1. May 2016 CGHSFOA CONFERENCE Child Support ACCOUNTING
Kathy Edwards, Lori English, Mike Auran

2. Session Plan
To review the different areas where child support collections and fees affect county Business Offices (BO), discuss incentives, the Child Support Pass Through (SB ) and answer any other questions.

3. Child Support Payments
All collections must be processed on ACSES, even if it is cash is paid to the county
Only child support collections on ACSES; SS benefits are NOT child support payments
Collections allocated to a balance due under the noncustodial parent’s court order; current support, arrears, or costs

4. Child Support Payments
Distributed against UPA (unreimbursed public assistance) or UMP (unreimbursed maintenance payments)
UPA or UMP is not a balance due
Disbursed to custodial party (CP), other state OR
EOM transfer to CFMS
Upload to CBMS or Trails

5. Notification CFMS distributes to CBMS & Trails
Federal requirements that CSS notify other divisions of payments
ACSES uploads to CFMS during end of month processing
Amounts paid to current support, arrears, excess over UPA or UMP
CFMS distributes to CBMS & Trails
The uploads occur during month end. ACSES IS reporting correctly…talk to your program people about how Trails & CBMS is using the data ACSES sends them. There are places in the other systems that display what ACSES has reported.

6. Reporting IVA & NIVA reported on the FM150
IVE & NIVE totals reported on the FM150; detail on the FM155
“Manual” collections reported on the AM360 report
Money reconciled & transferred to county via MM627 report
Back to the previous slide….these are allocations to specific balances, from collections entered into ACSES during Month 1.

7. Manual Ledgers ACSES cannot process all child support payments
Specific Amount Medical (SAM)
Spousal only (if child support arrears still due)
Multiple current counties with Foster Care involvement
Child support paid to FSR, deposited in FSR bank account
FSR sends checks to the county 7

8. Manual Ledgers Need internal process
BO notify CSS of a check for child support
A log, copy of the check,
CSS needs to know the case & amount
County enters on the OTC area on ACSES
County disburses from county bank account

9. Elements of the MM-627, Funds Transfer Report

10. Line 3
“Total non-AFDC intercept cert fee – program income” (reimburses costs)
Non-TANF cases only
$25 certification fee withheld from the first IRS intercept received each processing year
NCP received credit for full payment
Paid to county or prorated among counties receiving the intercepted payment
Entered into CFMS at a statewide level.
Feds get their share 66 – 34%, cause it’s counted as program income. 10

11. Line 3A Total IRS / ADO admin service Fee
Charged by Federal Office to intercept a federal payment (retirement, vendor payments, farm payments)
One fee per offset
State charges counties:
Prorated to counties receiving the intercepted payment
Different from the IRS certification fee recovered.
How do counties get this information? We do all the calcs for them & it’s reported in the settlement.

12. Line 4 Administrative costs collected:
Court ordered costs that were repaid to the CSE Unit:
paternity tests (DNA)
service of process fees
attorney's costs
Considered program income
On the FM150 report
Costs that are recovered, usually from the NCP but can be CP, are used to reimburse the county for costs they incur initially.
Child support payments are allocated to costs according to ACSES distribution hierarchy.
Program income – reported to feds & they get their 66% back. 12

13. Line 5 Over-the-counter settlement:
Child support payments receipted by the county
Internal process to let CSS know
CSS bookkeeper enters payment info into ACSES through the OTC (over the counter) menu
BO needs to let CSS know – internal process, log, , copy of check, etc, with identifying information.
Cash goes into county bank account. CSS needs the information to enter the payment into ACSES, to be tracked in a batch. Batches should be closed & sent daily because of CSS’s 2 day disbursement rule.
When county releases batch, the money goes from the county bank account to the FSR bank account.
When the money is then disbursed to the CP, the money can go from the FSR bank account to the CP.
Into county suspense, for county to batch allocate 13

14. Line 5 County deposits the batch into county bank account
County CSS releases batch on ACSES to FSR
FSR uploads to ACSES suspense
Payments allocate to an amount due on the ledger
Some don’t do

15. MM627 - Line 5 County receives notification of:
Non-Sufficient Funds (NSF)
Account Closed
Stop Payment
County CSS contacts state CSS with information
IV-D must notify the State FSR Financial Specialist so the payment will be backed out with the correct reason code
Send a fax request for a payment back out with name, FSR account # and other information along with a copy of the returned check (fax # ).
Journal entries based on what’s on the AM212. this is all state liability - we give counties their cash back to make them whole, & then we get the cash back & into the state bank account. 15

