Arkansas Administrative Code
Agency 006 - Department of Finance and Administration
Division 05 - Division of Revenues
Rule 006.05.04-003 - Financial Management Guide

General

The Freedom of Information Act was adopted in 1967 to ensure that citizens are informed about the actions of the State. The law applies to any bureau, commission, or agency of the State, or any political subdivision of the State, including municipalities, counties, townships, school districts, boards of education, and all other boards, bureaus, commissions, or organizations in the State of Arkansas, except grand juries, supported wholly or in part by public funds or expending public funds. ACA & 25-19-101 et.seq.

Open Meetings

Except as otherwise specifically provided by law, all meetings, formal or informal, special or regular, of the governing body of a State public entity (as delineated above) shall be open to the public. Public notice of meetings must be given in advance. Alternative procedures are established for special and emergency meetings.

Executive sessions, closed to the public, are allowed only in certain limited circumstances such as when certain confidential personnel matters are being discussed. If an executive session is permissible, the person presiding over the meeting must announce the specific purpose of the executive session in public before going into session. Strict adherence to open meeting requirements is essential to an informed citizenry, maintaining credibility and trust in government. ACA & 25-19-106

History. Acts 1973, No. 876, & 17; 1981, No. 741, & 2; 1985, No. 365, & 8; A.S.A. 1947, & 13-343.

In any year that changes in Constitutional Officers will occur, the Chief Fiscal Officer of the State, through the DFA-Office of Budget and Office of Accounting, will survey the condition of the various State budgets and take whatever actions he/she deems necessary in order to conserve appropriate portions of the applicable budgets to ensure adequate funding will be available for incoming officers.

R 2-19-4 -206Governor-Elect Transition Guidelines

The administration of funds, as may be appropriated by the General Assembly and provided to an individual who has been elected to a first term as Governor for the use in preparing for his or her forthcoming administration, must comply with the provisions of ACA & 25-16-205 and this policy.

General Limitations

The expenditure of funds is limited to direct expenses of the activities relating to the new office holder preparing to take office in January following the general election. Only those expenses incurred from the date of the general election until the date of inauguration, which are directly related to assuming the office, shall be considered eligible for payment. No transition funds will be used to pay a salary to a newly elected official prior to his or her assuming the office.

Specific Guidelines

A budget for proposed use of such funds must be prepared by the Governor-Elect and presented to the Director of the Department of Finance and Administration prior to the release of transition funds. The individual(s) authorized to disburse the funds will be designated in writing by the Director of the Department of Finance and Administration (DFA). Person(s) authorized to approve the following items must be designated in writing by the Director of DFA: employment and payroll documents, purchasing documents, contracts, invoices for payment, and travel reimbursement requests. All employees of the transition team are exempt from the overtime pay requirements of the Fair Labor Standards Act (FLSA) and, therefore, are not eligible for overtime pay.

The business affairs of the transitional team must comply with the policies, regulations and procedures established by the Director of the Department of Finance and Administration for the conduct of State business. All financial transactions shall be recorded on the State's Financial Management System, and all original documentation shall be kept on file in the Office of the Chief Fiscal Officer of the State.

History. Acts 1973, No. 876, & 6; A.S.A 1947, & 13-332.

History. Acts 1973, No. 876, & 6; A.S.A. 1947, & 13-332.

History. Acts 1973, No. 876, § 6; A.S.A. 1947, § 13-332.

History. Acts 1973, No. 876, & 6; A.S.A. 1947, & 13-332.

History. Acts 1993, No. 358, § 1.

History. Acts 1973, No. 876, § 27; A.S.A. 1947, § 13-353.

History. Acts 1973, No. 876, § 27; A.S.A. 1947, § 13-353.

History. Acts 1973, No. 876, § 27

History. Acts 1991, No. 421, §§ 1-3.

Overview

The Auditor of State-Data Processing Division receives warrant issuance files from AASIS that are to be paid by direct deposit into the vendor's commercial bank account. These payments must be formatted to comply with Automated Clearing House (ACH) requirements. Circumstances, occasionally, arise that require changes to the ACH transmittal file after it is created by AASIS but before the transmittal to the commercial bank for processing. Changes to the files must be made to avoid improper payments or incorrect payment routings. These changes may include, but are not limited to, deletion of an item or items for which direct deposit must be stopped immediately, change of a file amount total due to the deletion of an item or items, change of a settlement date or change of a vendor's Bank Routing Number/Account Number.

Only designated personnel from each agency may request the DFA-OA-Reconciliation Manager to authorize the Auditor of State-Data Processing Division to make changes to an ACH file. The request may be made by telephone to hold processing of a file until the "Request for Change of ACH Direct Deposit File" Form can be completed and faxed to the DFA-Reconciliation Manager. When received, the DFA-OA-Reconciliation Manager will forward the request by fax to the Auditor of State-Data Processing Division. The request from DFA-OA must be signed by two persons of a list of designated personnel within DFA-OA. This request must be received and reviewed by two persons from a designated list of personnel within the Auditor of State-Data Processing Division who will perform the actions to change the ACH file. A printed copy of the request of change, signed by the two persons within the Auditor of State-Data Processing Division will be returned to the DFA-OA-Reconciliation Manager within 48 hours of the processing of the change.

Form P 1-19-4 -407 is the "Request for Change of ACH Direct Deposit File" Form. The DFA-OA-Reconciliation Manager must include the file name, file date, total dollar value of the file as created, the adjusted dollar value of the file after changes and the adjustment that needs to be made with a brief description.

The Auditor of State-Data Processing Division representatives must both be present when the requested changes are made to the ACH file and verify that the changes were made accurately and completely. The Auditor of State-Data Processing Division designated representatives must then both sign and date the "Request for Change of ACH Direct Deposit File" Form, reflecting that the changes have been made and time and date that they were made. The Auditor of State-Data Processing Division representatives must also record the total dollar value of the file after the change for verification purposes. The signed original of the form will be delivered in person to and maintained in a file by DFA-OA-Reconciliation Manager and a photocopy will be retained by Auditor of State-Data Processing Division. PLEASE NOTE: All changes to warrant data files supplied by the Department of Finance and Administration to the Auditor of State staff prior to processing Automated Clearing House (ACH) payments or the printing of warrants shall be done in a controlled environment in accordance with proper internal control procedures.

PLEASE NOTE: If an erroneous file is transmitted and confirmed by Auditor of State, DFA-OA will make necessary corrections with the bank or the recipient's commercial bank.

History. Acts 1993, No. 540, §§ 1-5; 1995, No. 232, § 8.

History. Acts 1973, No. 876, § 12; A.S.A. 1947, § 13-338.

INTERNAL ACCOUNTING CONTROL UTILIZING AASIS SECURITY ROLES

R 1-19-4 -501 It is the objective of the State of Arkansas to assure proper internal accounting controls are in place, to safeguard the State's assets and to prevent fraud, errors and defalcations (theft and embezzlements). The Arkansas Administrative Statewide Information System (AASIS) utilizes various accounting roles in order to provide for an adequate segregation of duties to facilitate better business practices and enable an adequate system of internal accounting controls sufficient to accomplish the prevention of fraud, errors and defalcations. Each agency, board or commission that has online access to AASIS shall have a security liaison that is knowledgeable regarding the business and accounting practices of their respective entity, and have a working knowledge of internal accounting controls. Each security liaison will ensure that a particular individual does not have conflicting or an excessive number of security roles assigned.

R 2-19-4 -501 The security liaison will assign roles to any new accounting team employee upon his/her commencement of employment. New role assignments or revisions to current role assignments will be submitted to the AASIS Security Administrator for review and entry into the AASIS system. If a conflict or an excessive number of security role assignments are discovered in the review process, the AASIS Security Administrator will forward the request to the Department of Finance and Administration, Office of Accounting, CAFR Section (DFA-OA-CAFR Section) for approval of a proposed solution or design of mitigating controls to be implemented.

