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Business Procedures Manual

1.6 Records Maintained To Facilitate Required Reporting

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Due to the conflicting requirements imposed upon the University System of Georgia in conforming to GAAP/GASB principles while maintaining the ability to provide reporting as mandated by the laws of the state of Georgia (Georgia Budgetary Expense Reporting), several different ledgers should be maintained. These ledgers must be able to distinguish between fiscal year and budget period to facilitate correct reporting in the various reporting modes, as discussed in the following sections.

1.6.1 Georgia Budgetary Expense Reporting

For Georgia Budgetary Expense Reporting, revenues and expenditures are reported on an accrual basis, with encumbrances treated like expenditures at the end of the fiscal year.

Note: The following types of expenses are not allowable for reporting in Georgia Budgetary Expense Reporting:

  • Depreciation expenses of assets
  • Booking of compensated absences
  • Eliminations of intra-campus sales
  • Recording scholarship allowances
  • Booking of deferred revenues on sponsored grants

It is highly recommended that transactions only for Georgia Budgetary Expense Reporting be kept in a separate ledger. *

* Note: The ledger for Georgia Budgetary Expense Reporting will be the Actuals ledger for institutions using the GeorgiaFIRST model of the PeopleSoft Financials software.

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1.6.2 Capital Assets with Depreciation

For GAAP/GASB reporting, a ledger for capital assets with resulting depreciation values must be maintained. This ledger should be updated from a software module containing detailed information about each capital asset and its associated depreciation entries. *

* Note: The ledger for Capital Assets will be the Capital ledger for institutions using the GeorgiaFIRST model of the PeopleSoft Financials software. The Asset Management module will feed this ledger.

Due to the method for budgeting within the Georgia Budgetary Expense Reporting for Equipment (Capital Items), the ledger for capital assets must provide some offsetting information. For example, purchase of capital equipment in the ledger maintained for the Georgia Budgetary account will charge an equipment purchase expense account to support Georgia Budgetary Expense Reporting. For GAAP/GASB purposes, this is not an expense, but is the purchase of an asset. When this transaction is fed into the software module for tracking capital assets, it must generate an entry in the ledger for capital assets to debit the asset account for equipment, and to credit the equipment purchase expense account, which is the same account that was debited in the ledger for Georgia Budgetary transactions.

This means that the ledger for capital assets will not be able to support stand alone financial reporting. It is only meaningful when combined with the ledger supporting the Georgia Budgetary Expense Reporting process.

Using only the ledger maintained for Georgia Budgetary Expense Reporting will display the equipment expense as is required for Georgia Budgetary Expense Reporting. Combining the ledger maintained for Georgia Budgetary Expense Reporting and the ledger maintained for capital assets will not show any equipment expense, but will properly report the asset “Equipment” as required for GAAP/GASB purposes.

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1.6.3 Ledger for Adjusting Entries

In addition to the ledgers described above, a third ledger should be maintained for adjusting entries that must be booked to provide for certain GAAP/GASB reports. The entries to this ledger are those that would interfere with normal business processes if the entries were made to the other two ledgers described above.*

* Note: The ledger for adjusting entries will be the GAAP ledger for institutions using the GeorgiaFIRST model of the PeopleSoft Financials software.

Examples of entries made to the ledger for adjusting entries are:

  • Booking the amount of compensated absences
  • Eliminating intra campus sales
  • Recording scholarship allowances
  • Booking deferred revenues on sponsored grants

Generally, entries made into the ledger for adjusting entries will be reversed in the next accounting year.

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1.6.4 Combinations of Ledgers versus Reporting Requirements

  1. For Georgia Budgetary Expense Reporting, only the ledger containing Georgia Budgetary transactions is used *. This reporting is based upon budget period along with fiscal year.

    * Note: This will be the Actuals ledger for institutions using the GeorgiaFIRST model of the PeopleSoft Financials software.

  2. For GAAP based reporting, the ledger containing Georgia Budgetary transactions will be combined with ledger containing capital assets. * This reporting is based upon fiscal year without regard to budget period.

    * Note: This will be a combination of the Actuals and Capital ledgers for institutions using the GeorgiaFIRST model of the PeopleSoft Financials software.

  3. For GASB reporting (at the end of the fiscal year), the ledger for Georgia Budgetary Expense Reporting, the ledger for capital assets, and the ledger for adjusting entries will be combined. * This reporting is based upon fiscal year without regard to budget period.

    * Note: This will be a combination of the Actuals, Capital, and GAAP ledgers for institutions using the GeorgiaFIRST model of the PeopleSoft Financials software.

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