Cygnet IT

Rhoda Newens

Cygnet IT

April 2015

FMSFinancial Year End

Procedures

Cygnet IT

Contents

ContentsIntroduction............................................................................................................................4

New Year Creation..................................................................................................................5

Creating VAT Periods.....................................................................................................................7

Creating Salary Periods

9

Creating and Updating Cost Centre/Ledger Links......................................................................9

Year End System Checks…………………………………………………………………………………………………………10

Transferable……………………………………………………………………………………………………………………………..13

Processing Outstanding Transactions………………………………………………………………………………………14

Orders and Commitments…………………………………………………………………………………………………………14

Accounts Payable Invoice and Credit Notes………………………………………………………………………………15

Petty Cash....................................................................................................................................16

Journals and Accruals……………………………………………………………………………………………………………….17

Non Invoiced Income……………………………………………………………………………………………………………….18

Paying In Unposted Receipts……………………………………………………………………………………………………18

Accounts Receiveable Invoiced Income…………………………………………………………………………………….19

Paying In Unposted Receipts…………………………………………………………………………………………………….20

Debtors Review…………………………………………………………………………………………………………………………20

Bank Reconcilitaion Processes………………………………………………………………………………………………….21

Cancelling Unwanted Cheques....................................................................................................21

BACS Payments............................................................................................................................21

VAT Claims……………………………………………………………………………………………………………………………….21

Personnel Links............................................................................................................................22

Reports………………………………………………………………………………………………………………………………..24

Preliminary Closedown……………………………………………………………………………………………………………25

New Year ………………………………………………………………………………………………………………………………..28

CFR Reports……………………………………………………………………………………………………………………………..31

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Contents

Validation Errors within the Report……………………………………………………………………………………..32

Apportioned Column…………………………………………………………………………………………………………….40

Capital Apportioning………………………………………………………………………………………………………………40

Validation Checks…………………………………………………………………………………………………………………..40

Revenue Apportioning…………………………………………………………………………………………………………...41

Producing the Report………………………………………………………………………………………………………………42

Completion of Financial Statements………………………………………………………………………………………..43

Final CFR Report and Final Closedown…….…………………………………………………………………………..46

Appendix A………………………………………………………………………………………………………………………….50

Appendix B……………………………………………………………………………………………………………………………51

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IntroductionTo facilitate the closure of a financial year there are a number of checks that need to be executed.

Within FMS a preliminary closure should be executed however, there are a number of routines and checks that need to be completed before this can be carried out. These include:

Creating a new financial year

Defining VAT periods Defining salary periods

Verifying Cost Centre and Ledger code links

Preliminary closures can be run as many times as required.

Before the year end there are a number of areas that need consideration to assist with the smooth closure of the accounts. These include:

orders and commitments

invoices and credit notes

bank reconciliation

petty cash, income and journals

VAT

retained earnings, balances and carry forward figures

year end balances

produce the preliminary CFR

produce the final CFR

N.B. It is imperative that all guidance from your local authority has been read and understood prior to closing a financial year. As accounting practices differ from school to school no specific advice will be given on accounting practices and any accounting assumptions made in the guidance should be confirmed with your local authority.

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New Year CreationIt is permissible for two financial years to be open and another financial year to be created however, only two financial years can have transactions processed at any one time. To facilitate the entry of transactions into the new financial year it would be necessary to close a previously open financial year.

The following processes will need to be carried out prior to running a preliminary close.

Creating a new Financial Year1. Select Tools | Define Financial Years | Define/Edit Years to display the Define Years screen.

3. Add the new financial year by clicking the + button at the side of the screen.

Add Button

The following screenshot will be displayed.

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6. Input the following:

a) Year Description: 2015 Number of Periods: 12.

b) Select the Calendar Month radio button.

c) Next Year Begins: 01/04/2016 (N.B. This will be different for academies).

NOTE:

You have the choice of:

1. Check Spending against C.C.

2. Order Book Open (you may wish to close the order book in the old year now)

3. Order Book Open – restricted member of staff

4. Record Deliveries

5. Copy Service Term Mappings (if applicable – necessary if links with SIMS Personnel are in use.)

7. Click the Save button.

Wait a few seconds while the structure is copied to the new financial year.

The following screen will be displayed and the year will be visible. It will be displayed as Not Started. It is feasible to modify the structure, cost centre allocations, salary projections and salary calculations once the year has been created but NOT started.

N.B. No financial transactions can be undertaken.

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Creating VAT PeriodsEnsure that in the new year you have defined periods for VAT.

1. Select Tools | Define VAT Periods.

2. Click the green + button to add the new year’s VAT periods.

By default the Copy from Previous Year is selected as it is assumed that you will want to produce VAT reports on a similar time scale as the previous year. Always check the End Date is correct. Options are available for quarterly, monthly or a set number of days.

NOTE: The VAT126 form is for academies and therefore does not need to be submitted by maintained schools.

