Chart of Accounts Introduction to Object Codes

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Chart of Accounts Introduction to Object Codes

• ALASBO Power Lunch
• March 18, 2008
• Presented by Elwin Blackwell, Internal Auditor
• Department of Education Early Development

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Object Codes

• Object Codes are defined as
• The financial activity represented by a specific
  transaction. Revenue object codes refer to the
  source and type of specific revenues.
  Expenditure object codes describe the service or
  commodity obtained as a result of a specific
  expenditure. Balance sheet object codes refer to
  the asset acquired, liability incurred, or
  balance in a specific fund.

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Object Codes

• Object Codes are divided into three types of
  objects.
• Revenue Objects
• Expenditure Objects
• Balance Sheet Objects
• All Object codes will be reported by required
  code format.

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Revenue Object Codes

• Revenue Object Codes are additions to the
  net current assets of a fund excluding other
  Financing Sources and Expenditure Refunds.
• Local Revenue Sources City/Borough
  Appropriations or Earnings on Investments
• State Revenue Sources Foundation program
  revenue
• Federal Revenue Sources Impact Aid, Medicaid,
  etc.
• Other Revenue Sources - Proceeds from Sale of
  Property

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Revenue Object Codes

• Revenue Object Codes
• Revenue object codes will be reported in funds
  but will not be segregated by function.
• Optional revenue object codes are supplied for
  the districts use.

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Expenditure Object Codes

• Expenditure object codes are decreases in
  assets or increases in liabilities which decrease
  the amount of fund balance available.
• Expenditure objects are grouped in two
  ways
• Employee Salaries and Benefits (Personnel costs)
  
• Materials, Supplies, Services Other

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Expenditure Object Codes

• Once again optional objects are provided for
  the district to account for expenditures or
  services in further detail. If optional objects
  are used they are to be aggregated and reported
  at the required object level.
• Expenditure objects will be reported in funds
  and functions. Expenditure objects should not be
  reported by fund only.

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Balance Sheet Account Object Codes

• Balance Sheet Account Object Codes are
  provided to identify the type of items owned,
  owed, and fund balances.
• Balance Sheet Account Object Codes are divided
  into three groups.
• Asset object codes
• Liability object codes
• Fund Balance object codes.

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Equipment

• Equipment is defined as expenditures for
  furnishings, classroom or office equipment,
  vehicles, generators and other equipment.
• When capitalizing equipment the district should
  use the capitalization threshold established by
  the district.
• The federal government for grant management
  purposes uses a 5,000 threshold for capitalizing
  equipment. Most districts have adopted this
  threshold.

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Equipment

• Difference between Equipment and Supplies
• If an item does not meet all the following
  criteria for equipment then it should be recorded
  as a supply.
• Lasts more than a year
• You would repair rather than replace
• Independent unit rather than being incorporated
  into another unit item
• Cost of tagging and inventory are a small percent
  of item cost
• Exceeds minimum dollar amount (with due regard
  for group control of some items)

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Points or Ponder Object Codes

• Things to remember when coding expenditures to
  the Objects
• Liability insurance is to be recorded in District
  Administration Support Services (function 550)
  under Insurance and Bond Premiums (object code
  445)
• If the district is claiming any indirect cost
  they need to be recorded in District
  Administration Support Services (function 550)
  under Indirect costs (object 495). The indirect
  costs expensed in the special revenue funds also
  will use function 550, object code 495.
• Property and Automobile Insurance has to be
  recorded in Operations and Maintenance of Plant
  (function 600) under Insurance and Bond Premiums
  (object code 445)
• Energy costs which includes electricity is to be
  recorded in Operations and Maintenance of Plant
  (function 600) under Energy (object code 435)

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References

• Document Location
• Uniform Chart of Accounts
• http//www.eed.state.ak.us/publications/COA200
  0.pdf