Flexgen Trustee Warrants to Checks Resource 2018

Warrant System to Checking System Checking System Advantages/Disadvantages Approval Bank Coordination Department Coordination LGC Coordination Disbursement Process Accounting Entries

Checking System Advantages/Disadvantages

Checking System Advantages Truer picture of cash balances Better reflection of county cash flow Maintains more accurate department balances Less disparity between department and Trustee accounting Can eliminate manual warrant entry County Audit will love you!

Checking System Disadvantages Potential loss of some interest revenue (currently not as relevant) Can cause some increase in workload Transition period can be difficult

Warrant System vs Checking System

Warrant System Department disbursements are made to the Trustee’s General Ledger when the warrants are presented to the bank for payment Department balances are decreased as the warrants clear the bank A file can be sent to the Trustee from the departments The Trustee will then reconcile the warrants as they clear the bank The Trustee will then distribute the reconciled warrants This eliminates manually entry of individual warrants

Checking System Department disbursements are made to the Trustee’s General Ledger as soon as the checks are written by the departments Department balances are decreased at the time the checks are issued by the departments The decrease is the full amount of all checks issued The Trustee will receive a file from the departments as checks are written The Trustee will then distribute all checks as they are issued The Trustee cash account is effected immediately

Approval

Approval County Audit County Commission

Bank Coordination

Bank Coordination The transition needs to begin at the start of a month Bank clearing accounts need to be established County General Schools New checks may need to be ordered Previously issued warrants will continued to be handled as usual

Department Coordination

Department Coordination Transition needs to be coordinated with all departments in the county Each department (office) on LGC software will create a disbursement file and send to the Trustee after checks are printed If the department (office) is not on LGC software, a manual entry may be made

Department Coordination A report reflecting totals for each department will be sent to the Trustee along with the disbursement file Each department (office) will need to notify the Trustee when checks are voided Outstanding warrants will be handled as usual The Trustee and the departments need to be mindful of the transition date

LGC Coordination

LGC Coordination Contact your LGC Field Representative as early in the planning stages as possible to coordinate the transition Your LGC Field Representative will schedule a site visit for the transition day and training Your LGC Field Representative will also coordinate training for the other departments (offices) in the county Subsequent site visits will be coordinated as needed

Department Disbursement Process

Disbursement Process Department Process Accounting File Handler Check Reconciliation Create Diskette for Trustee Separate Files will be created for payroll and vendor checks

Disbursement Process Trustee Process Trustee Warrants Load Warrants by New File

Disbursement Process Trustee Process Trustee Warrants Warrant Reports Undistributed Warrants Totals Totals from this report should agree with the totals sent from the departments with the disbursement file

Disbursement Process Trustee Process Trustee Daily Day End Process Distribute Warrants

Accounting Entries

Accounting Entries When checks are distributed, the appropriate department will be debited and the 14320 Outstanding Warrants Account will be credited A check will be written from the Trustee Checking Account and deposited into the appropriate Bank Clearing Account A CD manual transaction is entered to debit the Bank Clearing Account and credit the Trustee Checking Account

Accounting Entries An electronic funds transfer may be made in lieu of writing a check In this case, a TR or JE manual transaction is entered to debit the Bank Clearing Account and credit the Trustee Checking Account

Accounting Entries As checks clear the bank, an entry is made for the total checks cleared This entry is a debit to the 14320 Outstanding Warrants Account and a credit to the Bank Clearing Account The balances of the Bank Clearing Accounts and the Outstanding Warrants Account should be the same Most Bank Clearing Accounts keep a “cushion balance”, so the balances between the Bank Clearing Accounts and the Outstanding Warrants Account will reflect this difference The Unreconciled Warrants Report should equal the total in the Outstanding Warrants Account

Accounting Entries

Accounting Entries Cumberland Clearing Account Balance: $615,521.31 Cushion: $100,000.00 Citizens Clearing Account Balance: $1,237,109.00 Cushion: $100,000.00 Outstanding Warrants Account Balance: $1,652,630.31 Cumberland Clearing Account $615,521.31 Citizens Clearing Account $1,237,109.00 $1,852,630.31 Account Cushions - $200,000.00 Net Total $1,652,630.31

This completes the Flexgen Trustee Warrant to Checks Presentation Thanks for attending!