R⋆STARS Data Entry Guide

Chapter #13

Project Accounting

PURPOSE

This chapter presents procedures to be followed when establishing projects, recording project budgets and requesting billings. It also includes typical examples which may be followed. It is not intended to provide users with an overview of the R⋆STARS project accounting capabilities nor is it intended to “stand alone” as a guide to using the Project Billing subsystem. The R⋆STARS Reference Manual, Chapter #12 should be reviewed prior to attempting to utilize this subsystem.

Table Of Contents

OVERVIEW

13–1    MAINTENANCE OF THE 27 – PROJECT CONTROL PROFILE

13–2    MAINTENANCE OF THE 92 – GRANT/PROJECT BILLING REQUEST PROFILE

13–3    MAINTENANCE OF OTHER PROJECT-RELATED PROFILES

Project Number Profiles

Project Type Profile

Project Category Profile

Agency Control Profile

Agency Code 2 Profile

13–4    ENTRY OF PROJECT BUDGETS

Billable Budgets

Expendable Budgets

13–5    REPORTING AND INQUIRY

on-line Inquiry

system-Generated Reports

User-Requestable Reports

13–6    PROJECT EXAMPLES

Example 1

Example 2

OVERVIEW

The project accounting and billing capabilities in R⋆STARS are provided through the use of the Grant/Project Subsystem. This subsystem may be utilized to account for project costs only or may be utilized for its more complex features including budgeting and billing. The flexibility of this subsystem enables each agency to choose the level of complexity required on a project-by-project basis. In R⋆STARS, the generic term project refers to several different types of projects, and may include the following:

◾ Capital Projects – which are typically funded internally, although funding may be from outside sources.

◾ Interagency Agreements – which are agreements for one agency to provide services to another agency within the government and may or may not be reimbursable.

◾ External Projects – which may be funded by sources external to the state.

◾ Other Projects – are not classified as one of the above types.

The capabilities associated with each of these types of projects include:

◾ Capturing and reporting financial information for expenditures, encumbrances, budgets, billings and receipts whether or not the project is defined within R⋆STARS as “billable”.

◾ Calculating and reporting billing transactions for externally reimbursable projects.

◾ Calculating and generating billing transactions for billable work authorizations.

◾ Calculating billings using a variety of methods, including actual costs, standard costs per unit and standard percentage rates.

◾ Providing budgetary control over encumbrances and expenditures charged to a project.

◾ Limiting the amount of billing transactions to the billable limits for each project.

◾ Billing by phase, which enables specific phases of work to be billed to another project whereby the billing transactions are generated with the phase number entered on the expenditure transactions against the work phase.

◾ Associating a project with a grant to reduce the number of elements required to be entered on financial transactions.

◾ Providing project-related reports which enable evaluation of financial information at a variety of different levels (transaction levels to summary levels) and a variety of different sort sequences).

This chapter provides the procedures to be followed to define the project accounting and billing methodologies, enter project budgets and request billings. Prior to attempting to complete any of the project-related system profiles or enter project budgets, users must first determine which system capabilities are required for each project. A thorough review of The R⋆STARS Reference Manual, Chapter #12 is a prerequisite to this step.

13-1   MAINTENANCE OF THE 27 – PROJECT CONTROL PROFILE

The 27 – Project Control Profile provides substantial flexibility in the methodology used to identify and account for projects and interagency agreements in R⋆STARS. To provide this flexibility, the 27 profile maintains a variety of information regarding each individual Project Phase. Project billing type, billing method, posting indicators, control dates and a number of other classification elements are maintained for each project. The format of the 27 profile is divided into several segments:  Control key, information elements, indicators, billing information, billing classification elements and recovery classification elements. The following paragraphs provide a description of the data segments maintained in the 27 profile.

This profile is maintained by the controlling or servicing agency and includes:

◾ Project Identification – These elements include the Project Number, Project Phase, Title of Project Phase, Project Type, Contractor and Contractor Suffix, and look up elements used to reduce coding on project-related transactions. Effective Start and Effective End Dates are included to open and close the project for posting financial transactions.

◾ Indicators – This segment defines the levels used to post financial information to the Project Financial Table and the severity of budget control.

◾ Billing Information – These elements define how and when the project will be billed. The Billing Type, Billing Method, Billing Cycle and billing dates (in MMDD format) are included, along with a Range and Rate which are required for certain billing methods. A customer number and mail code in this segment is used for externally reimbursed projects.

◾ Buyer's Accounting Distribution – This segment defines how the internal charge transaction to the buyer will be generated for work authorizations. The Transaction Code defines the type of transaction and the classification elements define which Index, Comptroller or Agency objects, and appropriation year will be included on the transaction.

◾ Recovery Classification Elements – This segment defines how the recovery transaction to the seller will be generated for reimbursable projects. Included are the Transaction Code and all of the classification elements used to record revenue, expenditure reimbursement and accounts receivable transactions.

See Chapter #6 for a description of the 27 profile.

