1. Introduction to CSU Reporting
Lily and Roberta
Survey campuses:
How long with CSU
How many came from private
Introduction to CSU Reporting
Roberta McNiel, SFSR and Lily Wang, MAPO
Chancellor’s Office
Year-End Legal Training
April 17, 2014

2. Year-End Legal Training
Agenda
Lily
Legal vs. GAAP Reporting
Application Software
Reporting Rollup
Chart of Accounts
Fund and Account Attributes
NACUBO Program Derivation Rules
April 2014
Year-End Legal Training

3. Year-End Legal Training
CSU maintains its financial records on a legal basis or modified accrual basis of accounting as required by the State of California.
Legal basis of accounting is not consistent with U.S. generally accepted accounting principles (GAAP). Must convert to full accrual basis of accounting as Assembly Bill (AB) 2613 requires CSU to issue annual audited financial statements in accordance with GAAP.
Lily
Give example:
Permanent differences such as fixed assets
Temporary Differences such as payroll and vacation accrual, prepaid.
Legal (modified accrual) Basis
Revenues recognized in the accounting period in which they become “available and measurable.”
Expenditures should be recognized in the accounting period in which the liability is incurred.
GAAP (full accrual) Basis
Revenues recognized in the accounting period in which they are earned.
Expenses are recognized in the accounting period in which they are incurred.
April 2014
Year-End Legal Training

4. Year-End Legal Training
Application Software
CFS (Common Financial System). PeopleSoft financial accounting software used by CSU.
FIRMS (Financial Information Record Management System). Database where each campus extracts the appropriate data from CFS and submits the information electronically to FIRMS.
TM1 or YES (Year-End System). Consolidation software. Each campus enters the audited financial statements information known as reporting package into YES. The system consolidates the figures to issue the CSU financial statements.
Lily
April 2014
Year-End Legal Training

5. State Controller’s Office
Reporting Rollup
State Controller’s Office
Legal Reporting
Some submitted at system level using FIRMS
and
Some submitted at campus level using campus data
GAAP Reporting
Consolidated financial statements submitted at system level
Chancellor’s Office
FIRMS DB
For Legal consolidation
Extract from xxCSU
TM1 DB
For GAAP financial statements consolidation
Entered from xxGAP
Campus
Legal records from CFS
xxCMP and xxCSU
GAAP records from CFS
xxGAP
Lily
Pictorial of reporting rollup.
April 2014
Year-End Legal Training

6. Chart of Accounts Overview
Campus
CSU
SCO
GAAP
Attribute
Fund
CSU Fund (3 digits)
State Fund (4 digits)
Net Asset Category
FNAT
Account
FIRMS Object Code
General Ledger Account Number (GLAN)
Natural Classification
AAT
Program
NACUBO Program Code
NACUBO Program Group
Rules
Class
CSU Fund
DeptID
Project
Lily
Lead in to detail review of fund, account, and program.
April 2014
Year-End Legal Training

7. Year-End Legal Training
Funds
The highest level of accounting is the state fund level. Fund accounting is the convention by which resources for various purposes are recorded and summarized in accordance with state laws and regulations. A fund is an accounting entity with a self-balancing set of accounts for recording assets, liabilities and fund equity. Separate accounts are maintained for each fund to ensure observance of limitations and restrictions placed on the use of resources.
The next level at which reporting is done at the CSU is the CSU fund level. The CSU has management and external reporting requirements beyond those mandated by the state. For each state fund, the CSU has established one or more CSU funds to provide further detail concerning its operations.
Within PeopleSoft, campuses establish and maintain PeopleSoft funds to manage unique campus activities. The purpose of the FNAT is to connect the campus PeopleSoft funds to a range of attributes as defined on the FNAT Data Table maintained by the Chancellor’s Office.
Roberta
April 2014
Year-End Legal Training

8. Fund Attributes (FNAT)
Roberta
Each time you create a Psoft fund, you must attach to a FNAT key.
April 2014
Year-End Legal Training

9. Year-End Legal Training
Accounts
Object codes are the individual FIRMS accounts which capture detailed accounting information concerning each CSU fund’s assets, liabilities, fund equity, revenue and expenses. They are the equivalent of general ledger account codes found in any other organization’s chart of accounts.
Within PeopleSoft, campuses establish and maintain PeopleSoft accounts to track unique campus activities. The purpose of the AAT is to connect the campus PeopleSoft accounts to a set of attributes as defined on the AAT Data Table maintained by the Chancellor’s Office. Rather than assigning a random number as the key value, like the FNAT, the object code is equal to the AAT.
Roberta
April 2014
Year-End Legal Training

