Report

15. Tying it all Together Actual Vs. Budget Report Open Encumbrance Report

16. Wondering how much you have left to spend? For Projects with no cost share: Take the BALANCE amount as seen at the bottom of the Budget vs. actual report LESS: the total encumbrance amount times the F&A rate DIVIDE that total by 1 + the F&A rate

17. Wondering how much you have left to spend? Page 2 of Budget vs. Actual Report

18. Wondering how much you have left to spend? Example: Balance: $50,036.55 (from Budget vs. Actual) Less F&A on encumbrances: $4,500 *.56 = $2,520 = $47,516.55 Finally...$47,516.55 / (1+.56) = $30,459.33 $30,459.33 is the amount of direct expenditures remaining on this project

19. ANY QUESTIONS?

20. Expense Processing Purchasing Credit Card Travel

21. Purchasing Card Purchasing Card Agreement – on Purchasing’s web site http://www.admin.mtu.edu/acct/dept/pur/purchcard/index.html http://www.admin.mtu.edu/acct/dept/pur/purchcard/index.html Supervisor approval required Banner Index must be provided as default – cannot be a sponsored index Pick up card from Purchasing – Citizen’s Bank 5 th Floor

22. Purchasing Card Credit Limit $4,999.99 (includes shipping) Supplies Travel – airfare, car rental, lodging, conference fees, gas for rental car No food, meals, entertainment No personal items No prohibited items (listed on website) 22

23. Card Holder Responsibilities Keep all receipts (3 years or 7 years) Reconcile receipts to monthly statement Reallocate charges to the appropriate index and account code Include who/what/when/where on Visa Information Management System for travel expenses Supervisor must sign monthly statement – Verifying purchases are valid and receipts are on file 23

24. Travel Conference/Registration Fees – Purchasing Card – Check request Transportation – Mileage – current IRS rate of 51 cents per mile – Airline Tickets – Superior Travel Must complete an Advance of Funds form – Purchasing Card

25. Travel Lodging – Purchasing Card – Check request - deposits Meals – Per diem rates or actual expenses – Standard daily per diem $46/day – IRS Key Cities – higher rates – Return day – standard per diem rate – Actual expenses when hosting non-university personnel during travel

26. Business Meals and Banquet Report Must include a valid business purpose No alcohol Payee – can reimburse an employee or pay the vendor directly If paying the vendor, include the vendor in the Name field Include attendees and affiliations Include original receipts 26

27. Travel Expense Voucher Complete within 2 weeks of return List purchasing card expenses in appropriate section on voucher Reimbursable expenses – expenses not charged to the purchasing card, Superior Travel or paid via check request. 27

28. International Travel Complete an International Travel Request prior to departure Approval of department chair Submit to Office of Risk Management & Insurance

29. Accounting’s Web site http://www.admin.mtu.edu/acct/index.html Travel policies and procedures can be found under Departments. 29

30. ANY QUESTIONS?

31. Payroll Forms Determine the distribution of payroll up front by using: Account distribution Form Employee Status Forms Time override Payrolls weblink: http://www.admin.mtu.edu/hro/payroll/index.shtml http://www.admin.mtu.edu/hro/payroll/index.shtml Human Resources series of presentations: Getting to Know You Keeping It All Together Weblink: http://www.admin.mtu.edu/hro/ 31

32. Expenditure Reallocations

33. Reallocations are sometimes necessary to correct data entry errors found after reviewing monthly account summaries. 33

34. Two types of reallocations: (examples in your handouts) Accounting weblink to Expenditure reallocation form: http://www.admin.mtu.edu/acct/pdf/reallocation_of_expenditures.pdf Payroll weblink to the reallocation form: http://www.admin.mtu.edu/hro/forms/payrollreallocationform0608.pdf 34

35. Reallocation after 90 Days Expenditure reallocations to sponsored projects after 90 days of the original charge are generally unallowable. OMB Circular A-133, Federal guidelines for auditors specifically directs auditors to target: “projects that are complete or in the later stages of completion. Frequent, untimely, and poorly documented reallocations can be an indicator of poor internal control”. 35

36. Reallocations necessary and exceptions to 90 day requirement: Official paperwork for an award is delayed (could request an advance-Handouts): http://www.mtu.edu/research/administration/sponsored- programs/pdf/advance2.pdf http://www.mtu.edu/research/administration/sponsored- programs/pdf/advance2.pdf Charging another sponsored project while waiting for another to be awarded. A semester effort certification is received and there is a problem with the % effort. It is determined that an unallowable expense is charged to the project. When reallocating to another index under the same award. 36

37. Miscellaneous: Justification should always include: Why the expense was not originally charged to the correct project. How the expenditure relates/benefits the project being charged. Other to the sponsors and auditors: Reallocations charging one sponsor project to clear a deficit in another. Reallocations at the end of the project to spend the remaining balance. 37

38. QUESTIONS? 38