Presentation on theme: "A 5x5 Model Webinar Compliance – Mastering the Annual Financial Report (AFR) Presenters – Lackisha Freeman – Janis Lane-Ewart – Brian Terhorst July 23,"— Presentation transcript:
A 5x5 Model Webinar Compliance – Mastering the Annual Financial Report (AFR) Presenters – Lackisha Freeman – Janis Lane-Ewart – Brian Terhorst July 23, 2013 1pm EST 5x5 Model Webinar
COMPLIANCE 5x5 Model Webinar
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What We’ll Cover Schedules A – F Areas of Concern/College University Licensees Understanding Changes In AFR Variance Maintaining Compliance In Reporting Wrap-up and Questions
Schedule A – Direct Revenue Track direct revenue sources eligible as NFFS with specific CSG sub-code in accounting process – Schedule A being revised into specific sections to address OIG concerns about revenue types and types of revenue transactions. In-kind revenue is not to be reported on Schedule A Direct revenue reported as Source – such as underwriting, tower rental revenue, for-profit business community Direct revenue reported as Form/Type – such as auction and special fundraising revenue Direct revenue sources not meeting NFFS must be reported in “NFFS X” links located throughout Schedule A Pay close attention to the exclusions in Business & Industry/Line 9; Membership Premiums/Line10; Special Fundraising Activities/Line 14; Major Individual Donors/Line 19 and Other/Line 20 (i.e. sale of parking vouchers to volunteers).
Schedule B – Indirect Admin. Support Indirect administrative support an important portion of an Institutional Licensees’ AFR reporting. Institutional and station staff determine method of calculating indirect administrative support – OSA, F&A, MTDC, Basic Method or Grantee-Developed Method (requires pre-approval from CPB). GM, Institutional Finance Director and/or Advancement must have good & open working relationships. Station’s Chart of Accounts can be structured to feed directly into AFR, especially Schedule B.
Areas of Concern/College University Licensees GM not included in compiling AFR reporting process nor in direct communication with Finance Director, Comptroller or Audit team. Various departments reporting discrete areas of revenue and/or expense and GM is unaware of source or form as it related to AFR Relevant parties/departments only know segments of NFFS eligibility- limited effort at coordinated learning and areas of expertise.
Schedules C & D – In-kind Contributions Important to know all eligible NFFS sources of in- kind contributions. Trade revenue and sponsorships eligible as NFFS with appropriate documentation and evidence of fair market value. Review checklist of eligible NFFS in-kind donations of volunteer services. Ensure all contracts for trade revenue, sponsorships and in-kind donations from community members are documented on appropriate letterhead and with original signatures.
Schedule E - Expenses Required to report all expenses & investments in capital assets. Develop formula for calculating functional expenses by departments, square footage or functional allocation and adjust annually based on changes in staffing, building space, etc. Schedule E is being revised to eliminate recurring mistakes in process of reporting functional allocations; sub-parts to be added to ensure discrete accounting method is employed for tracking CSG grant.
Schedule F – Reconciliation With Audited Financial Statements All revenue sources and expenses MUST track back to audited financial statements. Common errors such as rounding or reporting invalid source of direct revenue or expense result in non-reconciliation of Schedule F. Reconciliation mistakes are linked to misreporting of ineligible NFFS items – check Schedules A, C&D for areas where “NFFS X” should have been reported.
Understanding Changes In Variance Important to review variances over 10% - up or down with staff and board members as part of annual financial planning process. Annual financial reports are maintained online for 3-4 years – quick method for reviewing financial status over time. Functional allocations may be source of variance and affecting dips in variance – be sure to review calculations and rationale for assigned percentages regularly.
Maintaining Compliance In Reporting CPB’s Office of Inspector General is increasingly reviewing AFR’s for areas of non-compliance in discrete accounting methods. Repeated declines in certain revenue areas may lead OIG to review institutions compliance with overall CSG Communications Act requirements. OIG is increasing practice of issuing fines for non- compliance, in addition to reducing size of CSG grant – w/i last three months fines have been levied from $5,000 to $70,000.
Wrap Up Preparation/Gathering Information throughout the year essential to mastering AFR reporting. Discrete accounting and proper documentation to support ALL CSG revenue and expenses is vital to success. Check eligible and ineligible NFFS sources annually – reporting requirements to change. Make your audit team your best friend(s) – they are the key to your success in Mastering the Annual Financial Report.
Need Direct Assistance from CPB? Send questions to email@example.com Call 202.879-9600. Stay tuned for more information on possible NFCB member service for CPB compliance consultations.
Thank You Rock-star presenters Lackisha Freeman and Brian Terhorst – and behind the scenes, Barbara Hamm Lee. NFCB extends a huge thank you to Latino Public Radio Consortium and Maria Diaz Di Capta for translation services. This webinar also made possible by the support of the Corporation for Public Broadcasting.