Year-end Instructions 31 July 2015 - University of Cambridge · 2015-08-06 · Year-End Jul-15 Finance Division Version 0.6 May 2015 2 1. The Year-End Process 1.1 An Overview The

Finance Division

The Financial Procedures Manual

Chapter 11

Year-end Instructions 31 July 2015

Issued: May 15 Also available on-line at: http:// www.admin.cam.ac.uk/offices/finance/procedures

Year-End Jul-15

Finance Division Version 0.6 May 2015 1

Contents

1. The Year-End Process .............................................................................. 2

1.1 An Overview 2

1.2 Summary Year-end Timetable 2

1.3 Module Close Dates 3

2. Year-End Checklist 31 July 2015 ............................................................. 4

3. Detailed Instructions & Timetable ........................................................... 5

3.1 Payroll & University Payment System (PAY) 5

3.2 Procurement (PO) 6

3.3 Accounts Receivable (AR) 8

3.4 Accounts Payable (AP) 11

3.5 Inventory (INV) 14

3.6 Research Grants (GMS) 16

3.7 Fixed Assets (FA) 18

3.8 General Ledger (GL) 18

3.9 Certification by Head of Department 23

4. Staff Contacts ...........................................................................................24

Appendix A: Expenditure Accruals ........................................................................... 26

Appendix B: Unearned (Deferred) Revenue ............................................................. 29

Appendix C: Other Debtors (Income Accruals) ......................................................... 30

Appendix D: Prepayments ....................................................................................... 31

Year-End Jul-15


1. The Year-End Process

1.1 An Overview The University’s financial year-end is 31 July, the date being set by the Higher Education Funding Council for England (HEFCE) and it applies to all higher education institutions. At the end of each financial year the University is legally required to:

Prepare a set of financial statements (with a prescribed format and content) which includes an Income and Expenditure Account and a Balance Sheet.

Be subject to an external audit, to enable the auditors to form an opinion on the financial statements. The auditors will examine not just the preparation of financial statements, but also whether or not funding has been used for the purpose that it was given. This will include a review of departmental accounts and records.

Submit the financial statements to the Finance Committee and to Council for approval prior to submission to HEFCE.

Submit its audited financial statements to HEFCE no later than 1 December. The financial statements provide important information on the financial position of the University and they can be used as a basis for future financial planning.

1.2 Summary Year-end Timetable May / June

o Preparation by departments for the year-end o Issue of year-end instructions

July

o Year-end seminars o 31 July year-end

August

o Departments processing final transactions by mid-August for the

financial year-end o Sub-ledgers (UFS modules) for the July period are closed down

September

o Departments finalise their own departmental accounts o General Ledger is closed for July o First draft of University level Financial Statements prepared

October

o Departments sign off their own departmental accounts o Final external audit visit

November

o Final set of consolidated Financial Statements are prepared and

external audit is completed o Financial Statements are approved by Finance Committee and by

Council o Financial Statements are signed and submitted to HEFCE

Year-End Jul-15


A number of important aspects should be taken into account by departments as they prepare for year-end, these include the following. Year-end instructions By complying with these instructions the most relevant

actions will be undertaken in the preparation of a department’s year-end accounts.

Financial Regulations

By following Financial Regulations and relevant accounting procedures during the year the integrity of financial information will be assured.

Matching expenditure with income streams

Departments may receive funding from a range of sources which is used to fund different activities. By making appropriate use of the funding and ensuring that the expenditure is accurately matched to the relevant funding stream, the integrity and accuracy of the financial position for each funding source will be assured.

Accuracy of transactions By focusing on the accuracy and completeness of

transactions the quality of a department’s accounts will be assured.

Year-end certificate

The Head of Department is responsible for the final sign-off of the Department’s annual accounts, which is an essential step in the year-end process. In signing off the accounts the Head of Department is helping to discharge his / her responsibilities under University Statutes and Ordinances.

1.3 Module Close Dates All modules will be closed at 5 pm on the following dates.

Module Departmental Close

Purchasing PO Fri 7 Aug

Accounts Receivable AR Tue 18 Aug

Accounts Payable AP Wed 19 Aug

Inventory INV Wed 19 Aug

Grants GMS Fri 21 Aug

Fixed Assets FA Fri 28 Aug

General Ledger GL Mon 7 Sep

SUMMARY These year-end instructions include:

Detailed instructions for all relevant aspects of the year-end process.

A summary checklist to be used to monitor progress in completing a department’s year-end accounts.

A list of staff contacts to provide advice and assistance.

Year-End Jul-15


2. Year-End Checklist 31 July 2015 JUNE / JULY Actions

Done

Last date by

w/c 15 Jun Last CUEF unit dealing date for 2014-15 Wed 17 Jun

w/c 29 Jun PAY: Final date for new staff contracts to be with HR Fri 3 Jul

w/c 6 Jul PAY: Final date for overtime claims input to Payroll Fri 10 Jul

w/c 20 Jul PAY: Final date for UPS input for 2014-15 lecturers’ expenses etc. Thu 23 Jul

w/c 27 Jul

AR: Empty all vending machines etc. and identify all cash, cheques received up to the end of July

Fri 31 Jul

INV: Physical stock take for all departments with stores Fri 31 Jul

AUGUST

w/c 3 Aug

PO: Run and review the Open Purchase Order Report Mon 3 Aug

AR: Process all cash, cheque and (if possible) PDQ receipts relating to 2014-15 and run the Receipt Register report(s).

