Abila MIP Fund Accounting TM Encumbrances STUDENT WORKBOOK ABILA LEARNING SERVICES Important Notice: Authentic Abila MIP Fund Accounting TM training guides display a holographic image on the front cover. If you have received a counterfeit copy, please notify Abila Learning Services at 877-879-0456. The text, logos and images contained within this Training Guide, including all lectures and any supplementary materials, are protected under the Trademark and Copyright laws of the United States, as well as other countries. Any downloading, reproduction or further distribution of any original material within this manual without prior written permission of Abila is strictly prohibited. 2015 Abila NPS-FA205A-SG
NOTICE Visit our Web site at www.abilauniversity.com, or call 1-877-879-0456 to learn about training classes that are added throughout the year. Information in this document is intended solely as general information with respect to common business issues and is not to be construed as professional advice. It is always best to consult a tax or accounting professional for all tax and account related questions. THE INFORMATION HEREIN IS PROVIDED AS IS AND ALL WARRANTIES ARE EXPRESSLY DISCLAIMED, INCLUDING BUT NOT LIMITED TO ANY WARRANTY: OF MERCHANTABILITY; OF FITNESS FOR ANY PARTICULAR PURPOSE; OF NON-INFRINGEMENT OF ANY PROPRIETARY RIGHT OF ANY THIRD PARTY IN ANY COUNTRY; OTHERWISE ARISING OUT OF ANY PRODUCT, PROPOSAL, SPECIFICATION OR SAMPLE; AND ANY WARRANTY THAT THE DOCUMENT IS ERROR FREE. No license, express, implied, by estoppel or otherwise, to any intellectual property right is granted by this document. Abila may make changes to the information in this document at any time, without notice. Recipient is solely responsible for assessing the suitability of the information and assumes all risk of use. Copyright 2015 Abila, Inc. All Rights Reserved. All Abila product names appearing herein are trademarks and registered trademarks of Abila, Inc. in the United States and other countries. All other product names mentioned herein are the trademarks of their respective owners. GID: 2015.08.25.2015.2 PN: NPS-FA205A-SG
TABLE OF CONTENTS Encumbrances............................................. 1 Module Setup....................................................................... 1 Activating the Encumbrance Module................................................... 1 Setting Up the Encumbrance Module.................................................. 1 Encumbrance Transactions........................................................... 4 Manage Attachments............................................................... 6 Check Budget and Encumbrance Balances............................................. 10 Encumbrance Liquidations............................................................ 12 Manual Liquidations................................................................. 12 Liquidations with Other Transactions.................................................... 16 Without Purchase Order Module Installed.............................................. 16 Purchase Order Module Installed..................................................... 18 Auto-Close Encumbrances........................................................... 27 Display Encumbrance Balances....................................................... 30 Reports........................................................................... 33 Checklists......................................................................... 36 Reinforcement Exercises............................................................. 38 2015 Abila Student Curriculum i-1
Abila MIP Fund Accounting TM i-2 Student Curriculum 2015 Abila Attention: Authorized copies contain a holographic image on the front cover.
Encumbrances Module Setup Encumbrances The Encumbrances module integrates with the General Ledger and Accounts Payable modules to monitor your organization s financial commitments, providing increased internal tracking and external compliance for administering and reporting encumbered funds. Standard reports include an encumbrance budget report for easy comparisons and an aged encumbrance ledger. Encumbrances entered into the Application distribute encumbered amounts to individual funding sources, grants, programs or other account segments. Outstanding encumbrances liquidate automatically through standardized entry forms for Accounts Payable invoices, Cash Disbursements, or manually. The Encumbrances module also works with the Purchase Orders module to create encumbrance entries while printing Purchase Orders. Encumbrance transactions are maintained in a subsidiary ledger which exists outside of the Accounts Payable or General Ledgers. Module Setup Activating the Encumbrance Module After purchasing the Encumbrance Module, we recommend the following checklist to activate the module and enable all of its features. 1. Replace the Activation Code to unlock the Encumbrance Module. 2. Add the Encumbrances module. 3. Set up Organization Preferences for Encumbrance items. 4. Set up security for Encumbrances. 5. Enable the appropriate warnings for when Encumbrance balances are exceeded. A checklist is included at the end of this guide with the menu location for each step. The Abila Online Help also includes this checklist available from Help > Contents > Encumbrances > Introducing Encumbrances. Setting Up the Encumbrance Module Accessed from Organization > Setup Modules > Encumbrances. Use this form to create warnings when encumbrances will exceed their liquidation limit during transaction entry in Accounting involving Purchase Order items and Stand Alone Accounts. 2015 Abila Student Curriculum 1
Module Setup Abila MIP Fund Accounting TM Transaction Entry Options The Set Up Encumbrances form is typically only accessed when setting up the module, but you may need to return to this menu in the future if your organization s internal controls change. Warn when Encumbrance Balances are Exceeded for Purchase Order Items - Displays a warning when the actual expense recorded on the Accounts Payable Invoice, Cash Disbursement, or Check exceeds an encumbrance balance derived from the Purchase Order. This occurs at the item code level. Warn when Encumbrance Balances are Exceeded for Stand Alone Account Codes - Displays a warning upon Save during invoice entry, cash disbursements, encumbrance liquidations, or check writing entry sessions, when the actual expense exceeds an encumbrance balance at the transaction coding level. This warning applies to Stand Alone Encumbrances only. Allow Appending Entries to Encumbrances - When checked, allows existing Encumbrances to be adjusted with new information. Uncheck the box to prohibit existing Encumbrances, to be adjusted with new information. Example: If Allow Appending Entries to Encumbrances is checked, the Application will allow you to enter an encumbrance for a vendor that has the same document number and vendor information as an encumbrance that has already been saved in another session. By posting a second appending encumbrance, depending on the transactions within, one of the following will occur: 1. The resulting encumbrance (a combination of both the original and appending encumbrance) will be modified to include new line items that may not be related to the original transaction. 2. The new encumbrance transactions could negate the original encumbrance. 2 Student Curriculum 2015 Abila