10. Account Attributes (AAT)
Roberta
Each time you create an account, you must attach to an AAT key.
April 2014
Year-End Legal Training

11. Year-End Legal Training
Program
The National Association of College and University Business Officers (NACUBO) is the “industry” organization for higher education and as such sets accounting standards for its constituents. Traditionally, colleges and universities have described their operating expenses for external reporting purposes by functional categories. NACUBO has standardized those categories to ensure the comparability of higher education financial statements and defines them in their Financial Accounting and Reporting Manual for Higher Education (FARM). They are:
01xx - Instruction
02xx - Research
03xx - Public Service
04xx - Academic Support
05xx - Student Services
06xx - Institutional Support
07xx - Operation & Maintenance of Plant
08xx - Scholarships & Fellowships
Auxiliary Enterprises
Roberta
April 2014
Year-End Legal Training

12. Year-End Legal Training
NACUBO Program
The NACUBO Program Code is assigned to campus financial activity based on one of following:
The source of funds
The type of expenditure
The department spending the funds
CSU has created a set of rules that assign the appropriate NACUBO program code during the CSU Business Unit Derivation.
This program code is later used to assign the Program Group during the GAAP Derivation.
Roberta
April 2014
Year-End Legal Training

13. Year-End Legal Training
Derivation
The NACUBO Program Code derivation rules are processed in a specific order for each account type
Roberta
April 2014
Year-End Legal Training

14. FIRMS Derivation Rules and Order of Process
Roberta
April 2014
Year-End Legal Training

15. Year-End Legal Training
Rule 1
This is based on PeopleSoft’s Account Type. The Account Type indicates whether an account is an asset, liability, equity, revenue or expense. The Account Type associated with each PeopleSoft account chartfield is used to look up the associated NACUBO program code. Balance sheet accounts always use the program code associated with this rule.
April 2014
Year-End Legal Training

16. Year-End Legal Training
Rule 1 Illustration
Roberta
April 2014
Year-End Legal Training

17. Year-End Legal Training
Rule 2
This determines the program code based on the combination of Fund Processing Type and Object Code (also known as the AAT key). The Fund Processing Type defines a group of funds for which the same object codes are valid. Rule 2 looks up the Fund Processing Type and Object Code associated with the fund and account chartfields. If the program defines the combination, the related NACUBO program code will be used.
Revenue accounts are associated with program codes through application of this rule. However, if a program code cannot be found using Rule 2, a program code will be applied using Rule 1.
To illustrate the application of this rule, the object code is described as State E.O.P. Grant Program. The Program Code associated with this object code is 0801, Scholarships, which will be derived through the Rule 2 definition. Therefore, any balance in the object code will be categorized as Scholarships on the financial statements.
Roberta
April 2014
Year-End Legal Training

18. Year-End Legal Training
Rule 2 Illustration
April 2014
Year-End Legal Training

19. Year-End Legal Training
Rule 3 (also known as 3a)
This rule uses the FNAT to define the NACUBO program code when all expenses of certain funds need to be classified in a particular way. When the program code is defined on the FNAT all expense accounts where the program code was not determined via Rule 2 receive the defined code. For example, the program code 2001, Auxiliary Enterprises – Student, includes all expenses for auxiliary enterprise activities primarily intended to furnish self-supporting services to students. Expenses recorded in student auxiliary enterprise programs will receive the program code at the FNAT key level.
April 2014
Year-End Legal Training

20. Year-End Legal Training
Rule 3b
Rule 3 can also operate where the NACUBO program code has been specified on the PeopleSoft fund chartfield by individual campuses rather than on the FNAT.
Campus controlled equivalent to Rule 3
Should only be used when all remaining expenses should be coded to one program code
April 2014
Year-End Legal Training

21. Year-End Legal Training
Rule 4
This rule determines the NACUBO program code for operating expenses based on the department identification (deptID) chartfield. If the code was not derived through operation of Rules 2 and 3, Rule 4 determines the code to be applied. The distribution of expense to program codes is expressed as a percentage. For example, the Computing Support Department might be distributed 50% Academic Support and 50% Institutional Support. The percentage may also be, and often is, 100% for any given department.
April 2014
Year-End Legal Training

22. Year-End Legal Training
Rule 4 Illustration
April 2014
Year-End Legal Training

23. Year-End Legal Training
Resource
Legal Manual
Chapters 1, 2 and 3
April 2014
Year-End Legal Training

24. Year-End Legal Training
The California State University
April 2014
Year-End Legal Training