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3. Select the Copy From Previous Year radio button and click the Save button. The following screen will be displayed. It would be good practice to review the End Date of each period to ensure it falls in line with what is expected.

4. Click the Save button to complete the process.

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Creating Salary PeriodsThis process is only required where SIMS Personnel is linked in to FMS for salary projections, calculations and payments.

1. Select Tools | Define Financial Years | Define Salary Periods.

2. Click the green + button and select the new financial year from the browser, and then click the Save button to create the salary periods.

3. Click the Save button to complete. If links are in place you will receive a message stating Recalculating Commitments.

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Creating and updating the Cost Centre/Ledger Links

During the financial year it may have been necessary to create new Cost Centres (N.B. Academies CAN create new Ledger codes. Maintained schools can ONLY use the Ledger codes supplied by the Borough). At year end it is advisable to ensure that all Cost Centre/Ledger code Links have been updated. This ensures that the balances carried forward to the new financial year are held against the linked Cost Centre/Ledger code.

1. Select Tools| General Ledger Setup |tab 6 C/Centre Ledger Links

2. Click the + icon.

The next screen displays all the Cost Centres in the top left-hand side panel and the Ledger codes in the bottom left-hand side panel.

3. To create a link between a Cost Centre and a Ledger code, click on the required Cost Centre to highlight it. Now press the top icon or double click the required Cost Centre. This will then move the Cost Centre from the left panel to the right panel.

4. At the bottom of the screen find the required Ledger code and click on it to highlight. Now press the top icon or double click the required Ledger code. This will then move the Ledger code from the left panel to the right panel.

5. Click the Create Links button, a message will be displayed stating how many links have been created and how many already existed.

6. Click the Save button to complete the process.

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NOTE: The structure of the accounts will be as per the date the new year was created. If for any reason the structure needs to be altered in the old year, you will need to mirror this in the new year also – this does not automatically happen.

To do this select Tools | Define Financial Years | Update Next Year’s Structures. Select tab 1: (Ledger Codes), tab 2: (Cost Centres) and tab 3: (Groups/Templates) in turn, and then tag the codes which need copying to the new year. Click the Copy Tagged button.

You should also be aware that changes to the structure will affect any user defined reports and standard templates. These will need to be amended to bring them back into line, for example, with the new Cost Centre/Ledger codes. A useful report to check the structure in place is the Chart of Accounts listing report. To display the report select Reports | General Ledger Setup | Chart of Accounts Listing.

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Year End System ChecksThere are a number of system checks that will need to be run which will assist with the year end process. A sample report can be found in Appendix A.

Year End System ChecksSelect Reports | Year End | System Checks

This report gives a list of items that should be resolved before closing the year.

While some of the transactions will actually prevent a year being closed there may be other items which will require additional actions before the year end can be processed. Additional reports will be needed to review each area of FMS.

Transactions that will prevent a year end close should be processed, that is, deleted, cancelled, posted or authorised before the year can be closed.

N.B. All queries should be dealt with before 31st March.

Transaction Type Status on Report Action Before Year End

Order Not authorised Delete or authorise

AP invoice (local) Not fully authorised Cancel or authorise

On holdChange status or cancel commitment

AP invoice (central) Not fully authorisedAuthorise and print authorisation slip or cancel

Authorisation slip not printed Print authorisation slip or cancel

Invoice on holdChange status, cancel invoice (transferable if authorisation slip is printed).

Credit notes Not authorised Cancel or authorise

Non-invoiced income Created Delete or post

AR (invoiced income) Created or authorisedAuthorise and print, print or cancel

Petty cash Unposted Delete or post

All journals Unposted Delete or post

Transferable

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Transactions marked with a T may be transferred and require processing in the new financial year.

Transactions marked TS may be transferred as supporting items, for example the order supporting an invoice.

At the end of the report, further reasons may be given as to why it is not possible to run preliminary/final close, for example, Ledger codes have been added since the new financial year was defined. If Ledger codes, Cost Centres, Ledger groups, Profile models or journal templates have been added, select Tools | Define Financial Years | Update Next Year’s Structures, to ensure that these are copied across into the new year. You will also need to select this option to ensure that paying in books or products added since the new year was created are also copied across.

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Processing Outstanding Transactions Orders and CommitmentsBefore a financial year can be closed the status of all orders should be checked. Any orders that have a status of authorised, printed or partially invoiced will be transferred to the new financial year on the first preliminary close down. Fully invoiced orders may also be transferred if they are a support item for other transactions. Orders with a state of not yet authorised or on hold cannot be transferred and would prevent a close down from taking place. These orders need to be either deleted or authorised.

Outstanding Orders Report

It is recommended that the following report is run. When running the report select Outstanding orders option.

1. Select Reports | Accounts Payable | Purchase Order Reports | Purchase Orders

2. Click the OK button to display the report on screen. Any orders that have not been authorised will always appear at the top of the report. Thereafter the orders will be displayed by order number as a default (this can be changed to order date on the Report Criteria screen when running the report). The order total and remaining commitment are displayed.

