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Oracle Public Sector Financials User Guide
Release 12.1
Part Number E13449-04
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GASB 34/35 Asset Accounting Procedure

GASB 34/35 Asset Accounting Procedure

GASB 34/35 asset accounting enables users to report financial statements using the accrual basis of accounting in addition to reporting the modified accrual-based fund statement, drawing from the same financial records.

The process for meeting GASB 34/35 asset accounting and reporting requirements consists of the following steps:

  1. Create invoices.

  2. Review results for GASB 34/35 request set:

  3. Prepare assets.

  4. Post assets.

  5. Close period in expenditure asset book.

  6. Copy assets from expenditure asset book to depreciation asset book.

  7. Generate depreciation.

  8. Post depreciation to the accrual ledger.

  9. Copy balances and transactions from the modified accrual ledger to the accrual ledger and establish beginning balance of net assets.

  10. Convert asset expenditures to fixed assets.

  11. Reclassify proceeds from disposals.

  12. Record funding of fixed assets.

  13. Record additional entries.

  14. Run financial statements.

Prerequisites

Creating Invoices Procedure

In Oracle Payables, enter invoices in the Invoices window. Enter invoices using assets expenditure codes as the natural account values in the invoice line distributions.

To enter invoices and invoice distributions, see Entering Basic Invoices in the Invoice Workbench, Oracle Payables User Guide and Entering Invoice Distributions in the Invoice Workbench, Oracle Payables User Guide.

Reviewing GASB 34/35 Request Set Results Procedure

To review the results and output reports for the request set:

  1. Navigate to the Requests window.

    The Find Requests window appears.

  2. Enter request criteria and click Find.

    The Requests window appears.

  3. To view the results, select a request and click View Output.

    Note: Optionally, view the results for each concurrent process in the GASB 34/35 request set.

Note: If the printing option is set up for the request set, users can review printouts of the results.

Preparing Assets Procedure

In Oracle Assets, open each line and assign category codes depending on the asset type in the Mass Additions Summary window. Category codes default depreciation information such as accounts, methods, and useful lives. Users can also assign assets to employees and locations and add other additional information such as tag numbers with no accounting impact. When finished with asset preparations, change the Queue Name from New to Posted to make the assets eligible for posting in Assets.

To prepare assets, see Overview of the Mass Additions Process, Oracle Assets User's Guide and Mass Additions, Oracle Assets User's Guide.

Posting Assets Procedure

In Assets, run the Post Mass Additions request set to create asset records from the Mass Addition lines.

Note: The Mass Additions Post process creates asset records in Assets. It does not post to General Ledger.

To run the Post Mass Additions request set, see Post Mass Addition Lines to Oracle Assets, Oracle Assets User's Guide.

Closing Period in Expenditure Asset Book Procedure

In Assets, close the period in the expenditure asset book.

From the Run Depreciation window, enter the name of the expenditure asset book and the period as the parameters. Optionally, select the Close Period check box. However, if all assets depreciate successfully, the period automatically closes and the next one opens.

Although depreciation is not needed in the modified accrual leger to which the expenditure asset book is tied, depreciation must be run before a period is closed and a period must be closed in an asset book before its assets can be copied to another book.

To close the period in the expenditure asset book, see Running Depreciation, Oracle Assets User's Guide.

Copying Assets from Expenditure Asset Book to Depreciation Asset Book Procedure

In Assets, run the Periodic Mass Copy process to copy assets from the expenditure asset book to the depreciation asset book. Specify the name of the depreciation asset book to which assets is to be copied and the period as the parameters.

Note: The Periodic Mass Copy process can be used to initially populate the depreciation asset book if all assets were added to the expenditure asset book in the period for which Periodic Mass Copy is being run. The relationship between the depreciation asset book and the expenditure asset book is analogous to the relationship between the tax asset book and the corporate book for commercial organizations.

To copy assets from the expenditure asset book to the depreciation asset book, see Updating a Tax Book with Assets and Transactions, Oracle Assets User's Guide and How Periodic Mass Copy Works, Oracle Assets User's Guide.

Generating Depreciation Procedure

In Assets, generate depreciation in the depreciation asset book.

