ctcLink Accounting Manual | 40.20.10 Inter-Agency Reimbursements (between a college and a state agency)

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40.20.10 Inter-Agency Reimbursements

Between a college and a state agency

Inter-agency reimbursements are payments received by a college district as reimbursement of expenditures/expenses incurred for a state agency including 4-year institutions of higher education.

Inter-agency reimbursements transactions are used in all funds except proprietary funds.  However, for the purpose of interagency transactions, Funds 443 and 444 are not considered proprietary funds.

Reimbursements are recorded when one agency initially charges an expenditure/expense that is subsequently charged to another.

In ctcLink, the reimbursement is recorded as an expenditure/expense in the reimbursing agency and as an Inter-Agency Reimbursement revenue (account range 4020020 - 4020110) in the college receiving the reimbursement.  This range of revenue accounts crosswalks to AFRS/One Washington as a reduction of the corresponding expenditure/expense for the reimbursed college.

Accounting for reimbursements in this manner results in the expenditure/expense being reported only once and in the proper account. Reimbursements are to be appropriately documented and approved.

As described below, reimbursements are coded with accounts in the 4020020-4020110 range. The account coding should reflect the expenditure type (i.e. Salaries, Goods & Services) being offset with the reimbursement with an exception related to non-capitalized furniture, equipment and software.

This process does not apply to State Reimbursements received and expended in state funds (001, 08A, 057, 060 etc.) as part of the allocation process.

40.20.10.1 Inter-Agency Example

State agency Employment Security agrees to reimburse a college for providing a training class for unemployed individuals in local area. The college provides the instructor, the space and materials.  The college pays the instructor through payroll, the space and materials costs are paid through accounts payable.

College costs

1  5000090 - Salaries – $500

2  5010010 through 5010050 – Benefits - $150

3   5081090 - Printing – $200

4  5030010 - Classroom Supplies – $50

5  5081240 - Rent – $250

College accounts receivable

1   4020020 – Inter-Agency Reimb Salaries – ($500)

2   4020030 – Inter-Agency Reimb Benefits – ($150)

3,4,5   4020060 – Inter-Agency Reimb Goods/Services – ($500)

Illustrative Entries

Invoicing

Employment Security expenditure and accounts payable are recorded:

Invoicing

Contracted Services Expense

Due to Other State Agency

1. Where cc represents the last 2-digits of the college state agency number.
2. Due To (10101801) and Due From (2012050) accounts only required to be used when the payment has not been received at fiscal year (since all receivables and payables between state agencies and colleges must balance at the fiscal year end close).

40.20.10.2 State Agency Grants in Project Costing

The project type determines the revenue account used for each grant project.  However, each project may use only one project type, therefore each grant will only record one revenue account.  ctcLink is configured with Project Type 02002 ‘Inter-Agency Reimb Salaries’ which uses revenue account 4020020 for state agencies.

Thus, when the system billing function is used, colleges are required to reverse the original revenue entry in the general ledger and-—based upon the actual expenditures made by the college in the grant-—distribute the revenue to:

• 4020030 (salaries and wages)
• 4020050 (benefits)
• 4020060 (goods/services)
• 4020070 (travel)
• 4020080 (equipment)
• 4020090 (computer equipment)
• 4020100 (grants/contracts)

 

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40.20 Inter-Agency Transactions << 40.20.10 >> 40.20.20 Inter-Agency Services Provided and Used