The report can be filtered by Supplier, Order Date and Order Number however, it is recommended that these are left blank so that all outstanding orders are retrieved.

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Alternatively you can view and subsequently amend outstanding orders in the order Purchase browse.

1. Select Focus | Accounts Payable | Purchase Order

2. From the View field browser button all orders and status of orders can be retrieved. i.e. Unauthorised; On Hold; Cancelled etc.

3. If there are any unauthorised or on hold orders these need to be dealt with. The options available are to authorise (and print) the order or to delete them.

NOTE: Any orders that have a status of On hold will need to have the On Hold tick removed to change the state of the order to Not Yet Authorised and dealt with.

Accounts Payable – Invoices and Credit NotesBefore a financial year end any invoices that have a status of fully authorised will be transferred to the new financial year on the first preliminary close down. Paid invoices will also be transferred if they are a support item for other transactions. Invoices with a state of unauthorised or on hold cannot be transferred and would prevent a close down from taking place. These invoices need to be dealt with by either cancelling or authorising them.

Authorising Invoices

1. Select Focus | Accounts Payable | Invoice/Credit Note.

2. Select Unauthorised from the Status field.

A list of any unauthorised invoices will appear.

3. Either tag all the unauthorised invoices, and then click the Authorise Tagged button. Any invoices that are on hold need the tick to be removed from hold and subsequently authorised.

4. If an unauthorised invoice needs to be cancelled, perhaps added in error, then it may be necessary to cancel this invoice. To complete this, view the invoice and click the Cancel Invoice button.

N.B. Remember that any orders attached to invoices that may have been cancelled will then be released back into FMS and may also need to be cancelled.

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Petty CashAny unposted petty cash expenditure needs to be posted or deleted prior to year end otherwise the close down will fail. In addition the cash in hand figure on FMS should match the actual value of the petty cash held in the petty cash tin/safe.

Posting Petty Cash Expenditure

To complete the year end process it is necessary to ensure that there is no unposted petty cash expenditure.

1. Select Focus | General Ledger | Petty Cash.

A list of petty cash transaction will appear.

2. It will be necessary to post any unposted expenditure. Highlight the Unposted Expenditure and click the Post Transaction button on the upper right-hand side. Click the Post button.

Post Transaction Button

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Journals and AccrualsBefore a financial year can be closed, any unposted journals or accruals need to be dealt with. If there are any unposted journals or accruals on FMS the close down will fail. To resolve this, journals need to be posted or deleted. There are a number of different types of journals, which may be awaiting posting or might have to be deleted:

normal journals

reversing journals

accruals journals

cash book journals

VAT reimbursement journals

VAT transfer journals

Posting Unposted Journals

To complete the year end process it is necessary to ensure that there are no unposted journals.

1. Select Focus | General Ledger | Manual Journal Processing.

A list of unposted journals will appear.

If there are any unposted or incomplete journals they will be visible. Note that there is a U for unposted in the status (S) column.

If an unposted journal needs to be removed, for example it was started in error, highlight the unposted journal and click the – (minus) button at the top of the screen.

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Non Invoiced IncomeBefore a financial year can be closed it is necessary to ensure all non-invoiced income receipts entered have been paid in and all paying in slips have been posted.

Paying In Unposted Receipts

To complete the year end process it is necessary to ensure that there are no unposted receipts.

1. Select Focus | Non Invoiced Income | Receipts.

A list of unposted receipts will appear.

If there are any unposted receipts these will be visible on this screen. To view paid in receipts you will need to change the View to Paid In.

2. Click the Tag All button to tag the receipts. Click the Pay In button to select the Bank Account destination.

3. Click the Save button.

4. Ensure that a reference is entered against the payment.

5. Make sure that the total cash and total cheques are entered correctly in the Control Totals fields.

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6. Click the Save button at the top and the Print & Post button on the upper right-hand side.

Print & Post Button

7. Click the Close button to close the Paying In Slip screen and all the outstanding receipts will disappear as they have been paid in.

Accounts Receivable (AR) Invoices – Invoiced IncomeYou can issue accounts receivable invoices right up to the date of the 31st March 2015 for the financial year 2014/15. After this date, you should be producing the AR invoices in the new financial year 2015/16.

All AR invoices should be authorised and printed before 31st March 2015.

Currently only the paying in books are transferred at the year end.

1. Select Tools | Define Financial Years | Update Next Year’s Structures and clicking tab 4: Invoiced Income. All other books are visible in all financial years, so they do not need to be transferred at year end.

As there are strict rules concerning invoice, receipt, pay in, period and tax point dates, the system check report in FMS should be run before 1st April. This will enable you to identify any invoices, credit notes, receipts and pay in slips which require printing and posting.

NOTE: These should be printed and posted before attempting to close the financial year, as preliminary close will fail if any created items that have not yet been posted are found.

When the old year is closed, either through preliminary or final closure, invoices are not transferred into the new year. This does not mean, however, that they are not available when entering a receipt for payment received in the new financial year. A list of all outstanding invoices and receipts is available for matching to payments.