Tue 4 Aug

AR: Run and review the Unapplied Receipts Register Tue 4 Aug

GL: Balance and post petty cash journal for 2015 Fri 7 Aug

PO: Action the Open Purchase Orders Report Fri 7 Aug

w/c 10 Aug

AR: Raise and dispatch 2014-15 internal trading AR invoices Wed 12 Aug

FA: Return the Departmental Fixed Asset Register to the Fixed Asset helpdesk with details of any amendments

Fri 14 Aug

w/c 17 Aug

AP: Process all 2014-15 internal trading AP invoices Mon 17 Aug

AP: Run the Invoices on Hold and Invoice Register reports. Identify any remaining internal trading invoices in dispute and notify Finance.

Mon 17 Aug

AR: Run the Ageing-7-Buckets report, review for bad debts and notify Finance Division

Mon 17 Aug

AR: Receipt any BACS receipts, bank transfers or unclaimed PDQ income Tue18 Aug

AR: Raise, complete and dispatch all external AR invoices Tue18 Aug

AR: Run and review the Incomplete Invoices report Tue18 Aug

AP: Process all July AP invoices Wed 19 Aug

AP: Process all staff and visitors’ expenses Wed 19 Aug

GMS: Review and clear research grant funds check failures and exceptions Wed 19 Aug

GMS: Correct research grant VAT errors Wed 19 Aug

GMS: Clear suspense grants on Grants module Wed 19 Aug

GMS: Post EC ‘PI Time’ journals on Grants module Wed 19 Aug

GMS/GL: Process journals for monthly Barclaycard statements Wed 19 Aug

INV: Process all Inventory transactions Wed 19 Aug

GMS: Finalise and release all research grants journals Fri 21 Aug

GMS: Overheads, revenue and the EC FW7 Price Adjustments re-run n/a Mon 24 Aug

w/c 24 Aug

GL: Last date for funds on deposit movement Mon 24 Aug

GL: CUEF distribution and deposit interest posted n/a Tue 25 Aug

FA: Notify the Fixed Asset Helpdesk of any missed assets from the Fixed Asset Exception spreadsheet.

Wed 26 Aug

AP: Return supplier statement reconciliations to Finance Division Fri 28 Aug

GL: Clear any trust fund deficits based on a review of 2nd

interim statements Fri 28 Aug

GL: Prepare spreadsheets for income and expense accruals Fri 28 Aug

SEPTEMBER/ OCTOBER

w/c 7 Sep

GL: Finalise GL journals, including matching income and expenditure for source of funds and clearing deficits

Mon 7 Sep

GL: Final date for sending GL journals for central processing (items > £10k only) Mon 7 Sep

GL: Final ICC overhead journal posted n/a Tue 8 Sep

w/c 5 Oct Return signed year-end certificate(s) via Finance Manager. Fri 9 Oct

Year-End Jul-15


3. Detailed Instructions & Timetable

3.1 Payroll & University Payment System (PAY)

Final date for completion

Action required

Fri 3 Jul

New contracts Final date for new staff contracts to be with HR.

Fri 10 Jul

Established Staff (Stipends, Wages, and Research Salaries etc.)

A review of the final departmental monthly payroll should be made, ensuring all current payroll account codes are correct.

Final date for overtime claims input to Payroll.

Thu 23 Jul

University Payments System (UPS: Visiting lecturers etc.) Final date for making payments on the 2014-15 financial year for UPS. Where departments are unable to meet this deadline but are aware of payments for 2014-15, they should consider establishing payroll accruals. Advice is available from the Central Accounting Section.

All Payroll payments for the July period will be charged to the financial year 2014-15.

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Year-End Jul-15


3.2 Procurement (PO) The Purchasing module is used to create purchase orders on CUFS, this in turn, creates a commitment. When the order is complete and an invoice paid this becomes an actual expense. It is therefore best practice to ensure orders are processed appropriately and accounts are maintained and accurate.

Tasks Required Final Date for completion

PO: Run and review the Open Purchase Order Report Mon 3 Aug

PO: Action the Open Purchase Orders Report Fri 7 Aug

Module closes 5pm Fri 7 Aug

Run and review the Open Purchase Orders Report (UFS).

This report lists all the purchase order lines that have not been fully completed, received or fully matched to an invoice. It assists in identifying where goods need to be received into the system, purchase orders or order lines need to be cancelled or finally closed. It also provides useful information with regards to funds checking and commitments. You need to review the outcome of this report being ran and identify the actions needed as detailed below

Action the Open Purchase Order Report

Ensure all receipts of goods are processed

From the Open Purchase Orders Report (UFS) review outstanding receipts for purchase orders where the goods have not been received.

Complete receipts for all goods delivered (especially re e-invoicing suppliers) and where services have been received.

Finally closing orders and requisitions Review the Open Purchase Orders Report (UFS) report and establish orders where the goods have been received on the system, and the invoice has been paid but not matched to the original purchase order. Finally close the PO. The related requisition will automatically be closed.

Do not finally close any order awaiting an e-invoice.

In case of queries please contact the Procurement Services Helpdesk Tel. 65101 or email [email protected]

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Review purchase orders with a status of “Incomplete”

From the Open Purchase Orders Report (UFS) review purchase orders that the Department believes should be approved in order to record the commitment for the month.

For any orders (and related requisitions) no longer needed or raised in error, with a status of incomplete, the department will have to complete and approve the order before being able to cancel it. Alternatively, an order can be rejected back to the requistioner (where one exists) and then cancelled. Please ensure that any orders being approved to be cancelled, do not have the Z Marketplace supplier site name otherwise the order will be automatically sent to the supplier. You will also have to re-enter the ship to and bill to locations before you can approve and then cancel the order

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3.3 Accounts Receivable (AR) The Accounts Receivable module interrelates with Accounts Payable, Grants and General Ledger modules. It is essential that all customer / Internal Trading invoices are processed in the correct accounting period and all receipts are identified and applied to outstanding invoices.