Encumbrances Module Setup Activity: Set Up Encumbrance Module Navigator: Administration > Module Setup > Encumbrances Classic View: Organization > Set Up Modules > Encumbrances Transaction Entry Options Warn when Encumbrance Balances are Exceeded for Purchase Order Items: Warn when Encumbrance Balances are Exceeded Unchecked for Stand Alone Account Codes: Unchecked Allow Appending Entries to Encumbrances Checked Click OK 2015 Abila Student Curriculum 3
Encumbrance Transactions Abila MIP Fund Accounting TM Encumbrance Transactions Funds may be set aside, or encumbered, by entering a manual encumbrance documents from the Transactions > Encumbrances > Enter Encumbrances menu. Session Information The first step is to complete the session form: You should be familiar with how to complete a session form from the Transaction Entry chapter. Once the session form is complete, click Start to enter the encumbrance document form: Document Information Document Assign a unique document number to the encumbrance. The field length was determined when your organization was created. Date Accept the default or enter a valid date. Amount Enter the amount of the encumbrance, omitting dollar signs or commas. The document amount and the net of the transaction lines (Increase and Decrease columns) must equal. Description You may either accept the session description or enter a description specific to this document. The field length was determined when your organization was created. NOTE: To review what field lengths were established for your organization access Organization > Organization > Field Lengths tab. Select users from your organization may have access to this menu. Vendor ID Select the Vendor s ID. If you create a Vendor ID of UNASSIGNED using the Maintain > Vendors form, you may select this ID from the Vendor ID drop-down list. Use UNASSIGNED if you do not know your Vendor ID. Once you establish the appropriate Vendor ID for the posted encumbrance, you may assign the new ID when you liquidate the encumbrance. You may also leave it as UNASSIGNED if you do not need to track the vendor associated with the encumbrance. 4 Student Curriculum 2015 Abila
Encumbrances Encumbrance Transactions Transaction Entry Table: Segments, Increase, Decrease, Effective Date, Line Description In order for an entry to be recorded, each transaction line must have each segment completed, an increase or decrease amount, an effective date, and a line description. The transaction entry table for encumbrances created by a Purchase Order and will also display the PO Line # and the description from the original purchase order. The line number allows you to identify transaction lines with individual items ordered on a purchase order. Partially invoiced purchase orders with attached encumbrances liquidate by line number, applying quantity invoiced times invoiced unit amount. NOTE: The debit and credit columns in this form have been replaced with increase and decrease as an encumbrance entry is a one-sided entry to the encumbrance sub-ledger. Original encumbrance documents are posted as an increase for the encumbered amount. The net total of the increases and decreases in the detail lines for the encumbrance will equal the document amount of the encumbrance at the top of the form. Notice the Totals at the bottom of the form maintain a running total of increases, decreases and the net amount. You may make adjustments to existing, posted encumbrances by entering increases or decreases to the same document number and vendor of the posted encumbrance. The adjustment is shown separately on the detail encumbrance ledger report. TIP: If you created a Vendor ID of UNASSIGNED using the Maintain > Vendors form, you may select this ID from the Vendor ID drop-down list. It is used if you do not know the Vendor ID. Once you know the Vendor ID and have posted the encumbrance, you may assign the new ID using the Transactions > Encumbrances > Enter Encumbrance Liquidations form. Or, you may leave it as UNASSIGNED. 2015 Abila Student Curriculum 5
Encumbrance Transactions Abila MIP Fund Accounting TM Manage Attachments Select Attachments button (the button changes to when attachments already exist) to display the Attachments form. Use the attachment form to add, view, or delete an attachment that applies to the current menu selection. The form collects the basic information needed to manage and maintain attachments. The list of attachments is limited to the specific form (transaction source\session ID\document number) for transactions. Before using attachments, you must first enable the attachments by setting up Attachment Locations and Attachment Categories, available from Organization > Attachments > Set Up Locations. You should also review and set up attachment categories using Organization > Attachments > Set Up Categories. Category/Sub-Categories: The Application displays a list of category and sub-category folders available for the current menu selection. You may expand or collapse folders by selecting the plus or minus sign. Attachments: The Application displays the existing attachments for the selected category or sub-category. You may not change the information in the attachment panel. Name - The name given to the attachment when it was saved. Type - The type assigned to the attachment when it was saved, either L (Linked) or E (Encrypted). Path - The location where the attachment was saved. User ID - The user who created and saved the attachment. Date - The date the attachment was created and saved. To view or delete an attachment left mouse click on the box to the left of the attachment name and select View button, or Delete button. To add an attachment select New button, enter the Attachment name, browse to the attachment and select Save. Add Attachment: Use the Add Attachment Panel to attach an image or file to the selected category or sub-category. 6 Student Curriculum 2015 Abila
