1. TCM: HOW TO CREATE A BUDGET UNIT

2. WHAT ARE WE GOING TO COVER?
DEFINE A BUDGET UNIT FOR COST REPORTING
WHAT IS AN ORGANIZATION CHART
CREATING YOUR BUDGET UNIT USING YOUR FINANCIAL DOCUMENTS
IDENTIFYING COST OF STAFF IN A BUDGET UNIT AND OUTSIDE OF A BUDGET UNIT

3. WHAT IS A BUDGET UNIT?
For cost report purposes – a budget unit is defined as the budgetary/organizational unit identifiable on the LGA organization chart and general ledger that provides TCM and Non TCM services by staff within the unit.
The BU is to only include 100% labor costs of any staff within the unit, as well as non labor costs incurred for providing all services.

4. What is an organizational chart?
An organizational chart (often called org chart) is a diagram that shows the structure of an organization and the relationships and relative ranks of its parts and positions/jobs.

5. Here’s is an example of an org chart of Dept
Here’s is an example of an org chart of Dept. of Health and Human services from Sacramento County.

6. The TCM BU shall also be readily identifiable on the LGA organizational chart and the LGA accounting structure.

7. Budget unit
In this example we identified the budget unit to be Public Administrator/Guardian/Conservator. In the accounting structure of the LGA, the BU is identified with its specific fund center and cost center where the expenses – labor and non labor are charged. All staff are assigned to a common cost center as well as the non labor cost. If there are other programs in the BU, expenses are further assigned to an order number.

8. Why do we need to identify the Budget unit properly?
The guiding principles of OMB A87 or now under 2 CFR 200 regarding eligibility of federal reimbursement requires costs to be “reasonable and necessary” for the provision of TCM services. Identifying the TCM BU ensures that costs identified and allocated by the cost report are reasonable for providing TCM services.

9. What factors to consider
Organization Chart
Accounting Structure
For LGA
Fund Center
Cost Center
For Non-LGA
Depending on their structure
Entire agency is the budget unit
By department
By program
For non-LGA depending on the entity’s structure, the BU can be the entire agency or maybe a department of an agency or a program. The accounting system plays a major role of identifying 100% of the costs associated with the budget unit.

10. Accounting Structure for LGA
How are expenses charged?
For some, Costs are given accounting code assignments. Like for example a Fund center or Cost Center and may also include the lowest assignment of codes like order number to identify funding for operating expenses.
How are revenue recorded?
Generally, revenues are recorded in a pool but some can be specifically identified to their costs.
Indirect Cost Allocation
Includes County allocation plan

11. How do you account for costs outside of the budget unit?
A government entity that reports TCM expenses outside the BU must report only the TCM program costs and is required to maintain supporting documentation to substantiate the calculated TCM cost outside of the BU.
Only include TCM direct cost; therefore staff must time survey.
In our example – the TCM BU has an MOU with Behavioral Health Division for one Mental Health worker as a case manager for Public Guardian Conservator the BU. The Mental Health worker must time survey to account for his/her time providing TCM services. The Salaries and benefits of the Mental health worker will be calculated using the Time survey results to determine the TCM costs of the Mental health worker. Once the TCM cost is calculated it will be accounted as adjustment to TCM direct cost.

12. QUESTIONS