Empty all vending machines and identify cash/cheques received up to end of July 2015

Fri 31 Jul

Process all cash/cheques and PDQ income up to end of 31 July 2015

Tue 4 Aug

Run and review Unapplied Receipts Register Tue 4 Aug

Raise / dispatch all 2014/15 internal trading invoices Wed 12 Aug

Run Ageing -7 buckets report and review bad debts Mon 17 Aug

Receipt – BACS/bank transfers or PDQ income Tue 18 Aug

Raise, complete and dispatch all external invoices Tue 18 Aug

Run and review Incomplete Invoices report Tue 18 Aug

AR Module closes at 5pm Tue 18 Aug

Accounts Receivable Module

The Accounts Receivable module will not open for the August period until Monday 10 August 2015. You will not be able to raise August dated invoices until after this date; the delayed opening date will allow departmental accounts staff to concentrate on the closing of the July period which closes on Tuesday 18 August.

In case of queries please contact the Accounts Receivable Helpdesk Tel. 32215 or email [email protected]

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Year-End Jul-15


Cash and Cheque Receipts

Identify all monies received up to close of business on 31 July 2015, whether received via the post or over the counter. This will include monies from the emptying of all vending machines, pay phones, key deposits and photocopier sales etc. Departments should continue to bank cash and cheques received in relation to the new financial year but will not be able to enter receipt batches on CUFS until 10 August, when the AR module is opened for the new financial year. Finance Division will require all departments to confirm their petty cash and float balances as part of the year end process and departments will be contacted directly on this.

Receipt Batches

For all Accounts Receivable transactions please ensure the correct dates are used:

Receipt batches, receipts and transactions relating to the old financial year must have both receipt/transaction dates and GL dates of JUL-15.

Receipt batches, receipts and transactions relating to the new financial year must have both receipt/transaction dates and GL dates of AUG-15.

Complete all receipt batches for cash, cheques (and if possible PDQ transactions) received by the ‘University’ on or before 31 July 2015, using an accounting date of July 2015.

NB. All cheques need to be dated July 2015 or earlier.

Run the Receipt Register Report (UFS) for each receipt batch and bank as normal

NB. It may be that your first visit to the Cashier after the year-end includes two receipt forms, one for each year. This is expected and acceptable.

Run the Unapplied Receipts Register report to see where receipts have not been matched to an invoice. Apply receipts created against customers to clear outstanding invoices as necessary.

Review for Bad Debts

Run the Ageing–7 Buckets–by Account Report and review for doubtful/irrecoverable debtor items.

Notify Credit Control on any such debtors : [email protected]

BACS Receipts, Bank Transfers and unclaimed PDQ Receipts

Please ensure that all income is claimed and receipted from the twice weekly BACS list that we distribute for GBP, EURO and US Dollars, before we close AR. Claim all July or earlier BACS and any previously unclaimed PDQ bank deposits and counter credits, by receipting them in the usual way. Ensure you use a July 2015 receipt and GL date.

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Internal AR invoices

Invoices for 2014-15 To be raised with both an invoice date and a GL date of July 2015, and

dispatched to departments by 11 August.

NB. Departments are encouraged to raise their sales invoices as soon as possible to allow time for the receiving department to process them.

Invoices for Aug 15 May not to be raised until after the close of the AR module for the current

financial year.

NB. AS Internal Trading invoice and credit memo transaction types for 2015/16 should not be raised until after the close of July accounts (19 August will be the first possible invoice date) , users will be temporarily disabled from raising internal sales invoices from 12 August (5pm) to 18 Aug 2015.

External Invoicing – All departments

Ensure that all external sales invoices, together with credit memos, have been raised in order to record all income due and all monies owed to the department.

Run Incomplete Invoices report to check there are no un-posted invoices.

See ‘Debtors’ (section 3.8) if the final date for AR invoices has been missed.

Invoicing – Departments with Interfaces

Review all AR invoices pulled into the Accounts Receivable module through the Auto-Invoice process to ensure no errors are found. Make adjustments if these invoices need to be dated 31 July or earlier.

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3.4 Accounts Payable (AP) The Accounts Payable module interrelates with Accounts Receivable, Grants, Fixed Assets and General Ledger modules. It is essential that all supplier invoices and all expense claims, whether from employees, students or individuals, are processed in the correct accounting period.


Process all 2014-15 internal trading AP invoices Mon 17 Aug

Run the Invoices on Hold and Invoice Register reports Mon 17 Aug

Identify remaining internal trading invoices in dispute and notify Finance Division

Mon 17 Aug

Process all July AP invoices Wed 19 Aug

Process all staff and visitors’ expenses Wed 19 Aug

AP Module closes at 5pm Wed 19 Aug

Return supplier statement reconciliations to Fin Div. Fri 28 Aug

Accounting for AP Invoices

Please ensure that all supplier invoices received after 31 July are accounted for in the correct period. From 10 August, the AP Team will be issuing daily reports listing:

accounts payable August invoices posted in July; and

July or earlier invoices posted in August (if applicable).

This enables users to check these invoices have been accounted for in the correct period. In all cases please ensure that invoices are only processed in July if the goods were received in July, if you see an invoice processed in the wrong period please correct this before AP closes on 19 August. Reports will be sent to the same users as the supplier reconciliation notifications – please notify [email protected] if this should be any different. The Accounts Payable module will close at 5pm on Wednesday 19 August. Invoices relating to 2014-15 processed after this date should be accrued.