Encumbrances Encumbrance Transactions The Application displays the category or sub-category selected in the category/sub-categories panel. The category or sub-category may not be changed after an attachment is saved. Type: Select the type of attachment. Linked - Linking to a document means that you browse to the document location and the Application saves the path to the document. To view the linked document, it must remain in the exact location to be viewed. Encrypted - Encrypting a document means that the document will be scrambled by the Application to prevent unauthorized access, and copied to a location defined at Organization > Attachments > Set Up Locations. Encrypting a document provides basic security and prevents untrained individuals from viewing the document outside the Application. Name - Enter a unique name for the attachment. Source - Click the Browse button to specify the attachment location. 2015 Abila Student Curriculum 7
Encumbrance Transactions Abila MIP Fund Accounting TM Activity: Create Encumbrances Navigator: Accounting > Encumbrances > Enter Encumbrances Classic View: Transactions > Encumbrances > Enter Encumbrances Session Information Session ID: Use the plus (+) key to auto increment Status: Batch-to-Post Description: Record Encumbrances Date: Accept today s date Click Start Document Information Document: ENC1000 Date: Today s Date Amount: $500.00 Description: Encumbrance for Paper Stock Vendor ID: ABC Transaction Information Click Use Distribution Code Distribution Code Entries: General General Ledger: 57001 (Office and Other Supplies Expense) Click OK to create the encumbrance entries. Click Save 8 Student Curriculum 2015 Abila
Encumbrances Encumbrance Transactions Activity: Create Another Encumbrance Navigator: Encumbrances > Enter Encumbrances Classic View: Transactions > Encumbrances > Enter Encumbrances Session Information Session ID: Already in Session Click New to create a new Encumbrance Document Information Document: ENC5000 Date: Today s Date Amount: $2500.00 Description: Encumbrance for Form Printing Vendor ID: Rapid Transaction Information Click Use Distribution Code Distribution Code Entries: General General Ledger: 53001 (Public Relations Expense) Click OK to create the encumbrance entries. Click Save. 2015 Abila Student Curriculum 9
Encumbrance Transactions Abila MIP Fund Accounting TM Check Budget and Encumbrance Balances This feature is only available if the Budget module is installed. Use the Check Budget and Encumbrance Balances button to check Budget and Encumbrance balances for the current document. This helps determine the impact of the current document. The date range, account types (expenditure only, revenue only, or all available accounts), and segments used in the balance check are determined by the options on the Set Up Budget Controls form during Budget setup. If you have a segment other than GL selected (such as fund), the Application checks balances for line items with the two segments together. Budget Year Beginning, Ending: Enter the budget date range. Initially, the Application defaults to the organization's current fiscal year start and end dates. Once a budget date range is entered, it becomes the default. This entry choice is not available if critical segments are enabled and apply to the entry. Check Balances Table - The Application verifies the balances and displays budget and encumbrance information related to the current document s general ledger and distribution codes. GL and Segment Codes The Application displays any accounts associated with this current document s account coding, and displays the balances based on the current encumbrance s segment combination. Current Document - The Application displays the total amount for the displayed segments on the current document. Budget - Total amount of budget documents for the budget period. Actual -Total amount of posted G/L transactions. Posted Encumbrance - This amount includes encumbrances transactions that are posted. Available Budget - This amount is calculated taking budget less actual less current document less posted encumbrance. Unposted Encumbrance - This amount includes unposted transactions. Pending Requisitions - Displays the amount for all requisition items coded to the account combinations that are included in the document (only displays when Electronic Requisitions module is installed). 10 Student Curriculum 2015 Abila
Encumbrances Encumbrance Transactions Adjusted Available Budget - The Application calculates this amount by taking the budget variance less unposted encumbrances and pending requisitions amounts. TIP: This form processes amounts differently depending on the options selected using Organization > Set Up Modules > Budget > Primary Budget Controls > Controls tab and > Critical Segments tab. Activity: Check Budget and Encumbrance Balances Navigator: Encumbrances > Enter Encumbrances Classic View: Transactions > Encumbrances > Enter Encumbrances Session Information Session ID: Already in Session Document Information Document: Select ENC1000 Click Check Budget and Encumbrances Balances NOTE: Review the available budget surplus or deficit. Close the Check Budget and Encumbrance Balance window. Close the Encumbrance Session. Post the Encumbrance Session. Close the Post Sessions screen. 2015 Abila Student Curriculum 11
Encumbrance Liquidations Abila MIP Fund Accounting TM Encumbrance Liquidations There are two methods available to liquidate encumbrances: 1. Manually liquidate the encumbrance 2. Automatically liquidate through standardized entry forms: Enter an accounts payable invoice to liquidate the encumbrance. Enter a Cash Disbursement transaction to liquidate the encumbrance. Manual Liquidations Manual encumbrance liquidations are entered from the Transactions > Encumbrances > Enter Encumbrance Liquidations menu. Session Information The entry process is similar to encumbrance entry from opening the session through entering the document level information. These liquidations do not record expenses to the general ledger. Document Information The document form is displayed below: 12 Student Curriculum 2015 Abila
Encumbrances Manual Liquidations You will not have any auxiliary buttons available for copying/reversing documents or using offsets and distribution codes since these items are not appropriate for this type of transaction. After entering the document level information (document number, date, description and vendor ID), you may select the Choose Encumbrances button to select which encumbrances to liquidate. After you select the Vendor ID, when you click the Tab key the encumbrance selection screen appears. The Choose Encumbrance form lists all outstanding encumbrances for the selected vendor and any outstanding to vendor UNASSIGNED. This form allows you to select encumbrance(s) to liquidate by checking the selector box at the far left of each encumbrance. After selecting the encumbrance(s), close the search list by clicking OK. The Application uses the information from the encumbrance subsidiary ledger to create the entry that will liquidate the selected encumbrance(s). Once this entry is made, the segment columns on the entry form are not available for modification, since the liquidation entry must be made with the same coding as the original encumbrance entry. However, you may change the amounts, effective date and the line description. Totals at the bottom of the encumbrance liquidation form keep a running total of increases, decreases and the net. There are no balancing entries since we are dealing with increases and decreases in the encumbrance subsidiary ledger. When you post the encumbrance liquidation, the Application uses the entry to reduce the document balance in the Encumbrance subsidiary ledger. TIP: To expedite the selection process, use the filter or the select all button. You must select at least one encumbrance to save the encumbrance liquidation. 2015 Abila Student Curriculum 13