16. Lines 6 & 7 Pre-FSR adjustments FSR implemented in 1993
Don’t see anything on these lines

17. Line 8A Disbursement sent in error Incorrect payment amount
FA/County Erroneous Disbursements
Any non-custodial parent (NCP) or CP paid disbursement that is later backed out of ACSES.
CP erroneous disbursement found on AM212
NCP erroneous disbursement found on AM623
Disbursement sent in error
Incorrect payment amount
NSF, account closed or stop payment
Amended refunds
Information is on AM 212 & AM 623 – BO should journal this information.
AM212 is CP & AM623 is NCP 17

18. Line 8B
County/State Erroneous Disbursements
May be due from:
Custodial party
Other state
State or County liability
Primary responsibility for collecting resides with the enforcing county
BO journal entry from AM212 & AM623
State does not collect unfunded disbursements, even state liability.
Determined by the adjustment reason code used to back out the payment
CP or other state unfunded disbursements are not on the NCP’s ledger, because NCP doesn’t owe. They are tracked differently & have to be recovered separately.
We have a system to automatic withhold a small percent of the CP’s next payments to go to the unfunded disbursement balance. 18

19. Line 9
Net IV-D transfer – totals of lines 1 to 8B

20. Line 10 IV-A (AFDC) Retained Collections
Child support collections retained and shared by county, state, and federal governments
Due to assignment of rights while CP receives TANF
Explain assignment of rights 20

21. Line 10 Retained IVA collections: Federal share – 50% (50.72%)
County share – 20%
State share – 30% (29.28%)
Up to half to General Fund
Per Vol 6, at least half to counties as incentives (more like 90%)
Federal share is reported to feds on CSE forms, matches up with Accounting forms. Settled the same as state/county settle at eom.
County share is put into IVA line, to counties, in DHS budget.
State share is split – 15% to General Fund
Other 15% is Half State Share Incentives, to counties quarterly.
About $372,000 used for State operations out of $ $4.0 million

22. Line 11A IV-E (Foster Care) Retained Collections:
Collections retained and shared by county, state, and federal governments
Child support assigned
Reimburses IV-E expenditures
Foster Care Fee vs. Child Support on FM-155
FM150 = Maintenance vs. ump
CSS says Foster Care Fees, CW says Parental Fees 22

23. MM627 - Line 11B Excess over Maintenance
Monthly child support collected is in excess of the monthly Foster Care maintenance amount
Current child support, not arrears, distributes to monthly maintenance
Excess over maintenance are payments made to current support that exceed the amount of maintenance posted for that month.
Sometimes, maintenance didn’t post but case is still act IVE.
Payments sent to Trails, BO must look for other costs for this child(ren) to reimburse.
Vol 23

24. MM627 – Line 11B Excess over Unreimbursed Maintenance Payments (UMP)
Arrears payments collected are in excess of the total UMP balance
Arrears payments, not current support, distribute to UMP
These are child support payments made that are in excess of the UMP balance. Arrears payments reimburse the total UMP balance.
Federal regs are very specific about what can be posted as maintenance and what can be reimbursed by child support collections. 24

25. Line 11B IV-E Foster Care Excess Payments County share is 100%
Excess amounts shall be deposited into a trust account for the child’s future needs
Dear Director letter dated June 1, 2013
If no other costs, BO set up separate acct to track. See Dear Director letter dated June 1, 2013, which has information. CSE is NOT & cannot be involved in setting up any trust account with this money.
Reference Volume 6 ( ) 25

26. Reclassify IV-E Excess Costs
Excess maintenance and/or UMP payments that are in a trust fund can be reclassified to IV-E maintenance costs
Happens infrequently
Explain benefits of having more IVE expenditures.
Sandy E for questions on how to do it.

27. Line 11C Non IV-E (Foster Care) Retained Collections
Child support collections retained by counties
Used to reimburse Non IV-E expenditures
Child support assigned
ACSES does not track NIVE Expenditures, like it does IV-E Maintenance, because NIVE isn’t federally mandated. NIVE placement costs are tracked by Child Welfare systems. 27

28. Line 11C Child’s cost of care tracked in Trails
All support forwarded to Trails
Not separated into current support or arrears
There are no federal regulations concerning what can be reimbursed by child support on a NIVE child.