In case of queries please contact the Accounts Payable Helpdesk, Tel. 66888 or email [email protected]

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Year-End Jul-15


Review of outstanding invoices

Departments are reminded to please ensure that both the ‘Invoice Register’ and ‘Invoices on Hold Report’ reports are reviewed and all holds/queries are dealt with accordingly.

Run and review the Invoice Register (UFS) report showing all invoices not yet primary approved (i.e. validated). Validate and SIA or cancel as appropriate.

Review the Invoices on Hold Report and remove the holds/receipt delivered goods or services where appropriate.

NB “Invoices on hold” (other than those only awaiting secondary approval) at period end will not

be ‘accrued’ or charged in General Ledger. The AP team will regularly distribute the “AP Holds and Unaccounted Transaction Report” to departments.

Review Internal AP invoices for 2014-15

To be processed by 17 August with both an invoice date and a GL date of July 2015.

All 2014-15 invoices in dispute which cannot be resolved should be referred to the AP Helpdesk by 17 August for advice on the accounting treatment.

Enter and approve purchase (AP) invoices for 2014-15

Invoices processed after 31 July should be classified between:

July 2015 or earlier purchases (ie. ONLY goods/services received on or before 31 July should be recorded in July accounts, the purchase order date is irrelevant).

August 2015 purchases (for the new accounting year). For invoices dated July that relate to August purchases (eg. equipment rental payable in advance) the GL date should be changed from July to August.

Goods/services ordered in July or earlier but delivered/received in August are August purchases and must be recorded in August. For invoices dated August that relate to July purchases where the goods/ services were delivered/received prior to the end of July.

Ensure that the GL date on the invoice header screen and the invoice line screen is

amended to 31 July 2015, prior to approval of the invoice.

Do not change the GL date shown against the VAT line. For invoices dated August that relate to August Purchases.

Invoices for August purchases should retain the August GL default date.

NB, The Accounts Payable module will continue to accept July and prior purchase invoices until 19 August. Thereafter, all invoices will have to be processed in the new accounting year 2015-16. Invoices relating to the 2014-15 year received after 19 August should be

‘accrued’ as creditors – based upon the guidance issued within Creditors, Section 3.8

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Barclaycard Statements

The July statements will be available to print from 12 August. Each cardholder will have a statement but departments should be able to print / download into PDF all statements in one go. The statement dated 11 August 2015 will be posted into the July 2015 accounting period. Any grants expenditure should be journalled from the control account onto the research grant by the 21 August (close date of the Grants module).

Staff and Visitors’ expenses

Expenses need to be processed in the appropriate financial year. As expenses are paid in arrears please ensure July (or earlier) expenses have a July 2015 GL date and an appropriate Expenditure Item Date if charged against a grant.

Review and Return Supplier Statements

All supplier statements should be reviewed for invoices relating to 2014-15 to ensure they have been processed.

Statements from suppliers should be requested, retained and checked to AP invoices.

Records should be kept for audit purposes.

Finance Division will issue a list to each department of their Top 20 suppliers for the year and you will be required to select and reconcile the Top 10 and return these to the Finance Division.

The statements from suppliers should be requested, retained and checked to Accounts Payable invoices.

Records should be retained for audit purposes.

The Top 10 supplier statements should be returned to the Finance Division by Friday 28 August.

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3.5 Inventory (INV)

The Inventory module interrelates closely with the Core Purchasing, Grants and General Ledger modules. It is essential that all receipting into stores and issues from stores are up to date at this point so an accurate stock take can be completed on the last day of the financial year.


Physical stock take (all departments with stores) Fri 31 Jul

Update Inventory module with results of stock take Wed 19 Aug

Process all receipts and issues of stock up to 31 July Wed 19 Aug

Module closes at 5pm Wed 19 Aug

Central Accounting provide departments with reconciliation Thu 20 Aug n/a

Physical Stock Takes

All departments with stores (regardless of whether they are using the Inventory modules in UFS) are required to complete a physical stock count as at 31 July.

Inventory Module users only

Enter results of stock count on the Inventory Module - reviewing any material variances.

Ensure all receipts and issues of stock up to 31 July are processed. Including issues to / returns from research grants.

Review and resolve any pending transactions.

Inform the Inventory helpdesk of any miscellaneous processing that is required.

Central Accounting

Central Accounting will:

carry out GL transfers (Inventory to GL)

process miscellaneous transactions on request

reconcile the Inventory and General Ledger valuations and provide departments with the reconciliation documents.

7 Inventory (INV)

In case of queries please contact the Inventory Helpdesk Tel. 66780 or email [email protected]

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3.6 Research Grants (GMS) The Grants module interacts with the Accounts Receivable, Accounts Payable and General Ledger modules, as well as receiving imports from the Inventory module and CHRIS payroll. At year end there is a particular emphasis on ensuring exceptions, including funds check failures are clear, items have been cleared from suspense grants, and checking research expenditure has been recorded against the correct grant. As part of the Year End Certificate sign off process, Heads of Department are asked to sign off on the expenditure by project, covering all projects in their department.


Review and clear research grant funds check failures and exceptions

Wed 19 Aug

Correct research grant VAT errors Wed 19 Aug

Clear suspense grants Wed 19 Aug

Post EC ‘PI Time’ journals Wed 19 Aug

Process journals for monthly Barclaycard statements Wed 19 Aug

Finalise and release all research grants journals Fri 21 Aug

Module closes to departments at 5pm Fri 21 Aug

Overheads, revenue and the EC FW7 Price Adjustments re-run centrally

Mon 24 Aug n/a

Clear funds check failures and exceptions

Review and clear any funds check failures and exceptions. Where exceptions exist on awards, exception emails are sent to departments daily.

