Accounts Receivable, AR Aging Reconciliation & Analysis .
ACCOUNTS RECEIVABLE, ARAGING RECONCILIATION &ANALYSISShree Hamm, Financial AnalystShree.Hamm@usg.edu404‐962‐32311
AR Aging ReconciliationWhy it is Important Accounts Receivable amounts reported on the face of ourfinancial statements should have a detailed listing that tells uswho the debtors are as well as the amounts owed. We utilize Banner as a subsidiary ledger that holds this detailfor the Accounts Receivable GL balances reported on ourfinancial statements2
AR Aging ReconciliationWhy it is Important A reconciliation is performed to verify that AR reported inBanner agrees to the AR shown in our PeopleSoft GL. We should also consider any other AR balances that may notbe maintained within Banner and capture those in ourreconciliation as well. Note: While some AR activity may be maintained outside ofBanner, it is considered best practice to run all possible activitythrough Banner We need to ensure that ALL AR Balances are being accuratelyreported within PeopleSoft and can be documented with anAR Detailed Listing3
AR Aging ReconciliationWhy it is Important Legislators, OPB, SAO, Auditors and other parties outside ofUSG are looking at our AR balances and asking why they arecontinuing to grow.4
Issues with AR Aging Recon Most Institutions were not Reconciling their ZGRAGES & ARAging Report Submitted to the Data Warehouse to PeopleSoftGL Balances which caused variances between our AR detailedlistings and what was being reported on the FinancialStatements5
Addressing those IssuesNew Standard Reconciliation We have created a standard reconciliation form that you willutilize to reconcile the ZGRAGES to PeopleSoft6
AR Aging ReconciliationWhat to Submit To MoveIt New Excel AR Aging Reconciliation which will include ReconciliationZGRAGES SummaryTrial Balance Query from People SoftPivot table of People Soft Query showing totals by Fund and Account To Data Warehouse AR Aging Report7
AR Aging Report Submitted to Data Warehouse8
AR Aging Reconciliation Submitted to MoveIt9
AR Aging ReconciliationThings to Remember when Reconciling AR Aging Reconciliation should be completed and submittedto MoveIt bi‐annually, along with your AR Aging Reportsubmitted to Data WarehouseDate of AnalysisAs of December 31stAs of June 30thDue DateFebruary 10th10 days after submission of AFR AR Aging Reconciliation is different from your quarterlyTGRRCON Reconciliation The AR Aging Reconciliation and TGRRCON Reconciliation aretwo separate reconciliations10
AR Aging ReconciliationThings to Remember when Reconciling It is important to ensure that the amounts reported onZGRAGES agrees to the AR Aging Report Submitted to the DataWarehouse. The amounts within your AR Aging Reconciliation will be verifiedto the AR Aging Report Submitted to Data WarehouseNew AR Aging Reconciliation Template The New AR Aging Reconciliation Template along with somestep by step instructions has been provided through theRACAR and AFR Listserv. It is also available on MoveIt under the commons folder.11
TGRRCON ReconciliationThings to Remember when Reconciling TGRRCON Reconciliation will continue to be done as you havealways done it in the past, there are no changes at this time tohow this reconciliation is done or submitted. TGRRCON should be ran & reconciled at least monthly. Submit TGRRCON reconciliation to MoveIt quarterly. TGRRCON Reconciliation is different from your biannual ARAging Reconciliation.12
BPM ‐ ACCOUNTS RECEIVABLEOverview The next few slides will go through and highlight someimportant procedures relating to Accounts Receivableincluding proper procedure for write‐offs as well as otherpertinent information.13
Student ReceivablesTuition & Fees Student Account Receivables for Tuition and Fees should bekept current Student Accounts that are not current should be reported assuch on the AR Aging Report and submitted to the UniversitySystem Office as noted in Section 10.5 of the BPM14
Student ReceivablesCollection of Student Receivables Students should be given written notice about the nature andthe amount of the outstanding obligation. The student should be dropped from classes, if financial aidfunds, scholarship funds, or guaranteed third party payorfunds are not authorized for the student and they can not paythe tuition See Section 10.7.4 of the Business Procedures Manual15
Student ReceivablesUncollectibles After Due Diligence Process has been followed and theaccount has been turned over to a collection agency*, theuncollectibles should be written off as detailed in Section10.4.1 of the BPM Submit Request to SAO to write off anything under 3,000 Anything greater than 3,000 should be reserved for doubtfulaccounts*You do not have to turn accounts over to a collection agency. This isan additional step that you have the option to use, it is not required.16
State & Federal Gifts & GrantsReceivablesBilling Must be submitted promptly and accurately Each institution should maintain procedures and controls toensure the following: Periodic Interim Claims ‐ All reimbursable expenditures should be billed within 30 days of theclose of the period for which reimbursement can be claimed Final Claims – Final Claims for reimbursable expenditures should be submittedwithin 90 days of the completion of the term of the contract, grant,or other agreement17
State & Federal Gifts & GrantsReceivablesCollection Collection efforts must be established, although theprocedures may vary by funding agency Instances where claims must be rebilled, the original billingdate will continue to be used for aging purposes Follow‐up procedures should be in place and should takeadvantage of existing direct contacts available to contract andgrants officers See Section 10.7.4 Table 1 within the BPM18
Auxiliary Service ReceivablesResidence Halls Receivables are managed according to the terms of thecontract between the student and the institution. Receivables due from students who no longer live in aresidence hall should be handled in the same manner as otherStudent Accounts Receivable See Section 10.7.4, Table 2 of the BPM19
Uncollectible AccountsProcedures to follow when writing offqualifying receivables: Adequate information concerning the age of the outstandingbills and claims is essential1. Aging information must be collected, maintained, reported,and acted upon in a standardized and consistent manner2. Levels of effort in record keeping and collection must becommensurate with collection value (See Section 10.7.4 ofBPM)3. In general, bills must be collected as quickly as possible, butcost of collection must not exceed the expected revenue.20