Changes to current role assignments should be evaluated by the Agency Security Liaison to determine that internal control conflicts will not be created and that excessive roles are not assigned to one individual.

R 3-19-4 -501 When circumstances dictate, temporary security role assignments may be utilized by requesting that a security role assignment be granted for a specific time period, even though the assignment would appear to be allowing an individual to have excessive security roles. In the event an agency does not have sufficient staffing to assign security roles so that all park and post capabilities are met, they may request documents be posted by the DFA-OA-Service Bureau Manager. These items must be documented and reviewed by the individual that would otherwise have been required to park or post the documents or their immediate supervisor, as a mitigating control. This documentation must be retained in the files of the agency for review until the individual transaction records involved are destroyed.

Where staffing levels do not permit separation of duties, compensating controls such as strict individual accountability and thorough management review and supervision should exist to help safeguard assets and ensure that accounting records are complete and accurate. Any system adopted should include completely separating the handling of cash or checks from the recording function whenever possible. The compensating control procedures must be submitted to the Department of Finance and Administration-Office of Accounting for written approval.

Cash Received in Person

A receipt must be issued for each payment received. The following minimum standards shall be met. Receipts are to be pre-numbered by the printer, and a printer's certificate obtained and retained for audit purposes. Such certificate shall state the date printing was done, the numerical sequence of receipts printed and the name of the printer.

The pre-numbered receipts shall contain the following information for each item receipted:

Date Amount of receipt Name of person or company from whom moneys was received Purpose of payment Fund(s) to which receipt is to be credited Signature of employee receiving moneys The original receipt shall be given to the party making payment. One duplicate copy of the receipt shall be maintained in numerical order in the receipt book. Additional copies of the receipts are optional with the State agency, board or commission or institution and may be used for any purpose they deem fit.

The use of mechanical receipting devices, such as cash registers, which accomplish the same purpose as pre-numbered receipts, is acceptable and is encouraged.

All checks and other negotiable instruments must be endorsed immediately with a restrictive endorsement stamp.

Cash must be kept in a safe or other locked storage device until deposited.

Cash Received Through the Mail

The mail must be opened in a monitored environment. All checks should be numbered, marked or endorsed as soon as possible.

A list of cash (cash log) must be prepared in duplicate. The list shall include sufficient detail to allow an audit trail of an individual receipt.

One copy of the cash log shall be kept in the area and the other should accompany the deposit. Cash must be stored in a safe or other locked storage device until deposited.

Balancing of Cash Receipts

All cash receipts must be balanced daily by mode of payment by comparing the total of the cash to the cash register totals, to the pre-numbered receipts totals and to the totals of the moneys received by mail.

All voided transactions are to be approved and initialed by the supervisor. Agencies using the Arkansas Administrative Statewide Information System must run a ZCAJO Cash Journal report on a weekly basis. Enter the cash journal number, document status of "D" and the posting date range. This will generate a list of all deleted documents from the cash journal for the period specified. This list shall include the initials of the supervisor acknowledging authorization of all deleted cash receipt transactions and be available for audit purposes. Over/short amounts must be separately recorded, and investigated and resolved to the extent possible.

Preparation of Deposits

Someone not involved with collecting, recording or reconciling must prepare the deposit. Cash must be recorded on the deposit slip in the appropriate space.

An adding machine tape of checks must be included with the deposit slip if the number of checks exceeds the space available to list the checks on the deposit slip.

Reconciliation of Cash Collected

Bank accounts should be reconciled by an employee independent of the collecting, depositing or recording functions on a monthly basis. Correcting journal entries must be made to the agency's books of record to correct prior month's errors in the current month.

History. Acts 1973, No. 876, § 12; 1985, No, 365, § 1; A.S.A. 1947, § 13-338.

History. Acts 1973, No. 876, § 12; 1977, No. 486, § 2; A.S.A. 1947, § 13-338.

PLEASE NOTE: Refer to 19-5-104

The State of Arkansas implemented a new financial management system on July 1, 2001. The system is designed to be a database resource management tool that encompasses many types of information for management use in addition to accounting data, such as budgeting, purchasing and human resource management in an integrated fashion. The system is commonly referred to as AASIS, the acronym for "Arkansas Administrative Statewide Information System." The current operating platform is SAP software. The system replaced several of the previous automated systems used by the State since 1971. Upon conversion to AASIS, the State has the ability to report financial results on an individual agency or statewide basis on the modified or full accrual basis of accounting in order to comply with financial reporting requirements promulgated by the Governmental Accounting Standards Board (GASB). The system is utilized on-line by most agencies and departments of Arkansas State Government. There are some small agencies that do not have the resources to utilize the system. For those small agencies, boards and commissions, the DFA-Office of Accounting created the "Service Bureau" Section to process all transactions and produce financial reports.

Reporting agencies, (e.g. colleges and universities, certain constitutional offices, War Memorial Stadium Commission, Arkansas Highway & Transportation Department, etc.) do not use AASIS as their original books of record. They have their own separate and independent accounting systems. These systems must have the capability to present the reporting agency's trial balances and related financial statements on both the modified accrual and full accrual basis of accounting in order to facilitate preparation of the Comprehensive Annual Financial Report (CAFR) of the State of Arkansas in accordance with the requirements of GASB 34. Reporting agencies interface certain items within AASIS for budgetary control and for other financial reporting purposes. Each reporting agency, excluding the colleges and universities, shall make adjusting journal entries to agree with AASIS trial balance to their books of record, preferably on an interim basis, but not less frequently than annually as of June 30th of each fiscal year.

ACA § 25-31-101 et seq., known as the "Arkansas Electronic Records and Signatures Act" and ACA § 25-32-101 et seq., the "Uniform Electronic Transactions Act" details the definitions and guidelines relating to the authority and the use of electronic records, signatures and transactions. Acceptance and/or disbursement by State agencies of State funds via electronic means, including Internet transactions, also referred to as electronic commerce (e-commerce) must, at a minimum, be conducted in accordance with the above referenced Arkansas Code sections, the Arkansas Shared Technical Architecture Program policies which can be viewed at http://www.techarch.state.ar.us and other applicable laws, regulations and policies contained in this Guide. E-commerce includes, but is not limited to, acceptance of credit cards and debit cards, use of purchase cards, receipt and transmittal of purchase orders and invoices.

An agency may establish additional policies and requirements, as long as the agency meets the minimum requirements contained in the Arkansas Code. For example, ACA § 19-11-222 provides for the State Procurement Director to have exclusive jurisdiction over the establishment and maintenance of an electronic commerce procurement solution, to include planning and administration, consistent with the established financial systems of the State. The Department of Finance and Administration-Office of State Procurement (OSP) maintains, on its web site, links to State procurement laws and regulations, including those applicable to e-commerce. http://www.arkansas.gov/dfa/purchasing/lawsandregs.html Electronic warrants issued in payment for goods and/or services received by the State and its agencies, boards and commissions are discussed in detail in section R 1-19-4 -407 of this Guide.

Vehicle tag renewals and fishing and hunting licenses can be obtained via the Internet from the Department of Finance & Administration - Revenue Division and the Arkansas Game and Fish Commission, respectively. Links to these e-commerce transactions can be found at http://www.accessarkansas.org/

Other examples of efficient use of e-commerce:

History. Acts 1973, No. 876, § 12; 1979, No. 833, § 3; A.S.A. 1947, § 13-338.

R 1-19-4 -506Reporting Capabilities of System AASIS has the ability to produce many reports. A table which outlines the available reports is located at appendix P 1-19-4 -506 . The table is categorized by report type and includes the following: financial and accounts payable reports, funds management reports, accounts receivable reports, asset management reports, fiscal control reports, human resources reports and procurement reports. More information can be found on these reports at www.aasis.state.ar.us

R 2-19-4 -506General Reporting and Year End Closing Procedures

Purpose

This portion of the Guide establishes the State reporting policies and procedures governing the accumulation of accounting data for reporting purposes and the preparation of the State of Arkansas Comprehensive Annual Financial Report (CAFR).

