1. FINANCIAL STATEMENTS Presented By: David Boling Associate Comptroller for Financial Reporting and Analysis 25 July 2007

2. Why Produce Financial Statements? To provide financial information to the University’s constituencies, which include the State (taxpayers), donors, and grantors To provide management information to University leaders so that they can make decisions

3. Transactions Every transaction processed in every module ultimately ends up on one or more lines in the financial statements So choosing the right “code” is important (Expenditure type or object code, fund source, etc.)

4. Transaction Flow PTAEO – COADetail Summary INSTITUTIONAL REPORTS Expenditure Budget Revenue Budget Grants Accounting Deposits (cash, checks, credit cards) Accounts Receivable General Ledger PTAEO detail is summarized

5. Cash Basis versus Accrual Financial statements must be prepared on the accrual basis of accounting What’s the difference?....TIMING, meaning which fiscal year should a transaction be reported in? If activity occurred before June 30 th, but was paid for after June 30 th, then it is (accrued) as June 30 th activity Examples of Accruals: Accounts Payable and “Lag Pay(roll)”

6. Adjusting Periods ADJ1 (13 th period): Used to update GL for activity that occurred BEFORE June 30 th, but for which information was received AFTER June 30 th (Ex: Deposits, interest paid) ADJ2 (14 th period): Used to update GL for accrual transactions

7. GASB Reporting Model Governmental Accounting Standards Board (GASB) sets accounting and financial reporting rules for governments, including public higher education institutions FASB sets standards for private higher education institutions GASB changed its financial statements model to be more like the FASB model, beginning in FY02

8. Who’s Included in UVa’s Financial Statements? Academic Division Medical Center (hospital) UVa College at Wise But NOT the University’s Foundations (more on them later)

9. Timeframe for Financial Statements June 30: Fiscal year ends July to August: Accruals, allocations, and other adjustments generated, and put into ADJ1 and ADJ2 GL periods Mid Aug to mid Sept: Draft financial statements produced and analyzed Early Sept: Med Center and foundations submit their financial statements Sept 27, 2007: Financial Statements completed and submitted to the State

10. UVA’s Financial Statements 1. Statement of Net Assets (Balance Sheet) 2. Statement of Revenues, Expenses, and Changes in Net Assets (SRECNA) 3. Cash Flow Statement