Complete this closing package for each fund that has total grants receivable of $50,000 or more at June 30.
PURPOSE
The purpose of this closing package is to gather information regarding grants receivable. This information will be used to prepare the State's Comprehensive Annual Financial Report (CAFR).
ACCOUNTING PRINCIPLES AND POLICIES
The State prepares its financial statements in accordance with Generally Accepted Accounting Principles (GAAP). GAAP require the State to record the following in its financial statements:
- Grant revenue for the fiscal year ended June 30
- Grants receivable at June 30
- Sales of Future Revenues
GAAP relating to recognition of grant revenue appear in the following authoritative pronouncements:
- Governmental Accounting Standards Board (GASB) Statement No. 33, paragraphs 21-30
- GASB Statement No. 34, paragraphs 16, 31, 64, and 92
- GASB Statement No. 38, paragraph 13
- GASB Statement No. 48, paragraphs 5-7, 11-13, and 17-18
- GASB Statement No. 65, paragraphs 12 and 30
- GASB Implementation Guide 2015, section Z.33
- GASB Codification Sections N50 and 1600 paragraphs 106-108
- Chapter 6 of State and Local Governments Audit and Accounting Guide (AICPA, 2016)
The following guidelines help determine if grants receivable should be reported:
Provided your agency has met all grant eligibility requirements, recognize a grant receivable for any allowable expenditures. Generally the eligibility requirements have been met when your agency has incurred grant expenses for which you have not been reimbursed at June 30, but for which you will receive a reimbursement after June 30. Award amounts must be reasonably estimable (measurable) and expected to be collected (realizable). As applicable, include those grant expenditures previously identified in your Interfund and Accounts Payable Closing Packages, plus applicable payroll costs incurred that have not yet been paid.
If your agency has been awarded a grant or entitlement with little or no eligibility requirements (i.e., a grant that approaches the definition of a gift or donation), the situation may require the entire balance of the award to be classified as a grant receivable. If you have a grant you think fits this description, include it in the closing package with appropriate notations or contact the Office of the State Controller (SCO) at cafr@sco.idaho.gov for clarification.
Revenue Recognition - Governmental Funds
Record revenue when:
- all grant eligibility requirements have been met
- the amount to record is measurable and available (available means will be or is expected to be received within 60 days after year-end)
Record unavailable revenue when all the eligibility requirements have been met but the revenue is not available. "Not Available" means cash is not expected to be received within 60 days of year-end. The difference between what is reported as receivable and what is recognized as revenue is unavailable revenue, a deferred inflow of resources.
Revenue Recognition - Proprietary Funds
Record revenues in the fiscal year when all grant eligibility requirements have been met, regardless of when payment is received.
GAAP INDICATORS
If GAAP Indicators are used when processing transactions in STARS, the GAAP Indicator Report, DAFR0227, can be submitted in lieu of transcribing the information on the closing package.
GAAP Indicator applicable to the Grants Receivable closing package:
M - Grants Receivable
|
Click here for a GAAP Indicator Explanation
DEFINITIONS
Capital Grant – A grant that is restricted for the purchase or construction of capital assets.
Entitlement and Formula Grants - These grants are not "earned" but are received once eligibility requirements have been met. No performance is required to receive the grant funds.
Grant – Award of money or direct assistance to perform activities or programs whose outcome is seen as less certain than that from a contract, with expected results described in general terms. Most federal grants fall into categories such as entitlement, competitive, block, categorical, demonstration, formula, matching, project, and research grants.
Grants Receivable – Amounts grantors owe the State at June 30, usually based on unreimbursed expenditures.
Grant Revenues – Amounts the State receives from grantors. For this closing package, do not consider grant awards to be received indirectly through other awards or other state agencies.
Operating Grant – Operating grants include the following:
- Grants you may use only to finance operations
- Grants you may use either to finance operations or to purchase/construct capital assets
Pass-through Entity – An agency (primary recipient) that receives a federal or other award and then provides the award to a subrecipient to carry out a federal or other program.
Pledges of Receivables – Receivable used as security for repayment of revenue bonds or other debt.
Primary Recipient – An agency that initially receives an award from a grantor (i.e., federal government) and is accountable to the grantor for the award.
Reimbursement-Type Grants – The agency incurs costs and then bills the granting agency for reimbursement. The agency must also, if applicable, "match" additional resources as required by the grant contract.
Sales of Receivables – Transactions in which an agency receives proceeds (cash) in exchange for the future cash flows from those receivables. A sale has occurred if the agency's continuing involvement has been effectively terminated. An agency's continuing involvement has been effectively terminated if all the following criteria are met:
- The transferee has the ability to sell or pledge the receivables.
