Chart of accounts presentation

WHAT WE WILL COVER TODAY The topics to be covered today include: Why the need for training and the anticipated outcomes Working through the various segments of the chart of accounts iProcurement and the rest Proposed financial accountability in the new faculty Lots of time for questions!

Why the need for training and the anticipated outcomes Why have we asked all staff to come to a training session? Vet Science Local Purpose Codes were used in developing the 2015 Ag Sciences budget; however Ag Science staff are not in the habit of using these LPCs The implementation of the Melbourne Operating Model means that faculty staff who previously coded orders will no longer be available University Services staff who will be handling financial transactions have no knowledge of the 10 Academic Divisions’ budget structures The operating environment will be focussed on self-service, with staff being expected to know their relevant account strings A good understanding of account strings means that orders will be processed promptly Income and expenditure will be against the correct budget (rather than unattached, requiring excessive housekeeping!)

Themis chart of account strings The Chart of Accounts is the structural framework on which Themis Financials is based. Data is stored in such a way, using the eight segments, to allow information to be effectively and efficiently retrieved and analysed using reports or on line enquiry functionality. Each segment can provide valuable information in its own right; however it is when data in one segment is used in conjunction with data captured in other segments, that the Chart becomes a powerful analysis tool.

Segment 1 – Company code Segment 1 This is the company code Core University activities, Trusts, semi-autonomous bodies, and subsidiaries of the University all have a separate Company number For our purposes please use 01 in most cases

Segment 2 – Budget Unit Segment 2 This is the budget unit The Budget Unit segment follows the organisational hierarchy of the University. It is a four digit, alphanumeric code representing a functioning area. A Faculty or Division is a “parent” that consolidates a group of Budget Units. A Budget Unit can only “belong” to one Faculty or Division. This segment also provides information about “Who” owns the transaction and who has accountability for it. We have two Budget Units 2080Agricultural Science 2510Veterinary Science For accreditation reasons

Segment 3 – Cost Centre Segment 3 This is the cost centre The Cost Centre segment (Segment 3) is a two-digit numerical code which is dependent on the Budget Unit. This segment represents a material area of operation, teams of people or an investment in significant resources or areas of responsibility and control within a department that requires active management and is therefore the level for budgeting people and other resources. The Cost Centre segment is another that provides information about “Who” owns the transaction. The Faculty has a range of cost centres (see handout). Academic staff will use one of the following that correspond to their section: Biosciences32 Community Practice & Emergency33 Crop & Soil Sciences34 Pathobiology35 Production Animals36 Referral Clinics & Hospital Services39

Segment 4 – Natural Accounts Segment 4 This is for natural accounts Natural Account is an independent segment used to classify income, expenditure, assets, liabilities and equity transactions. The Natural Account is an important segment as it provides information about the nature of the transaction and “What” has been captured. For example, expenditure is allocated by nature as being either Salary or Stationary. It is a segment that is used for control, understanding actual income and expenditure transactions against expectations. This is one area that it is best to leave blank if you don’t know the answer

Segment 5 - Projects Segment 5 This is for projects Project is a six digit numeric code that captures information about specific projects (“Who”). It is a way of grouping and controlling the income, expenditure, assets and liabilities related to (mostly research) projects over number of accounting periods. The allocation of Project Codes is regulated by Finance and Planning using a specific set of criteria. A range of Project Codes have been allocated to Budget Units, this creates a notional dependency between the two segments. The two main groups are: The range of projects from to – Operating The range of projects from to – Research Academic staff will be familiar with their own research project numbers

Segment 6 – Local Purpose Codes Segment 6 This is for local purpose codes The Local Purpose Code segment is a three digit alpha-numeric code dependent on the Budget Unit. The Local Purpose Code allows Budget Units to capture and group information concerning their areas at levels that are relevant to them (what). Used in conjunction with other segments such as Cost Centre, Activity or Project they can be a valuable source for analysis and enquiry. Vet Science and Agricultural Science have the same LPCs for common activities, eg salaries, and different LPCs for discipline specific activities, eg teaching LPCs See the second page of the handout for the common LPCs

Segment 7 – activity code Segment 7 This is for activity code Activity is an independent segment that uses a two digit numeric code. The Activity Code captures information about the function of the transaction (what). In choosing the appropriate Activity Code consideration should be paid to the “primary purpose” of the transaction. The Faculty uses these activity codes to analyse segment income and expenditure, ie teaching, research, consultancies See your handout for the breakdown of these

Segment 8 - Location Segment 8 This is for location Location (Segment 8) is an independent segment identified by a two digit numeric code. The Location Code is used to determine the assignment of 'campus’ or physical locality to transactions (where) Our locations may be: 01Parkville 10Werribee 11 Dookie 14Burnley 17Creswick

iProcurement Oracle iProcurement is the tool chosen by the University for the raising of on-line Purchase Requisitions. All purchases of goods and services (with a limited number of exceptions) require an approved purchase order. Purchase orders can only be generated from an approved purchase requisition. All account codes must be changed as otherwise it defaults to the account from which the requestor’s salary is paid Please review the iProcurement handout for further information

Financial housekeeping The Finance team will be carrying out some financial housekeeping in the next few weeks:  No expired projects will be left open; accounts where the owner has left will be deactivated  Number of active accounts to be monitored and managed is minimised to reflect reduced staffing in MOM  Staff will receive a monthly report for all the accounts for which they are responsible  Staff are responsible for managing their accounts and keeping them in the black  Accounts in deficit will be frozen until the deficit is resolved

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