TRAININGAccounts Payable

Year End Close ProcessPresented by: Sandra King, Office of Business Services

Welcome

FY09 Accounts Payable Year-End

Closing Workshop

June 16, 2009

Topics of Discussion Year end process and your role in the close

Key dates for submitting items to our office related to: Vendor Invoices Accounts Payable and Travel Payments Petty Cash & Employee Reimbursements Invoices Corrections Accruals Carry Forward Purchase Orders Check Deposits

GOAL

To close the accounting books on time

To close the accounting books accurately

Ensure all vendors, employees and students payments are recorded in the proper year

What is the Fiscal year? Montgomery College’s fiscal year runs

from July 1 to June 30th

A new Fiscal Year starts on July 1.

Specific year end deadlines are set in order to close the books and prepare the financial statements

Closing DEADLINESClosings: June 15th Last day for P-card Charges

June 30th Last day to submit the following• Petty Cash Reimbursement

• Local Travel under $25 July 10th, all FY09 invoices, travel, employee

reimbursements

So how are we going to achieve our goals? By staying current ensure all payment

requests for FY 09 has been forwarded to Accounts Payable

Meet or beat the deadlines dates(making sure invoices are in the hands of Accounts Payable and not inter office mail by the due dates

Ask for clarification and help

Ensuring you have received invoices from vendors and all Goods & Services must be completed and received by June 30, 2009.

.

What Determines the fiscal Year?

Completed or Date of Receipt of Goods and Services

Determines fiscal year If received before June 30th-FY09

If received after June 30th-FY10

Blanket Purchase Orders

All (B#) Blanket Purchase Orders will be closed as of June 30th.

Departments must make sure they have received and approved all invoices for the blanket purchaser order

If not, contact the vendor immediately to send the invoices to Accounts Payable

Example –June payment for a lease

What happens if the final June invoice is not received by June 30th for Blanket Orders or other types of payments

You must contact the vendor immediately to forward an invoice to Accounts Payable

If no invoices is received by July 10th, you must submit an accrual listing with information to Accounts Payable

Definition of an Accrual What is an accrual?

If goods have been received or services performed prior to June 30th, the related expense must be recognized in the current fiscal year regardless of whether the goods/services have been paid for

Account Payable - Accruals

Accruals will appear on your June ledger The accrual will be reversed on your July ledger The actual invoice payment will hit your ledger in

the month paid in the new year. This charge and the accrual reversal in July should net to $0 in the new year.

If invoices are over the accrued amounts the differences will be charged to the next fiscal year

ACCRUALS

At the end of June, Accounts Payable has to accrue our obligations. An obligation is any amount the University owes. In Accounts Payable, we base the obligation amount on three things: Amount of unpaid invoice. Amount of items received, but not yet paid. Amount reported by colleges or departments.

EXAMPLE Example: Accrual Submit a PO for a computer costing $3,200 in May The computer is received in June The invoice is received and processed in July (in

new fiscal year) Because the computer was received before year

end, it represents an expense to fiscal year 2009

 

Fiscal Year _____________          MONTGOMERY COLLEGE

ACCOUNTS PAYABLE

ACCRUAL REQUEST FORM   

Fund, org, account, program

Dollar Amount Vendor Name PO#

Inv or Order #

Date Received-

goods/services Reason For Accrual

Example            

1110-225558-6020-0010 $1,500.00 Formost Printing Inc 50944555 A2588891 6/11/09Invoice not received by

6/30                                                                 

                                                                                                                                    `                                                                           

NOTE: ONLY FOR GOODS & SERVICES RECEIVED PRIOR TO JUNE 30.        **SUPPORTING BACKUP DOCUMENTATION MUST BE ATTACHED (Contract, Packing List, Quote, Invoice)    Must be received in Accounts Payable no later than July 10.

Account Manager's Signature:     Date:   Ext.______________

Account Manager (Print)    

Department:    

PRINT FORM    MAIL TO: Accounts Payable , MKE 230-Attn Sandra King , AP Manager      

Where can I find the accrual form?

The accrual form is located on the Accounts Payable website

www.montgomerycollege.edu/departments/obs

Accrual Form Required InformationAccrual Information Required

Vendor name Amount Account number Account manager approval Purchase order number Supporting Backup Reason for Accrual

Accrual Documentation

Documentation

To support your accrual request is also needed and may include the following:

Copy of the PO, Contract for services Packing Lists Order Form/Confirmation Proof of Delivery Receipts Written documentation from vendor on letterhead

Carryover Encumbrances/Purchase Orders

What are carryover encumbrances/purchase orders? Purchase orders that are established in

current fiscal year (FY09) but, no payment and receipt of goods or services are not completed by June 30, 2009.

What should be done if I have a carryover purchase order? A listing must be completed using the carry

over request form online and forwarded to Accounts Payable by July 10, 2009.

Written details supporting the carry forward purchase orders must be provided

There can be no changes to carryover purchase orders. Any differences over the purchase orders are paid out of the next fiscal year.

Important to Know about Carry Forward Purchase Orders

NOTE payment will not be made to

vendors until August of the next fiscal year once FY09 budgets are rolled and the year is closed.

Questions

Invoice Corrections Journal entries-account cleanup

CUT off Date is July 10, 2009 for all corrections Invoice journal correction form must be completed and

forwarded to Accounts Payable with supporting backup documentation.

During the year, there is only one cut off date to get journals in for the month. There is no provision for

corrections and adjustments after the cut off date for that year. They must be posted into the next fiscal

year.

Accounts Payable - Prepaid Expenses for the coming fiscal year that

require payment prior to July 1st can be submitted to Accounts Payable clearly marked FY 10 Examples: Subscriptions and membership

renewals, insurance, etc.

A prepaid account is used when payment is made in FY09. An entry is made in July to charge your department account.

Accounts Payable-Final Cut off Date

All invoices, travel and requests for payment must be received in Accounts Payable no later than July 10, 2009, at 5:00 p.m.

Accrual listing and supporting backup is due for goods and/or services received by June 30, 2009.

Carryover purchase order requests form are due by July 10, 2009.

Removing PO Encumbrances

Encumbrances remaining on Purchase Orders (POs) as of June 30, 2009 are carried forward to FY 2010

If the departments would like encumbrances on regular purchase orders removed before they are carried forward into the new year, please submit the request to Accounts Payable by June 30th

Travel & Employee Reimbrursement

All local and long distance travel completed as of 6/30 should be recorded as an expense of FY 2009

All travel reports and employee reimbursements processed before 6/30 will be charged to FY 2009

All travel reports and employee reimbursements submitted after 7/10 will be paid out of the next fiscal year FY10 budget.

The department must submit paper work and orginal receipts to Accounts Payable by June 30, 2009.

Deficits/Over Expenditures

Units are responsible for monitoring balances in their accounts throughout the year.

A deficit is when the cash balance in general ledger is negative.

Deficits must be cleared in a timely manner, but no later than June 30th (fiscal year end)

REFUND CHECKS FOR DEPOSIT Do not hold checks. Please bring all checks

sent directly to your department to the Cashier’s window as they are received.

Cash Closing – done on June 30th

June 30th deposits will be recorded to fiscal 2009

If you deposit money after 6/30 , the funds will appear on your FY10 ledger.

Your Role in the Close

Ensure all deadlines are metand you have followed all ofthe year-end close processes.

Ask questions if you need help!

Where do you go for help? Visit Accounts Payable Website:

www.montgomerycollege.edu/departments/obs

Contact Accounts Payable at X75338 or X75336

Email Accounts Payable AccountsPayable@montgomerycollege.edu

Questions?