FIACCT 15-01_12 Project Accounting – Budgets

Effective: July 1, 1994
Revised: 

Purpose

This policy discusses the budgeting concepts and methods available for project accounting in FINET.

---

Policy

It will be the responsibility of department project accounting users to establish and maintain the budgets for their projects.

---

Background

Project budgets are established at two levels – at the project level for source of funding estimates, and at the project, subproject and phase levels for expenditure estimates. The project master (PJ) transaction is used to establish the original budgets and to modify an existing budget. The total of the source of funds estimate at the project level must equal the total of the expenditure estimates at the subproject and phase level.

Multi-year projects and the associated project budget may be established for the life of the project, which may result in the project budget amounts exceeding the amount initially appropriated. This will occur when a multi-year project is funded through a year by year appropriation. Budgets for multiple year projects may be established for the lifetime of the project, and not closed out at the end of each state fiscal year, but continue into the new year(s) with remaining balances and expended amounts intact.

Budgets for projects are independent from and in addition to appropriations, expense budgets and revenue budgets established for financial accounting. The appropriation and expense budget controls are always enforced on accounting transactions. The project accounting user can enforce the additional project budget control at the subproject and phase level by setting the funds control edit to yes.

The subproject and phase detail level of the budgeted expenditures is established for each detail line in dollar amounts, including cents. The total of all subproject and phase detail line budgets must equal the total of the estimated funding sources at the project level.

There are situations where project accounting users want to account for a project using several subproject and phase lines, all of which must be established and valid on the project tables, but do not want to budget using all subproject and phase combinations. This is accomplished in FINET by establishing the non-budget subproject and phase combinations with zero dollar budgets and no funds control.

The overall project level budget, which is the estimated funding source(s) at the project level, is established for both dollar amounts (including cents) and percentage of total project funding by each funding source. The funding sources are:

Š Bond Funded
This is the amount of revenue estimated to be received to fund the project from the issuance of bonds. This source is primarily used for capital projects.

Š Federal Funds
This is the amount of revenue estimated to be received to fund the project from federal funding sources. If these federal monies are also grant related, they may also need to be accounted for using FINET grant accounting. Grants are discussed in the GRANT ACCOUNTING section of this manual.

Š Government Funds
This is the amount of state appropriation(s) expected to be used to fund the project.

Š Other Funds
This is the amount of revenue estimated to be received from other funding sources.

The combined total expected to be received from the above funding sources will equal the total that is expected to be spent on the project and will equal one-hundred percent of the funding. The setting up of the estimated funding sources are discussed in the Project Accounting – Project Transactions – Project Master Initial Entry and Modifications Instructions” section of this manual.