Correct VAT errors

As advised by the Tax & Property Finance Section for guidance see http://ufs.admin.cam.ac.uk/r12reference/gms/gms_me_vatcrc.pdf

In case of queries please contact the Grants Helpdesk Tel. 61649 or email [email protected]

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Clear suspense grants

Review and clear expenditure posted to suspense grants. Any unresolved items in suspense grants which relate to July 2015 or earlier will be transferred to a departmental overhead GL account (EDAA.FAAE) on 24 August prior to final processing and closure of the grants module. Affected departments will be sent details of the journal.

Post EC ‘PI Time’ journals

These journals reflect timesheets, as per monthly processes.

Process journals for monthly Barclaycard statements

See GL section 3.8.

Finalise and release all Research Grants journals

As introduced last year, in 2015 departments have two additional days following the closure of the Accounts Payable module to review their grants and post correcting journals as required. Departments must ensure that all grants journals have been released in order to allow the Grants module processes to be run (e.g. costing and funds checking) before the module closes for the year end. NB: Departments are not required to raise accruals for un-posted July invoices relating to research grants.

Overheads, revenue and the EC FW7 Price Adjustments re-run centrally

Please do not enter grants journals or run grants reports from CUFS on the morning of Monday 24 August until after the email has been sent to Key Contacts to say the Grants module has been closed for July 2015.

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3.7 Fixed Assets (FA) The Fixed Asset module interrelates with both the Account Payable and General Ledger modules. At year end there is a particular focus on ensuring that the register is up to date and that assets have been physically verified. This is an area that the auditors have been paying close attention to in recent years.


Review Fixed Asset Register Fri 14 Aug

Physically verify assets Fri 14 Aug

Notify FA helpdesk of disposals/amendments Fri 14 Aug

Ensure that July additions are included on register Wed 26 Aug

Module closes at 5pm Fri 28 Aug

Reviewing the Fixed Asset Register

The Fixed Asset Register will be sent out by Central Accounting for the period up to the end of June once Fixed Assets for June is closed. Particular attention should be paid to:

Ensuring that all assets listed can be physically verified

Nil value assets – are these still in existence and in use

Responsible employees – new starters /leavers

Departmental locations– relocations/ expansions

Tag numbers – are they recorded and correct

Asset additions and disposals during the 11 months to June

Appropriate Individual asset descriptions – e.g. not “as attached” Confirmation of the fixed asset return should be sent to Central Accounting by the 14 August with any amendments detailed.

In case of queries please contact the Fixed Asset Helpdesk Tel. 66780 or email [email protected]

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Update the Fixed Asset Module

Departmental users are able to update the following details on the Fixed Asset module:

Asset descriptions

Tag numbers

Serial Numbers, Model Numbers

Asset locations

Responsible employee

July Accounts Payable invoices not tracked as an asset

Review by the 26 August the exceptions spreadsheet sent out by Central Accounting on 20 August for items purchased in July over £2,000 to ensure all asset purchases for July are reflected.

Central Accounting

Central Accounting will process all amendments by Friday 28 August.

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3.8 General Ledger (GL) The General Ledger collates information from the rest of the system about all the transactions that have been processed. This information is then summarised into various departmental accounts. The information can then be utilised for both management and reporting purposes.


CUEF unit dealing for 2014 -15 Wed 17 Jun

Process and reconcile petty cash Fri 7 Aug

Process journals for credit card expenditure Wed 19 Aug

Movement of monies on deposit Mon 24 Aug

Prepare spreadsheets for income and expense accruals Fri 28 Aug

Match expenditure with income and clear deficits Mon 7 Sep

Module closes at 5pm Mon 7 Sep -

Return signed year-end certificate(s) via Finance Manager Fri 9 Oct

CUEF unit dealing for 2014-15

There are no purchases / sales of Cambridge University Endowment Fund (CUEF) units at 31 July. The last day for dealing for 2014-15 is Wed 17 June. Contact Treasury if there are any queries.

In case of queries please contact the General Ledger Helpdesk Tel. 39660 or email [email protected]

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Process and reconcile Petty Cash

The department’s petty cash needs to be closed as at 31 July 2015. The GL journal (and Grants

journal if necessary) needs to have a July 2015 date.

Petty cash expenditure for August 2015 must be journalled into August 2015.

The department’s petty cash control account balance should reflect the amount of cash held.

NB. It may be that your first visit to the University Cashier after the year-end includes two petty cash forms, one for each year. This is expected and acceptable.

Credit Card Expenditure

Monthly Barclaycard statements will be issued to departments prior to the closure of AP (see AP section for statement issue dates). Expenditure will be split between July and August purchases.

The appropriate receipts and necessary authorisation of expenditure needs to be collected and retained.

The department’s default GL credit card account(s) should be cleared for the year-end.

The GL journal and/or Grants journal for July expenditure needs to have a July 2015 date

Monies on Deposit

Monday 24 August is the last date for placing eligible funds on deposit as at 31 July.

Departments are reminded that monies should be taken off deposit to reduce account deficits.

Deposit account and CUEF interest will be posted on Tuesday 25 August.

Details on eligible Source of Funds, how to place money on deposit and taking money off deposits are available in the Investments manual (Chapter 12 of the Financial Procedures Manual).

Accruals

These are amounts owed by the department for goods and services that they have received prior to 31

July. Therefore, their costs need to be included in the 2014-15 financial year. This is done by the

process of “accruals”. Expenditure accruals occur where:

Goods/services have been received on or before 31 July but no invoice has been received and therefore not processed on CUFS; or

Goods/services have been received on or before 31 July and the invoice has been received after AP module has closed and therefore the invoice will be processed in AP in 2015-16 financial year.