PLEASE NOTE: A table of reports available from AASIS is in appendix P 1-19-4 -506 .

PLEASE NOTE: Also refer to year-end closing instruction at http://www.state.ar.us/dfa/accounting/fy2004_year_end_closing_procedures.doc

Applicability & Responsibility

Each of the State of Arkansas' agencies, boards, commissions, departments and institutions is primarily responsible for the collection, maintenance, recording and transmission of financial information and other necessary disclosures to permit the Department of Finance & Administration - Office of Accounting - CAFR Section (DFA-OA-CAFR Section) to prepare financial statements and the related footnotes in accordance with Generally Accepted Accounting Principles (GAAP) and official pronouncements of the Governmental Accounting Standards Board (GASB). Each agency, board, commission, department and institution is also required to provide supplementary information and statistical summaries as requested to allow the DFA-OA-CAFR Section to compile schedules and disclosures to be presented in the CAFR. The DFA-OA-CAFR Section is responsible for assisting each entity with its compliance with these reporting requirements, including:

History. Acts 1973, No. 876, § 12; A.S.A. 1947, § 13-338; Acts 2001, No. 1453, § 8.

R 1-19-4 -518General Ledger Chart of Accounts

The Financial Management System General Ledger Chart of Accounts contains the asset, liability, fund equity, revenue, expense, operating transfer, other financing sources/uses and prior period adjustment accounts necessary for operating purposes and financial statement presentation for the State of Arkansas. These accounts record the dollar value of the business transactions completed by State agencies.

The general ledger accounts are generic in nature and are established and titled for use by all State agencies. The general ledger accounts will not be set up to record specific transactions of an individual agency unless extraordinary circumstances justify the request.

The following is a general discussion concerning general ledger accounts, their characteristics and purposes. Procedures related to uses for specific transactions are located in other sections of this Guide. Types of General Ledger Accounts:

Asset Accounts

Assets are a probable future economic benefit obtained or controlled by a particular entity as a result of past transactions or events. These economic resources can be tangible or intangible. Assets are recorded in the general ledger account number range 1000000000 to 1999999999. Asset accounts may have budget relevant commitment items. Run AASIS report S_KI4_38000036 to obtain the commitment item for all accounts.

Liability Accounts

Liabilities are probable future sacrifices of economic benefits, arising from present obligations of a particular entity to transfer assets or provide services to other entities in the future as a result of past transactions or events. The term does not include encumbrances.

Liabilities are recorded in the general ledger account number range 2000000000 to 2999999999.

The commitment items for all liability accounts are non-budget relevant, also referred to as statistical. One exception to the statistical posting is on the sales/use tax liability, which is non-statistical.

Fund Equity Accounts

Equity accounts are the difference between a fund's assets and liabilities. In governmental funds, it is referred to as fund balance.

Fund equity is recorded in the general ledger account number range 3000000000 through 3999999999.

The commitment items for all fund equity accounts are non-budget relevant, also referred to as statistical.

Revenue Accounts

Revenues are inflows or other enhancements of assets during a period from delivering or producing goods, rendering services or carrying out other activities that constitute an agency's operations. Revenues are recognized in the accounting period in which they become measurable and available for modified accrual and when they become measurable and earned for full accrual. Moneys receipted should be recorded as revenue upon the first receipt. Generally movements of moneys between State agencies or an agency's fund groups should not be recorded as revenue. They should be recorded as transfers. The Governmental Accounting Standards Board (GASB) requires that, if goods or services are provided between agencies and the value is approximately what it would be to receive the same goods or services from an outside source, the transaction be recorded as an expense to the paying agency and revenue to the receiving agency.

Revenues are recorded in the general ledger account number range 4000000000 through 4999999999.

The commitment items for all revenue accounts are non-budget relevant, also referred to as statistical.

Expense Accounts

Expenses are outflows, consumption of assets or incurrence of liabilities during a period from delivering or producing goods, rendering services or carrying out other activities that constitute an agency's operations. Expenses are generally recognized in the period when incurred regardless of the timing of the related disbursements with the following exception. Certain expenses are recognized when due for modified accrual such as debt service payments, claims and judgments, accrued leave and net pension obligations. Moneys that are moved between State agencies or fund groups are generally not an expense but a transfer. However, the Governmental Accounting Standards Board (GASB) requires that, if goods or services are provided between agencies and the value is approximately what it would be to receive the same goods or services from an outside source, the transaction be recorded as an expense to the paying agency and a revenue to the receiving agency.

Expenses are recorded in the general ledger account number range 5000000000 through 5999999999.

Expense accounts may have either budget relevant or non-budget relevant commitment items. Run AASIS report S_KI4_38000036 to obtain the commitment item for general ledger accounts.

Period ending accrual entries are made to non-budget relevant general ledger accounts that are ties to statistical commitment items. However, all warrants, checks and inter-agency transfers for expenses must be coded to budget relevant general ledger accounts with a non-statistical commitment item.

Operating Transfer Accounts

Operating transfers are used to record transfers of funds. They are legally authorized transfers from a fund receiving revenue to the fund through which the resources are to be expended. They include inter-fund transfers (transfers between two or more State agencies) and intra-fund transfers (transfers within a State agency).

Operating transfers are recorded in the general ledger account number range 60000000000 through 6999999999 along with Other Financing Sources/Uses and Prior Period Adjustments.

At the present time, all Operating Transfers have non-budget relevant commitment items.

Other Financing Sources/Uses Accounts

Other Financing Sources/Uses Accounts are used to record inflow/outflow of resources that are not revenue/expense.

Other Financing Sources/Uses are recorded in the general ledger account number range 60000000000 through 6999999999 along with operating transfers and prior period adjustments.

All Other Financing Sources/Uses accounts for use by agencies other than certain accounts set up for use by DFA Employee Benefits Division only are non-budget relevant.

Prior Period Adjustments

Prior Period Adjustments are the net effect of changes resulting from the correction of errors which occurred in prior fiscal years. No Prior Period Adjustment shall be recorded by an agency without prior authorization from Department of Finance and Administration - Office of Accounting (DFA-OA). Prior period adjustments are recorded in the general ledger account number range 60000000000 through 6999999999 along with operating transfers and other financing sources/uses.

All Prior Period Adjustment accounts are non-budget relevant.

AASIS Reports S_ALR_87012333, S_ALR_87012326 and S_ALR_87012328 all can be used to produce lists of the Chart of Accounts. In order to receive an accurate report, Chart of Accounts and Company Code must both reflect ARK.

Contact DFA-OA for additional information concerning the Chart of Accounts.

R 2-19-4 -518Journal Entries

Journal entries are used to change the posted value of a general ledger account balance or sub-ledger balance that is specific to a single business transaction. Generally, these include correcting the posting of a cash receipt, check or warrant to an improper account. Journal entries are also used to adjust the ending or beginning balance of an account so that the general ledger, as well as sub-ledgers is maintained in accordance with Generally Accepted Accounting Principles (GAAP), State policies, and audit requirements, such as year-end accruals for financial reporting.