- The agency cannot substitute or reacquire specific accounts (defective accounts are exempt).
- The sale agreement cannot be cancelled by either party.
- The receivables and the cash collected have been isolated from the agency. The receivables have been isolated if all the following criteria are met:
- The transferee has legal standing separate from the agency.
- Access to the cash collected from the receivables has been eliminated. However, an agency can still service the receivables if all the following criteria are met:
- Payments to the transferee are made only from the cash collected from the receivables.
- The cash collected is transferred without significant delay.
- The agency considers the receivables sold, as paid in full.
- The transferee is protected from the agency's creditors.
In a sale of future revenues, the transferor government should report the proceeds as a deferred inflow of resources unless the revenue has been recognized in the period of sale. The revenue will be recognized in the period of sale only if the revenue was not recognized previously because of uncertainty of realization or the inability to reliably measure the revenue.
Subrecipient – An agency that expends federal or other awards received from a pass-through entity to carry out a federal or other program. A subrecipient may also be a primary recipient of other awards directly from an awarding agency. For this closing package, do not report grants for which your agency is a subrecipient.
WORKING PAPERS
Click here for a definition of Working Papers
You should retain correspondence or other documents relating to the following:
- Grant awards
- Cash advances on grants
- Letter of credit draws
- Receipt of grantor reimbursement payments
GENERAL INSTRUCTIONS - GRANTS RECEIVABLE
Some state agencies receive assistance from the federal government, corporations, foundations, or others. Such assistance includes grants and entitlements to support specific programs, such as education or Medicaid. Amounts your agency receives from these types of programs represent revenues to the State. For purposes of this closing package these revenues will be referred to as "Grant Revenues."
Only PRIMARY Recipients (see Definitions) of grant revenues will report amounts in this closing package. Do not include grants passed through from other state agencies.
- Review the Accounting Principles and Policies section of this closing package carefully before you attempt to complete the form.
- Complete the Grants Receivable Closing Package if the fund has incurred any grant expense that is measurable and realizable at June 30. Remember to include all normal covered grant expenditures (e.g., payroll, accounts payable, etc.).
- Internal schedules may be submitted in lieu of closing packages if they provide all required information.
- When completing the revenue subobject portion of the closing package specify (by use of the appropriate subobject) if the grant is an operating or capital grant. Capital grants are grants restricted for capital purposes. If a grant may be used for operating or capital purposes the grant is an operating grant.
- Report Medicaid receivables on the form only if they represent receivables from grantors.
- Report receivables for grants only if your agency met all eligibility requirements at June 30, and your agency will receive the related reimbursement from the grantor after June 30. Most grants are reimbursement-type grants and expenditures must be made to meet eligibility requirements.
- Round all dollar amounts on the form to the nearest whole dollar.
- CLICK HERE FOR SUBMISSION INSTRUCTIONS.
- Submit the completed form to the SCO by August 14.
COMPLETING THE GRANTS RECEIVABLE CLOSING PACKAGE
- Complete the header information.
- Indicate whether any receivables have been sold.
- Indicate whether any receivables have been pledged.
- Indicate whether the receivables are Federal or Other. Other can include grants from cities, counties, private individuals, corporations, or non-profit organizations.
- The prior year's total for the grant awards will be calculated for you. If amount differs from current year by 10% and the change equals or exceeds $100,000, please explain in the Comments section.
- If this is a Gift-Type Grant, please check the appropriate box.
- For the total grants receivable balance, calculate amounts due from the grantor as of June 30 including applicable payroll costs and amounts entered on the Interfund Payables and Accounts Payable closing packages for amounts incurred but not yet paid.
- Enter the amount to be recognized as revenue (received within 60 days of fiscal year-end). Proprietary funds will recognize the total grants receivable, regardless of when payment will be received.
- Enter the STARS revenue subobject code. Enter a capital projects subobject code if the grant award is strictly for capital expenditures.
- For governmental funds, enter the amount of unavailable revenue, if any. Unavailable revenue in this situation would be revenue earned but not available (won't be received within 60 days after year-end). Note: This unavailable revenue is not to be reported in the unearned revenue closing package.
- Enter the amount expected to be uncollectible.
- Enter the grants receivable balance that will not be collected within one year. Please provide a brief explanation in the Comments section.
- Enter the expected uncollectible amount for the grants receivable to be collected after one year. Please provide a brief explanation in the Comments section.
- Enter the revenue subobject code that will be used when the amount is received.
- Open a new Grants Receivable closing package and repeat steps 1 - 13 for each fund with grants receivable (reimbursement or gift-type) of $50,000 or more.
| 18 Grants Receivable GL 1503, 1505, 2417 | Due Date: August 14 |