Solving the Mystery USSGL. By Laura A. Logan, CPA, CGFM April 16, 2014

Transcription

1 Solving the Mystery USSGL By Laura A. Logan, CPA, CGFM April 16, 2014

2 The Basics True / False DEBITS = CREDITS Assets = Liabilities + Equity The President can authorize and appropriate funds Budgetary = Proprietary Budgetary Resources = Status of Budgetary Resources Trial Balance is Balanced Federal Accounts Payable = Federal Accounts Receivable Statement of Budgetary Resources = Income Statement

3 Unraveling The Budgetary Process The 4 Phases of Federal Budget Process Budget Formulation Congressional Action Budget Execution Audit & Compliance

4 Budget Formulation What is Budget Formulation? Who is involved? Why formulate? When and How?

5 Congress takes Action Spending and Revenue Entitlement Spending Must Haves Majority of all Federal Spending Discretionary Spending Congressionally authorized Funded by appropriation bills Revenue Sources Taxes Fees More Taxes Donations Sale of Assets Interest on Loans Fines and Penalties Did anyone say Taxes

6 Budget Execution Funds Available Congress Enacts Legislation or mandatory programs Purpose of spending Congress Appropriates/authorizes budget authority revenue and expenditures Allocations of the appropriations for specific programs or actions Departments and Agencies Allot the funds to start the execution of Congressional mandates and manage Federal programs.

7 Types of Funding Appropriation One year Multi-year No Year Reimbursable Authority Working Capital/Revolving Borrowing Authority Contract Authority

8 Legislative Mandates Type of funding Definite Exact $$, time, purpose Indefinite Such sums as necessary for a purpose How long is funding good? It Depends! Congress sets timeframe and/or purpose Unexpired funds are available for obligations Expired funds not available obligations, may pay obligations made while unexpired. Lasts 5 years. Cancelled funds all budgetary accounts, receivables and payables withdrawn and transferred to Treasury Indefinite funding cancelled when executive branch determines purpose has been met and no disbursements made for two consecutive fiscal years

9 Compliance OMB has the authority and responsibility for financial management of the Federal Government Dept of Treasury promulgates detailed fiscal guidance, maintains a central accounting system, makes disbursements and basically keeps the purse. Budgetary execution and status is reported in addition to Financial Statements Financial Statements completed quarterly. Yearend for Federal Government is September 30.

10 What is an obligation? Use of Government resources Federal entity has a future liability to pay. Undelivered Order - Unpaid Amount of goods and services ordered and obligated which have not been actually or constructively received and have not been prepaid or advanced Budget entry only!

11 More Obligations Undelivered Order Prepaid/Advanced Payment made generally to another Govt entity for program expenses Proprietary Entry made Receivable from other entity Delivered Order - Unpaid Goods and Services received and accepted Proprietary entry Payable created Delivered Order- Paid Payment made for goods and services received and accepted Proprietary entry Cash Payment

12 USSGL United States Standard General Ledger Maintained by Treasury Provides uniform chart of accounts budgetary and proprietary Demonstrates accounting transactions for business events rules for GL recordation Supports preparation of financial reports by providing account crosswalks to reports

13 Proprietary Accounts Assets series Liabilities series Capital and Cumulative Results of Operations series Revenue series Expenses series Gains/Losses series

14 Budget Accounts 4000 Series Resources Appropriations Reimbursable Authority Funds Collected Resources from Borrowing Transfers from other Entities Status Apportionment Allotment Commitment Undelivered Orders Delivered Orders

15 Budgetary vs Proprietary Budgetary Appropriation warrant issue Funds apportioned Funds allotted Purchase Request Commitment Purchase Order Undelivered Order Receipt and Bill Received Funds Expended Proprietary Agency receives cash from Treasury No Entry No Entry No Entry No Entry Payable Established Cash Paid

16 ADA Cannot spend what you don t have $$ Time Purpose Must be reported to the President and Congress May have financial and legal consequences to responsible party

17 Financial Statements Presents the financial position and results of operations Supports budget process provides link between budge and accounting Operationally provides data for decision making Provides accountability of Govt resources Audits completed internal and external auditors statements fairly present..

18 Major Financial Statements Balance Sheet Statement of Net Cost Statement of Changes in Net Position Statement of Budgetary Resources Other Disclosures Management Discussion and Analysis (Overview) Footnotes to statements

19 Internal Controls and Auditors Integral component of financial management Internal controls are policies and procedures that help government be effective and efficient, provide reliable financial reporting, comply with laws and regulations while avoiding serious problems such as overspending, operational failures, fraud, waste, and abuse. Various laws and regulations for Federal operations. OMB Circular A-123 provides guidance and requires reporting on the effectiveness of management controls over financial reporting, adopting concepts from Sarbanes-Oxley. Auditors review for compliance.

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21 Solve the Mystery 1. Who initiates funding legislation? 2. Who presents the Federal Budget? 3. What is the single largest source of revenue for the federal government? 4. Identify the four phases of budget process. 5. When does budget execution start? 6. Who provides basic structure of the General Ledger accounts to government agencies? 7. Does the receipt (with an invoice) and acceptance of a product ordered generate budgetary accounting entry. 8. Placing an order prior to receipt of an appropriation is? 9. What does the USSGL provide to government users? 10. What does government accounting really do?

22 The Basics True / False DEBITS = CREDITS Assets = Liabilities + Equity The President can authorize and appropriate funds Budgetary = Proprietary Budgetary Resources = Status of Budgetary Resources Trial Balance is Balanced Federal Accounts Payable = Federal Accounts Receivable Statement of Budgetary Resources = Income Statement The Federal Government consolidated receives a clean audit opinion annually

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