A. Instructions

Departments have two ways to raise accruals: a) Identify departmental accruals and allow Central Accounting to process them

Provide details to the Central Accounting team and they will then process a GL journal. These journals will be automatically reversed in the August period of the 2015-16 account.

OR

Accruals should only be raised for transactions over £1,000

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b) Departments can create their own accruals by GL journal. Further guidance on creating journals for accruals is detailed in Appendix A.

By using the ‘Auto Reversal’ journal category these journals should be automatically reversed into the AUG-15 period. Ensure that you post the July journal.

If the journal category ‘Accrual’ is used then you must remember to manually reverse it in the AUG-15 period using the ‘More Actions’ button and to post both journals.

Sometimes journals need to be reversed in a period later than August for example if income has been accrued in July but is not received until September then the Jul-15 journal should be ‘Accrual’ type and should be reversed in September.

Unearned Revenue

Income should be “deferred” where it has been received by the department in advance of the goods or services being supplied (e.g. trading, course fees). If income received in advance is not deferred

then it will be credited and shown in the incorrect financial year. Like expenditure accruals above, departments can choose to defer income themselves (see Appendix B) or identify the deferral and ask Central Accounting to process the journal.

Other Debtors

These are amounts owing to the department for services/goods provided but unbilled at the year-end. They are the opposite of the accruals described above. They will arise from goods or services provided to external customers but not yet invoiced on the AR module. As described under ‘Accruals’, departments can choose to defer income themselves (see Appendix C) or identify the deferral and ask Central Accounting to process the journal.

Prepayments

A prepayment occurs when a payment has been processed on UFS in advance of the goods or services being received. When this occurs over the year-end the proportion of the payment that relates to goods or services received in the new financial year (August 2015 and beyond) has to be calculated. The expenditure for 2014-15 is then reduced by this prepaid amount.

Where accruals for a single Department total over £200,000, you must send supporting details to Central Accounting by Friday 28 August.

Detailed supporting working papers must be retained for all Departmental

accruals for the purposes of audit inspection

Detailed supporting working papers must be retained for audit inspection.

This course of action should only be used for material adjustments ≥ £10,000. Detailed supporting working papers must be retained for purposes of audit

inspection.

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Year-End Jul-15


Departments can choose to set up prepayments themselves (see Appendix D) or identify the prepayment and ask Central Accounting to process the journal.

Matching Related Expenditure and Income

Matching expenditure with the correct income will be an important process for departments. The method to achieve the transfer between sources of funds is to move or transfer, the net balance of each type of expenditure by a GL journal, using the original expenditure transaction code for both the debit and credit entries of the journal. Example: o Initially all your photocopying paper expenditure (transaction code ESFZ) was coded against

source of funds AAAA. o However, the department used £100 worth of paper when it was running off posters for an

exhibition. o The exhibition is a trading activity with income on source of funds GAAA. o Therefore a journal should be raised to match the paper costs with the exhibition as follows: CREDIT U. Dept. CC . AAAA . ESFZ £100 DEBIT U. Dept. CC . GAAA .ESFZ £100

This procedure should not be used to correct miscoding and applies to movement of expenditure between sources of funds only.

If you require clarification please contact your Finance Adviser or see

Clearing Deficits

Once departmental accounts have been reviewed and adjustments made to:

Deficits may be off-set against surpluses on non-restricted and trading sources of funds by journaling expenditure using the Transfer Codes EZXX.

Correct miscoding

Match related expenditure and income (as above)

Account for accruals, prepayments, other debtors and income accruals (as above)

Remove monies from deposit (section 3.8)

Prepayments are only necessary for transactions > £10,000. Detailed supporting working papers must be retained for purposes of audit

inspection.

Detailed supporting working papers must be retained for audit inspection.

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Roll Forward

Trust Funds

Individual statements for all trust funds will be sent to departments as follows.

Date Statement

7 Jul 30 June statement

10 Aug 1st

interim statement as at 31 July (will exclude Jul-15 distribution)

26 Aug 2nd

interim statement as at 31 July (will include Jul-15 distribution)

14 Sep Final statement as at 31 July

Journals are to be processed centrally to transfer expenditure to trust funds relating to

appropriations in aid and overhead charges. It is planned that all such journals will be included on the 1

st interim statement.

Clear any trust funds deficits based on a review of 2nd

interim statements.

Year-end income and expenditure totals by source of funds and cost centre will be rolled forward, in accordance with University policy, to create the brought forward balances for 2015-16, by the close of Tuesday 15 September.

As part of the preparation of the final accounts, adjustments may be necessary. This means that balances rolled forward may change. Any such adjustments will be communicated to departments.

In case of queries please contact the Trust Fund Helpdesk Tel. 39660 or email [email protected]

Two adjustment periods have been set up on GL for this purpose ADJ1-15 and ADJ2-15. In no circumstances should anybody attempt to post journals into

either of these periods. All year-end postings should be entered into Jul-15, and Jul-15 should be used for all year-end reporting.

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Care should be taken with this process and the transaction code EZXX must be used on both sides of the journal. Further information and guidance on their use is available from:

Your Finance Adviser

Best Practice Guide –Transfer Codes http://www.admin.cam.ac.uk/cam-only/offices/finance/procedures/bpguides/three.pdf

Online course - Transfer Codes http://www.training.cam.ac.uk/fin/event/1202536

http://www.admin.cam.ac.uk/cam-only/offices/finance/procedures/bpguides/three.pdf

Year-End Jul-15


3.9 Certification by Head of Department

Final date for completion

Action Required

Fri 9 Oct

The Reporting team in Finance Division will issue electronically to departments a number of versions of their Departmental Summary Reports as follows.