Most transactions do not originate in the general ledger but rather in one of the modules (sub-ledgers) that feed the general ledger, such as the Accounts Payable and Accounts Receivable modules. In order to maintain module integrity, proper audit trails and to comply with external audit requirements, it is imperative that adjustments or corrections be made in the module from which a transaction originated whenever possible. Thus, adjustments or corrections made directly in the general ledger should be relatively few in number. In AASIS, a journal entry is prepared, checked and parked by one staff member; and it is approved and posted by another staff member. The approving staff member is responsible for ensuring that each journal entry is:

This sub classification shall be applicable to all salaries and compensation, except as hereafter provided in this section, for State employees where the number of employees and maximum amounts of compensation are statutorily authorized as provided by Arkansas Constitution, Article 16, § 4, irrespective of the financial resources compensating such employees within this sub classification, and where the method of salary disbursing of the institutions of higher learning involves payment from State agency bank funds of the institution, subject to reimbursement to the institution for such amounts as are properly payable from funds in the State Treasury. However, the State's financial management system may include in the sub classification of regular salaries the following:

This sub classification shall be used for payment of all salaries and compensation of part-time or temporary employees, as authorized by law, who are employed one thousand (1,000) hours per year or less. This sub classification may be used to pay part-time or temporary employees who are employed for more than one thousand (1,000) hours per year if specific authorization is provided by law and if such use is within standards established by the Director of the Department of Finance and Administration. In no case shall any extra-help funds be used for the purposes of paying additional compensation to a full-time State employee. A 'State employee" is defined as any employee occupying a regular salaried position for a State agency, board, commission, department, or institution of higher education;

This sub classification is applicable for payment of services performed in excess of normal hours of work during a specific time when specifically authorized by law; and

History. Acts 1973, No. 876, § 12; 1977, No. 813, § 1; 1979, No. 833, §§ 1, 2; 1981, No. 741, § 1; 1981, No. 924, § 1; 1983, No. 628, § 1; 1985, No. 365, §§ 2, 3, 12; A.S.A. 1947, § 13-338; Acts 1987, No. 646, § 2; 1997, No. 342, § 40; 1997, No. 1211, § 29; 2001, No. 163, § 1; 2001, No. 1453, § 11.

History. Acts 1973, No. 876, § 12; 1977, No. 813, § 1; 1979, No. 833, §§ 1, 2; 1981, No. 741, § 1; 1981, No. 924, § 1; 1983, No. 628, § 1; 1985, No. 365, §§ 2, 3, 12; A.S.A. 1947, § 13-338; Acts 2001, No. 1453, § 12.

The Arkansas Building Authority ("ABA") was established to oversee and manage capital improvements, real estate transfers and leases. ABA has established policies and guidelines governing the acquisition, construction, equipping, maintenance and operation of public buildings and other real property. The Boards of Trustees of the University of Arkansas, Arkansas State University, University of Central Arkansas, Henderson State University, Arkansas Tech University, Southern Arkansas University and other governing boards of public institutions of higher education with the approval of the Department of Higher Education, as well as the State Highway Commission, are not required to obtain approval or any other form of advice for projects from Arkansas Building Authority (ABA). All other agencies, departments and institutions should refer to ABA policies and procedures in addition to the guidelines provided herein. The ABA policies and procedures, known collectively as ABA Minimum Standards and Criteria, are located on ABA's web site, http://www.arkansasbuildingauthority.com. (ACA § 22-2-101 et seq., ACA § 6-62-302 ) State agencies, departments and institutions are required to obtain legislative authorization prior to the construction and or acquisition of any lands, buildings, structures, utility systems or similar facilities to be financed in whole or in part by State Treasury Funds, Cash Funds, Federal Grants, Revenue Bonds, or Revenue Notes provided by law, agency or institutional receipts, donated funds from private sources or a combination of the above sources. (ACA § 22-2-108(2) (B), ACA § 22-2-108(7) (B), ACA § 22-9-103(b), ACA § 22-9-104 )

Construction Approved by the General Assembly (During Session)

All State agencies, except the Arkansas State Highway and Transportation Department, must submit a Method of Financing (MOF), P 1-19-4 -524, to the Department of Finance and Administration-Office of Accounting-Funds Group (DFA-OA-FG) before entering into any contract or making any commitment of funds against a construction and permanent improvements appropriation. (ACA § 19-4-1403, ACA § 19-4-1407, ACA 22-2-102 )

Construction Not Approved by the General Assembly (Between Sessions) If prior legislative authorization has not been received and a State agency, department or institution, excluding the Arkansas State Highway and Transportation Department, desires to make a capital expenditure for construction and/or acquisition of lands, buildings, structures, utility systems or similar facilities between sessions of the General Assembly, the agency, department or institution must submit a request for such expenditure to the Chief Fiscal Officer of the State. The request must include a MOF Form . The request shall be reviewed for approval by the Chief Fiscal Officer of the State. Project requests $250,000 or less may be reviewed by the Governor. Project requests in excess of $250,000 require the Chief Fiscal Officer to submit the MOF to the Legislative Council for its review. Upon favorable review, the requesting agency, department or institution may proceed with the capital expenditure. (ACA § 19-4-1407, ACA § 22-9-103, ACA § 22-9-104 )

MOF Processing

Upon certification of the availability of appropriations, if applicable, and funds, the DFA-OA approves the MOF. A copy of the approved MOF is returned to the originating agency. The agency making the request is responsible for providing its contracting parties with a copy of the MOF. (ACA § 19-4-1403, ACA § 19-4-1407, ACA § 19-4-1409 )

If the project's estimated costs or funding sources change, a revised MOF must be submitted. Revisions to approved MOF shall be submitted in the same form and manner as that of the original MOF. (ACA § 19-4-1407 )

Processing of Payments

Payments to contractors may be made at the conclusion of the contracted work or may be in the form of progress payments. Progress payments are payment for a portion of work completed on public construction contracts in connection with estimates submitted by a prime contractor to the State agency, department or institution. Such estimates shall be reported by measurable units of the contract completion and compared to the actual progress of project completion. Prior to payment, the estimate must be approved by the architect, contractor or his representative.

When a contractor submits a properly prepared estimate of work completed on a construction project and such request for payment conforms to the provisions of the construction contract and laws of the State of Arkansas, the following allowable time for the processing of the estimate is permitted, excluding time required for transmittal to each party, for each of the respective parties involved:

. Architect or other design professional - Five (5) working days

. State agency or institution of higher education exempt from ABA review & approval - Five (5) working days

. Department of Finance and Administration - Five (5) working days Each of the parties above is to make a notation on the request for payment completed to indicate the date and time of receipt as well as a notation to indicate the date and time of forwarding for further processing to aid in the investigation of delays in processing, if necessary.

In the event that a delay occurs during payment processing, the agency where the delay occurs is responsible for notifying the contractor that payment has been delayed and the related reasons. If the delay is attributable to one of the parties listed above, a penalty of 8% per annum of the amount of the request for payment shall be assessed against the parties responsible for the delay. The Chief Fiscal Officer of the State shall direct such payment rendered to the contractor. (ACA § 19-4-1411 )

Retainage on Public Construction Contracts

An invoice for payment must include the total amount of the estimated completed project to date less total previous payments. The contractor is entitled to 90% of the progress payment when due. The remaining 10% is held by the State agency to assure faithful performance of the contract. After the architect and/or engineer certify the construction project is 50% complete, no additional retainage will be withheld. Because the retainage is not applicable to those materials and/or equipment required by the construction contract to be stored on the job site or in a bonded warehouse, the invoice for payment must provide enough detail to identify the portion of the payment attributable to such materials and/or equipment from the balance of the invoice total. (ACA § 22-9-604 )

Upon completion of a contract, the originating agency will notify DFA-OA-Funds Group of the conclusion of the contract; no further expenditures or obligations will be incurred and all unexpended or unobligated funds will be blocked. Within thirty (30) days after the contract has been substantially completed, the portion of the progress payments withheld by the State agency for retainage shall be paid to the contractor. (ACA § 22-9-601 et seq, ACA § 19-4-1410 )

PLEASE NOTE: Only the provisions of this regulation related to payment and retainage are applicable to projects of public institutions of higher education where funds from private sources exceed $5 million dollars and are sufficient to finance 80% of the estimated cost of such project. (ACA § 19-4-1413 )

Recording

Assets Under Construction should be recorded on each agency's books of record. If the agency is using the State's accounting system, expenditures for Assets Under Construction should be recorded using Work Breakdown Structure (WBS) Elements. All WBS Elements should be settled to an Assets Under Construction Asset Shell when the asset is complete or at the end of each fiscal year if the asset is not complete at the end of the fiscal year. For additional information on the use of WBS Elements see Appendix P 2-19-4 -524.