NOTE: If a credit note or write-off is required for an AR invoice in the new financial year the AR invoice will need to be transferred into the new year. This is achieved by changing back to the appropriate year in FMS. Then enter the Accounts Receivable module. Locate the invoice in question, highlight and click the Write-Off button. A message will be displayed if you want to copy the invoice into the next financial year. Clicking the Yes button will move the invoice into the next year. The invoice can then be dealt with in the normal way in the new year.

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Paying In Unposted Receipts

If there are any unposted receipts in Accounts Receivable they will need to be paid in before a year end can take place.

1. Select Focus | Accounts Receivable (Invoiced Income) to enter the Accounts Receivable module.

2. Select Focus | Receipts and search for any receipts with a status of Created. Created receipts need to be paid or cancelled. Click the Close button to close the Receipts browse.

3. Select Focus | Pay In to display the Pay In browse.

4. Click the blue tick icon to save and the Post Pay In Slip button to complete the pay in.

Post Pay In Slip Button

Debtor ReviewIt is recommended that the aged debtor report is reviewed and any debts that are considered unrecoverable are written off within the current financial year before year end.

In Accounts Receivable select Reports | Aged Debtor Report. Click the OK button on the report criteria screen to display the report, similar to the graphic displayed below.

Exit the Accounts Receivable module.

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Bank Reconciliation Processes

A final bank reconciliation would normally be completed at the end of the financial year. You will need to ensure that you have a financial statement that goes up to 31st March. It is essential that you ensure that the final balances are correct.

The bank reconciliation can be viewed via Focus | General Ledger | Bank Reconciliation.

Cancelling Unwanted Cheques

It may be necessary to cancel cheques that are no longer required, perhaps because of a dispute with a supplier, an alternative method of payment has been found or the cheque presentation period has expired. If these are not dealt with they will continue to appear on the unreconciled transactions listing.

1. Select Focus | Accounts Payable | Cheque Processing. Select the relevant cheque run or use find cheque number.

2. Once the cheque has been located click the Cancel Cheque icon and confirm the cheque needs cancelling, then enter an appropriate entry into the Audit Log. Remember to cancel the invoice and order if the commitment is no longer required.

NOTE: It is recommended that you speak with your accountants to ensure that they are aware of all the necessary reports required following the bank reconciliation.

BACS PaymentsBACS runs and payments are not transferred from one year to the next. Therefore, it is essential that all BACS transactions are reconciled before running preliminary and final close.

If you decide to run a preliminary close within one calendar month of year end or a BACS run within the last month of the year, a warning message will display reminding you to ensure that all BACS transactions and possible contra transactions have been reconciled to the bank statement. This does not apply to failed BACS files, as these never appear on bank statements. However, it is quite possible for a BACS file to appear on one bank statement and any contra records for BACS transactions which have failed to appear on a later statement.

Once a preliminary close has been run for the previous financial year, you will only be able to view BACS payments. No further processing for the year may take place.

Ensure that all BACS transactions have been reconciled, as outstanding BACS files will not be transferred to the new year.

VAT ClaimsIt will be necessary to ensure that you produce the final VAT claim for the financial year. This may be the last quarter or month for the year, depending on the frequency on claim. The earliest this final VAT report can be run is 1st April 2015. The appropriate VAT reports will need to be run depending on the Local Authority requirements. The various VAT reports are found under Reports | General Ledger | VAT | VAT Reports.

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Personnel LinksIf using personnel links, you will have to clear any outstanding salary commitments within FMS. You would do this once all salary payments have been completed or if salary payments are made in a different way but commitments appear for salary calculations.

If there is any outstanding salary commitments these need to be cleared before the final close down (it does not prevent a preliminary close down). For training purposes the year end system check will indicate whether there is any outstanding commitment. If there is no outstanding salary commitment then the following is an example of what would need to be done back in school.

Salary Commitment - Personnel Links1. Select Focus | Personnel Links | Salary Projection.

2. Click the Clear Commitment button at the top right of the screen.

Clear Commitment Button

Check each month for any outstanding commitments by clicking in the commitments for period field. If there is any outstanding commitments then click the Tag All and Clear Commitments buttons for each period.

Central Schools

Central Reconciliation

Make sure all the authorisation slips are printed or exported for the central invoices which have been authorised, in guidance with the timings of the LA year end procedures.

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Reconciliation to LA Systems (Central/Partial)

The financial statements received from the LA should be used to ensure all transactions have been included up to period 12. Any future reconciliations relating to the current year can be done in period 13, but reconciled into periods 1 to 12. These will usually relate to the period 13 financial statement issued by the LA.

Make sure you have completed the period 12 financial statements and that FMS balances with the LA’s monthly income and expenditure statement before proceeding with a preliminary year end (central schools).

Partially funded schools will have reconciled all central transactions (usually salary payments) up to period 13 or even 14 which would then show the YTD figures on your LA reports which would then be the same actual totals.