Date

Interim 1 Wednesday 5 August

Interim 2 26 Aug (following close of AP etc.)

Interim 3 9 Sept (after GL closed to departments and final ICC overhead charge)

Final By 22 Sept

Cognos users can run additional interim versions of Departmental Summary Reports at any time.

A year-end certificate letter will be issued to accompany the final version of the Summary Reports. This, together with summary statements of research grant expenditure and aged debtor listings will be sent to all departments during the first week of September.

Heads of Departments will also be required to certify their report, which should be signed and returned to School / Non-School Finance Managers who will issue their own deadlines to departments.

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Year-End Jul-15


4. Staff Contacts

CUFS Helpdesks Accounts Payable 66888 [email protected]

Accounts Receivable 32215 [email protected]

Cash Management 65980 [email protected]

Fixed Assets 66780 [email protected]

GL Journals GL Reporting

39660 65098

[email protected] [email protected]

Inventory 66780 [email protected]

Purchasing 65101 [email protected]

Other Key Contacts

Cashier Graham Dando Ana Fabrega-Fernandez

64221 48867

[email protected] [email protected]

Credit Control email [email protected]

CUEF Investments Heather Davis 65974 [email protected]

Deposit Account Scott Maclaren 64216 [email protected] Internal trading disputes

Andrew Weatherley 66220 [email protected]

Research Grants School Teams see www.admin.cam.ac.uk/offices/research/contact/

Research Accounting 64796 [email protected]

Trust Funds 39660 [email protected]

Department specific advice

School / Group Finance Manager Finance Adviser

Arts & Humanities

Claire Cahill

64074

[email protected]

Ben Perks

66392

[email protected]

Humanities & Social Sciences

Beverley Housden

64081

[email protected]

Deana Carlyon

30701

[email protected]

Biological Sciences

Felicity Webster

66897

[email protected]

Adam Durrant

61568

[email protected]

Clinical Medicine

Robin Uttin

63653

[email protected]

James Whybrow

36730

[email protected]

Physical Sciences

Susan Wright

67137

[email protected]

Joel Brand 30582

[email protected]

Technology

Matt Burgess

65643

[email protected]

Dan Greenfield

30700

[email protected]













http://www.admin.cam.ac.uk/offices/research/contact/








Year-End Jul-15


School / Group Finance Manager Finance Adviser

UAS

Mike Millard

65975

[email protected]

Elizabeta Moss

32243

[email protected]

Non-School Institutions

Diane Gaskin

65812

[email protected]

Catherine Bentham

66597

[email protected]




Year-End Jul-15


Appendix A: Expenditure Accruals

At the end of any month there might be some costs that you know you have incurred but for which you haven't yet received (or logged onto CUFS) the invoice.

This is more significant at year-end when it is important to get the repair cost in the right accounting year. The costs are allocated to the correct year by means of a General Ledger journal. This journal is then reversed out in the following month/year so that when the invoice is logged onto CUFS and paid in the

normal way, you don't have a double charge to your departmental account.

How to raise the Journal 1. Log into CUFS in the normal way and go into your departmental General Ledger responsibility. 2. Select Journals Enter. 3. Click on the New Batch button and complete the header details in the normal way. 4. Click on the Journals button and start to enter the accrual journal for July

a) Period : should be JUL-15 at this year-end b) Category: select Auto Reversal

ifrom the list of values

c) Description: enter as appropriate d) Control Total: enter as appropriate

5. Account codes to be used: Debit Credit

Department code As normal As per debit line

Cost Centre As normal As per debit line

Source of Funds As normal 0000

Transaction code Appropriate to the expenditure being accrued

VBAK (accrual)

6. Save your Journal

Example: An engineer comes to the Department in the middle of July and repairs a

machine.

You know that he is going to charge you £1,500 for the work but you won't get

his invoice until the end of August.

However, that repair actually took place in July and should therefore be

included in the accounts for July.

Year-End Jul-15


Post the journal. From the Navigator screen choose Journals >Post. Enter the batch name to recall the journal and tick the box to select it for posting. Behind the scenes, a second (reversing) journal will be created in the next period and will be automatically posted by the Finance Division. If the journal category ‘Accrual’ or ‘Adjustment’ is used then you must remember to manually reverse it in the AUG-15 period using the ‘More Actions’ button and to post both journals.

In your accounts… The accrual journal will debit (or charge) expenditure – in place of the absent invoice. The credit entry will go to the VBAK balance sheet code, representing a liability for the goods/services received but not yet invoiced. The reversal journal will create a credit against the original expenditure transaction code (e.g. EMZZ from the screen shot above) which in turn will be cancelled out by a corresponding debit balance when the supplier’s invoice is finally received and processed on CUFS in the normal way.

Year-End Jul-15


FAQs Does it matter if I have already raised a Purchase Order for the goods/services in July?

No. Should I include the VAT element of the goods/service in the accrued total?

Yes. What if the invoice is still not received in August?

Then the accrual journal must be repeated in August. It will reverse in September when, hopefully, the invoice will be entered on CUFS.

Example: Current financial year:

29-Jul-2015 Create journal to accrue expenditure £1,500

(No invoice received but expenditure is charged to correct year)

New Financial Year:

01-Aug-2015 Journal reverses automatically (£1,500)

20-Aug-2015 Invoice for repairs is entered in AUG-14 £1,500

Effect on expenditure in the new year £ 0

Year-End Jul-15


Appendix B: Unearned (Deferred) Revenue

Income should be “deferred” where it has been received by the Department in advance of the goods or services being supplied (e.g. in the case of trading, course fees).