Uncollectible AccountsProvisions for Uncollectibles GASB requires that uncollectibles be treated as a contrarevenue rather than expense for financial reporting purposes. In order that realized revenue will be reflected properly,uncollectibles must be regularly recognized as stated inSection 10.4.1 in the BPM For accounts receivable of 3,000.00 or less to be determineduncollectible, due diligence for collection must have takenplace along with an approval from SAO (see Section 10.7.4 ofthe BPM)21
Uncollectible AccountsProvisions for Uncollectibles Write‐off of receivables is based upon the aggregate of thedebtor, not on individual transactions. A student may owe ten different transactions of which no singletransaction is over 3,000 However the total of those tentransactions in 4,000. In this case, the 4,000 can NOT be written off. It is considered best practice to continually analyze the accountsreceivable and write them off before they become larger than 3,000 Note: It is important to maintain records of those write offswithin Banner to avoid allowing a student to register forclasses in the future after their debt was written off22
Uncollectible AccountsWhat Allows us to Write Off Uncollectibles? Senate Bill 73, OCGA Section 50‐16‐18 Provides State Agencies with a mechanism for writing off debt ofan immaterial nature owed to the state. Materiality threshold is 3,000.00 or less for the institutions ofthe Board of Regents of the University System of Georgia23
BPM 10.7.4 Collection Efforts24
BPM 10.7.4 Collection Efforts25
AR Aging Analysis, Recon,Review & ReportingDue Dates Defined Using the accurate due dates are important when agingaccounts receivable Due Dates are defined as follows: Student Accounts – The first day of classes for the term* Student Account due date may be modified to the date that financialaid is withdrawn in order to give the student and institution anopportunity to locate other payment arrangements Non Student Accounts – Generally 30 days after the invoice date*Due dates for Student Accounts are determined differently amongst the variousinstitutions. This will be considered further when updating a revising the AR BPM.For now just be sure to use a consistent due date to accurately age the receivable.26
AR Aging Analysis, Recon,Review & ReportingReporting AR Aging Report Submitted to USG vis Data Warehouse As stated in Section 10.5 of the BPM, Each Institution will submitan analysis of receivables to the Vice Chancellor for Fiscal Affairsin accordance with the schedule below:Date of AnalysisDue DateAs of December 31stFebruary 10thAs of June 30th10 days after submission of AFR27
AR Aging Analysis, Recon,Review & ReportingAnalysis, Reconciliation & Review Aged listing of receivable will be prepared at least quarterlyand will reflect the results of billing and collection follow‐upactivity. Management above the level responsible for supervising thebilling and collection follow‐up function will review old datedbalances. The Accounting Office (The Institution’s Fiscal Affairs orequivalent) will ensure that subsidiary ledger records(including those maintained outside the accounting office) arereconciled to the control account balances at least quarterly.28
AR BPM Update We realize there is a need to update and rewrite the BPMAccounts Receivable Section and we are planning to beginworking on this in the near future. If you are interested in sharing your thoughts or suggestionsregarding the AR BPM please send an email toShree.Hamm@usg.edu29
30
The amounts within your AR Aging Reconciliation will be verified to the AR Aging Report Submitted to Data Warehouse New AR Aging Reconciliation Template The New AR Aging Reconciliation Template along with some step by step instructions has been provided through the RACAR and AFR Listserv.
Accounts receivable 100 Sales 100 Accounts Receivable Allowance for Doubtful Accounts Beg. 500 25 Beg. End. 600 25 End. Sale 100 Slide 7-22 UCSB, Anderson Accounting for A/R and Bad Debts Collected of 333 on account ? Cash 333 Accounts receivable 333 Accounts Receivable Allowance for Doubtful Accounts Beg. 500 25 Beg. End.
Create a Receivable Document Learning Objectives In this lesson, you will: Examine the Receivable document components Review Receivable document data entry Create a Receivable document Examine the requirements to bill a vendor for a refund Create a Receivable from a template
What is an Accounts Receivable (A/R)? A balance due from a debtor on a current account. Receivable ‐Amounts owing to the State including accounts receivable, loans, notes receivable, and interest. Receivables can be due from private persons, firms, corporations, other agencies,
2. The percent of accounts receivable method uses an analysis of accounts receivable to estimate the amount that will be uncollectible. Percents are usually based on past experience. A business that has experienced a 1.0% rate of uncollectible accounts can reasonably expect that 1.0% of future accounts receivable will become uncollectible.
Structured Finance 31 Debtor-in-possession Financing 32 Factoring 33 Third-Party Vendors 34. Accounts Receivable and Inventory Financing ii Comptroller’s Handbook . Comptroller’s Handbook 1 Accounts Receivable and Inventory Financing Accounts Receivable and Inventory Financing Introduction This booklet describes the fundamentals of .
142 customer accounts receivable 177,965,627 143 other accounts receivable 63,798,926 144 accumulated provision for uncollectible accounts (3,189,707) 145 notes receivable from associated companies 16,024,261 146 accounts receivable from associated companies 936,122 151 fuel stock 550,278 152 fuel stock expense undistributed -
physical invoice by selecting Click here to download the invoice template. The Contracts Accounts Receivable Detail can be accessed from 1. Select Contract for AR page by selecting the View/Add Accounts Receivable (AR) to this contract ( ) icon, then selecting the View this Accounts Receivable (AR) ( ) icon from the Contract page 2.
Example risk assessment for food preparation, cooking and service This example risk assessment applies to restaurants, cafés, sandwich bars, pubs, takeaways or hotel kitchens.