History. Acts 1973, No. 876, § 12; 1977, No. 813, § 1; 1979, No. 833, §§ 1, 2; 1981, No. 741, § 1; 1981, No. 924, § 1; 1983, No. 628, § 1; 1985, No. 365, §§ 2, 3, 12; A.S.A. 1947, § 13-338; Acts 2001, No. 1453, § 13.

ACA§ 19-4-526 Repealed

A funds center (appropriation) is the legal authority provided by the Arkansas General Assembly to disburse funds for programs and services administered by business areas (individual State agencies, boards or commissions). A funds center code identifies the programs and services to be provided plus the authorization to carry out the programs and/or services. ACA 19-4-520 through 19-4-525 provides a detailed analysis of the various classifications of funds centers (appropriations) and the restrictions regarding their usage. ACA 19-4-701 defines the fiscal periods of the State and the time period of a funds center. The funds center cycle is summarized as follows:

The business area (State agency) prepares the initial biennial budget request in the State's Budget System. P 1-19-4 -601 Business Area/ Cost Center Ranges & Functional Areas Table. The Department of Finance and Administration-Office of Budget (DFA-OB) and the Office of Personnel Management-Classification and Compensation Division (OPM-CCD) review the request and assist the business area in its preparation.

Budget requests are presented to the Governor or Governor-Elect for review and recommendations.

Budget requests with the executive recommendations are presented to the Legislative Council/Joint Budget Committee for recommendation or referral to a sub-committee. Legislative recommendations are entered into the State's Budget System by the DFA-OB and OPM-CCD and transmitted to the Bureau of Legislative Research to draft appropriation bills.

The appropriation bill is presented to the General Assembly and can be amended while under consideration.

The Joint Budget Committee reviews all appropriation bills as introduced and takes one of the following actions: pass, hold or refer to committee.

If the appropriation bill is passed by the General Assembly, it goes to the Governor for approval or veto. If approved, the bill becomes law. The Governor's Office sends signed bills to the Secretary of State where Act numbers are assigned.

If either the General Assembly or the Governor rejects the appropriation bill, it may be amended and resubmitted or a new bill may be drafted if the deadline for filing appropriation bills has not passed.

In the interim (between sessions of the General Assembly), the Chief Fiscal Officer of the State has the authority to establish and/or increase certain funds center accounts as outlined in the various appropriation acts. All such establishments and increases of funds centers must meet with guidelines established by both the Legislature and the Chief Fiscal Officer of the State.

Fiscal Controls

ACA§ 19-4-608 establishes fiscal controls to prevent deficit spending each fiscal year. Each business area shall prepare an annual operations plan which contains proposed expenditures and anticipated resources on a periodic basis for the ensuing year. Agencies which receive general revenue must prepare a quarterly operations plan. Other agencies may prepare an operations plan for any given period (monthly, quarterly, or annually). Prior to the beginning of each fiscal year, the Chief Fiscal Officer of the State provides an estimate of the general revenue funding available for each business area. When the "General Revenue Forecast" is revised, the Chief Fiscal Officer of the State will announce the new forecast and provide, by letter, notification to all business areas which receive General Revenue. The actual notification for the business areas will be prepared and distributed by the DFA-OB. A change in the "General Revenue Forecast" could be an increase or a decrease. The business areas will then provide by letter, worksheet or e-mail the adjustments for their annual operations plan using the Budget Quad coding structure (fund, funds center, commitment item, functional area) to the agency's assigned Budget Analyst in the DFA-OB. Business areas also must include new or revised Certifications of Income to inform the DFA-OB of the amount of revenue that is expected to be collected by the business area. The available funds center will be adjusted to the level of expected revenue.

See the Annual Operations Plan, "R 1-19-4 -608" for more detailed information.

Funds Management - Budget Structure (Quad)

The Funds Management module of AASIS is used to ensure compliance with the fiscal laws of the State. There are four elements of master data in the Funds Management module: Funds Center - represents the purpose authorized in the appropriation act and establishes budget control. Funds centers may be further divided into sub-funds centers. The appropriation acts will authorize non-spendable commitment items for some business areas. Special non-spendable commitment items are broken down to sub-funds center/sub-appropriation. A sub-funds center/sub-appropriation is established to transfer budget from the special commitment item to a spendable commitment item. The sub-funds center is used to ensure that the amounts transferred to the spendable commitment items are adequately tracked and are not commingled with the amounts originally appropriated in the spendable commitment items. Business areas with Performance Based budgeting funds center structures also use sub-funds centers to represent the objectives as outlined in their Strategic Plans. The funds center is hierarchical in structure.

The funds center account code is a three-digit alpha/numeric, numeric or numeric/alpha code, which identifies a business area's authority to disburse funds. An alpha/numeric code reflects a cash/bank funds center/appropriation (A01). Numeric and numeric/alpha codes reflect a funds center/appropriation in which the funds are deposited in the State Treasury (001, 1AA). A sub-funds center is the same numeric or numeric/alpha code with a fourth alpha character (001M).

Commitment Item - represents the funds center/appropriation breakdown by line-item detail. This level is where the funds center is classified in accordance with the expenditure breakdown in ACA 19-4-521 through 19-4-525. Expenditure commitment items begin with the number 5. The first three digits of the commitment item usually correlate to the first three digits of the general ledger account. The last two numbers of the commitment item reflect the existing classification such as salaries or operating expenses. The commitment item is a seven-digit numeric code. The commitment item is determined by the general ledger account. Transaction SKI_38000036 provides a list of all general ledger accounts along with the assigned commitment items.

PLEASE NOTE: Go to P 2-19-4 -601 for the "Commitment Items Table."

Fund - represents cash/bank and Treasury funds as outlined in the Funds Group located at R 1-19-5 -101. fund is defined as a fiscal and accounting entity with a self-balancing set of accounts which are segregated for the purpose of carrying on specific activities or attaining certain objectives in accordance with special regulations, restrictions or limitations.

Functional Area - groups business areas by activity. Each business area is assigned to a functional area. These functional areas are:

For CAFR reporting purposes, a slightly different set of functional areas are used. These functional areas are:

Education

Health and human services

Transportation

Law, justice and public safety

Recreation and resources development

General government

Labor, commerce and regulatory

Debt service

Capital outlay

See P 1-19-4 -601 for a list of business areas along with functional area and cost center range.

Expenditures cannot exceed the budget at the fund/funds center/commitment item/functional area level.

Commitment Items Transfers and Increases

Amounts appropriated in each commitment item are established by the Legislature and can be transferred in the following circumstances:

History. Acts 1973, No. 876, § 9; A.S.A. 1947, § 13-335

History. Acts 1973, No. 876, § 11; 1977, No. 486, § 1; A.S.A. 1947, § 13-337; Acts 1995, No. 1296, § 69. 19-4-605. Strategic planning.

History. Acts 1973, No. 876, § 9; A.S.A. 1947, § 13-335; Acts 2001, No. 1453, § 14.

Agencies must submit an Annual Operations Plan in May of each fiscal year to the Department of Finance and Administration-Office of Budget (DFA-OB). (ACA § 19-4-607 ) An Annual Operations Plan contains an agency's proposed expenditures and anticipated resources for the ensuing fiscal year. The Annual Operations Plan is prepared using the State's budgeting system and upon review by the Department of Finance and Administration Offices of Budget and Accounting, the approved plan will be transferred into the Arkansas Administrative Statewide Information System (AASIS). Forms and instructions are available on the DFA-OB web site at www.accessarkansas.org/dfa/budget/annual_operations_plan.html.

