Fiscal Year-end 15 & 2015-17 Biennial Budget Build Workshop May 27, 2015 Small Agency Financial Services

Find Out and Understand Workshop Objectives Communicate and Inform our customers of important annual reminders about the state fiscal year close and the biennial budget build process. Find Out and Understand Who does what What’s required and what needs to be done Where the information goes When are the important due dates How the processes work and Why these are important

Payroll Important Dates June 15th - Cost coding for FY 16 due (dependent upon budget approval) June 30th - Comp time cash out July 1st - Payroll due June 16th - 30th activity Board/Commissioner stipends Commute Trip Reduction (CTR)

Questions about year-end payroll?

Cash Receipts Important Dates June 30th – cash cut off Checks dated 6/30 and before are to be recorded in FY15.

Cash Receipts Important Dates July 8th – submit invoice information to DES Finance for DES prepared invoices (on goods/services delivered by 6/30). DES will be sure to record and send your invoices to all agencies and colleges before 7/23.

Cash Receipts Important Dates July 23rd – deadline for submitting your agency prepared invoices (for goods/services delivered by June 30th) to state agencies and colleges. After this date DES will work with other agencies to balance Due to/from GLs for CAFR. Deadline: August 21st

Questions about year-end cash receipts?

Year-end Accounts Payable Purchases Invoices Cash Cut-off Accruals Travel Belated Claims

Purchases For FY15 funds, goods/services must be received by June 30th Mark date received on invoices/back up Include packing slips US Bank statements – Identify correct fiscal year of purchases on backup

Invoices Deadline: July 15th Split A45s between years: FY15 and FY16 Send to: DESsmallagencyap@des.wa.gov MS 41465 Split A45s between years: FY15 and FY16 Be proactive Track down invoices Set up new vendors ASAP 3 business days to set up vendor in AFRS 7 -10 business days to set up EFT/direct deposit

Cash Cut-off What does it mean? Accrual vs. Cash Basis State Treasurer deadline for cash transactions is June 30 Accrual vs. Cash Basis Payments or fund transfers after June 30 are considered accruals for FY15, since the Treasurer will move the money in FY16 Different trans codes necessary for moving expenses between funds

Accruals Deadline: July 24th Determine if Amount is Estimated or Actual Fill out template Backup needed – Contracts, purchase orders, field orders, quotes, etc. Backup needed – Reports, analysis, etc.

Accrual Template

Travel Deadline: July 15th Submit it! Approve it! Send to: DESsmallagencytravel@des.wa.gov MS 41465 Submit it! Make sure employees submit requests timely Approve it! Make sure approvers approve requests timely Pending reimbursements? Let us know!

Belated Claims What are they? What do you have to do? Old year expenses paid with new year funds What do you have to do? Get Budget analysis Get OFM approval

Questions about AP? Key Dates July 15 - All payment documents must be received by DES July 15 - All travel reimbursement requests must be received by DES July 24 - All expenses to be accrued must be received by DES.

Let’s Take a Break Five minute break

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Capital Assets A capital asset is Any tangible or intangible assets held and used in state operations, which have a service life of more than one year. SAAM 85.60.10 $5,000 or more in value for a tangible asset OR is a small and attractive item, such as laptops, cameras, smart-phones, special equipment, etc. $1,000,000 or more in value for an intangible asset.

Accounting for Capital Assets Each agency is required by SAAM to complete a physical inventory of capital assets at least once a biennium SAAM 30.45.10 What we need from you Perform a physical inventory of items. Inform SAFS budget analysts of any added items during the period or any items that were disposed of. What you can expect from us A most recent listing of capital assets for your agency. Input changes into CAMS to ensure for proper reconciliation of General Ledgers for year end and disclosure reporting.

Questions about Capital Assets? By June 30th complete a physical inventory By July 15th submit all payments of equipment received on or before June 30th. By July 20th notify your SAFS budget analyst of any unrecorded assets or disposed assets.

Disclosure Forms Disclosure forms are how the agency provides OFM with detailed financial information for use in preparing the state comprehensive annual financial report (CAFR). Disclosure forms also provide assurances that the agency is following good accounting and internal control practices. SAAM 90.40.10 Each agency is REQUIRED to submit disclosure forms to OFM. SAFS will prepare all the necessary disclosure forms.

