FY15 Annual Report & Accrual Reporting Transition. Presentation will start at 10 AM

Transcription

1 FY15 Annual Report & Accrual Reporting Transition Presentation will start at 10 AM

2 ?????? Questions during Webinar?????? If you have any questions during the webinar, you can enter your questions into the Questions pane for the organizer or panelists to answer. Type your question into the Questions pane and click Send. The organizer will answer the question or direct it to a resource that will contact you after the webinar.

3 FY15 Annual Report & Accrual Reporting Transition Agenda Highlights of Year End Accrual Reporting Transition Modified Cash to Modified Accrual Differences Advanced Accounting Topics A/R & A/P Highlights & Changes to the FY15 Annual Report Demonstration of Preparation & Submission of Annual Report Prior Year Transaction Implications Demonstration of Reconciliations Credit Memo Demonstration New Support Tool & Resources Available

4 Highlights & Benefits of Modified Accrual Reporting Begins 7/1/14 QuickBooks is a full service accounting tool which records activity on an accrual basis. Cash basis limits the expenses and revenues to those paid and collected. Consistent with accounting required by auditors of the Archdiocese. Reflects Generally Accepted Accounting Principles Allows for interfaces with Third Party Systems (e.g. Tuition Tracking Software) Multiple Year Phased Implementation for Schools Provides more complete reports for leadership who need to make parish decisions. Access greater variety of reports in the hosted environment as other Dioceses do

5 How do I Toggle to Accrual Basis? As Administrator, in Single User Mode, Edit, Preferences, Reports & Graphs, Company Preferences, Report Basis -- Accrual - OK!

6 These accounts were already used for accrual accounting: Investments (1400) - are trued up to the Market Value at least every six months. Manna Certificates (1610) Manna purchases should not be recorded to expense until sold. Treat as inventory. Prepaid Tuition & Fees (2400) Registration and tuition for next year is shown as a liability until the relevant school year. Unspent Fund Raising & Auxiliary Group Funds (2550 & 2551) - Carry over to date of specific event. AOC Loans & Outstanding AOC Invoices (2313 & 2600) recorded as a journal entry in FY14 or prior in addition to entering as bills in QB.

7 Cash Basis treatment continues in these areas: Payroll Ensure a full year has been recorded; partial period accruals are not required. Pledges Recorded in QuickBooks only when collected; but should be tracked for year-end reporting purposes. A footnote feature has been added to the Annual Report submission tool. Fixed Assets Capitalization occurs at consolidated level Tuition & Fee Income Unless interface with Third Party Software Reporting Always on a cash basis.

8 Watch for these changes! By using Enter Bills/Pay Bills, as always recommended, there will be an A/P balance on the Balance Sheet for bills entered but unpaid. Old Invoices or Credit Memos in Customer Center will resurface. Unpaid Invoices or Credit Memos in Vendor Center will show as outstanding liabilities. Invoices entered for Lease and Rental clients will recognize income immediately not just when paid. FACTS or SMART interface will bring over summarized receivables and deferred income to be amortized. New accounts added in FY14.

