1. 2017 GAAP reporting updates
Nathanael Bryant, Financial Systems & Reporting Analyst
Systemwide Financial Standards & Reporting, CO

2. YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
APRIL 2017
Learning Objectives
Review changes to legal to GAAP reconciliations
Discuss Pollution Remediation form
Review changes to the SCO GAAP capital assets/accumulated depreciation screen in AM
Inform participants about new rounding conventions
Discuss a new FIRMS GAAP edit

3. Legal to GAAP Reconciliations
YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
APRIL 2017
Legal to GAAP Reconciliations
Finally, some good news!
The SCO no longer requires campuses to submit legal-to-GAAP reconciliations for state funds other than the General Fund (0001).
Remember: these instructions still apply!
Legal-basis amounts must agree to the balances reported to the SCO via the SAM 99
GAAP amounts must agree to the balances submitted to GAAP FIRMS and TM1

4. Legal to GAAP Reconciliations (cont.)
APRIL 2017
YEAR-END GAAP TRAINING
Legal to GAAP Reconciliations (cont.)
Use the standard GAAP adjustments listed on the Description of GAAP Adjustments tab.
Do not change adjustment numbers
Do not change adjustment descriptions
If non-standard adjustments are required, give them a new number and a concise and understandable description
DO NOT submit compound entries (i.e. don’t merge multiple entries into a single entry)

5. Legal to GAAP Reconciliations (cont.)
YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
APRIL 2017
Legal to GAAP Reconciliations (cont.)
Regarding the General Fund reconciliation, do not separate GAAP adjustments by CSU fund (001 & 017) as reporting is done at the state fund level.

6. YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
Quiz 1
Which fund(s) require submission of a legal to GAAP reconciliation?
General Fund only
General Fund + non-governmental funds
General Fund + all capital outlay funds
All state funds

7. Pollution Remediation
YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
APRIL 2017
Pollution Remediation
The SCO requires detail of pollution remediation obligations
GASB 49 defines these as obligations to address the current or potential detrimental effects of existing pollution by participating in pollution remediation activities.
This can range from asbestos abatement in old buildings to clean-up of lead paint chips.

8. Pollution Remediation (cont.)
APRIL 2017
YEAR-END GAAP TRAINING
Pollution Remediation (cont.)
Reminder:
Campuses will submit the report by state fund to the CO for all non-governmental funds. Typically this is for state funds 0948 & 0576.
For governmental funds, campuses will submit the report (by state fund) as a part of their package to the SCO.

9. Pollution Remediation (cont.)
APRIL 2017
YEAR-END GAAP TRAINING
Pollution Remediation (cont.)
According to GASB 49, pollution remediation activities include the following:
Pre-cleanup activities, such as the performance of a site assessment.
Cleanup activities, such as removal and disposal of pollutants and site restoration.
External government oversight and enforcement-related activities, such as work performed by an environmental regulatory authority dealing with the site and chargeable to the government.
Operation and maintenance of the remedy, including required monitoring of the remediation effort (post-remediation monitoring).

10. Pollution Remediation (cont.)
APRIL 2017
YEAR-END GAAP TRAINING
Pollution Remediation (cont.)
In 2016, only 7 campuses reported any pollution remediation obligations on the SCO GAAP template.
As campuses perform non-recurring maintenance projects, the number requiring submission of the pollution remediation template is expected to increase.
Make inquiries of your facilities maintenance personnel to determine if and to what extent pollution remediation activities are taking place
Chapter of the CSU GAAP Accounting & Reporting Manual has more detail regarding categorization of pollution obligations

11. Pollution Remediation (cont.)
YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
APRIL 2017
Pollution Remediation (cont.)
Column A (Beginning Balance) must equal ending balance from prior year
Columns E & F (Due Within 1 Year and Non-current Liability) must tie to balances reported in the current and non-current columns of Note 20 – Other Liabilities detail - in TM1

12. Pollution Remediation (cont.)
APRIL 2017
YEAR-END GAAP TRAINING
Pollution Remediation (cont.)
Errors are frequently noted in the completion of the Disclosure Information column. Campuses need to disclose all of the following:
Nature and source of obligation
Amount of estimated liability
Methods employed to estimate liability
The potential for changes in the estimate
An estimate that is recoverable from insurance or other parties
If the liability for the project cannot be determined, indicate why

13. Pollution Remediation (cont.)
YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
APRIL 2017
Pollution Remediation (cont.)
Example of poor disclosure:
Asbestos clean-up on campus
Example of good disclosure:
Asbestos was discovered in the Science Building when repairing the HVAC system. The total cost of clean-up was determined to be $500,000 based on a successful vendor’s bid. We estimate less than a 1% chance that there will be a material change in the estimate. No insurance recovery is expected.

