Welcome

Accounts Payable FY2010

Year-End

Closing Workshop

Presented by: Sandra King, Accounts Payable Manager

Office of Business Services

Importance of Year-end Closing

The College meets its obligations: Legal Financial Budgetary

BY Robert M. Preston, M.B.A., M.S.

Director of Financial Reporting and Operations

GOAL

To close the accounting books on time

To close the accounting books accurately

Ensure all vendors, employees and students payments are recorded in the proper year

Topics of Discussion Fiscal year-end processes Your role in the closing Key due dates and submitting documents

related to: Vendor Invoices and Travel Related Payments Petty Cash & Employee Reimbursements Invoices Corrections Accruals Carry Forward Purchase Orders Check Deposits

Your Role in the Closing

Ensure all deadlines are met You have followed the year-end close

processes. Ask questions if you need help!

How are we going to achieve our goal?

staying current ensure all payment requests for FY 10 has been forwarded to Accounts Payable

Meeting the deadlines (making sure invoices are in the hands of Accounts Payable and not inter office mail by the due dates)

Asking for clarification and help Ensuring you have received invoices from

vendors for all Goods & Services completed and received by June 30, 2010.

What is the Fiscal Year? Montgomery College’s fiscal year runs

from July 1 to June 30th

New Fiscal Year for FY11 starts on July 1st 2010

Specific year end deadlines are set in order to close the books and prepare annual financial statements

What Determines the fiscal Year?

The Date of Receipt of Goods and Services

Determines the fiscal year expenditure

If received before June 30th - FY10

If received after June 30th - FY11

Travel & Employee Reimbursement

All local and long distance travel completed as of 6/30 should be recorded as an expense of FY 2010

All travel reports and employee reimbursements processed before 6/30 will be charged to FY 2010

All travel reports and employee reimbursements submitted after 7/10 will be paid out of the next fiscal year FY11 budget.

The department must submit paper work and original receipts to Accounts Payable by June 30, 2010.

Blanket Purchase Orders

All (B#) Blanket Purchase Orders will be closed as of June 30th.

Departments must make sure they have received and approved all invoices for the blanket purchaser orders

Example –June payment for a lease

What happens?

If the final June invoice is not received by June 30th for Blanket Orders or other types of payments, you must contact the vendor immediately to forward an invoice to Accounts Payable

If no invoices is received by July 10th, you must submit an accrual listing with complete information and backup to Accounts Payable

Accrual

What is an accrual?

If goods have been received or services performed by June 30, 2010, the invoice amount is accrued to be booked in the correct year (FY10).

Accruals – continue

At the end of FY10, Accounts Payable has to accrue our obligations. An obligation is any amount that the College owes. The obligation amount is based on: Amount of unpaid invoice. Amount of items received, but not yet paid. Amount reported by college or

departments.

Accruals - continue

Accruals will appear on your June –FY10 ledger

If invoices are over the accrued amounts the differences will be charged to the next fiscal year- FY11

Accruals – continue Example of Accrual

Submit a PO for a computer costing $3,200 in May -The computer is received in June

The invoice is received and processed in July (in new fiscal year)

Because the computer was received before year- end, it represents an expense to fiscal year 2010

 

Fiscal Year _____________          MONTGOMERY COLLEGE

ACCOUNTS PAYABLE

ACCRUAL REQUEST FORM   

Fund, org, account, program

Dollar Amount Vendor Name PO#

Inv or Order #

Date Received-

goods/services Reason For Accrual

Example            

1110-225558-6020-0010 $1,500.00 Formost Printing Inc 50944555 A2588891 6/11/09Invoice not received by

6/30                                                                                                                                                                                                     `                                                                           

NOTE: ONLY FOR GOODS & SERVICES RECEIVED PRIOR TO JUNE 30.        **SUPPORTING BACKUP DOCUMENTATION MUST BE ATTACHED (Contract, Packing List, Quote, Invoice)    Must be received in Accounts Payable no later than July 10.

