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Reimbursables & You!

This presentation discusses current policies and procedures, audit findings, and causes regarding reimbursable projects. Learn how to avoid future audit findings and address issues in deferred revenue and accounts receivable.

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Reimbursables & You!

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  1. Reimbursables & You! The presentation so nice, we’re doing it twice…sort of… April 29, 2008

  2. Purpose • Discuss current policies and procedures and why they exist • Discuss the related audit findings and causes regarding reimbursable projects • http://www.corporateservices.noaa.gov/~cbs/ - Includes Standard Operating Procedures, Chapter 10, all reimbursable forms

  3. Reimbursable Project Policies and Procedures • Documents and correspondence move from FMC to LO to Finance to Budget • Finance (only) alerts Budget of changes to allotments • General Counsel clearance required for all reimbursable projects (copy of memo to Finance) • No mixing advance and non-advance projects • 1 to 1 relationship of project codes to agreements/funding documents

  4. Policies & Procedures – Why? • Financial statement audit (KPMG) • A-123 (internal) audit • Intra-government audit (Treasury & KPMG)- the agreement number serves as the common identifier, hence the need for a 1 to 1 relationship between agreements and project codes- CBS is able to capture agreement data

  5. Audit Findings Past, Present, & … • Past • Expired cash remaining on advance and non-advance projects • Audit Findings! • Present • Unmatched cost & deferred revenue • Accounts Receivable balances misstated • Audit Findings!!

  6. In Order to Avoid Future Audit Findings • Areas of concern - Monitor all costs charged to reimbursable projects - Review the need for SLTs- Review unmatched cost reports (QR0068, RADG107, RA504D) - Compliance with Chapter 10, SOPs

  7. Current Audit Finding On Deferred Revenue (aka Advances) • Background • KPMG found that unmatched cost does not reduce advances from others account (can be overstated) • For open agreements (time & amount), cash balances are reduced as costs accrue • For expired agreements, cash balances must be refunded (CBS will not recognize/post cost) • Causes of Excess Deferred Revenue • Agreements expire with remaining advances • Funds are not obligated within the period of performance (remaining advances) • Prior year downward adjustments cause costs to be reduced after billing and collection

  8. Audit Finding On Deferred Revenue (Cont.) • Causes of Anomaly Balances in Deferred Revenue • Cost continues to be charged after agreement expiration (official term: Unmatched Cost)

  9. Audit Finding On Reimbursable Accounts Receivable • Background • Mainly conversion issues from 2005 • General Ledger accounts not properly coded based on lack of knowledge re automated postings • Addressing the Issues • Finance Office has researched and identified problem projects • Solutions are now being devised

  10. Line/Staff Office Role • LO/SOs may be asked to: • Work with Finance Office staff to reconcile projects, review problem areas, gather documentation, check with NOAA and/or Department General Counsel when necessary, insure that LO/FMC reimbursable staff have been properly trained (see Chapter 10, Appendix B)

  11. In Summary • The Reimbursable Work Group will continue to meet on a monthly basis to fine tune procedures and address issues • Finance & LOs must insure that Chapter 10 and SOPs are followed - watch for cost overruns, expired TWAs and agreements, activate/turn off projects accordingly • As a result of these changes, NOAA will experience better financial management & audit outcomes

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