Manual Liquidations Abila MIP Fund Accounting TM Notes on Encumbrances The table displays the PO Line # and Encumbrance ID columns when an Encumbrance session is created using the Create/Modify Purchase Order. Upon liquidation of the Encumbrance line item, the associated PO Line will no longer display. This allows you to identify transaction lines with individual items ordered on a purchase order. For invoices that only liquidate part of the purchase order, this allows you to easily identify the line items that have been invoiced. Entering encumbrance liquidations, Transactions > Encumbrances > Enter Encumbrance Liquidations, does not record expenses to the general ledger; it only reduces amounts that have been previously encumbered. To Manually Liquidate an Encumbrance: 1. Access Transactions > Encumbrances > Enter Encumbrance Liquidations. 2. Enter the Session ID, Status, Description, and Date. 3. Click Start. 4. Enter the Document Number, Date, and Description. 5. Select a Vendor ID. 6. Check the box to the left of Encumbrance ID to select the Encumbrance(s) to liquidate. 7. Click OK. 8. The Application will validate the encumbrance, and auto-populate the Transaction Grid. Make any needed adjustments. 9. Click Save. 10. Post the ENL session. 14 Student Curriculum 2015 Abila
Encumbrances Manual Liquidations Activity: Encumbrance Liquidations Navigator: Encumbrances > Enter Encumbrance Liquidations Classic View: Transactions > Encumbrances > Enter Encumbrance Liquidations Session Information Session ID: Use the plus (+) key to auto increment Status: Batch-to-Post Description: Liquidate Encumbrance Date: Today s Date Click Start Document Information Document: ENL1000 Date: Today s Date Description: Record liquidation of encumbrance Vendor ID: ABC <ABC Office Supply> Transaction Information Choose Encumbrances for Vendor ABC should display or Click Choose Encumbrances, then Click Display Records Select Encumbrance ID: ENC1000 Accept Current Amount: $500.00 Click OK to close the selection form. Review the encumbrance liquidation entry. Click Save and Close to complete the liquidation. Post the Encumbrance Liquidation (ENL) Session. Close the Post Transactions screen. 2015 Abila Student Curriculum 15
Liquidations with Other Transactions Abila MIP Fund Accounting TM Liquidations with Other Transactions Without Purchase Order Module Installed Encumbrances may be liquidated by entering a cash disbursement, or an accounts payable invoice. To liquidate en encumbrance, start a session and enter the document level information (invoice number, date, amount, description, vendor ID and due date). The Encumbrance Liquidation button becomes available and the Choose Encumbrances form appears. o The Choose Encumbrances form lists all outstanding encumbrances for both the selected vendor and also the vendor UNASSIGNED. This form allows you to select the encumbrance(s) to liquidate by checking the selector box at the far left of each encumbrance. When you finish selecting encumbrances and close the search list by clicking OK, the Application uses the information from the encumbrance subsidiary ledger to generate the expense portion of the document entry that will liquidate the selected encumbrance(s). Create the balancing entry to complete the check or invoice as discussed in the General Ledger Transaction Entry and Accounts Payable chapters. Fully Liquidate Selected Items Checking this box will default the Fully Liquidate Encumbrance check box to be selected when you choose an encumbrance, and cannot be changed. When you fully liquidate the encumbrance, the segment columns on the entry are available for modification. If you do not fully liquidate the encumbrance, the segment columns on the entry are not available for modification since the liquidation entry must be made with the same coding as the encumbrance was originally input. You may however, change the amounts, entry type, effective date and the line description. 16 Student Curriculum 2015 Abila
Encumbrances Liquidations with Other Transactions Filters - You may use the filter and/or the select all buttons to expedite the selection process. Remember that you must select at least one encumbrance to save the encumbrance liquidation. Encumbrances Group Box Use this form to display open or outstanding encumbrances previously recorded in the Application. Fully Liquidate Encumbrance This box is available once an encumbrance is selected. Checking Fully Liquidate Encumbrance will cause the application to compare the invoice amount and encumbrance amount. Should any difference exist, the system will automatically liquidate the difference upon posting as an ENL transaction. The entire encumbrance amount will be liquidated when the invoice does not match the encumbrance amount and will prevent a negative or positive encumbrance balance during the liquidation process. PO/Encumbrance Number (Display Only) The Application displays the Encumbrance number. Description (Display Only) The Application displays the Encumbrance document description. Current Amount Defaults to the unliquidated balance of the encumbrance, however you may enter the current document amount if it is more or less than the encumbrance amount. If you enter an amount less than the encumbrance balance the encumbrance will be partially liquidated. If you enter an amount that is more than the encumbrance balance, the encumbrance will be fully liquidated preventing a negative or positive encumbrance balance during the liquidation process. Unliquidated Encumbrance Balance - (Display Only) The Application displays the current encumbrance balance, which is the balance left on the encumbrance. Encumbrance Session ID (Display Only) The Application displays the encumbrance transaction session ID. Encumbrance Document Date (Display Only) The Application displays the document date of the original Encumbrance. Vendor ID (Display Only) The Application displays the vendor ID or UNASSIGNED. When you post the check or accounts payable invoice, the Application uses the entry to reduce the document balance in the Encumbrance subsidiary ledger. NOTE: Accounting > Encumbrances > Enter A/P Invoices > Enter Encumbrance Liquidations do record expenses to the general ledger since they are part of an accounts payable invoice transaction. 2015 Abila Student Curriculum 17