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ReportsThere are a number of reports that should be run to assist with the financial year end. The following is a list of suggested reports that will assist with ascertaining the financial position of your school. Schools may wish to run/print other reports that are not listed below.

Trial Balance by I& E and Balance Sheet

Go to Reports| General Ledger| Trial Balance |Trial Balance by I & E and Balance Sheet | Detail

The above report can also be run as a summary report and by Cost Centre and/or Ledger code. The report will show closing balances for all accounts, including bank, debtors, creditors and VAT .

Cost Centre Summary Report

Go to Reports | General Ledger | Transactions | Cost Centre Summary Transactions | Cost Centre Summary by Cost Centre

This report will show all current commitments for a Cost Centre and associated Ledger codes which will be carried forward to the new financial year.

Unreconciled Bank Transactions

Go to Reports | General Ledger | Bank | Unreconciled Transaction Listing

This report will display an unreconciled bank transactions.

VAT Report

Go to Reports | General Ledger | VAT | VAT Reports.

Balance and Reserves

Go to Reports | General Ledger | Balances and Reserves, select Financial Year.

It is now possible to extend the balance sheet ledger types to display, for example, other assets, liabilities and retained earnings.

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Preliminary ClosedownTo complete the closure it is imperative that the System Check report no longer reports any issues (see page 50) and that all the necessary adjustments have been completed.

A preliminary year end cannot be run prior to 1st April 2015.

N.B. Bank reconciliation cannot be undertaken in the old year after the first preliminary, as all unreconciled transactions and bank balances are automatically carried forward at this time. Therefore, it is very important that the bank balance reconciles to the actual bank statement at this point.

1. Select Tools | Define Financial Years | Define/Edit Years.

3. Highlight the year 2014, and then click the Preliminary Close button.

4. You may receive the following warning message.

4. Click the Yes button. The dialog showing in the following graphic will display:

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5. If there is a red cross in any of the boxes click the Report button and it will print a report to advise why this part of the preliminary has failed or click the Cancel button to exit. You will not have the option to continue if there are any failed areas.

6. You then make adjustments, by revisiting the areas that have failed and start the preliminary year end procedures again.

The screenshot below may appear if you still have central options available. If you are a centrally funded or a partially funded school it is imperative that you select the Do Not Transfer Central Invoices Passed for Payment option at this stage. This means that any central invoices or central receipts will remain in the old year awaiting the next financial statement from the LA. It is important to choose correctly. Always check with your LA if there are any concerns.

7. Click the Yes button in response to the following if it appears.

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The year will then be preliminarily closed and it will say Closed – not Finalised.

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The New Year1. Go into the new financial year 2015.

Check the results of the first year end, for example, Orders/Invoices carried forward into the new year.

2. The opening balances should be checked to reflect the financial statements. Select Focus | General Ledger | Journal Review to display a list of journals.

3. Locate the Opening Balance Journal (it will have a period of 00).

4. Double-click this journal to display the lines of the journal.

5. The entries on this journal will be balance sheet Ledger codes and reflect the balances rolled forward on the bank account(s), petty cash, creditor/debtor control accounts, VAT and so on and the retained earnings balance.

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6. These figures can also be obtained from the trial balance report by selecting Reports | General Ledger | Trial Balance | Summary Trial Balance | By Ledger Code. Ensure you select Period 1 and do not select a fund. The Opening Balance column will contain these balances against the appropriate ledger codes.

7. It is likely that there will be a number of retained earnings codes reflecting each of the funds which have been set up. For example, School Budget Share and Capital Funds.

After the Preliminary Year End

After the preliminary closure has been run, FMS moves into period thirteen. It may still be necessary to make adjustments to the accounts on the old year. Functions permitted in the previous financial year after preliminary close are listed in Appendix B.

Each preliminary close will produce journals to update the balances in the new year and adjust the balance sheet codes accordingly.

To undertake year end adjustments ensure you are in the old financial year 2014.

Select Focus | General Ledger | Manual Journal Processing.

Click the + button to add a journal, you will be presented with the graphic displayed below.

Year end adjustment journals enable you to post entries against income and expenditure codes but also the bank account(s), payroll control, asset and liability codes. You cannot post against VAT, petty cash, creditor/debtor control accounts or retained earnings codes.

The year end adjustment reversing journal enables you to complete reversing journals between period thirteen of the old year and the period one of the new year.

The ability to add an opening balance journal is only possible in the first year of usage.

Cross Year SymbolsAny orders or invoices transferred to the new year will appear with cross year symbols. This helps when transactions are cancelled in the new year, for example, an unpresented cheque. The symbols used are as follows:

Old Year

n T - indicates that the listed item has been transferred to the new year and requires additional processing.

n TS - indicates that a copy of the item has been transferred to the new year as a supporting item.

n TR - indicates that a transaction has been copied in support, then been cancelled.

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New Year

n F - indicates that the listed item has been transferred from the old year and requires further processing.

n FS - indicates the item has been transferred from the old year as a supporting item.

n FR - indicates a transaction has been copied from the old year in support and the item it was supporting has been cancelled. Further processing may be required.

