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June 16, 1995

COMPTROLLER'S MEMORANDUM NO. 20 (1994-95)

SUBJECT: STATEWIDE POLICY FOR RECEIPT AND DISBURSEMENT OF FEDERAL FUNDS


Chapter 95-303, Laws of Florida, amended Section 216.102, Florida Statutes, effective July 1, 1995, to require the Comptroller to publish a Statewide policy detailing the requirements for recording the receipt and disbursement of Federal funds into the State Automated Management Accounting Subsystem. Enclosed is a copy of the policy, which will become effective July 1, 1995.

Questions regarding this policy should be directed to the Bureau of Accounting at 488-2922, Suncom 278-2922.

FEDERAL FUNDS ACCOUNTABILITY ACCOUNTING POLICY
EFFECTIVE DATE: JULY 1, 1995

I. TITLE
Federal Funds Accountability

II. AUTHORITY AND REFERENCE
Article III, Section 19, Constitution of the State of Florida Article VII, Section 1(e), Constitution of the State of Florida
Section 11.46, F.S.
Section 17.14, F.S.
Section 215.31, F.S.
Section 216.102, F.S.
Section 216.121, F.S.
Section 216.165, F.S.
Section 216.212, F.S.

III. PURPOSE
To improve accountability over federal financial assistance funds in the State of Florida and to minimize the payment of interest to the federal government pursuant to the implementation of the Federal Cash Management Improvement Act of 1990.

This is the first in a series of policies relating to the accounting and financial reporting of federal grant funds. It is the intent of this policy to standardize the accounting and reporting for all cash receipts of federal financial assistance and cash disbursements for direct costs associated with federal programs. The extension of these minimum requirements to all revenues and expenditures related to federal financial assistance is encouraged but not required at this time. Future policies will address accounting and financial reporting for indirect cost earnings and state matching requirements.

It is the intent of this policy that revenue be recognized upon the initial receipt of federal funds into the State Treasury and that it be classified as operating transfers in/out for all subsequent moves between agencies included within the reporting entity of the state. Disbursements will be recognized upon the ultimate cash payments of federal funds from the State Treasury.

IV. DEFINITIONS

  1. Federal Funds - any assistance provided to the State of Florida or its political subdivisions by a federal agency, either directly or indirectly, in the form of grants, contracts, cooperative agreements, loans, loan guarantees, property, interest subsidies, insurance, or direct appropriations.
  2. Operating Transfers In/Out - legally authorized transfers from the state trust fund in which the initial deposit of federal funds was made to the state trust fund through which the federal funds are to be expended.
  3. Operating Grants - Grants which are restricted by the grantor to operating purposes (i.e. salaries and benefits, other personal services, expenses, operating capital outlay, etc.).
  4. Capital Grants - Grants which are restricted by the grantor for the acquisition of or addition to fixed assets.
  5. Catalog of Federal Domestic Assistance Number - The 5 digit code which identifies the specific federal domestic assistance program revenue source (Example 93.667 Social Service Block Grant).

V. POLICY STATEMENT

It shall be the policy of the State that the recording and reporting of federal financial assistance receipts and disbursements shall adhere to the following accounting standards. The accounting standards have been developed by the State Comptroller in consultation with the Executive Office of The Governor and the Treasurer.

  1. All receipts of federal financial assistance shall be recorded into the State Automated Management Accounting System (SAMAS) utilizing the following accounting codes:
  1. Governmental and Similar Fund Types

    1. Receipts
      1. General Ledger - 614xx - Revenue - Grants and Donations.
      2. Revenue Source Codes - 000700 U.S. Grants and 000701 - Federal Disaster Relief.
      3. Grant - a valid Grant identification code which has been established on the SAMAS Grant Information and Title files. The SAMAS Grant Information file must designate the Grant as a Federal Grant and carry a related and validated Catalog of Federal Domestic Assistance number.
    2. Operating Transfers In
      1. General Ledger - 655xx - Federal Funds Transfers In from Within the Agency, or 656xx - Federal Funds Transfers In from Other Agencies.
      2. Revenue Source Code - 001510 - Transfer of Federal Funds.
      3. Grant - a valid Grant identification code which has been established on the SAMAS Grant Information and Title files. The SAMAS Grant Information file must designate the Grant as a Federal Grant and carry a related and validated Catalog of Federal Domestic Assistance number.

  2. Proprietary and Similar Fund Types
    1. Receipts (Operating Grants)
      1. General Ledger - 683xx - Operating Grants.
      2. Revenue Source Codes - 000700 - U.S. Grants and 000701 - Federal Disaster Relief.
      3. Grant - a valid Grant identification code which has been established on the SAMAS Grant Information and Title files. The SAMAS Grant Information file must designate the Grant as a Federal Grant and carry a related and validated Catalog of Federal Domestic Assistance number.

    2. Receipts (Capital Grants)
      1. General Ledger - 511xx - Contributed Capital.
      2. Revenue Source Codes - 000700 - U.S. Grants and 000701 - Federal Disaster Relief.
      3. Grant - a valid Grant identification code which has been established on the SAMAS Grant Information and Title files. The SAMAS Grant Information file must designate the Grant as a Federal grant and carry a related and validated Catalog of Federal Domestic Assistance number.

    3. Operating Transfers In
      1. General Ledger - 655xx - Federal Funds Transfers In from Within the Agency, or 656xx - Federal Funds Transfers In from Other Agencies.
      2. Revenue Source Code - 001510 - Transfer of Federal Funds.
      3. Grant - a valid Grant identification code which has been established on the SAMAS Grant Information and Title files. The SAMAS Grant Information file must designate the Grant as a Federal Grant and carry a related and validated Catalog of Federal Domestic Assistance number.

B. All disbursements of funds involving federal financial assistance shall be recorded into the State Automated Management Accounting System (SAMAS) utilizing a valid Grant identification code which has been established on the SAMAS Grant Information and Title files. The SAMAS Grant Information file must designate the Grant as a Federal Grant and carry a related and validated Catalog of Federal Domestic Assistance number. In addition all operating transfers out shall utilize the state standard object code number 8110 - Distribution and Transfers of Federal Funds. The transfers out will be offset with the receipts for each grant and Catalog of Federal Domestic Assistance number so that the recording of the federal funds at the State level will be acknowledged one time.

Cost pools collected and subsequently allocated to individual federal programs may be recorded to the grant level at the time of the allocation. The allocation of cost pools shall be recorded in SAMAS within forty-five days after the end of each quarter of the fiscal year, but prior to fiscal year end closings. Adjustments to this data after the close-out of the fiscal year may not be made without the written approval of the State Comptroller or his designee.

The State Comptroller or his designee may authorize exceptions to these policies when in the best interest of the State.

VI. RESPONSIBILITIES
A. The State Comptroller will provide the federal financial assistance data to the following:

  1. the Office of the Auditor General for use in the preparation of the single audit of federal funds required by the Federal Single Audit Act of 1984.
  2. the State Treasurer to audit and monitor state agency compliance with the state-federal agreement relative to the Federal Cash Management Improvement Act of 1990.
  3. the Executive Office of the Governor for use in the Legislative Appropriations System and the Planning and Budgeting Subsystem (LAS/PBS) and for use by the Federal Aid Tracking System (FATS).

VII. ASSISTANCE AND QUESTIONS
For assistance and questions regarding this policy, contact the Bureau of Accounting at 410-9951, Suncom 210-9951.