Liquidations with Other Transactions Abila MIP Fund Accounting TM Purchase Order Module Installed Encumbrances may also be liquidated by entering a cash disbursement, or an accounts payable invoice. To do this, start a session and enter the document level information (invoice number, date, amount, description, vendor ID and due date). After entering the document level information the Choose Items/ Encumbrances button is available. Select the Choose Items/Encumbrances button to display the Choose Items/Encumbrances for Vendor form. The Choose Items/Encumbrances form lists all open or outstanding purchase orders and encumbrances for both the selected vendor and also the vendor UNASSIGNED. This form allows you to select the purchase orders and encumbrance(s) to liquidate by checking the selector box at the far left of each purchase order or encumbrance. After selecting encumbrances, close the search list by clicking OK. The Application uses the information from the encumbrance subsidiary ledger to generate the expense portion of the document entry that will liquidate the selected encumbrance(s). Create the balancing entry to complete the check or invoice as discussed in the General Ledger Transaction Entry and Accounts Payable chapters. 18 Student Curriculum 2015 Abila
Encumbrances Liquidations with Other Transactions Fully Liquidate Selected Items Selecting the box will default the Fully Liquidate Encumbrance box to be selected when you choose a purchase order item or encumbrance. If you fully liquidate a Stand Alone Encumbrance, the segment columns on the entry form are available to modify. If you do not fully liquidate a Stand Alone Encumbrance, the segment columns on the entry are not available for modification. You may change the amounts, entry type, effective date and the line description. If you fully liquidate a purchase order item and encumbrance, the segment columns on the entry are not available for modification. You may change the amounts, entry type, effective date and the line description. Purchase Orders/Encumbrances Group Box Displays open or outstanding purchase order items or encumbrances previously recorded in the Application. You may display all open items and encumbrances or limit the display to purchase order items, received items, or stand alone encumbrances. All - Displays open or outstanding purchase orders items and stand alone encumbrances previously recorded in the Application. 2015 Abila Student Curriculum 19
Liquidations with Other Transactions Abila MIP Fund Accounting TM Purchase Orders - Displays outstanding purchase order items that did not go through the receiving process. Receiving - Displays outstanding purchase order items that have been received, Activities > Purchase Orders > Receive Items. Stand Alone Encumbrances - Displays unliquidated encumbrances entered from Transactions > Encumbrances > Enter Encumbrances. NOTE: Select the Skip Receiving check box on the Purchase Order, Activities > Purchase Orders > Create/ Modify Purchase Orders, form to automatically receive the items. Selection Grid The Application displays different fields depending on the selected display option (All, Purchase Orders, Receiving, or Stand Alone Encumbrances). The table on the next page explains each field in relation to if the item is a Purchase Order, a Purchase Order with Receiving, a Stand Alone Encumbrance, or all. 20 Student Curriculum 2015 Abila
. Encumbrances Liquidations with Other Transactions Field All Purchase Order Receiving Stand Alone Fully Liquidate Encumbrance Yes Yes Yes Yes PO/Encumbrance Number Yes Yes Yes Yes Line Number Yes Yes Yes N/A Item Code Yes Yes Yes N/A Description Yes Yes Yes Yes Record Type Yes Yes Yes N/A Distribution Code Yes Yes Yes N/A Ordered Amount Yes Yes N/A N/A Cancelled Amount Yes Yes N/A N/A Previously Invoiced Amount Yes Yes N/A N/A Current Amount Yes Yes Yes Yes Currently Invoiced Quantity Yes N/A Yes N/A Unit Price Yes N/A Yes N/A Previously Invoiced Quantity Yes N/A Yes N/A Received Quantity Yes N/A Yes N/A Cancelled Quantity Yes N/A Yes N/A Ordered Quantity Yes N/A Yes N/A Last Receipt Number Yes N/A Yes N/A Unliquidated Encumbrance Balance Yes Yes Yes Yes Current Encumbrance Liquidation Yes Yes Yes N/A Encumbrance Session ID Yes Yes Yes Yes Encumbrance Document Date Yes Yes Yes Yes Vendor ID Yes Yes Yes Yes Fully Liquidate Encumbrance This box becomes available once a purchase order item with an associated encumbrance or a stand alone encumbrance is selected. If the box is selected, the invoice amount will be compared to the encumbrance amount and any difference will automatically liquidate (an Encumbrance Liquidation - ENL) after posting. This applies to both increase and decrease amount differences. The entire encumbrance amount will be liquidated when the invoice does not match the encumbrance amount and will prevent a negative or positive encumbrance balance during the liquidation process. 2015 Abila Student Curriculum 21
Liquidations with Other Transactions Abila MIP Fund Accounting TM NOTE: If you select Fully Liquidate Selected Items, the Fully Liquidate Encumbrance check box will default to checked. You cannot uncheck the box without first deselecting the Fully Liquidate Selected Items box. PO/Encumbrance Number - (Display Only) The number assigned to any open Purchase Order or Encumbrance for the selected vendor. For Purchase Orders and Encumbrances the Application displays the Purchase Order number. For Stand Alone Encumbrances, the Application displays the Encumbrance Number. Line Number - (Display Only) The Application displays the line number assigned to the Purchase Order line. The Application displays zero for Stand Alone Encumbrances. The PO Line Number ties to the item code line number and general ledger coding entered on the purchase order. It also provides a reference between a purchase order item and an encumbrance that was generated from that purchase order, Activities > Purchase Orders > Create/Modify Purchase Orders. This allows for specific identification of an Item Code and the related segment coding in the encumbrance. This reference is available until the encumbrance transaction line is fully liquidated. Stand Alone Encumbrances originating on the Transactions > Encumbrances > Enter Encumbrances form do not have a Line Number reference. Item Code - (Display Only) The Application displays the Item Code for the line number. The Application does not display item codes for Stand Alone Encumbrances. Description - (Display Only) The Application