State Disclosure Required state disclosure forms Miscellaneous disclosure form Financial disclosure certification form Other common state disclosure forms Cash on hand and in bank Capital assets – summary of activity Lease disclosure Liabilities by major class Deferred and unearned revenue

Federal Disclosure Required federal disclosure forms Federal assistance certification Federal financial assistance direct Federal identification numbers Other federal disclosure forms Federal assistance received from nonfederal sources Federal loan balances Federal nonfinancial assistance Federal nonfinancial assistance inventory balances

Finalize the Forms What we need from you Your SAFS budget analyst prepares the forms and will send these to you with a cover memo. Review the forms. Sign the state/federal certification State due to OFM by September 16th Federal due to OFM by December 4th (signing delay) Email your signed certification form to back to SAFS budget analyst (end of August). Provide any required supplemental information (i.e. pending lawsuits).

Questions on Disclosures? Mid July, State Disclosure system opens, your DES budget analyst will be working with you to complete the forms. Late August, you will receive a memo and copy of the disclosures from DES. Return the signed certification sheet promptly to DES budget by email.

Allotments Now to the preparation of your next two year spending plan for the 2015-2017 Biennium.

Where are we in the Budget Process? We are here. Preparing for here.

Allotments - Basic Process SAFS will begin drafting the two year spending plan based on historical spending. We’ll add in the changes we are aware of such as: Changes to central service costs Step increases Any raises submitted as part of the compensation data model last year Any other known changes

Allotments - Basic Process We’ll prepare the plan in a format that separates and allocates fixed and discretionary costs to show you where your spending flexibility may be. Fixed Costs are expenses that do not change as a function of the activity of the business. Discretionary Costs are everything else.

Allocate Fixed Costs

Allocate Discretionary Costs

Questions about the basic process? Allotments Questions about the basic process?

When we meet with You Next, budget meetings will be scheduled in June or July. We’ll meet with your agency to discuss changes to the draft spending plan and finalize it. Once final, SAFS will electronically submit the spending plan to OFM.

Allotment Meeting Goal The goal of the allotment meeting is to resolve any difference between the draft spending plan and the authorized spending authority.

Documents SAFS will bring Expenditure Authority Schedule. Budget bill. Recommendation summary. Copies of the central service model. Salary projections. Preliminary estimates of fixed and discretionary costs.

Questions about the budget meetings?

What we need from you We need your help to know what is changing. The earlier we know, the more we can incorporate in the initial draft we bring out to you.

What we need from you Some examples of what we may need from you are: Grant or contract award amounts Updated interagency agreements or leases Planned raises, new hires, and retirements Updated revenue estimates Changes due to legislative action or agency restructure Impacts of changes in your line of business, practices, or policies Unusual costs Equipment needs

You WILL hear from us Who? Effective when? For how long? How much? Over and Over and Over and Over… Who? Effective when? For how long? How much? How many? When we are done with known factors, where do you want the remaining balance/cut to go?

Remember… Remember the goal of the meeting? The goal of the meeting is to resolve any difference between the draft spending plan and the authorized spending authority. If we cannot achieve a plan for all the spending authority, a due date for additional information will be assigned.

Next Steps SAFS will take your input and incorporate it into the spending plan to create a final spending plan. We will send your spending plan to you for review and approval. Once final, SAFS will electronically submit the spending plan to OFM.

OFM Allotment Deadlines August 3rd August 7th August 11th SAFS internal deadline is about two weeks prior. We will contact you with a deadline. If you need to adjust your due date for commission or board approval please contact your SAFS budget analyst.

Final Thoughts For those agencies with fiscal staff, we will work with you to determine which areas you need assistance from SAFS. FY16 Supplemental – Start working on in September.

Questions on Allotments? Allotments and what we need from you June or July, SAFS will schedule an allotment meeting with your agency.

Q&As Thank you for your questions during the workshop. We have captured those questions and answers below. Q: If it is after July 15 (payables due date) and before July 24 (accrual due date), do we send in the invoice for payment or accrue it? A: You will need to do both. Include it in the accrual template AND send it over for payment in the new fiscal year (FM01). Q: What general ledgers (GLs) will the accruals hit? A: The accruals will be in GL 6505 Accrued Expenditures/Expenses and GL 6560 Estimated Accrued Expenditures/Expenses. Q: How long will the budget allotment meetings be? A: We are scheduling one hour meetings to review allotments with your agency. Q: How can the agencies get invoices to DES to pay by July 15 or accrue by July 24 when the initiating agency doesn’t mail the invoice out until July 23rd? A: If DES does not receive the invoices for accrual prior to July 24, it is best to send DES an estimate accrual.