Reconciliation of FM to FI and CO 
Purpose
You are required to reconcile budgetary fund balances to fund balances calculated on a modified accrual basis. Certain types of postings may need to be made in Financial Accounting (FI) for modified accrual accounting purposes that would not update Funds Management (FM) on an actual basis. These postings can be recorded against statistical commitment items and carried forward to future fiscal years in FM for reconciliation and reporting purposes.
Transactions can be posted in FI and Controlling (CO) that should not be reflected against budgeted amounts in FM. Statistical posting of these transactions can be done in FM to facilitate reconciliation with FI and CO.
Prerequisites
You must create GL accounts in FI specifically for non-budgetary use and link these accounts to statistical commitment items created in FM.
You should create separate P&L statement account types in FI and link the non-budgetary GL account(s) to separate fund balance (retained earnings) accounts for carryforward from year to year. You may also decide to link certain budgetary GL accounts to separate fund balance commitment items to enable easy comparison between the budgetary and non-budgetary balances. The separate fund balance accounts should reflect those categories of timing or permanent differences that you are required to report.
You should also create separate carryforward item categories in FM, linking the statistical commitment item(s) to separate fund balance commitment items for carryforward from year to year. You may also decide to link certain non-statistical commitment items to separate fund balance commitment items to enable easy comparison between the budgetary and non-budgetary balances. The separate fund balance commitment items should reflect those categories of timing and/or permanent differences that you are required to report.
For more information on the configuration and processing of GL accounts, commitment items, and balance carryforwards, refer to the Financial Accounting and Funds Management documentation.
Process Flow Example
You must comply with GASB Statement Number 34, which requires you to record investments at fair market value under modified accrual accounting, resulting in an unrealized gain or loss on investments. For budgetary accounting and control purposes, however, you budget and record only realized gains and losses on investments.
Description |
G/L Account |
Commitment Item |
Statistical Indicator |
Realized Investment Income |
273100 |
273100 |
(Blank) |
Unrealized Investment Income |
273199 |
273199 |
X |
You can map the different GL accounts to individual fund balance (retained earnings) accounts to separate them as balance carryforwards from year to year.
G/L Account |
P&L Statement Account Type & Related Fund Balance Account |
273100 |
RI >> Fund Balance-Revenue-Budgetary Interest |
273199 |
IN >> Net Assets-Full Accrual-GAAP-Interest Revenue |
You can map the different commitment items to individual fund balance accounts to segregate them as balance carryforwards from year to year.
Commitment Item |
Carryforward Item Cat. & Related Fund Balance Commitment Item |
273100 |
RI >> Fund Balance-Revenue-Budgetary Interest |
273199 |
IN >> Net Assets-Full Accrual-GAAP-Interest Revenue |
You can post both transactions in FI and FM, making the unrealized gain or loss a statistical posting in FM, and track this as a timing difference from year to year in both
Initial Year Results:
Fiscal Year |
Fund |
G/L Account |
Commt Item |
Amount |
XXXX |
GENERAL |
273100 |
273100 |
$1,000 |
XXXX |
GENERAL |
273199 |
273199 |
$2,000 |
Fiscal Year XXXX Fund Balance: GENERAL Component: FI (GAAP) |
|
G/L Account 273100 |
$1,000 CR |
G/L Account 273199 |
$2,000 CR |
Total Ending Fund Balance |
$3,000 CR |
Fiscal Year XXXX Fund Balance: GENERAL Component: FM (Budgetary) |
|||
|
Actual |
Statistical |
FI Balance |
G/L Account 273100 |
$1,000 CR |
|
$1,000 CR |
G/L Account 273199 |
|
$2,000 CR |
$2,000 CR |
Total Ending Fund Balance |
$1,000 CR |
$2,000 CR |
$2,000 CR |
Subsequent Year Results:
Fiscal Year |
Fund |
G/L Account |
Commt Item |
Amount ($) |
XXXX+1 |
GENERAL |
273100 |
273100 |
1,500 CR |
XXXX+1 |
GENERAL |
273199 |
273199 |
1,500 CR |
Fiscal Year XXXX+1 Fund Balance: GENERAL Component: FI (GAAPl) |
|
Beginning Fund Balance* |
|
Fund Balance – Revenue Budgetary Interest |
$1,000 CR |
Net Assets – Full Accrual-GAAP Interest Revenue |
$2,000 CR |
Total Beginning Fund Balance. |
$ 3,000 CR |
G/L Account 273100 |
$ 1,500 CR |
G/L Account 273199 |
$ 3,000 CR |
Total Ending Fund Balance |
$ 7,500 CR |
Fiscal Year XXXX +1 Fund Balance: GENERAL Component: FM (Budgetary) |
|||
|
Actual |
Statistical |
FI Balance |
Fund Balance – Budgetary- Interest Income |
$1,000 |
- |
$1,000 CR |
Fund Balance – GAAP – Interest Revenue |
- |
$2,000 CR |
$2,000 CR |
G/L Account 273100 |
$1,500 CR |
|
$1,500 CR |
G/L Account 273199 |
|
$3,000 CR |
$3,000 CR |
Total Ending Fund Balance |
$2,500 CR |
$5,000 CR |
$7,500 CR |