13-2   MAINTENANCE OF THE 92 – GRANT/PROJECT BILLING REQUEST PROFILE

The 92 profile is used to request the billings for projects which are not scheduled for automatic billing at month end. The 92 profile provides the ability to request a selected cycle of projects. It contains a cycle selection which is used by the Project Billing subsystem to select projects which have billing schedule dates in the 27 profile which fall within the cycle selection. The following example illustrates:

The billing capabilities in R⋆STARS may be selected on a Project or Grant Phase-by-Phase basis and include these two primary options.

◾ Cycle Selection – Billing transactions may be calculated at each period end or on specific dates or other cycles such as monthly, quarterly, etc.

◾ Billing Method – Bills may be calculated with or without regard to billable budgets and may be calculated using actual costs, standard percentages or standard costs per unit.

All projects with a Billing Cycle of 2 (bill on specific date) and MMDD values which fall within the 92 profile Billing Cycle Selection are printed on the Project Billings Detail Report.

13-3   MAINTENANCE OF OTHER project-RELATED PROFILES

The Project Billing subsystem utilizes five other profiles in R⋆STARS:  the D42 – Project Number Profile, the D06 – Project Type Profile, the D41 – Project Category Profile, the 25 – Agency Control Profile and the D27 – Agency Code 2 Profile. The functions of these profiles are described below and references to the input coding instructions are provided.

Project Number Profiles

The D42 profile may be used to enter a title or description of the Project Number. This title is then displayed on project-related reports. The title for each phase of the project is maintained in the 27 profile described above. The project phase budget indicator, project category, and project manager are also indicated on this profile.

Project Type Profile

The D06 profile is agency defined and could include:  capital projects, other projects, external projects.

Project Category Profile

The D41 profile defines systemwide project categories and their associated titles. Project Category serves as an alternate roll-up of Project Numbers and may be used to account for capital projects that cross agencies.

Agency Control Profile

To provide each agency with a method of controlling those expenditures which exceed the billable budgets, a unique classification is established in the 25 profile. This classification, called the Billing Deficit Accounts, consists of IDX (Index) and PCA.

The system posts this classification in the database for recoveries which do not equal billable amounts. The system also extracts this classification from the database when the billing transaction is generated to check for costs that exceed a billable budget.

Agencies which have projects with billable budgets, or which use Billing Methods 1, 2, 3 or 4, should set up billing deficit accounts in the 25 profile.

One important rule must be followed:  Once billing deficit accounts have been established in the 25 profile and utilized by the Project Billing subsystem, they may not be changed. Billing deficit accounts may only be changed when a new 25 profile record is established each year.

Note: The Billing Deficit Accounts are not used in Oregon.

Agency Code 2 Profile

The D27 profile is an agency defined field which can be used as an additional level in the project structure for budgeting and reporting purposes. Agency Code may be inferred from either Index or PCA or may be entered on the transaction.

13-4   ENTRY OF PROJECT BUDGETS

The use of project budgets is an optional feature of R⋆STARS. The 27 profile (discussed in Section 13-1) contains indicators which define whether billable and/or expendable budgets will be used.

When project expendable or billable budgets are utilized, the budgets must be entered as standard financial transactions. These budgets are entered using transaction codes established specifically for this purpose. Billable and expendable budgets require two transactions.

Once the project budgets are established, they may be adjusted (increased or decreased) at any time by entering adjustment transactions into the system in the same manner as the original budgets were entered. Normally, decrease adjustments are entered with the Reverse Code set to R.

Many levels of budgets are available for projects. Appropriations, allotments and financial plans are discussed in the R⋆STARS Reference Manual, Chapter #6, Budgeting. In addition to these, billable budgets and expendable budgets may also be recorded and controlled. These optional budgets may be recorded on a phase-by-phase basis or at the project level. Billable and expendable budgets are discussed below.

Billable Budgets

Billable budgets may be entered at the Project or Phase level or by expenditure object within Project or Phase. These budgets serve to limit the amount of the billing transaction calculated.

Billable budgets may be used not only to limit the amount of the charge but to limit the types of expenditures billed. In this way, only specified expenditure object codes would be billed even though other costs may be charged to the project.

It should be noted that if the billable budget option is selected and no budget is entered, billing transactions will not be generated or reported. Note:  At present, Oregon does not maintain projects with billable budgets.

Billable budgets, if utilized, must be entered at the same level as the Expenditure Posting Level Indicator in the 27 profile and must be entered for the appropriate objects (Comptroller or Agency). If these rules are not followed, expenditures will not be billed.

Revenue, expenditure reimbursement and accounts receivable transactions may be limited to the billable budget amount if certain billing methods are chosen. The Grant/Project Billing subsystem calculates the total cumulative-to-date expenditures, deducts previously billed amounts and compares the result to the billable budget. The billing is then generated for an amount up to the billable budget amount.

Users should monitor billable budgets to ensure that they are reasonable and that the appropriate amount of billing transactions are being generated.

In summary, a budget must be recorded when expenditures are recorded in the Project Financial Table.

Expendable Budgets

The second type of project budgets are expendable budgets and can be recorded to limit the amount of expenditures charged to the job. When expenditure transactions are entered against a project, the available balance of the expendable budget is compared to the amount of the expenditure.

