Heads up on fiscal year-end policies

From the Controller’s Office

The university’s current fiscal year will end on June 30, 2006. The new fiscal year ’07 (FY ’07) will begin on July 1, 2006, and end on June 30, 2007. Purchasing Services and Accounts Payable must verify that expenses are charged to the correct fiscal year. Your help and cooperation are needed to ensure that this is successfully accomplished.

Budget managers and requestors should plan ahead by using the following guidelines regarding the purchase of goods and services as we transition from one fiscal year to the next.

Charging appropriate fiscal year

The date that goods or services are received is used as the determining factor in deciding which fiscal year to charge. This method is based upon generally accepted accounting principles.

Payment should be made out of the current FY ’06 budget if:

Supplies and products are received on or before June 30, 2006
Services were performed on or before June 30, 2006

Payment should be made out of the FY ’07 budget if:

Supplies and products are received on or after July 1, 2006
Services are performed on or after July 1, 2006
A trip occurs on or after July 1, 2006, even if a Prepaid Expense Report is submitted earlier
Services are performed on or after July 1, 2006, even if they are prepaid

Services that will cross over both fiscal years will be charged to the year in which most of the services are provided. For example, if a consultant begins providing service on June 24 and ends services on July 19, the entire amount will be charged to FY ’07.

FY ’06 purchases: Before you place your order, verify that the vendor can and will deliver before June 30!

FY ’07 purchases: You may start to order goods or services against the new budget on Monday, June 5, 2006. To use the new budget, the transaction date must be changed to July 1, 2006, or later, and goods or services must be delivered on or after July 1, 2006. The vendors should be aware that they must deliver after July 1, 2006. Keep in mind that if the goods or services purchased are received before June 30, they will be charged in the current FY ’06.

Standing orders: You can begin entering standing orders on June 5, 2006. These will be faxed by Purchasing Services to the vendors so they know the purchase order number to invoice against for the next fiscal year. In the Document Text section, enter “Standing Order July 1, 2006-June 30, 2007,” so the vendor knows when to start using the new number.

Payments processed in Accounts Payable: Submit all FY ’06 employee reimbursements, prepaid requests, cash advances, independent contractor requests, check requests, invoices, purchase order invoices, and miscellaneous payment requests by Friday, June 30, 2006. Remember that the current fiscal budget must have funds available to cover these expenses.

ProCard purchases: If you are using a UST WellsOne Commercial Card (PCard) to make material purchases near year end, you must be aware that the bank cycle ends on June 30, 2006. Please be aware that if purchases are made close to the bank cycle end date, it is not guaranteed that the charges will be charged to FY ’06 (due to the fact that there may be a timing delay from when the actual purchase was made and when the vendor submits the credit card charges to WellsOne). Return completed reconciliations to Room 204, Aquinas Hall, or mail them to Mail #AQU 204 by July 14, 2006.

If you have questions regarding these procedures, e-mail:

Amy Schwartz, Purchasing Services
Edie Dull, Accounts Payable
Allison Hanson (for budget matters), Controller’s Office

2006 timeline:

Monday, June 5, 2006: FY 2007 budget opens
Friday, June 30, 2006: All FY ’06 payments need to be submitted
Friday, July 14, 2006: All June PCard reconciliations must be turned into Room 204, Aquinas Hall, or Mail #AQU