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CFR ReportThe CFR Report shoul be run after the preliminiary closedown and any errors corrected.

Running the CFR Report1. Select Reports | CFR | CFR Report.

2. Make sure the Contact Name field is filled in before proceeding.

3. The Contact Name field should be populated with the name of the person in charge of the CFR report, i.e. the headteacher.

a) Check that your School Type is correct.

b) Make sure the Complete Financial Year check box is selected.

c) Select the check box If your school is rates exempt.

d) The Has the school been involved in the preparation of the CFR return? check box defaults to being deselected. Schools should seek guidance from their LA on whether this check box should be selected.

e) Select the If your schools insurance policies/premiums have been purchased centrally, at no cost to the school check box.

f) Select the Is your school the hub school of a Federation? check box if applicable.

Contact your school’s LA financial advisor if unsure of any of the above.

Opening Balances Detail

Opening balances are shown in more detail now with four boxes, indicating B01 and B02 balances as revenue balances B03 and B05 for capital and B06 balances for community focused schools with a total balance. For the purposes of training these are nil.

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Click the Preliminary button to continue.

The CFR Report – Preliminary screen will be visible and consists of five tabs, as shown in the graphic displayed below.

Validation Errors Within the ReportThere are validation error symbols built into FMS. These symbols represent either soft warning messages where you would have to produce an explanation in the notes or genuine error symbols that would stop you being able to produce the CFR report.

All the validation error symbols show in the status column of the report.

Validation Error Symbols Within CFR:

Validation failed

Validation failed, but entry is allowed providing an explanation is given

Passed validation

Note added to explain a query

Look at the tabs from 1 to 5 to check for any validation error symbols that have appeared.

If you have the validation failed symbol, this is classed as a failed area and the business rules within FMS would stop you producing the report. If you click the line with the error, it will give an explanation at the bottom of the screen as to why the failure has occurred.

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You cannot produce the report with these red errors and will need to make the relevant changes (in this case the insurance has been bought centrally but the appropriate selection has not been made on the initial criteria screen).

If you have the validation failed, but entry is allowed providing an explanation is given symbol, this is classed as a soft warning and is drawing your attention to this area, just in case there is a problem. The business rules within FMS require you to provide an explanation for this error message.

If this soft warning is displayed, click the line to see a message at the bottom of the screen as to why this symbol has appeared. Most of these soft warnings are just to draw attention to this area and ask if you are happy with the results. You can produce the report with these soft warnings but an explanation should be provided.

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You should read these warnings and if satisfied with the figures, give an appropriate explanation. If you are not happy with this figure, revisit FMS and make the appropriate changes.

1. Locate the B02 Uncommitted Revenue Balance line. This needs further explanation as it has a validation warning.

You give the answer or explanation by clicking the pencil button to the right of the warning, an explanation screen will be displayed as shown in the following graphic.

Pencil Button

Type an appropriate explanation.

2. Click the OK button to continue.

Notice that the note added to explain a Query button will appear next to the warning after you have completed the explanation.

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NOTE: Every soft warning symbol will need to contain an explanation note symbol next to it.

The View button at the right of these warnings will let you view where the figures come from and which Ledger codes were used. This is very useful functionality and can assist considerably when investigating the data.

View Button

3. An alternative way to view errors is by printing an error report highlighting the errors and why they have occurred. To print this error report click the DfE Reports button.

The following screen will be displayed, make sure the CFR Error Report radio button is selected.

4. Click the OK button to produce the report, and then click the Print button to print the report.

The report will appear, as displayed below.

Note from the report that some of the errors are queries and some are errors. Each of these queries or errors has an error number and a description of the error. It will also advise on what CFR line the query is.

Errors should be fixed in FMS before the data can be submitted in the report. Queries should be fixed in FMS or have an appropriate explanation entered before the data can be submitted in the report.

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Tab 1: Income (Revenue)

Tab 1 of this table, as shown in the graphic displayed below, is a total of all the revenue income that has occurred during the year against the income headings I01 to I18 with totals.

Tab 2: Expenditure (Revenue)

Tab 2 of this table is a total of all the revenue expenditure that has occurred during the year against the expenditure headings E1 to E32, with totals.

N.B. Expenditure Just below E32 there is a new validation for error number 450. This is expenditure on directly employed classroom staff (E01, E02 and E03) as a percentage of total expenditure. This should normally be between 50-80% for primary and secondary schools and 40-90% for all other schools.

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There will be a green tick validation if the school falls into the normal category for the school type selected earlier. However, you will get a yellow exclamation mark validation if the school falls above the normal category for the school type and an appropriate explanation needs to be given.

Tab 3: Capital Income

Tab 3 of this table is a total of all the capital income that has occurred during the year against the income headings CI01, CI03 and CI04 with totals.

Tab 4: Capital Expenditure

Tab 4 of this table is a total of all the capital expenditure that has occurred during the year against the expenditure headings CE01 to CE04.