displays the description. For Purchase Orders and Encumbrances, the Application displays the Line Number description of the Purchase Order. For Stand Alone Encumbrances, the Application displays the Encumbrance document description. Record Type - (Display Only) The Application displays the type of record, such as P (Stand Alone Purchase Order - Skip Receiving), PE (Purchase Order with Encumbrances - Skip Receiving), R (Stand Alone Purchase Order - Received), RE - (Purchase Order and Encumbrances - Received), and E (Stand Alone Encumbrance). Distribution Code - (Display Only) The Application displays the distribution code for the line item on the purchase order. If no distribution code was entered, this field is blank. Ordered Amount - (Display Only) The Application displays the amount ordered for the line item, Activities > Purchase Orders > Create/Modify Purchase Orders. The Application displays zero for Stand Alone Encumbrances. Cancelled Amount - (Display Only) The Application displays the amount cancelled for the line item, Activities > Purchase Orders > Cancel Items. The Application displays zero for Purchase Orders - Skip Receiving and Stand Alone Encumbrances. Previously Invoiced Amount - (Display Only) The Application displays the amount that has been invoiced for the line item, Transactions > Accounts Payable > Enter A/P Invoices; Transactions > Enter Cash Disbursements or Write Checks where Choose Items/Encumbrances has been selected. The Application displays zero for Stand Alone Encumbrances. 22 Student Curriculum 2015 Abila
Encumbrances Liquidations with Other Transactions Current Amount - The Application displays the Current Amount based on the Record Type. For Stand Alone Encumbrance type items the Current Amount is the unliquidated encumbrance balance. You may accept this amount or enter the document amount. If you enter an a amount less than the encumbrance balance the encumbrance will be partially liquidated. If you enter an amount that is more than the encumbrance balance the encumbrance will be fully liquidated preventing a negative or positive encumbrance balance during the liquidation process. For Stand Alone Purchase Order - Skip-Receiving type items, the Current Amount is the difference between the Ordered Amount less the Previously Invoiced Amount.You may accept this amount or enter the document amount. If you enter an a amount less than the balance the purchase order will be partially invoiced. If you enter an amount that is equal to or more than the balance the purchase order will be fully invoiced. For Purchase Order with Encumbrances - Skip Receiving type items, the Current Amount is the difference between the Ordered Amount less the Previously Invoiced Amount.You may accept this amount or enter the document amount. If you enter an a amount less than the purchase order/ encumbrance balance the purchase order and encumbrance will be partially invoiced and liquidated. If you enter an amount that is equal to or more than the purchase order/encumbrance balance the Application will set the Fully Liquidate Encumbrance check box to selected. The purchase order/ encumbrance will be fully invoiced and liquidated preventing a negative or positive encumbrance balance during the liquidation process. For Stand Alone Purchase Order - Received type items, the Current Amount is automatically calculated by the Application using the Unit Price multiplied by the Currently Invoiced Quantity. You may accept this amount or modify the amount by changing the Currently Invoiced Quantity. You may also adjust the amount directly up to +/-.5% of the Currently Invoiced Quantity (+/-.005 * Currently Invoiced Quantity). For Purchase Order with Encumbrances - Received type items, the Current Amount is automatically calculated by the Application using the Unit Price multiplied by the Currently Invoiced Quantity. You may accept this amount or modify the amount by changing the Currently Invoiced Quantity. You may also adjust the amount directly up to +/-.5% of the Currently Invoiced Quantity (+/-.005 * Currently Invoiced Quantity). The encumbrance will be liquidated for an amount equal to the Unit Price multiplied by the Currently Invoiced Quantity. However, if you select the Fully Liquidate Encumbrance check box the encumbrance will be fully liquidated. Currently Invoiced Quantity - (Display Only) The Application displays the original/adjusted quantity received less any amounts that have been previously invoiced. You may accept the displayed amount or enter a partial amount to invoice. You may not enter an amount greater than the Received Quantity. See Multiple Receipts (in Receipt Number column) for more information. The Application displays zero for Purchase Orders - Skip Receiving and Stand Alone Encumbrances. Unit Price - (Display Only) The Application displays the last price or adjusted price of the last Receipt/ Adjustment Number associated with the Purchase Order, Line Number, and Item Code combination. The Application displays zero for Stand Alone Encumbrances. 2015 Abila Student Curriculum 23
Liquidations with Other Transactions Abila MIP Fund Accounting TM Previously Invoiced Quantity - (Display Only) The Application displays the quantity previously invoiced. The Application displays zero for Purchase Orders - Skip Receiving and Stand Alone Encumbrances. Received Quantity - (Display Only) The Application displays the original /adjusted quantity received entered using Activities > Purchase Orders > Receive Items or Adjust Receipts. The Application displays zero for Purchase Orders - Skip Receiving and Stand Alone Encumbrances. Cancelled Quantity - (Display Only) The Application displays the quantity cancelled on the Purchasing > Cancel Items form. The Application displays zero for Purchase Orders - Skip Receiving and Stand Alone Encumbrances. Ordered Quantity - (Display Only) The Application displays the quantity ordered on the Activities > Purchase Orders > Create/Modify Purchase Orders form. The Application displays zero for Stand Alone Encumbrances. Last Receipt Number - (Display Only) The Application displays the receipt number entered in Process Receipts. If Multiple Receipts exist, the Application displays the most recent receipt associated with the Purchase Order, Line Number, and Item Code combination. The Receipt Number field is blank for Purchase Orders - Skip Receiving and Stand Alone Encumbrances. Each purchase order item may be affected by multiple receipts. If there is more than one receipt, invoice quantities are applied against received quantities on a first in, first out basis. For example: Receipt 1 has a Quantity of 10. Receipt 2 has a Quantity of 15. Receipt 3 has a Quantity of 10. If Invoice 1 has a Quantity of 12 then, Receipt 1 and Receipt 2 cannot be changed through the receipt adjustment, Activities > Purchase