From the Run Depreciation window, enter the name of the depreciation asset book and the period as the parameters. Optionally, select the Close Period check box. However, if all assets depreciate successfully, the period automatically closes and the next one opens.

To generate depreciation, see Running Depreciation, Oracle Assets User's Guide.

Posting Depreciation to the Accrual Ledger Procedure

From the Submit Request window in Assets, run the Create Accounting process to post depreciation to the accrual ledger. Specify the name of the depreciation asset book and the period as the parameters. Since the depreciation asset book is associated with the accrual ledger, the journal entries are created in the accrual ledger.

Note: Journal reversal criteria must be defined for asset addition journal categories in the second ledger. These addition entries are not used for GASB 34/35 asset accounting.

To define journal reversal criteria, see Oracle Public Sector Financials Setup Overview.

Copying Balances and Transactions Procedure

Balances are copied from the modified accrual ledger to the accrual ledger during the first year. Transactions are copied from the modified accrual ledger to the accrual ledger during subsequent years.

To set up consolidation mapping, see Oracle Public Sector Financials Setup Overview.

To copy balances or transactions, see Transferring Subsidiary Data to Your Parent, Oracle General Ledger User Guide.

Copying Balances During the First Year

From the Transfer Consolidation Data window in General Ledger, select the consolidation mapping that was set up for GASB 34/35. The year-to-date balances through the twelfth period must be copied from the modified accrual ledger to the accrual ledger.

The transfer creates a journal entry, where Source equals Consolidation and Category equals Consolidation that must be posted in the accrual ledger.

The account balances for the first ledger are copied in their entirety to the second ledger. In the first or modified accrual ledger, revenues and expenditures are closed to fund balance. In the second or accrual ledger, revenues and expenditures are closed to net assets.

One difference between fund balance and net assets is that fund balance is reduced by capital acquisitions while net assets are reduced by depreciation. After the beginning balances of fixed assets and accumulated depreciation are determined, the journal entry in the table below converts the fund balance to net assets in the accrual ledger:

Journal Entry Example
Debit/Credit Account Name Debit Amount Credit Amount
Dr. Fund Balance XX,XXX,XXX  
Dr. Fixed Assets X,XXX,XXX  
Cr. Accumulated Depreciation   XXX,XXX
Cr. Net Assets   XX,XXX,XXX

Copying Transactions During Subsequent Years

Once a net assets balance is established in the accrual ledger, copy the year-to-date transactions, not the balances, from the modified accrual ledger to the accrual ledger to avoid copying fund balance accounts again.

Converting Asset Expenditures to Fixed Assets Procedure

In the accrual ledger, run the Mass Allocation batch that was set up to reclassify asset expenditure accounts to fixed asset accounts.

To set up Mass Allocation batches, see Oracle Public Sector Financials Setup Overview.

To run Mass Allocation batches, see Generating MassAllocation Journals, Oracle General Ledger User Guide.

Reclassifying Proceeds from Disposals Procedure

In the accrual ledger, record journal entries to reclassify Proceeds from Asset Disposals which is a revenue account in the modified accrual ledger.

The credit balance of this account must be reclassified to the following components:

To record journal entries, see Entering Journals, Oracle General Ledger User Guide.

Recording Funding of Fixed Assets Procedure

In the accrual ledger, run the Mass Allocation batch that was set up to reclassify that portion of net assets that represents net investment in capital assets.

To set up Mass Allocation batches, see Oracle Public Sector Financials Setup Overview.

To run Mass Allocation batches, see Generating MeassAllocation Journals, Oracle General Ledger User Guide.

Recording Additional Entries Procedure

In the accrual ledger, record any additional entries required to comply with GASB 34/35. For example, record entries to reflect differences in accounting for debt between the modified accrual ledger and the accrual ledger or to reflect more detail in net asset accounts.

Note: Optionally, record entries in a thirteenth adjusting period.

To record journal entries, see Entering Journals, Oracle General Ledger User Guide.

Running Financial Statements Procedure

Use the Financial Statement Generator to set up, at a minimum, the following reports:

To use the Financial Statement Generator, see Overview of the Financial Statement Generator, Oracle General Ledger User Guide and Using Financial Statement Generator, Oracle General Ledger User Guide.