The S_ALR_87013611 Cost Centers Actual Plan Variance report in AASIS can be used to monitor and compare actual vs planned expenditures. http://aasis.state.ar.us/Reports/reports_fifm.htm

If at any time during the fiscal year changes to the Annual Operations Plan result in an increase or decrease in the appropriation and/or funding allocated for expenditure, corresponding adjustments to the Annual Operations Plan must be made in the detail plan in AASIS. (ACA § 19-4-608 ) These changes may be made by accessing transaction KP06 - Activity Input Planning. Although budget is not checked at this level, proper plan maintenance is required for accurate evaluation of agency expenditure variances. Training courseware is available at the following web site: http://aasis.state.ar.us/Training/Courses/default.htm.

PLEASE NOTE: Agencies that do not have access to AASIS should contact their Budget Analyst in the DFA-OB for assistance.

Authority

Arkansas Code 19-4-703, Redemption of Warrants, states: "No warrant issued by the Auditor of State shall be payable by the Treasurer of State unless it shall have been presented for payment within the twelve (12) months immediately following the close of the fiscal year or other appropriated fiscal period against which appropriation the warrant was charged."

Purpose

Warrants that are outstanding at the end of the State Fiscal Year on June 30 and have been issued more than 12 months will be considered to be "outlawed." (i.e. Warrants issued in FY 2002 and still outstanding the first day of FY 2004).

The Treasurer of State-Warrant Division cannot redeem an outlawed warrant. The Auditor of State-Warrant Division cannot reissue an outlawed warrant.

The payee of the outlawed warrant must file a claim with the Arkansas State Claims Commission in order to be compensated.

The fund of original disbursement of the outlawed warrant will receive a restoration of the cash balance as a result of the warrant being "outlawed." If the fund of issue or its components are inactive, then the fund/components will be reactivated temporarily for the initial posting followed immediately with a transfer of funds to a current active fund/component.

If the fund is supported by general revenue, the moneys will be reclaimed in part or whole and transferred to the General Revenue Allotment Reserve Fund or other designated fund as dictated by State Law.

Process

The outlawed warrant process begins with the production of a report from the Treasurer of State-Treasury Management System on or about July 10th of each year. This allows for the processing of any warrants that may be in transit through the commercial banking system as of June 30. Federal banking requirements dictate that, if a warrant is presented for payment to a financial institution by close of business on June 30th, the warrant must be redeemed by the State of Arkansas and cannot be outlawed.

The Auditor of State-Warrant Division and Treasurer of State-Warrant Division reconcile outlawed warrant differences between their respective systems. An adjusted report is provided to the DFA-OA for validation and further reconciliation to outstanding warrants in AASIS. Journal entries are created with document type "ZO" for the initial outlawed warrant posting for funds and components that are currently active. The following entry is made as of current date:

DR 1100001000 (Cash in State Treasury)

CR 6990001000 (Prior Year Warrants Outlawed)

The outlawed warrant general ledger account is a non-budget relevant posting that does not adjust appropriation.

The warrant number is used in the reference field for the posting of the outlawed warrants. The warrant number may also be found in the text column of the document.

If the creation of a warrant affects multiple funds, an individual document with a debit and offsetting credit is posted for each fund.

DFA-OA-Funds Group will be responsible for the "General Revenue Reclaim" (the restoration of cash balance) that is returned during the outlaw process if the original expenditure was from a fund that is supported by general revenue. DFA-OA-Funds Group will create and park a document to reclaim these funds, and they will immediately be posted following the initial posting of outlawed warrants. The document type used for these reclaims is "ZL."

PLEASE NOTE: If a warrant is outlawed, the vendor must request a refund of their moneys by completing and submitting a claim to the Arkansas State Claims Commission. The form can be found at http://www.claimscommission.ar.gov/claim_forms.asp

History. Acts 1973, No. 876, § 13; 1985, No. 365, § 6; A.S.A. 1947, § 13-339.

History. Acts 1973, No. 876, § 13; 1985, No. 365, § 6; A.S.A. 1947, § 13-339.

History. Acts 1973, No. 876, § 13; A.S.A. 1947, § 13-339.

History. Acts 1973, No. 876, § 13; 1977, No. 486, § 3; 1979, No. 833, § 4; 1985, No. 365, § 5; A.S.A. 1947, § 13-339; 2001, No. 1453, § 16.

PLEASE NOTE: Refer to P 1-19-5 -101 for instructions and forms.

Process

The administrative head of any State agency, board, commission or institution planning to cease operations shall notify the Chief Fiscal Officer of the State in writing of such intent.The notice shall indicate whether:

The agency is being transferred to another agency as specified in ACA 25-2-104 through 25-2-107.

The agency is being abolished, and the operations will cease. The Chief Fiscal Officer of the State will review related legislation and/or executive orders to determine what action should be taken to satisfy obligations, protect the interests of the State and preserve the records of the agency.

Instructions will be issued from the Chief Fiscal Officer of the State to the administrative head of the agency in question and letters of instruction to any department/institution that may be receiving the employees, authority, assets, liabilities and/or records of the closing agency. The instruction will designate the Department of Finance and Administration (DFA) personnel assigned (contact people) who will work with the closing and/or receiving agency and specify what general actions must be taken and lay out a timetable for completion.

Assignments may include:

History. Acts 1975, No. 5, §§ 1, 2; A.S.A. 1947, §§ 13-356, 13-357.

History. Acts 1975, No. 5, § 4; A.S.A. 1947, § 13-359; 2001, No. 1453, § 17.

History. Acts 1975, No. 5, § 7; 1975, No. 265, § 1; 1977, No. 713, § 14; A.S.A. 1947, §§ 13-356.1, 13-362; Acts 1997, No. 540, § 39; 1997, No. 1000, § 17; 1997, No. 1179, § 3; Init. Meas. 2000, No. 1, § 19.

ACA§ 19-4-804 Repealed

History. Acts 1975, No. 5, §§ 8, 9; A.S.A. 1947, §§ 13-363, 13-364.

Agency Bank Reconciliations

Arkansas Code 19-6-103 states that "All taxes, licenses, fees, permits, or other income collected by any board, agency, or commission by virtue of the authority of the State of Arkansas which are designated by law to be deposited in a depository other than the State Treasury are classified as "Cash Funds" and are declared to be revenues of the State to be used as required and to be expended only for such purposes and in such manner as determined by law." Arkansas Code 19-4-801(2) defines Cash Funds "as all moneys, negotiable instruments, certificates of indebtedness, stocks and bonds held by or owned by any State Agency which are not on deposit with or in the trust of the State Treasurer."

Cash expenditures must have legislative authorization (appropriation) and are subject to Accounting, Procurement, State Printing and Arkansas Building Authority regulations unless exempt under Arkansas Code 19-4-803, as amended.

All agencies, other than institutions of higher learning, shall request and abide by the recommendations of the State Board of Finance as to the best investment decisions of any idle cash balances. The institutions of higher learning shall have the right to determine the depositories and the nature of investments of any of their Cash Funds which are not currently needed for operating purposes.

All cash activity must be recorded in AASIS using the proper transactions. This includes interest earned on investments. Various sections of the Financial Management Guide contain instructions for most types of transactions that occur in a Cash Fund and should be reviewed for the correct accounting procedure for those transactions.

The AASIS balance at month end must be reconciled to either the check register or the bank statement depending upon whether the agency is a user agency (an agency with direct access to AASIS) or Department of Finance and Administration- Office of Accounting-Service Bureau (DFA-OA-SB) agency (an agency who uses DFA-OA-SB to record transactions in AASIS-they do not have direct access). The following procedures must be followed when reconciling the AASIS balance at month end:

User Agencies

There are two different business processes that determine the method to be used for month-end reconciliations performed by user agencies: those with commercial bank accounts that are held and managed at the agency location and those with local accounts held and managed at local offices at multiple locations.

User Agency (Accounts Held at Agency Location)

If an agency has a commercial bank account(s) that is held at the agency location, transactions must be entered in AASIS on a "real time" basis. This means that transactions should be recorded on a daily basis. At any time, a trial balance pulled from AASIS should equal the balance held at the commercial bank account plus or minus any reconciling items (i.e. outstanding checks, deposits in transit, interest, etc.).