Orders > Adjust Receipts, process because the quantity invoiced consumed all of Receipt 1 and part of Receipt 2, while Receipt 3 remains open or adjustable. Later, if an Invoice is booked with a quantity of 14, then none of the receipts may be changed because the quantity invoiced consumed the remaining quantity of Receipt 2 and part of Receipt 3. Unliquidated Encumbrance Balance - (Display Only) The Application displays the current unliquidated encumbrance balance. The Application displays zero for Stand Alone Purchase Orders. Current Encumbrance Liquidation - (Display Only) The Application displays the current encumbrance liquidation. This amount may be edited on the transactions form. The Application displays zero for Stand Alone Purchase Orders. Encumbrance Session ID - (Display Only) The Application displays the encumbrance transaction session ID. This column is unavailable when the Encumbrance Balance is zero. The field is blank for Stand Alone Purchase Orders. Encumbrance Document Date - (Display Only) The Application displays the document date of the original Encumbrance. This column is unavailable when the Encumbrance Balance is zero. The field is blank for Stand Alone Purchase Orders. Vendor ID - (Display Only) The Application displays the vendor ID or UNASSIGNED. 24 Student Curriculum 2015 Abila
Encumbrances Liquidations with Other Transactions After selecting purchase orders or encumbrances, close the search list by clicking OK. The Application uses the information from the purchase order or the encumbrance subsidiary ledger to generate the expense portion of the document. Once this entry is created, the segment columns on the entry may not be modified for Purchase Order type items and Stand Alone Encumbrances (Fully Liquidate Encumbrances box unchecked) since the invoice or liquidation entry must be made with the same coding as originally input. You may change the amounts, entry type, effective date and the line description. Create the balancing entry to complete the invoice as discussed in the Accounts Payable chapter. When you post the accounts payable invoice, the Application uses the entry to reduce the document balance in the Encumbrance subsidiary ledger. Encumbrances Tips For Purchase Orders and Encumbrances and Stand Alone Purchase Orders, the Line Number description of the Purchase Order displays in the transaction line description. For Stand Alone Encumbrance, the original Encumbrance description displays in the transaction line description. In the Purchase Orders/Encumbrances table, you may sort the data based on any column. Doubleclick on a column heading to sort according to that column. The sorting functionality is only for table display and does not affect printing. Print uses the data from the database and is therefore not reflective of how the items were sorted. Use Transactions > Accounts Payable > Enter A/P Invoices > Choose Items/Encumbrances to record expenses to the general ledger since they are part of an accounts payable invoice transaction. 2015 Abila Student Curriculum 25
Liquidations with Other Transactions Abila MIP Fund Accounting TM Activity: Liquidate an Encumbrance using Accounts Payable Invoices Navigator: Encumbrances > Enter A/P Invoices Classic View: Transactions > Accounts Payable > Enter A/P Invoices Session Information Session: Use the plus (+) key to auto increment Status: Batch-to-Post Description: Monthly Bills Date: Today s Date Click Start Document Information Invoice: 1000 Date: Today s Date Amount: $2600.00 Description: Form Printing Vendor ID: Rapid Due Date: Accept Default Click Choose Encumbrances or Choose Items/Encumbrances if the Purchase Order module is installed. Select Encumbrance: ENC5000 Fully Liquidate Encumbrance: Yes (select check-box) Click OK after making the selection. Review the debit entry. Click Use Offsets to generate the credit to accounts payable. Click Save and Close to complete the transaction. Post the session. 26 Student Curriculum 2015 Abila
Encumbrances Auto-Close Encumbrances Auto-Close Encumbrances Available from Transactions > Encumbrances > Auto-Close Encumbrances. Use this form to close encumbrances on a global basis instead of liquidating the encumbrances one vendor at a time. You can close out the encumbrance ledger cleanly at the end of the budget cycle or fiscal year. If policy requires that encumbrances be reinstated for the next budget cycle, you can simultaneously generate an encumbrance session that will reverse the closing session or to exclude encumbrances from the reversing session. This form is available if security rights were granted by your Administrator from Security > Setup Organization Menus. Each encumbrance selected must past a validation in order for the liquidation and reversing session to occur. If a single encumbrance does not pass the validation on the Auto-Close Encumbrances form, the system will not close any of the Encumbrances you selected. You can select smaller batches to close as a workaround. Example Your organization has approved for you to receive a new computer. A $500 purchase order with encumbrance was created to encumber the funds in the budget. While waiting for the invoice for your computer to arrive, the fiscal year ended. Your invoice will arrive after the beginning of the new fiscal year, but you would like to close all your encumbrances. Since the encumbrance has not been recognized you would close and recreate one for the computer in the new fiscal year. Using the Auto-Close Encumbrances feature, system will close the $500 encumbrance and all other open-balanced encumbrances that you selected and in the new fiscal year, one encumbrance will be recreated with the $500 balance. To Auto-Close an Encumbrance 1. Post all outstanding transactions prior to using the Auto-Close Encumbrances form. 2. Access Transactions > Encumbrances > Auto-Close Encumbrances. 3. Enter a Session ID, Description, Close Encumbrances as of date, check the Create Session Reversal as of check box and enter a date. NOTE: If you do not want the Encumbrance to be reinstated in the new fiscal year, do not check Create Session Reversal As Of, or enter a date. 2015 Abila Student Curriculum 27
Auto-Close Encumbrances Abila MIP Fund Accounting TM 4. Click Start. 5. Select the check box next to the Vendor ID column for which you want to close encumbrances. If the Create Session Reversal as of check box was selected and a reverse date was entered on the Transaction Session form, the Reverse check box is also selected. 6. Click OK to begin the close procedure. 7. Click Yes to confirm the action. If you have selected Create Reversal Session as of the system will create two sessions: (1) an ENL session to liquidate the encumbrance, and (2) an ENC session to create the encumbrance in the new fiscal year. 8. Click Finish. 28 Student Curriculum 2015 Abila
