First 5 LA Invoicing & Budget Modification Workshop

1. First 5 LAInvoicing & Budget Modification Workshop FY 2010-2011

2. Financial Overview • Invoice Reporting • Informal Budget Modification/Budget Changes • Formal Budget Modification Process • Financial Compliance Site Visit

3. Invoice Reporting SAMPLE

4. Invoice Reporting (Cont.) • Contact Name & Phone # line, please provide the name and phone # of the individual who is familiar with the expenses reported on the invoice form • Must be based on actual expenses • Must be according to the approved budget line items

5. Invoice Reporting (Cont.) • Once an invoice has been paid, Grantee CANNOT make adjustments to prior month’s expenses. Prior months’ adjustments can be made only on the current month being invoiced (with justification). • Justification of previous months’ adjustments should be enumerated • If budget changes have been made, please make sure to revise the “Approved Budget Total” column on the invoice form • First 5 LA will place a HOLD on invoices, if grantee is not in compliance with the Grants Management Dept. (i.e., missing reports, proof of insurance, etc.) and/or Finance Dept. (i.e., error in calculations, unallowable %, etc.)

6. Invoice Reporting (Cont.) • Invoices are to be submitted on a monthly basis • due the 20th business day of each month for the previous month • Must be signed by the agency authorized representative (listed on the Signature Authorization Form) • Payments are processed within 20 workings days of the receipt of the grantee’s invoice, if invoice is properly completed

7. Personnel Cost Allocation

8. Invoice Reporting (Cont.) • All invoices must be mailed to: First 5 LA c/o Finance Dept. 750 N Alameda St., Suite 300 Los Angeles, CA 90012 • Invoice forms can be downloaded from our website: www.first5la.org

9. Informal Budget Modification Rule 1: 10% Changes for line item budget of $5,000 or more: • You may increase/decrease the amount of the original budget line item by no more than 10% without submitting a formal budget modification

10. Informal Budget Modification (Cont.) Rule 2: $5,000 or less Changes for line item budget of less than $5,000: • You may increase/decrease any amount of the original budget line item up to the original amount When making a budget change, a memorandum explaining the changes must be submitted with the invoice

11. Informal Budget Modification (Cont.) Rule 1: 10% Example: Budget Line Item Amount Change • Personnel $250,000 + $25,000 • Contracted Services 75,000 + 7,500 • Space 20,000 + 2,000 Rule 2: $5,000 or less: Budget Line Item Amount Change • Supplies $4,000 + $4,000 • Telephone 1,500 + 1,500

12. Informal Budget Modification (Cont.) • Only two (2) Informal Budget Modifications/Budget Changes will be accepted per contract year When making a budget change, a memorandum explaining the changes must be submitted with the invoice • If Grantee exceeds two (2) budget changes, a Formal Budget Modification will be required

13. Formal Budget Modification Process Grantee must submit the following: • Budget Modification Form • Justification letter • Revised Statement/Scope of Work (if modification impacts program activities)

14. SAMPLE

15. SAMPLE

16. Formal Budget Modification Process (Cont.) • Formal Budget Modification due by the 1st of the month – to be effective the 1st of the following month, if approved • First 5 LA will not process e-mailed or faxed budget modifications • Formal Budget Modifications will not be processed during the first two months and the last 3 months of the contract year

18. Formal Budget Modification Process (Cont.) Formal Budget Modifications are not retroactive

19. Formal Budget Modification Process (Cont.) • Plan the Formal Budget Modification with the understanding that the requested changes will be effective one month after submission, if approved. Example:Your agency plans to hire a Case Manager position with savings from the Equipment line item and the Formal Budget Modification is submitted to First 5 LA November 1st. The Formal Budget Modification will be effective, if approved, December 1st. Therefore, the Case Manager position should be budgeted for only 7 months (December – June).

20. Financial Compliance Site Visit • Agencies must demonstrate internal accounting controls and practice standard accounting principles • First 5 LA will select budget line items to be reviewed • Grantees will provide documentation to support expenses • To be scheduled after completion of first year

21. Personnel Line Item will be selected (this line item will always be reviewed) Total Personnel expenses billed to First 5 LA will be verified against: General Ledger Payroll Records (ADP, Paychex, and other) Personnel files will be checked against the approved budget (personnel titles, salaries, and dates employees were assigned to First 5 LA program, timesheets, etc.) Financial Compliance Site Visit (Cont.)

22. Financial Compliance Site Visit (Cont.) • Other forms required for the financial compliance site visit: • Personnel position assigned to First 5 LA • Payroll reconciliation worksheet • Record of Financial Compliance form

23. Finance Department