Account Manager's Signature:     Date:   Ext.______________

Account Manager (Print)    

Department:    

PRINT FORM    MAIL TO: Accounts Payable , MKE 230-Attn Sandra King , AP Manager      

Accounts Payable Accrual Diagram

ACCURALSTRANSACTION

TYPEPO

EncumberedFY10

Received Goods and Services (06/30/10)

InvoiceReceived

07/01-07/09

Accrual Required

If not paidin Banner)

Process

Direct Payment Invoice

NOPO Required

Actual goods or services rec’d by

06/30/10.

YES or NO YESComplete On-line

Accrual FormSubmit to AP with

invoice or supporting back-up

Purchase OrderExpenditure

YESActual goods or services rec’d by

06/30/10)YES YES

Complete On-line Accrual Form

Submit to AP with invoice

Purchase Order Expenditure

YES Actual goods or services rec’d by

06/30/10

NO Invoice

Estimate Accrual

YES Complete On-line Accrual Form

Submit to AP with PO copy, supporting

back-up

The accrual form

Use the accrual form to submit your request. The form is located on the Accounts Payable website

www.montgomerycollege.edu/departments/obs

Required information

Please include: Vendor name Amount Account number Account manager approval Purchase order number Supporting Backup Reason for Accrual

Supporting Documents

Documentation To support your accrual you may include the following: Copy of the PO, Contract for services Packing Lists Order Form/Confirmation Proof of Delivery Receipts Written documentation from vendor on letterhead

Carry forward Encumbrances/Purchase Orders

What are carry forward encumbrances/purchase orders? Purchase orders that are

established in current fiscal year (FY10), but no payment and receipt of goods or services are completed by June 30, 2010.

What should be done to request carry forward purchase order?

A listing must be completed using the carry forward request form and forwarded to Accounts Payable by July 10, 2010.

Written details supporting the carry forward purchase orders must be provided

The Balance of the purchase order can be carried forward to be used in FY11.

Important to Know about Carry Forward Purchase Orders

Payment will not be made to vendors until August -of the next fiscal year once FY10 budgets are rolled and the year is closed.

Invoice Corrections

Journal entries-account cleanup

CUT off Date is July 10, 2010 for all corrections

Invoice journal correction form must be completed and forwarded to Accounts Payable with supporting backup documentation.

Prepayments

Expenses for the coming fiscal year that require payment prior to July 1st can be submitted to Accounts Payable clearly marked FY 11 Examples: Subscriptions and membership

renewals, insurance.

Closing Deadlines

June 15th Last day for P-card Charges June 30th Last day to submit the following

Petty Cash Reimbursement Local Travel under $25

July 10th, all FY10 invoices, travel, employee reimbursements

Final Cut off Date All invoices, travel and requests for

payment must be received in Accounts Payable no later than July 10, 2010 at 5:00 p.m.

Accrual listing and supporting backup must be received July 10, 2010 at 5:00.

Carry forward purchase order requests form are due by July 10, 2010.

Closing- PO (Encumbrances)

Encumbrances balance on Purchase Orders as of June 30, 2010 are carried forward to FY 2011

If the departments is not using open purchase orders in FY11, the PO can be closed.

please submit the request to Accounts Payable by June 30th.

Deficits/Over Expenditures

Units are responsible for monitoring balances in their accounts throughout the year.

A deficit is when the cash balance in general ledger is negative.

Deficits must be cleared in a timely manner, but no later than June 30th (fiscal year end)

Refund checks for deposit Do not hold checks. Please bring all checks

sent directly to your department to the Cashier’s window as they are received.

Cash Closing – done on June 30th June 30th deposits will be recorded to fiscal

2010 If you deposit money after 6/30 , the funds

will appear on your FY11 ledger.

Where do you go for help?

Visit Accounts Payable Website:

www.montgomerycollege.edu/departments/obs

Contact Accounts Payable at X75338

Email Accounts Payable AccountsPayable@montgomerycollege.edu

Questions?