How to adjust for it 1. Raise a new journal batch and create a journal choosing the category Auto Reversal

1.

Choose the period JUL-15. Enter a suitable description e.g. "Defer AR Invoice 123456 for course fees starting on 5-Aug-15”

2. Code as follows: Debit Credit

Department code As normal As per debit line

Cost Centre As normal As per debit line

Source of Funds As normal 0000

Transaction code As normal (e.g. LAAD) VZAA (unearned revenue)

3. Save your journal.

Posting the journal. From the Navigator screen choose Journals > Post. Enter the batch name to recall the journal and tick the box to select it for posting. Behind the scenes, a second (reversing) journal will be created in the next period and will be automatically posted by the Finance Division. If the journal category ‘Adjustment’ is used then you must remember to manually reverse it in the AUG-15 period using the ‘More Actions’ button and to post both journals.

In your accounts… The deferred income journal will debit (i.e. reduce) income in July. The credit entry will go to the VZAA balance sheet code, creating a liability for the income received for which no goods/services have yet

been provided.

1The auto-reverse function should only be used when it is appropriate for the journal to be reversed in the next

period, as in the case of this example where the course begins in August. When it is not appropriate to reverse the journal in the next period, for instance if the course was not starting until November, the journal should be entered in the normal way and manually reversed in the appropriate period.

Course fees invoiced on 1 July of £11,000 for a course starting on 5 August.


01-Jul-2015 Sales Invoice raised £11,000

29-Jul-2015 Create journal to reduce income (£11,000)

Effect on income in current year £ 0

(Proceeds of Sales Invoice are deferred and a liability created on Balance Sheet)

New Financial Year:

01-Aug-2015 Journal reverses automatically £11,000

(Liability is cancelled out and income is credited to trading account. Any expenditure incurred will then

be appropriately matched to income.)

Year-End Jul-15


Appendix C: Other Debtors (Income Accruals)

These are amounts owing to the University where we have provided goods or services before 31 July but where we have not raised an invoice on the Accounts Receivable system.

How to adjust for them: 1. Raise an Auto Reversal journal in July with an appropriate description e.g. "Conference held in July but not invoiced"

2. Code as follows:

Debit Credit

Department code As per credit line As normal

Cost Centre As per credit line As normal

Source of Funds 0000 As normal

Transaction code UNAA (Other Debtors) As normal (e.g. LAAC)

3. Save your journal.

Posting the journal. From the Navigator screen choose Journals>Post. Enter the batch name to recall the journal and tick the box to select it for posting. Behind the scenes, a second (reversing) journal will be created in the next period and will be automatically posted by the Finance Division. If the journal category ‘Accrual’ or ‘Adjustment’ is used then you must remember to manually reverse it in the AUG-15 period using the ‘More Actions’ button and to post both journals.

In your accounts: Income is credited to the departmental account in JUL-15 without an invoice being raised. The reversing action of the journal in AUG-15 means the subsequent sales invoice raised in August is netted off to zero.

You held a conference on 30 July 2015 for which you will invoice delegates on 31

August, but the AR module for July closed on 16 August.


29-Jul-2015 Create journal to credit income £15,000

(In lieu of sales invoice not yet raised)

New Financial Year:

01-Aug-2015 Journal reverses automatically (£15,000)

31-Aug-2015 Create sales invoice £15,000

Effect on income in new year £ 0

Year-End Jul-15


Appendix D: Prepayments

A prepayment is when you pay for goods or services and some or all of those goods/services relate to the next financial year.

The expenditure is taken out of the 2014-15 year by means of a journal which is then reversed in AUG-14 to allocate the cost to the subsequent year.

How to raise the Journal

1. Start to enter your journal in the normal way

a) Period : should be JUL-15 at this year-end b) Category: select Auto Reversal from the list of values c) Description: "Pre prepayment of invoice X for period dd/mm/yy to dd/mm/yy" d) Control Total: enter as appropriate

2. Enter the following journal lines:

Debit Credit

Department code As per credit line As normal

Cost Centre as per credit line As normal

Source of Funds 0000 As normal

Transaction code UNGA (prepayment) As normal (e.g. EUEF)

3. Save your Journal

Posting the journal. From the Navigator screen choose Journals > Post. Enter the batch name to recall the journal and tick the box to select it for posting. Behind the scenes, a second (reversing) journal will be created in the next period and will be automatically posted by the Finance Division. If the journal category ‘Adjustment’ is used then you must remember to manually reverse it in the AUG-15 period using the ‘More Actions’ button and to post both journals.

You are billed in advance for the annual maintenance charge for your equipment

of £10,200.

The Invoice is received and processed in July 2015, however it relates to

maintenance for the period 1 August 2015 - 31 July 2016.

Year-End Jul-15


In your accounts:

i The auto-reverse function should only be used when it is appropriate for the journal to be reversed in the next period. When it is not appropriate to reverse the journal in the next period the journal should be entered in the normal way and manually reversed in the appropriate period.


15-Jul-2015 Suppliers Invoice entered in CUFS £10,200

29-Jul-2015 Prepayment journal reduces (credits) expenditure (£10,200)

Effect on expenditure in current year £ 0

New Financial Year:

01-Aug-2015 Journal reverses, charging expenditure to dept a/c £10,200

Documents

Year-end Instructions 31 July 2015 - University of Cambridge · 2015-08-06 · Year-End Jul-15 Finance Division Version 0.6 May 2015 2 1. The Year-End Process 1.1 An Overview The