29. MM627 – Lines 12, 12A, 12B
Line 12 is the net funds transfer, the sum of the negative and positive cash transfers
Line 12A is the amount of the warrant that goes to the county – now CFMS
Line 12B is an amount due to the state
Ignore

30. Tracking the MM627 to CFMS

31. If Positive = State owes County If Negative = County owes State
Under what CFMS Program/Function codes will I find the above information?
Line CFMS P/F C Line CFMS P/F C
Line 3A CFMS P/F C Line 11A CFMS P/F E
Line CFMS P/F C Line 11B CFMS P/F E
Line CFMS P/F C Line 11C CFMS P/F X
Line 8A&B CFMS P/F C
If Positive = State owes County
If Negative = County owes State

32. Total Non-AFDC Intercept Certification Fee Line 3 MM627 CFMS C825.8000
Entered via ADI upload by Program Accountant

33. Total IRS/ADO Admin Service Fee Line 3A MM627 CFMS C830.8000
Entered via ADI upload by Program Accountant

34. Total Administrative Costs Line 4 MM627 CFMS C845.8005
Entered via ADI upload by Program Accountant

35. Over-The-Counter Settlement Line 5 MM627 CFMS C840.8900
Entered via ADI upload by Program Accountant

36. FA/County Erroneous Disbursements Net Line 8A/B MM627 CFMS C835.8900
Entered via ADI upload by Program Accountant

37. IV-A Retained Collections Line 10 MM627 CFMS C990.8500
ACSES to CFMS interface

38. Foster Care (IV-E) Retained Line 11A MM627 CFMS E750.1235
ACSES to CFMS interface
ACSES to CFMS

39. Foster Care (IV-E) Excess Payments Line 11B MM627 CFMS E997.1236
ACSES to CFMS interface
ACSES to CFMS
If you need/want to reclass these, contact settlement accounting

40. Foster Care (NON-IV-E) Payments Line 11C MM627 CFMS X475.1237
ACSES to CFMS interface
ACSES to CFMS

41. Incentives State Incentives Federal Incentives
Federal Incentives are put back into the program. Accounting forces this entry by reclassifying from to C , using accounts or

42. DRA Fee The NIVA service fee - FY 07
Once $500 has been disbursed to the CP, she/he owes a $25 fee
Taken from the next child support payment after $500
Implemented as part of the DRA, Deficit Reduction Act. Effective FY 07, 10/1/07.
Based on FFY not CY
ANNUAL?????

43. DRA fee Reported to feds annually
Program income – 66% to feds, 34% to counties
Part of CFMS settlement
Cash kept in state bank account until reported to feds
At FY eoy, we create a report which goes to state accounting, to be entered into CFMS. Part of CFMS settlement, counties see the fees we’ve collected. Counties see the net, not the details.
About $500,000 to feds annually & $275,000 to counties.
On the state total page of MM627, not county pages.
CFMS: C ; debit is & credit is 43710

44. NIVA application Fee
A $20.00 fee received from non-public assistance applicants (NIVA) before child CSE services can be provided
IV-D documents fees paid in ACSES
All fees must go to the BO for deposit, along with back-up documentation
Again, internal processes to ensure that both divisions have all the information. 44

46. Waived Application Fee
If the fee is waived for the CP, the county must pay the $20.00 fee
IV-D provide documentation of waived fees to the BO
BO enters fees directly into CFMS
Considered program income to county
County decision when to waive fees.
Print screen or log for waived fees to give to BO
Back up documentation can include detail found on the AM360 52A screens 46

48. IV-A & IV-E Receivables
Business Office needs monthly total to record on county financial statements as Accounts Receivable
Responsibility belongs to current county
Journal entry to adjust to the AM165 report
Discuss current and enforcing county. Whichever county is current will receive the report. AM 165 report. 48

50. Child Support Incentives
Quarterly Monitoring Report (QMR) sent to County Directors and IV-D Administrators
Report totals forwarded to State Accounting
State Accounting uploads totals into CFMS on a quarterly basis
Usually completed about 6 wks after the quarter closes.
Quarter ending June is an estimate in order to close the State Fiscal Year; all others should balance.
Once the actual incentives are calculated for the June quarter, an adjusting entry is made into CFMS. 50

51. Incentives State Incentives Federal Incentives
Federal Incentives are put back into the program. Accounting forces this entry by reclassifying from to C , using accounts or

52. Child Support Pass Through
Senate Bill
Allows all Current support (MSO) for TANF clients collected to be paid to the Custodial Parent (CP)
County 20% share and portion of State share paid to counties will be backfilled with State GF dollars, making counties whole.
If funds not appropriated for a given year, pass though is not done.
Usually completed about 6 wks after the quarter closes.
Quarter ending June is an estimate in order to close the State Fiscal Year; all others should balance.
Once the actual incentives are calculated for the June quarter, an adjusting entry is made into CFMS. 52

53. Questions? Kathleen.edwards@state.co.us 303-866-4582 (CSS Financial)
(ACSES specific)