You can view details of any of these figures by clicking the view button at the right of each heading.

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Tab 5 – Balances

Tab 5 of this table shows all the revenue and capital balances.

CFR Codes B/Fwd Calculated Apportioned

B01

This will always be zero and set by FMS. It will never be editable.

No values will be entered into this cell.

Initially values will be set to zero or for any value previously entered. Values may be edited.

B02

If available, this will display the sum of the actual for B01 and B02 for the previous year. This cell is editable.

This will be calculated by FMS as the sum of the income table actual column less the sum of the expenditure table actual column. This cell is non-editable.

Values are system generated and initially will be the same as the value in B02 in the calculated column. This cell is non-editable. When a value is entered into B01, the value is updated here as B02 – B01 = n.

B03 The actual balances for each of the CFR codes are displayed. Values will be taken from the previous year’s final report and may be edited.

No value will be entered into this cell.

Initially values will be set to zero or for any previously entered. Values may be edited.

B05

This will be calculated as the sum of the capital income table less the sum of the capital expenditure table. The cell is non-editable.

Values are system generated and initially will be the same as the value held in B05 calculated column. This cell is non-editable. When values are entered into B03 and B04, FMS will update this cell with the current value minus the sum of the values entered in to B03 and B04.

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The figure of -£327745.77 in the row B02 and column calculated is a given figure, and is worked out by the total in tab 1 – income minus I16 and I17 less the total in tab 2 – expenditure minus E31 and E32. This represents all revenue with the exclusion of extended school income and expenditure which is calculated in B06.

NOTE: This figure does not include the brought forward balance – it is an in year movement calculation.

The figure of -£12254.23 in the row B05 and column calculated, is also a given figure and is worked out by the total income in tab 3 – capital income minus the total in tab 4 – capital expenditure. This is all the capital income within CI01 to CI04 minus all the capital expenditure within CE01 to CE04. This is a capital balance.

NOTE: Our example shows an over spend in capital expenditure which will require a direct revenue financing journal.

B06 Community Focused Ext School Revenue Balance

The value £0 displayed in our following example is calculated from I16 + I17 - E31 -E32.

Three validation rows will appear on the balances tab to assist in the understanding of the revised tab, these validation rows have been shaded in blue as the values in the actual column have not been included in the total row.

B/Fwd Column

The B/Fwd column B02 is automatically populated with the revenue (B01 and B02) under spends or over spends from the previous year’s CFR. The B/Fwd columns B03 and B05 are automatically populated with the capital (B03 and B05) under spends from the previous year’s CFR. These again, are given figures and cannot be adjusted.

Schools should contact their LA if they are not happy with the brought forward figures.

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The CFR has not been completed, therefore it is possible to modify the opening balances.

Apportioned ColumnThe calculated column of the CFR table represents given figures, as calculated by FMS. However these balances need dividing accordingly, within the apportioned column, depending on several factors.

Capital ApportioningFMS automatically populates row B05 of the calculated column with a given figure. However, not all our capital projects are within the B05 category. It is important that all our capital projects are categorised correctly between B03 and B05 and this is done within the apportioned column.

Validation Checks

Check 93 Checks that your opening revenue balance (OB01) plus income (sums of I01…I15) less expenditure (sum of E01…E30) matches your closing end of year revenue balance (B01 + B02) with a tolerance of £1000.

Check 95 Checks that your opening community focused school revenue balance (OB02) plus income (I16…I17) less expenditure (E31…E32) matches your closing end of year community focused revenue balance (B06).

Check 97 Checks that your opening capital balance (OB03) plus capital income (CI01…CI04) less capital expenditure (CE01…CE04) matches your closing end of year capital balance (B03 + B05).

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Revenue ApportioningThe breakdown required for revenue balances is between committed revenue balances and uncommitted revenue balances.

The screen on this page shows that there is a revenue under spend of £180000 represented in the actual column of the page. This balance will automatically go into B02 as an uncommitted revenue balance. This is stating that there is a carry forward balance of £180000, but it is uncommitted. It is up to the school to decide how much of this uncommitted carry forward balance is committed for the following year. The LA will expect a breakdown of this committed carry forward balance.

You should discuss the detail of what is classed as committed and uncommitted revenue balances with the LA school financial advisor.

You will have to manually edit this carry forward balance in order that it is showing in the correct row (either B01 or B02), depending on how much of it is committed or uncommitted.

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Producing the ReportOnce you are happy with the balances within tab 5, you are ready to produce a preliminary CFR report.

1. Select Reports | CFR | CFR Report.

2. Click the Preliminary button.

3. Click tab 5: Balances and double check the balances and make sure all the balances have passed the validation checks, using the CFR error report. Once you are confident that the balances are correct you can submit the preliminary CFR report to the LA as a XML file.

4. Click the Export to XML button which is found under tab 5: Balances of the CFR report.

A file will be created and the following message will be displayed, as shown in the graphic below.