Encumbrances Auto-Close Encumbrances 9. Go to Activities > Manage Sessions > Post Transactions. Select both the ENC and the ENL session. Click Post. TIP: A complete list of fields and descriptions on this form are available from the Abila Online Help by clicking the? Help icon in this form. 2015 Abila Student Curriculum 29
Display Encumbrance Balances Abila MIP Fund Accounting TM Display Encumbrance Balances The Encumbrance Balances form is accessed from the Activities > Display Encumbrance Balances. Use this form to view encumbrance balance and document information. Date Range for Balances Select the date range you would like to display in the table. Date From, Date To If the same date is selected for both boxes, the documents created on that day will display in Current Activity. This filter applies to the original document only. The Date Range does not filter the associated documents. Display Accounts This group box contains your segments. You are required to filter on at least one segment. Click Display button to view the filtered data. 30 Student Curriculum 2015 Abila
Encumbrances Display Encumbrance Balances Display Encumbrance Balances Table The Application displays document information depending on your selections. The table supports expandable levels. You may click on the plus (+) sign next to a level to expand the outline, click the minus (-) sign to collapse the item. You can view balances on accounts with any status (active, inactive, discontinued). Balance Table Level - Description Fields 1 - Original Document Segment Name(s) Description From Date Through Date Posted Amount 2 - Related Document (Displays all documents related to the Original) 3 - Transaction (Displays transaction information related to the expanded document) Effective Date Transaction Type Document Number Posted Amount ID Session ID Document Date Document Description Segment Name(s) Debit, Credit Entry Type Effective Date Transaction Description TIP: When viewing data in the table, level 1 needs to extend beyond (be wider than) levels 2 and 3 in order to view all column data. You also need to use the vertical scroll bar within that level to see its data. (Each level has its own vertical scroll bar.) 2015 Abila Student Curriculum 31
Display Encumbrance Balances Abila MIP Fund Accounting TM Activity: Display an Encumbrance Balance Navigator: Encumbrances > Related Tasks > Encumbrance Balances Classic Menu: Activities > Display Encumbrance Balances Date From: <First day of current year> Date To: <Last day of current year> Selected Filter: Fund: 01 (Operating Fund) General Ledger: 53001 (Office and Other Supplies Expense) Click Display to view the balance information. Click Plus to view the transactions that comprise the current activity. Click Close to close the Display Balances form. 32 Student Curriculum 2015 Abila
Encumbrances Reports Reports The Encumbrance module includes a set of Encumbrance Analysis reports, accessed from Reports > Encumbrances. These reports enable you to research encumbrance and purchase order transactions and aging information for encumbrances entries. Report Name Unposted Encumbrance Transaction Report Information Prints encumbrance entries that are not posted. Use(s): Internal audit trail / best practices. Posted Encumbrance Transactions Prints posted encumbrance entries. Use(s): Internal audit trail. Summary Encumbrance Ledger Summary-style ledger (summary of detail ledger entries), that prints a list of encumbrances through the selected date range with effective date prior to or within the selected date range. Detail entry amounts for an encumbrance are netted together creating a summary account. Liquidations made through Enter A/P Invoices also appear in the report. Options: Account level security is available. Use(s): Assists in reconciling encumbrance balances. Use the Detail Encumbrance Ledger to see an individual record for each transaction. Detail Encumbrance Ledger Detail-style ledger which prints the amount of an encumbrance through the report date range, can print in detail or summary. Options: If Summarize Dollar Amounts is selected (Options tab), the detail entry amounts for an encumbrance netted together giving a summary amt due. If not Summarize Dollar Amounts is not selected, report prints each individual record for an encumbrance. Use(s): Internal audit purposes Researching encumbrance questions or reports 2015 Abila Student Curriculum 33
Reports Abila MIP Fund Accounting TM Report Name Aged Encumbrances Report Information Summary-style ledger that prints a list of encumbrances using an aging date, broken into four aging periods of your choice (in days). Liquidations entered through AP Invoices also appear on this report. Options: Account level security Use(s): Allows you to see how old an encumbrance is as compared to the date it was entered. Encumbrance Budget Prints data comparing current year / period budgeted revenue and expense against current year/period encumbrances. Options: Budget columns calculated based on Budget version in Options tab. Uses: Comparing budget vs encumbered amounts. Encumbrances in Financial Statements You can include Encumbrance amounts in the Balance Sheet, and Statement of Financial Position. In order to view Encumbrance amounts on your financial statement formats, follow these steps: 1. Access Reports > Financial Statements > Create Statement Formats. 2. Select either the Statement of Financial Position (S/P), or the Balance Sheet (B/S). 3. Select your financial statement Format Name. 4. Check Include Encumbrance Accounts 34 Student Curriculum 2015 Abila
Encumbrances Reports 5. Click the Create Outline tab, and select Net Assets or the Current YTD Net Income line. 6. Click the Assign Accounts tab. 7. Assign the EN (Encumbrance) and RV (Reserve for Encumbrance) accounts. 8. Click Save. 9. On the Report Options tab, check Include Encumbrance Amounts. NOTE: Whether the box to Include Encumbrance Amounts is checked or not, this Encumbrance information is only available if you have also set up the report format to include Encumbrance amounts. 10. Run your report to screen - the report will now include the encumbrance information. EN and RV Accounts The EN and RV accounts are internal accounts that will not appear in the Chart of Accounts. They are only enabled with the options in these reports. These accounts will reflect the net of the encumbrance subledger EN is the debit, (normally in the Unrestricted fund Balance section), while RV is the credit (normally in the Temporarily Restricted fund Balance section). TIP: The Detail Encumbrance Ledger allows you to review every transaction that comprises encumbrance balances. Adding the Transaction Source column to this report will help explain how transactions were entered through the Application. 2015 Abila Student Curriculum 35