Monthly Financial Review

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Monthly Financial Review

• Office of the Controller
• Yale University

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Agenda

• Internal controls
• Objectives of monthly review
• An overview of the process
• Advantages of using the review tool
• Distribution of reports

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Internal ControlsDepartment Environment

• Internal controls are integral to a departments
  daily operations protect the University from
  various risks
• Controls are either preventive or detective

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Internal ControlsBusiness Manager Role

• Understands financial goals of the department
• Recognizes and manages risk of financial loss
• Understands and applies University policies and
  procedures
• Performs regular monitoring and review activities

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Internal ControlsInstitutional Assumptions

• Business managers have a fiduciary responsibility
  to the University, its sponsors and donors for
  the funds provided to the department
• Managers can delegate authority but not overall
  responsibility

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Internal ControlsResources

• University Auditing
• www.yale.edu/auditing
• Internal control self assessment procedure
• www.yale.edu/ppdev
• Procedure 1101PR.01
• Internal controls and transaction processing best
  practices
• www.yale.edu/mfr

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Monthly Financial ReviewObjectives

• Validate internal controls
• Ensure that financial information accurately
  reflects the organizations activity
• Identify exceptions
• Identify balance deficits

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Monthly Financial ReviewObjectives

• Identify possible inaccuracies through the
  comparison of actuals to budget guidelines
• Provide a quality assurance check prior to the
  distribution of statements to account owners

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Monthly Financial ReviewProcess
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Produce, Review Distribute Account Holder
Reports
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Run the Review Tool
Run the Position Plan Report
Run the Summary of Activity by Source Group
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Review Sign Monthly Financial Review Checklist
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Monthly Financial ReviewReview Tool

• The Review Tool contains the reports necessary to
  complete exception monitoring
• The Review Tool was designed to accompany the
  monthly financial review checklist but is not
  required to complete review

Run the Review Tool
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Monthly Financial ReviewReview Tool

• The Review Tool is available in the data
  warehouse portal in the financial reports area
• Best practice is to schedule the review tool to
  run as a month end event and use the tool for
  checklist completion

Run the Review Tool
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Monthly Financial ReviewReview Tool

• AP holds, labor suspense AP bounces
• Assets liabilities
• Fund balances
• Grant balances
• Casual labor charges
• Transaction detail

Run the Review Tool
With strong internal controls in place within the
department, best practice is to monitor
exceptions.
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Monthly Financial ReviewStandard Reports

• Position Plan Report
• Compare actuals to MP0 or Department Plan
• Run with commitments at level appropriate for
  department
• Summary of Activity
• Review revenue, expenses and change in fund
  balances
• Does activity match your expectations?

Run the Position Plan Report
Run the Summary of Activity by Source Group
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Monthly Financial ReviewDistribute Reports

• Non Grants
• Position Plan
• Current Month Detail
• Grants
• Account Holder Report for Grants

Produce, Review Distribute Account Holder
Reports
Note Account holder report distribution will
change in Fall of 2006. The Account Holder Report
will be standard practice for all funds.
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Monthly Financial ReviewChecklist
Review Sign Monthly Financial Review Checklist

• Signature required monthly
• States that review has been completed and
  exceptions are noted
• Use the review tool
• Alternate approaches are ok but must be noted on
  the checklist
• Maintain checklist on file
• Internal and external audit may request a copy

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Monthly Financial ReviewResources

• Financial controls and monthly review procedure
• www.yale.edu/mfr
• Procedure 1310 PR.1
• Monthly financial review checklist
• www.yale.edu/mfr
• ga.usersupport_at_yale.edu
• General financial assistance
• Alternate review approaches

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Summary

• Strong internal controls minimize risk of
  financial loss and reduce the need to tick and
  tie every transaction
• The review tool assists with monthly financial
  review and checklist completion
• Reports for account holders are generated monthly
  and include a summary and detail of the account(s)