14. SCO GAAP Capital Assets & Accumulated Depreciation Worksheet
YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
APRIL 2017
SCO GAAP Capital Assets & Accumulated Depreciation Worksheet
Changes were made to the capital assets and accumulated depreciation input screen in Asset Management
Data from CWIP & PWIP forms carry forward to this screen
Now campuses can easily see if their CWIP & PWIP transfers net to zero by checking to see if the CWIP/PWIP transfers out are equal to the CWIP/PWIP transfers in

15. SCO GAAP Capital Assets & Accumulated Depreciation Worksheet (cont.)
YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
APRIL 2017
SCO GAAP Capital Assets & Accumulated Depreciation Worksheet (cont.)
Prior Period Adjustment Additions and Prior Period Adjustment Deductions columns are now “read only” so campuses can no longer enter data into these columns; they are solely populated by data from last year’s GAAP adjustments columns.

16. YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING

17. SCO GAAP Capital Assets & Accumulated Depreciation Worksheet (cont.)
YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
APRIL 2017
SCO GAAP Capital Assets & Accumulated Depreciation Worksheet (cont.)
Input of GAAP adjusting entries remains the same as in prior years
The CWIP & PWIP forms remain the same; campuses will enter data to all cells manually.
SFSR validates the worksheet through reference to the data reported in TM1

18. SCO GAAP Capital Assets & Accumulated Depreciation Worksheet (cont.)
YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
APRIL 2017
SCO GAAP Capital Assets & Accumulated Depreciation Worksheet (cont.)
Campuses also have access to a CFS query showing campus input for each of the columns of the form. Query is an aid to validation of data entered on the worksheet.
Use query “GAAP Basis by Business Unit” to download input data straight from CFS
Use this data to compare data entered on the worksheet to data in TM1 Note 5 to verify accuracy
This query also acts as a print option for campus

19. SCO GAAP Capital Assets & Accumulated Depreciation Worksheet (cont.)
YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
APRIL 2017
SCO GAAP Capital Assets & Accumulated Depreciation Worksheet (cont.)

20. SCO GAAP Capital Assets & Accumulated Depreciation Worksheet (cont.)
YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
APRIL 2017
SCO GAAP Capital Assets & Accumulated Depreciation Worksheet (cont.)
Common prior year errors were:
Additions on form did not equal additions in TM1
Data was in wrong category (e.g. addition entered in Building Improvements when it should have been in Buildings)

21. YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
Quiz 2
What data do campuses enter into the Prior Period Adjustments columns?
Any and all adjustments that will make the ending balances “work”
GAAP adjustments from the prior year
None, the columns are automatically populated and the entries cannot be altered
Only corrections provided by the external auditors

22. YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
Rounding Convention
Source of data on Excel SCO GAAP templates is the campus general ledger and data should agree to FIRMS submissions
Since general ledger and FIRMS data are stated to the nearest penny, the Excel templates should follow this same rounding convention.
SCO GAAP templates completed in TM1 can follow the same rounding convention used for all other data entry in the system (i.e. nearest dollar)
The Capital Assets and Accumulated Depreciation Worksheet is programmed to round to the nearest penny
Following these rounding rules will speed up CO’s consolidation process and will facilitate identification of errors

23. Rounding Convention (cont.)
APRIL 2017
YEAR-END GAAP TRAINING
Rounding Convention (cont.)
These are the forms where rounding to the cent is applicable:
Reconciliation of Due To/From Accounts
Reconciliation of Transfers To/From Other Funds
Capital Assets and Accum. Depreciation Worksheet
Depreciation Expense Schedule
Legal to GAAP Reconciliation
The templates have been updated to note the rounding convention being applied

24. YEAR-END GAAP TRAINING
APRIL 2017
YEAR-END GAAP TRAINING
APRIL 2017
Update to FIRMS Edit
Due to implementation of GASB 68 (accounting for pension obligations), the consolidated value of GAAP object code , Unrestricted, is expected to carry an abnormal (debit) balance into the foreseeable future.
Abnormal balance causes a FIRMS error for most campuses and prevents a “clean” submission.
FIRMS validation updated to exclude CSU fund 488, GASB 68 Net Position Liability, from calculation of consolidated value of , therefore:
Campuses should be able to achieve a “clean” submission
If a FIRMS error is triggered due to an abnormal balance in (unrelated to the pension liability recorded in 488), an explanation will be required.