These accounts must be reconciled to the commercial bank account statement on a monthly basis using the "Cash in Bank Reconciliation" Form, P 1-19-4 -805. Instructions for the use of this form are provided with the form.

PLEASE NOTE: A journal entry to correct any reconciling item, caused solely by a difference in when the transaction is recorded in two different periods by the perspective parties, must be made in the month following the event that caused the reconciling item to be created.

After the reconciliation is completed, the agency must submit a copy of the first page of the bank statement and the "Cash in Bank Reconciliation" Form to DFA-OA-Fund Reconciliation. These shall be received by DFA-OA-Fund Reconciliation by the 15th of each month.

User Agency (Accounts Held at Local Offices at Multiple Locations)

If an agency has commercial bank accounts held at local offices at multiple locations, with approval from the DFA-OA-Fund Reconciliation, the agency can make an entry at month end for the total of transactions that occurred during that month. These entries must be made in the month that the transaction(s) occurred.

These accounts must be reconciled to the commercial bank account statement on a monthly basis using the "Cash in Bank Reconciliation" Form. Instructions for the use of this form are provided with the form.

PLEASE NOTE: A journal entry to correct any reconciling item, caused solely by a difference in when the transaction is recorded in two different periods by the perspective parties, must be made in the month following the event that caused the reconciling item to be created.

After the reconciliation is completed, the agency must submit a copy of the first page of the bank statement and the "Cash in Bank Reconciliation" Form to DFA-OA-Fund Reconciliation.These shall be received by DFA-OA-Fund Reconciliation by the 15th day after the cutoff date of the statement period.

DFA-OA-SB Agencies

If an agency uses DFA-OA-SB to record transactions in AASIS, the agency must send in transactions on a "real time" basis to be entered. This includes both incoming and outgoing cash transactions for both appropriated and non-appropriated accounts.

The agency must reconcile its check register to the commercial bank account statement at month end and submit a copy of the reconciliation and the commercial bank account statement to DFA-OA-SB by the 15th of the following month. DFA-OA-SB will reconcile the agency's account balance with AASIS utilizing the reconciliation.

PLEASE NOTE: A journal entry to correct any reconciling item, caused solely by a difference in when the transaction is recorded in two different periods by the perspective parties, must be made in the month following the event that caused the reconciling item to be created. ALSO NOTE: This section shall not apply to institutions of higher education which maintain full accounting records separate and apart from AASIS. Receipts and disbursements of such agencies shall be submitted in summarized form for general review and reference.

History. Acts 1975, No. 5, § 10; A.S.A. 1947, § 13-365; Acts 2003, No. 656, § 1.

History. Acts 1991, No. 21, § 1; 2001, No. 1453, § 21.

History. Acts 1991, No. 21, § 1; 1997, No. 541, § 1; 2001, No. 1453, § 22.

History. Acts 1973, No. 876, § 16; A.S.A. 1947, § 13-342; Acts 2001, No. 1453, § 24.

ACA 19-4-902 places the authority and responsibility of authorizing and approving travel expenses with the board or commission in charge or to the administrative head of the agency, department or institution.

R 1-19-4 -902 Responsibility and Accountability for Travel Authorizations and Disbursement It shall be the responsibility of the administrative head of each agency, board, commission or institution to keep on file in the place of business of the agency, subject to audit, originals of all supporting documents and required receipts for expenses incurred in connection with the travel authorizations and disbursements for persons traveling on behalf of the governmental entity. The documents on file may be in the form prescribed under the provisions of ACA 19-4-815(b) if approved by the Division of Legislative Audit.

In large governmental units, it may not be feasible for the administrative head of the agency, department, or institution to act as travel administrator. In this case, he or she may designate other responsible officials to act as his or her agent(s) and to be referred to as travel administrator. The approval of these designated agents will be considered to reflect the approval of the board, commission or head of the agency, department or institution. The designation of agents as travel administrators shall be made in writing and kept on file in the agency/institution.

History. Acts 1973, No. 876, § 16; 1974 (Ex. Sess.), No. 16, § 1; 1977, No. 462, § 1; 1979, No. 890, § 1; 1985, No. 365, § 7; A.S.A. 1947, § 13-342; Acts 1987, No. 81, § 1; 1991, No. 1222, §§ 1, 2; 1997, No. 795, § 1.

Officials and employees may be paid travel expenses when required to travel away from their "official station" on State business. "Official station" is the geographic location or "address" where the employee normally reports for duty and/or spends the majority of his/her productive time and must be designated as such in writing by the employer. An employee's "residence" shall be the city or town in which the individual has an abode or dwelling place. An employee whose resident city is a location other than his/her "official station" shall not be allowed mileage to travel between them except as provided for in Rule 3, under Special Authorizations.

All employee travel reimbursement claims must be completed for payment to the individual traveler. One employee may not include on his travel payment request the expenses of another employee.

No expenses for meals or lodging will be allowed within the city or town of the employee's "official station" unless "special authorizations," under ACA 19-4-903, are authorized by the agency head or travel administrator.

State employees loaned from one State agency to another may be reimbursed for travel expenses by the agency benefiting from the travel.

Limits for Meals and Lodging

Please note that travel reimbursement is NOT a per diem and is to be claimed for ACTUAL EXPENSES FOR MEALS AND LODGING NOT TO EXCEED THE MAXIMUM ALLOWABLE RATES AS LISTED IN THE FEDERAL TRAVEL DIRECTORY, http://www.policyworks.gov/org/main/mt/homepage/mtt/perdiem/travel.shtml, PLUS APPLICABLE SALES TAX. (Sales tax rate must be stated on Travel Reimbursement (TR-1) forms or equivalent in instances where the sales tax causes the maximum per diem rate(s) to be exceeded.)

Meals

Reimbursement for meals is allowed only in connection with overnight travel whether in State or out of State unless "special authorizations," under ACA 19-4-903, are authorized by the agency head or travel administrator. The maximum full day meal allowance will be the Federal-per-Diem rate depending on the destination location. For partial days, meals charged must be in proportion to the time in travel status and may not exceed the maximum for applicable meal(s) stated in the Federal Travel Directory for the location(s). Although receipts for meals are not required by this rule, the administrative heads of agencies, departments and institutions may require them. See the Federal-per-Diem site @ http://www.policyworks.gov/org/main/mt/homepage/mtt/perdiem/travel.shtml.

Lodging

Reimbursement for lodging is limited to the single room rate. If a room is occupied by more than one person, the single room rate must be noted on the receipt. The maximum daily allowance will be limited to the Federal-per-Diem rate depending on the location for both in State and out of State travel. Lodging costs exceeding the rates listed in the Federal Travel Directory may not be paid without a letter of authorization by the administrative head of the agency and must include a justification as to why it was in the best interest of the State to exceed the standard reimbursement rate. Such letter of authorization must be filed in the agency files with the travel payment document for the trip for each occurrence of such overage. Except for institutions of higher education exempt under ACA 19-4-903(a) (2), a report of these special authorizations in a format prescribed by the Department of Finance and Administration may be required. See the Federal-per-Diem site @http://www.policyworks.gov/org/main/mt/homepage/mtt/perdiem/travel.shtml.

Transportation

Travel may be achieved by plane, train, bus, taxi, private vehicle/aircraft, rented or State-owned automobile; whichever method serves the requirements of the State most economically and advantageously.

Reimbursement for out-of-state travel will be the lesser of coach class airfare or the established rate of private car mileage, based on map mileage when driven.

The minimum miles traveled per day while in travel status in reaching or returning from a destination to be eligible to collect a night's lodging must be 400 miles. Travelers by commercial air shall utilize coach accommodations, except in those instances where first class accommodations would be more economical for the State. Instances where first class fare is utilized will require detailed justification and must be approved by the travel administrator.

