Budget and Fiscal Management The accounting basics: preparing for the Mid-Year Re-Allocation Report Lucinda Aborn, CMP Coordinator

Accounting Overview Fund Accounting Fund Structure Sources of Revenue DSPS Revenue Sources Expense Categories

Fund Accounting Governmental agencies operate on a fund accounting basis Each fund is a self balancing set of accounts Fund accounting is used as a control device to separate financial resources to insure funds are used for their intended purpose

Fund Definition: An independent fiscal and accounting entity with a self-balancing set of accounts for recording cash and other financial resources, together with all related liabilities and residual equities or balances, and changes therein.

Unrestricted Funds Definition: Resources available for general District purposes to be used to full-fill the institution’s education mission

General Fund Definition: The fund used to account for the ordinary operations of the district. It is available for any legally authorized purpose not specified for payment by other funds.

Restricted Funds The use of resources received are restricted by laws, regulations, donors, or other outside agencies for the operation and support of specific educational programs Restriction defined by State or Federal not local Boards Accounting for separately from the general operating fund May be subject to audit by the agency granting the funds

Program Source of Funding Examples DSPS EOPS Student Success and Support Programs Student Equity Programs CalWorks Vocational & Technical Education Act (VTEA) General Fund

Formula Budget Definition: Objective formulas based on systematic data are used to distribute resources to ensure each program or entity is receiving a fair share. This is most often used at the state level.

Allocation Definition: Division or distribution of resources according to a predetermined plan.

DSPS Restricted Categorical Fund Provided for the restricted purpose of providing services to students with disabilities Amount of funds determined by allocation formula Currently DSPS Annual Allocation received in the 6th month of the fiscal year (December) Mid-Year Re-Allocation due in late March End of the Year Report – Submitted through SSARCC See new Title 5 Regulations changes on the Chancellor’s Office website: http://extranet.cccco.edu/Divisions/StudentServices/DSPS/StatutesRegulations.aspx Student Service Automated Reporting for Community Colleges: http://extranet.cccco.edu/Portals/1/SSSP/DSPS/Home%20Page/2016_SSARCC_DSPS_Handbook_rev_11.02.16.pdf DSPS Solutions : Section 10 Budget and MIS http://www.dspssolutions.org/resources/section-ten-budgetmis

DSPS Allocation Parts College Allocation DHH Distribution Access to Print and Electronic Information = Total College Funding See the Chancellor’s Office Allocation Page http://extranet.cccco.edu/Divisions/StudentServices/DSPS/Allocations.aspx

Full-time Equivalent Student (FTES) Definition: An FTES represents 525 class (contact) hours of student instruction/activity in credit and noncredit courses. Full-time equivalent student (FTES) is one of the workload measures used in the computation of state aid for California Community Colleges. (See form CCFS-320, “Apportionment Attendance Report.”)

Budgeting Definition: The process of allocating available resources among potential activities to achieve the objectives of an organization

Coding Definition: A system of numbering or otherwise designating accounts, entries, invoices, vouchers, etc., in such a manner that the symbol used reveals quickly certain required information. An example is the numbering of monthly recurring journal entries to indicate the month and the nature of the entry and the numbering of invoices or vouchers so that the number reveals the date of entry.

Accounting Code Definition: A sequence of numbers and/or letters assigned to ledger accounts to classify transactions by fund, object, activity, etc.

Activity Definition: A set of institutional functions or operations related to an academic discipline or a grouping of services.

Activity Code Definition: A set of institutional functions or operations related to an academic discipline or a grouping of services.

Activity Codes 0100 – 5900 Instructional 6000 – 7900 Administration & Support

Expenditures Definition: Payment of cash or cash equivalent for payroll, goods or services, or a charge against available funds in settlement of an obligation.

Expense Categories 1000 Academic Salaries 2000 Classified & Other Non-academic Salaries 3000 Employee Benefits These three areas are “People” costs

Expense Categories, p.2 4000 Supplies and Materials Consumable 5000 Other Operating Expenses & Services Intangibles 6000 Capital Outlay Long Term 7000 Other Outlay

Unencumbered Balance Definition: That portion of an appropriation or allotment not yet expended or obligated.

Other Funding Sources used by DSPS Student Success and Support Programs (3SP) Student Equity Funds Federal Work Study CalWorks Work Study Vocational and Technical Education Act (VTEA) Medical-Billing Reimbursement (MAA) Grants/Foundation

Other College-Wide Issues Status of the State Budget Apportionment Deferrals – Delay in Payments to the College Cash Flow 50% Law Counselors and Librarians Technology Support Full time Faculty Obligation – FTFO FON (Full-time Faculty Obligation Number) Deferral vs. Waiver

Audit Definition: An official examination and verification of financial statements and related documents, records, and accounts for the purpose of determining the propriety of transactions, whether transactions are recorded properly, and whether statements drawn from accounts reflect an accurate picture of financial operations and financial status. Audit procedures may also include examination and verification of compliance with applicable laws and regulations, economy and efficiency of operations, and effectiveness in achieving program results. The general focus of the annual audit conducted on the district is usually a financial statement examination andcompliance audit.

50% Law The “50 Percent Law”, as defined in Education Code Section 84362 and California Code of Regulations Section 59200 et seq., requires California Community College districts to spend each fiscal year 50% of the current expense of education for payment of salaries of classroom instructors. The intent of the statute is to limit class size and contain the relative growth of administrative and non-instructional costs. The Annual Financial and Budget Report (CCFS-311) includes actual data on the district’s current expense of education and compliance with the 50% Law. (See Current Expense of Education.)

Budget and Accounting Manual Definitions Source – Budget Accounting Manual (BAM) Accounting information is posted on the Chancellor’s Office website link below: http://extranet.cccco.edu/Divisions/FinanceFacilities/FiscalStandardsandAccountibilityUnit/FiscalStandards/BudgetandAccountingManual.aspx

Proceed to Discussion Forum Questions For further information refer to: Chancellor’s Office web page http://www.dspssolutions.org/resources/section-ten-budgetmis/chancellors-office-documents-relating-to-dsps-allocation DSPS Solutions

Preparing Your Mid-Year Re-Allocation Report Module 4 Budget and Fiscal Management