Make a note of the location of this file so you can send via the appropriate method to the LA.

The LA may want you to send this report to them before the year is finalised and produce the final CFR report. They may also require a trial balance or a report directly from FMS to prove that the chart of accounts within FMS agrees with the CFR. Check this with the LA school financial advisor.

Only year end adjustments can still be made at this stage and the preliminary CFR run again if need be. Please ensure that, every time you make a change in period 13, the preliminary year close is run again to update the FD or RE for the new year.

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Completion of Financial StatementsDo not attempt to run a final year end until this balance has been verified by the local authority.

Once a final close down has been completed it is not possible to complete any financial transaction in that year.

It is good practice to complete a preliminary close down just before completing a final close down to ensure that the final opening balances in the new year are as expected.

It is also good practice to complete a backup before proceeding and run the year end system check.

Final Close Down

1. Select Tools | Define Financial Years | Define/Edit Years.

2. Highlight the 2014 financial year and click the Final Close button.

3. If the date is within twenty eight days of the financial year end you will receive a message, as displayed below. Click the Yes button.

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4. You will be reminded about running the CFR return, click the Yes button.

5. The Final Checks screen will be displayed. Click the Continue button.

6. You should obtain green ticks against each process. If a red cross appears, it means that the business rules for the process have not been achieved. These areas will need to be revisited and the appropriate adjustments made. You will not have the option to perform close if there are any red crosses. If there are any failures click the Cancel button to exit or click the Report button to find out the reasons for failure. Otherwise click the Perform Close button.

7. Click the Yes button to the warning message to say final close can be completed. The 2014 year will now have a state of Finalised.

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8. Click the Save button to complete.

It is now no longer possible to process any transactions in the finalised year. However, it is still possible to run reports as necessary.

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Final CFR ReportsOnce this is completed and an XML file produced it will no longer be editable. The final closedown of FMS needs to have been completed.

Producing the Final Consistent Financial Report

Once you have finalised the school’s accounts, you are ready to produce a final CFR. The year should be finalised. Ensure you are in the 2014 financial year.

1. Select Reports | CFR | CFR Report.

2. Click the Final button to continue. This will only show once the old year has been closed.

3. Click tab 5: Balances and double check the balances and make sure all the balances have passed the validation checks.

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4. Click the Print CFR Report button to check the report.

Once you are happy with the results of the report you can export to XML. Please note this report will still say Proposed until you have created the final XML file.

5. Click the Export to XML button to continue.

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The following message will appear, as shown in the graphic displayed below.

It is vital that you are completely happy with the report before saying Yes to this prompt. Creating the report in XML format will lock the report and you will no longer be able to make any changes.

6. Click the Yes button to produce this prompt.

7. Click the OK button once you have made a note of the directory where the report is saved.

The above prompt is informing you that it is located in the C drive with SIMS\TRANSFER\OUT.

The LA financial advisor may wish the school to send this XML report via a suitable secure method.

You are now ready to print off a final CFR report.

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Producing a Final Hard Copy of the Consistent Financial Report

1. Select Reports | CFR | CFR Report.

The following window will be displayed, as shown in the graphic displayed below.

2. Click the Final button to continue. Click the Print CFR Report button to continue.

The report will appear and it will say final CFR report. Print this report.

Make sure this report is signed by the head teacher and chair of governors.

A copy should be sent to the LA and a copy retained in school.

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Appendix AYear End Reports

FMS END OF FINANCIAL YEAR PROCEDURES 2015 April 2015

Appendix B

System Date on or After 31/03/2015

System Date Action Entries to be made into Period 12 (March) 2014

3/03/2015 1 Financial year 2015/2016 needs to be defined and year opened.

31/03/2015 2 Salary Periods 2015/2016 needs to be defined.

31/03/2015 3 VAT Periods for 2015/2016 need to be defined.

31/03/2015 4 Link any unlinked Cost Centres to the relevant Ledger code.

31/03/2015 5 Bank Reconciliations need to be entered for 31/03/2015.

31/03/2015 6 A non-invoiced receipt need to be paid into the bank.

31/03/2015 7 Unauthorised Orders need to be authorised and printed.

31/03/2015 8 An Accounts Payable invoices need to be authorised/deleted.

31/03/2015 9 Unbalanced Photocopying journal needs to be balanced (£1,050.00) and posted to March 2015.

31/03/2015 10 Journals needs to be posted .

31/03/2015 11 Unposted Petty Cash need to be posted.

31/03/2015 12 Accounts Receivable Paying In Slips need to be posted.

02/04/2015 13 Undertake Preliminary Closure

To be confirmed 14 Undertake Second Preliminary Closure

10/04/2015 15 Complete the CFR Report. Generate the CFR 2014/2015 report. Review CFR 2014/2015.

To be confirmed by the Borough

16 Undertake Final Closure. Generate CFR.

FMS END OF FINANCIAL YEAR PROCEDURES 2015 April 2015

Document InformationCopyright Information Cygnet IT Training Notes April 2015

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