1. Common Journal Entries Sheryle Coaker, MASBO Stacey Graves, Desoto County School District Sandy Halliwell, Clinton Public School District

2. Overview Debt Entries Construction Entries Year End Entries

3. Debt Entries Debt service funds (4xxx) are generally used to account for the accumulation of resources for the payment of principal and interest A separate Debt Service Fund is to be used for each levy established by the school board Debt service funds are used when a tax levy is in place to repay a particular debt of the school district. Not needed if accumulated resources are not necessary (ex: 16 th section principal loans)

4. General Obligation Bond Record proceeds Debit – Cash Credit – Proceed of GO Bond (function 6100) Capital Projects Fund, General Fund

5. General Obligation Bond Record collections for re-payment Debit – Cash Credit – Revenue function (1120 – Ad Valorem, 6720 – Transfer from District) Debt Service Fund

6. General Obligation Bond Record annual debt payment Debit – Principal Payment (function 6140, object 840) Debit – Interest Payment (function 6140, object 830) Debit – Fees – if applicable (function 6140, object 810) Credit – Cash Debt Service Fund

7. 3 Mill Note Record proceeds Debit – Cash Credit – Proceed of Loan (function 6200) Capital Projects Fund, General Fund

8. 3 Mill Note Record collections for re-payment Debit – Cash Credit – Revenue function (1120 – Ad Valorem, 6720 – Transfer from District) Debt Service Fund

9. 3 Mill Note Record annual debt payment Debit – Principal Payment (function 6120, object 840) Debit – Interest Payment (function 6120, object 830) Credit – Cash Debt Service Fund

10. Qualified School Construction Bond Record proceeds Debit – Cash Credit – Proceed of Loan (function 6100) can use expanded function ex: 6102 Capital Projects Fund

11. Qualified School Construction Bond Record collections for re-payment Debit – Cash Credit – Revenue function (1120 – Ad Valorem, 6720 – Transfer from District) Debt Service Fund (4021 – 4029)

12. Qualified School Construction Bond Record annual payment to lending institution Debit – Payment to Qualified Zone/School Debt Escrow Agent (function 6190 – 830,840,810,845) Credit – Cash Debt Service Fund (4021 – 4029)

13. Qualified School Construction Bond Record payment received by lending institution Debit – Cash/Invest with fiscal agent (gl code 105/111) Credit – Payment to Escrow Agents (800-6800) Credit – Interest Income (800-1520) Debt Service Fund (4091 – 4099)

14. 16 th Section Principal Loan Record proceeds Debit – Cash Credit – Advances from other funds (gl code 442) General Fund

15. 16 th Section Principal Loan Record transfer of loan Debit – Advances to other funds (gl code 132) Credit – Cash 16 th Section Principal Fund (7211)

16. 16 th Section Principal Loan Record annual payment General Fund Debit – Advances from other funds (gl code 442) Credit – Cash 16 th Section Principal Fund Debit – Cash Credit – Advances to other funds (gl code 132)

17. Shortfall Note Record accrual for Ad Valorem Debit – Due from Local Sources (gl code 121) Credit – Ad Valorem Revenue (function 1120) General Fund

18. Shortfall Note Record proceeds Debit – Cash Credit – Proceeds of Loan (function 6200) General Fund

19. Shortfall Note Record collections (monthly) Debit – Cash Credit – Due from Local Sources OR

20. Shortfall Note Record collections (monthly) Debit – Cash Credit – Ad Valorem Revenue 2 nd journal entry at year end to reduce Due from Local Sources (next slide) General Fund

21. Shortfall Note Year End Adjustment (total collections) Debit – Ad Valorem Revenue Credit – Due from Local Sources General Fund

22. Shortfall Note Record interfund transfer (annual) Debit – Transfer Out (function 7120, object 990) Credit – Cash AND General Fund

23. Shortfall Note Record interfund transfer (annual) Debit – Cash Credit – Transfer In (function 6720) Debt Service Fund

24. Shortfall Note Record annual payment Debit – Interest (function 6160, object 830) Debit – Principal (function 6160, object 840) Credit – Cash Debt Service Fund

25. Construction Entries Record proceeds Debit – Cash Credit – Proceed of Debt (bonds, loans) Capital Projects Fund (3xxx), General Fund (1xxx)

26. Construction Entries A capital projects fund is generally necessary to account for the purchase, construction or major renovation of a school district facility Capital projects funds are not used to account for acquisition of short lived assets (furniture and equipment) and repairs not capitalized A separate fund must be used when a project is to be financed by a note or bond issue

27. Construction Entries Record proceeds Debit – Cash Credit – Proceed of Debt (bonds, loans) Capital Projects Fund (3xxx), General Fund (1xxx)

28. Construction Entries Record construction expenditures Debit – Facilities acquisition & construction (function 5100 – 5900) Credit – Cash Capital Projects Fund

29. Construction Entries Record repair expenditures Debit – Operation and maintenance of plant (function 2610 - 2690) Credit – Cash General Fund

30. Construction Entries Record year-end payables Debit – Facilities acquisition & construction Debit – Architect fees Credit – Construction contracts payable Credit – Retainage percentage payable Credit – Claims payable (architect fees)

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32. Construction in Progress Record Construction in Progress to Fixed Asset on the financial statements for all 5xxx expenditures through June 30 Capitalize as buildings/building improvements when construction is complete Not recorded in the funds within the financial software

33. Year End Entries