Reimbursement for Use of Privately Owned Vehicle

Private vehicle mileage shall be reimbursed and computed, using map mileage, between the travel site destination and the employee's official station or residence, if leaving directly from the residence, whichever is less. Mileage reimbursement for official use of a private motor vehicle may be claimed, listed separately on the TR-1, within the vicinity of any locale.

When privately owned motor vehicles are used for travel on official business, the owner may claim reimbursement at the rate per mile established by the Chief Fiscal Officer of the State in effect during the time the travel occurred. See P 2-19-4 -903. The shortest major highway route (map mileage whether paper based or electronic) will determine the maximum mileage allowed.

The State will reimburse for official miles driven only. The State assumes no responsibility for any maintenance, insurance, operational costs, accidents or fines incurred by the owner of the vehicle while on official business for the State.

When a privately owned aircraft is used for travel on State business, the rate of reimbursement will be the rate as established by the Chief Fiscal Officer of the State, under the provisions of ACA 19-4-903, during the time the travel occurred. See P 2-19-4 -903.

Use of Travel Agencies

Travel agencies may be used to obtain transportation, lodging and related travel expenses.

Miscellaneous Expenses

Miscellaneous expenses, whether or not directly connected with travel (such as postage, small emergency supplies, etc.), may be allowed with adequate justification when necessary to the performance of official duties. Receipts are required.

Items Not Reimbursable

Except for those provisions enumerated in ACA 19-4-904, expenses for personal entertainment, tips, flowers, valet service, laundry, alcoholic beverages, cleaning, movies or other similar services are not reimbursable. Communication expenses shall be allowed only when necessary for the transaction of official business and properly receipted.

Expenses for rental of space, decorations, entertainment or other arrangements in connection with banquets held solely for the benefit of employees are not reimbursable.

Petty cash funds cannot be used to make travel advances or reimbursements. If the agency has a petty cash fund, incidental expenses incurred by the traveler such as postage and procurement of minor supplies essential to the performance of State business may be reimbursed from petty cash funds upon presentation of proper receipts. If the agency has no petty cash funds, such items may be reimbursed using the TR-1 form with proper and sufficient documentation.

Exempt Persons and Agencies

There exists certain provisions in State law for the payment of some travel related expenditures for State supported colleges and universities and some other specific institutions that are responsible for the care and/or group activities of students, inmates and wards of the State. The administrative head of agencies and institutions to which these provisions apply is to be cognizant of and shall properly adhere to such provision of special legislation.

R 2-19-4 -903More Restrictive Policies

Under authority of ACA 19-4-903, the administrative heads of the various departments, boards, commissions and institutions of the State of Arkansas may promulgate and enforce regulations governing travel that are more restrictive than those promulgated by the Chief Fiscal Officer of the State.

R 3-19-4 -903Taxable Use of State Vehicle

Personal use of a State vehicle is considered a taxable benefit. Refer to IRS Publication 15b for conditions and methods. The responsible administrative head shall ensure that the Payroll Unit of each agency, department and institution performs proper reporting for taxable use of State-owned vehicles.

State employees and officials who drive State-owned motor vehicles for personal use, whether limited to commuting from and to their residence, are subject to receiving an amount on their wage statement W2 form for the value of the uses of the vehicle. Various conditions and factors determine the method and amount of such value. Internal Revenue Service (IRS) Publication 15b http://www.irs.gov/pub/irs-pdf/p15b.pdf sets out the valuation rules. When computing the value of the personal use of a State vehicle to determine the benefit amount to be reported on the annual Statement of Wages, any reimbursements made under the provisions of ACA 19-4-903(b) (2) (A) may be subtracted from the total taxable benefit for vehicle usage.

See IRS Publication 15-B "Employer's Tax Guide to Fringe Benefits" for information related to the taxable use of State-owned vehicles by State employees. http://www.irs.gov/pub/irs-pdf/p15b.pdf

R 4-19-4 -903Reimbursable Use of State Vehicle

Reimbursement for the Use of State-Owned or Leased Motor Vehicles for Transportation To and/or From an Employee's Residence ACA 19-4-903(b) (2) (A) states that "any employee of the State of Arkansas, who utilizes, but whose job does not require the employee to utilize, a State-owned motor vehicle for transportation to or from his permanent residence from or to his official station on a daily basis shall reimburse the fund from which the operating expenses of the motor vehicle are paid at the rate of $0.15 cents per mile for each mile or portion thereof in excess of ten (10) miles each way" provided that all State-owned or leased vehicles shall be for official business use only.

The administrative head of each State agency, board, commission, department and institution shall be responsible for determining which of their employees utilize a State-owned or leased vehicle for transportation to and/or from their permanent residence to their official place of duty that exceed the distance of ten (10) miles each way by the shortest route. A permanent record of such employees shall be established in each agency containing the following:

The cost of meals, lodging, and mileage of State employees who are designated by a supervisor or agency director to attend official or special board meetings or other functions recognized as being in the performance of their official duties may be paid either as reimbursement to the employee or on direct billing, in the case of meals and lodging, subject to approval of the superior.

PLEASE NOTE: Go to

http://170.94.58.9/NXT/gateway.dll?f=templates&fn=default.htm&vid=blr:code

to view complete code section and list of agencies and number of vehicles authorized.

History. Acts 1983, No. 490, §§ 1, 2; 1985, No. 649, § 44; 1985, No. 888, §§ 22, 23; A.S.A. 1947, §§ 13-342.1, 13-342.3; Acts 1987, No. 921, § 19; 1989, No. 790, § 1; 1989 (1st Ex. Sess.), No. 252, § 9; 1993, No. 447, § 9; 1997, No. 540, § 40; 1997, No. 948, § 3; 1999, No. 646, § 56; 1999, No. 1164, § 156; 1999, No. 1398, § 28; 2001, No. 739, §§ 2, 3; 2001 No. 1669, § 29; No. 1800, § 2.

Claims must be filed quarterly if the amount of the claim is $750.00 or more. If the amount of the claim is less than $750.00, the amount may be carried forward and filed in a succeeding quarter when the cumulative amount of excise taxes to be claimed exceeds $750.00. If you cannot file a claim for at least $750.00 after the fourth calendar quarter, the form must be filed as an "annual" claim after the end of the year. All claims must be filed no later than 3 years following the close of the taxable year in which taxes were paid.

DIESEL

The refund provision for sales of undyed diesel fuel to a State or local government for the State or local government's exclusive use can be found under Treas. Regs. §48.6427-9. A registered ultimate vendor must obtain a properly executed exemption certificate from the State or local government. See P 1-19-4 -1006, "Sample Exemption Certificate."

Note that, unlike gasoline refunds, there is no provision for a State or local government to receive refund or credit of diesel fuel tax paid to its supplier. The only way to avoid tax is through a tax excluded purchase from a registered ultimate vendor.

As an alternative to the purchase of undyed diesel fuel, the State may purchase tax-free dyed diesel fuel for its exclusive use. Submission of an exemption certificate to the State's supplier is not required for the purchase of dyed diesel fuel. An executed certificate may be requested from DFA-OA. This certificate will suffice for all State agencies utilizing the TIN that is used for those agencies who utilize the State's payroll system. Those offices and institutions not using the State's TIN may complete the blank Certification Statement shown as addendum P 2-19-4 -1006.

R 1-19-4 -1007State Travel Card Use

Procedures for Authority to Use Credit Cards

Approval for use of all credit cards rests with the Chief Fiscal Officer of the State. The State of Arkansas' "Arkansas Procurement Card," "Arkansas-Sponsored Business Travel Card" (SBTC), and oil company cards in force on December 31, 2002, are approved. No other retail credit cards issued in the name of State agencies and institutions may be used after the adoption of these travel regulations and must be cancelled as soon as practical and billings are paid. Directors of State agencies, boards, and commissions and presidents and chancellors of institutions of higher education may request from the Chief Fiscal Officer of the State, in writing, authority to establish an agency commercial account. Requests shall state:

. