Miscellaneous Journal Entries
1.0 PURPOSE
The purpose of this procedure is to provide guidance to the General Accounting staff on how to process miscellaneous journal entries in the Financial Records System (FRS).
2.0 SCOPE
The scope of this procedure is to document the internal control and data entry processes for the General Accounting Staff.
3.0 PROCEDURE
3.1 Definition
A journal entry is an accounting transaction that is not processed against a "real" account, i.e. it does not originate in a disbursement or a revenue ledger. Journal entries are used to redistribute internal costs and revenues, such as Service Division charges to other internal University accounts, to correct erroneously recorded transactions, to record investment unrealized gains and losses, to capitalize equipment and fixed assets and to move fund balances as authorized by the Budget Office. Journal entries can be manual or automated.
3.2 Manual Journal Entries
General Accounting staff members, use FRS screens 014 or 025 to process manual journal entries. Entries are grouped in batches with a unique batch number assigned and displayed on the batch document. The batch numbers are kept in a manual log. They are referenced on the input document and on the individual transactions in FRS. Before the entries are entered, they must include signatures of the persons who prepared the transaction, and the reviewer. The person who enters the transaction also signs the batch document. In addition the input documents include documentation of the purpose and the nature of the transaction.
3.2 Automated Journal Entries
Non-accounting University personnel who have responsibility and authority in "service" departments initiate automated journal entries. The automated entries are fed into FRS through the use of automated batch processes. The output reports for these automated entries are received by the General Accounting personnel and forwarded to the individuals responsible for the entries. The originators of these entries are responsible for the integrity of the transactions, and for keeping adequate documentation in their files.
3.3 Inter/Intra Departmental Transactions (IDT's)
An IDT is a manual journal entry that is processed in FRS using screen 025. The IDT's are received throughout the month and are processed by the General Accounting staff before month-end close. Each IDT is reviewed by an accountant for validity of signature authority, validity of object codes and documentation of the reasons for transaction. Any discrepancies are brought to the attention of the originator and are corrected before the IDT's are entered in the accounting system. Reviewed IDT's are then processed in accordance with the procedure referenced in paragraph 3.2 Manual Journal Entries. Please refer to the "Business Procedure Memorandum No. 20" for further details on IDTs.
4.0 RESPONSIBILITIES
The Controller and her/his staff have the responsibility for ensuring compliance with this procedure.
5.0 REFERENCES & ATTACHMENTS
- Business Process Memorandum No. 20
- Batch Header for Screen 014
- Batch Header for Screen 025
- Journal Entry Screen 014
- Journal Entry Screen 025
Last Updated: August 8, 2012