9 Balance Sheets Side by Side Cash vs. Accrual Cash Basis Balance Sheet in QB Unpaid Bills as of 6/30/2014 Type Open Balance Accrual Basis Balance Sheet in QB Jun 30, 14 Accurate Fire Equipment Co Jun 30, 14 TOTAL ASSETS 1,480, Total Exelon # (Church) -1, TOTAL ASSETS 1,480, LIABILITIES & EQUITY Liguori Publications LIABILITIES & EQUITY Liabilities Credit Liabilities Current Liabilities Bill Current Liabilities Accounts Payable Total Liguori Publications Accounts Payable 2000 Accounts Payable 0.00 McGraw Hill Companies 2000 Accounts Payable 4, Total Accounts Payable 0.00 Bill 1, Total Accounts Payable 4, Total McGraw Hill Companies 1, Other Current Liabilities Missionary Co-Op Plan Other Current Liabilities 2200 Other Payroll Withholdings Bill Other Payroll Withh Archdiocesan Obligations 488, Total Missionary Co-Op Plan Archdiocesan Oblig 488, Prepaid Tuition & Fees 6, Ricoh USA, Inc Prepaid Tuition & Fe 6, Total Other Current Liabilities 495, Bill Total Other Current Liabilities 495, Total Current Liabilities 495, Total Ricoh USA, Inc Total Current Liabilities 500, Long Term Liabilities The Cleaning Company, Inc. Long Term Liabilities 2600 Loans 584, Bill 3, Loans 584, Total Long Term Liabilities 584, Total The Cleaning Company, Inc. 3, Total Long Term Liabilities 584, Total Liabilities 1,080, TOTAL 4, Total Liabilities 1,084, Equity 2700 Equity -3,579, Equity -3,579, Retained Earnings 3,895, Retained Earnings 3,895, Net Income 84, Net Income 80, Equity Total Equity 400, Total Equity 396, TOTAL LIABILITIES & EQUITY 1,481, TOTAL LIABILITIES & EQUITY 1,481,260.34

10 FY14 Unpaid Bills Paid in 2015 or to be paid later No further action required, assuming: Supplied Unpaid Bills report as of 6/30/14 in the amount of unpaid bills. Report to Parishioners these expenses previously or plan to include with FY15 Annual Report information sent to parish. Will not be Paid Enter Credit Memo as of 7/1/14 Use Extraordinary Income 5064 or next available subaccount PY Accrual Reversal

11 FY13 or Prior Unpaid Bills Paid in 2015 or to be paid later No further action required, assuming: Supplied Unpaid Bills report as of 6/30/14 in the amount of the unpaid bills. Report to Parishioners Do not include invoices due to the AOC which have been converted to loans. Will not be Paid Enter Credit Memo as of 7/1/14 Use Extraordinary Income 5064 or next available sub-account PY Accrual Reversal

12 FY14 Open Customer Invoices If there is material income recognition of customer invoices entered with a date of 7/1/13-6/30/14, the parish should record offsetting credit memos on 7/1/2014, nullifying the effect of the income into Extraordinary Expense. HOWEVER, If the invoices are valid, they should be re-entered with a 7/1/14 date and tracked for collection and/or resolution. Use Extraordinary Expense 6064 or next available sub-account PY Accrual Reversal

13 FY13 and Prior Open Customer Invoices If there is material equity recognition of customer invoices entered with a date prior to 7/1/13, the parish should similarly record offsetting credit memos on 7/1/2014, nullifying the effect of the income into Extraordinary Expense. HOWEVER, reestablishing these invoices should be evaluated very carefully from a collectability perspective. Collection on invoices over 12 months old is typically very limited. Re-establishing of these invoices would also require establishing a bad debt reserve Use Extraordinary Expense 6064 or next available subaccount PY Accrual Reversal.

14 Annual Report Highlights Annual Report is due August 31 st! NT Investment statements should be available around July 18 th. An alert will be sent to the address on file. RN/QB Pro 2013 users must submit the financial schedules on-line using the submit button. The Balance Sheet (two year comparative) accrual basis and Unpaid Bills listing should be prepared using the Memorized Reports in QuickBooks and exported to the Right Networks I:/Drive/FY 2015/FY 2015 Annual Report Approved & Submitted folder. It is critical that once you have submitted all reports required for the annual report that you set a closing date of 06/30/15 in QuickBooks Additional Materials available on Parish Operations webpage.

15 Changes to FY15 Annual Report Process One button submission for all schedules - Submit Annual Report Pages 1 9, Balance Sheet, Unpaid Bills & Pledge Info, if applicable. Enhanced Annual Report Checklist - cash vs. accrual reconciliation spreadsheet is found in the 2 nd tab and the 3rd tab is guide to how the past and current unpaid AOC bills should be recorded. Annual Report will be submitted on a modified accrual basis. Compliance report has been eliminated. Pastor Representation Letter has been expanded and enhanced to include new information. This is the last year parishes will submit the Annual Report using the A-1-C2 format. Required reports for next year will be more in line with non-profit reporting using the hosted environment. Pledge Receivable information will be collected using the hosted environment and listed on the Notes Page.