Like billable budgets, expendable budgets may be recorded at the Project or Phase level or an object level within Project or Phase. By entering expendable budgets at a level below Project or Phase, the types of expenditures charged against a project may be controlled. For example, if fatal control is selected for an expendable budget for Personal Services, only Personal Services expenditures may be charged to the project.

Expendable budgets must be recorded using the same rules as those described above for billable budgets. That is, expendable budgets must be entered at the same level as the Expenditure Posting Level Indicator in the 27 profile and must be entered for the appropriate objects.

Encumbrance and expenditure transactions are controlled against the project expendable budget if this option is chosen. If the Project Control Type Indicator in the 27 profile is set to 1, encumbrance and expenditure transactions which exceed the expendable budget will fall to the Error File. If set to 2, these transactions will post to the financial files (including the Project Financial Table) and a warning message will be issued. If set to 0, these transactions will post to the financial tables and will not be evidenced by an error message.

The Budgetary Transaction Entry screen and coding instructions are covered in Chapter #3.

13-5   REPORTING AND INQUIRY

The project-related reporting capabilities of R⋆STARS include on-line inquiry, system-generated reports and user-requestable reports. These capabilities provide a full range of financial information for both reimbursable and non-reimbursable projects.

on-line Inquiry

The primary source of on-line financial information for projects is available through the 80 – Project Financial Inquiry screen. An example is shown below:

The key to this screen is Agency, Project, Phase, Appropriated Fund, Fund, Comptroller/ Agency Object and Agency Code 2. The level of information maintained in this table is defined in the 27 profile Indicators. Detail procedures for using the on-line inquiry features of R⋆STARS are provided in Chapter #3.

The 105 – TRANSACTION Detail by Project and AOBJ/AGL Inquiry summarizes transactions by project phase, agency object (from the D11 – Agency Object Profile), and agency general ledger (D32 – Agency General Ledger Accounting Profile).

Within each category, it displays the transactions by batch date (most recent first) and current document number and suffix (alpha / numeric order).

It reads the Active (AE) and Inactive Accounting Event (IAE) tables. The AE/IAE tables contain the accounting for every financial transaction that has not been archived. You may elect to see the records from the AE (A), Inactive (I) or both (B) by changing the RECORD TYPE. The default is B.

At a minimum, enter the project AGY and PROJ. The PROJ NO is from the D42 profile.

You can restrict the inquiry further by entering the PROJ/PH, AGY OBJECT, and/or AGY GL.

The project transactions will post with a PROJ/PH (phase) if the PROJ PH BUDGET LEVEL IND on the D42 profile is Y. The D27 profile lists the project phases.

The 106 – TRANSACTION Detail by AOBJ/AGL and Project Inquiry summarizes transactions by agency object, agency general ledger, and project and phase. Within each category, it displays the transactions by PCA, transaction code, service date, batch date, and current document number and suffix.

You can restrict the inquiry further by entering the PROJ/PH (both are required), and/or AGY GL. The PROJ NO is from the D42 Profile; the phase is from the 27 Profile.

NOTE:  the totals on this screen may be misleading. The display lists a transaction for each general ledger posting for each transaction code.

system-Generated Reports

The DAFR4021 Project Billings Detail Report is generated automatically each time the Project subsystem is run, both during the month for projects scheduled for non-month-end billing and at month-end. (For non-month-end billings, this report is generated only when requested through the 92 profile). This report displays the charge, recovery and deficit transactions calculated by the system.

User-Requestable Reports

Except for the Project Billings Detail Report, all project related reports are user requestable. Agencies must specifically request these reports by following the procedures outlined in Chapter #11. The project-related requestable reports which are available from R⋆STARS are also listed in this chapter.

13-6   PROJECT EXAMPLES

This section presents a number of examples which illustrate varying levels of complexity in using the Project subsystem. Completed screens are included to display profile entries and brief descriptions of the examples follow.

Example 1

Agency 101 has received an appropriation to construct a new library. It will be built in phases over a period of three years, with the first year's emphasis on design and engineering. The second year construction will commence. During the third year, construction and landscaping should be completed. Besides the appropriation level budget, no project budgets are required. Since the project is funded internally, no billings are required.

This is the simplest form of project accounting, where life-to-date expenditures are accumulated but budgets and billings are not required.

The following displays the D42 and 27 profile screens for establishing the project in R⋆STARS. The 27 profile shown displays the entry for the first phase/design. Additional 27 profiles will be completed and entered for the remaining phases. The D42 profile must be completed before the 27 profile is established.

Example 2

Agency 101 has agreed to provide building maintenance services to Agency 307 for fiscal year 2014. During the year, month-end billings for actual costs will be charged to the buyer. The buyer and seller, however, have agreed that the total charges shall not exceed $12,000 for the year. The $12,000 represents the billable budget. The seller agency does not require expendable budgets. The seller in this example is funded by the General Fund; therefore, the transaction code entered in the Seller's Accounting Distribution identifies that the recovery will be credited as an expenditure reimbursement.

The following shows the screens used to set up this interagency agreement in the 27 profile and record and enter the billable budget.