16 FY15 Annual Report Agenda Step by Step Demonstration of the NEW tools on Right Networks for the Annual Report Parish Operations Procedures, Forms & Materials Directory for Approved & Submitted Reports Review AOC Report Menu Review Annual Report Financial Schedules Run and Save QuickBooks Memorized Annual Report Schedules: Page 10 Unpaid Bills Page 11 Balance Sheet Two Yr. Comp. Accrual Add, Edit & Delete Notes to Financial Statements Enter Pledge Receivables, if applicable Submission of ALL Annual Report Pages one click Enter 06/30/15 Closing Date in QuickBooks

17 Last Steps- Review Reports & Submission of the Pastor Representation Letter Ensure ALL the schedules are reviewed, as appropriate, including, but not limited to the Pastor, Administrator, Principal and Finance Council. Finally, the Pastor Representation Letter addressed to Archbishop Cupich should be completed, signed by the appropriate Parish representatives and sent to Betsy Bohlen, Chief Operating Officer. Please do not let the required signatures on the Representation Letter delay your Annual Report submissions. The signed letter can be sent at a later date, if necessary. This is the only document that needs to be sent to the Pastoral Center via mail, fax, or .

18 Recap of FY15 AOC PARISH Accounting Reporting Changes Impact of Modified Cash to Modified Accrual is best summarized with the reconciliation supplied with the FY 15 Annual Report checklist. PY Transaction Implications must be handled BEFORE submitting the FY 2015 Annual Report on a Modified Accrual basis Example videos and analysis available on the Parish Operations website

19 Demo of Entering Credit Memos Accounts Payable To offset dated invoices that have been otherwise paid or no longer valid. Accounts Receivable To offset unpaid invoices as of 6/30/14 which may be: Re-established as of 7/1/14, or Offset as they are no longer valid or collectable

20 Review of Resources Available on Website Additional materials/procedures available for review or download on the Parish Operations webpage at under Procedures, Forms and Materials - including: - FY15 Annual Report Letter to Parishes - FY15 Annual Report Schedule Summary - Enhanced 2015 Annual Report Checklist - Advanced Accounting Video Examples - FY15 Annual Report & Accrual Reporting Transition Webinar slides - FY15 Status Animarum Online Submission Instructions - And more

21 Key Contacts for Support Right Networks/Cathonet: (888) option #2 or - Technical trouble connecting to your QuickBooks file - Problems with printing or connecting to the report server - Password re-set for Right Networks ID or to set-up or terminate user ID# s. Parish Operations: parishoperations@archchicago.org - Submission or reporting questions on Right Networks - Accounting issues or questions regarding QuickBooks or Archdiocesan procedures. - Issues with exceptions or incorrect values on the Right Networks generated report. - Confirmation of previously submitted financial information.

22 Testing of New Support Tool Parish Operations is testing a new support tool called Team Support. The tool will track all parish requests including phone calls and s. Using the FY15 Annual Report process as a way to test the system thoroughly, with plans for a full roll-out next year. Any report submitted with exceptions will be assigned a ticket number and a response or resubmission will be required. Please send all requests via to parishoperations@archchicago.org so they can get logged, tracked, responded to and closed out. Refrain from sending your requests and questions to individual parish operations personnel

23 FY15 Annual Report & Accrual Reporting Transition FY15 Annual Report & Accrual Reporting Transition Webinars Thursday, July 23 rd 2:00 PM 4:00 PM Tuesday, August 4th th 10:00 AM 12:00 PM

24 Parish Reporting & Accounting Updates Thanks for joining us today!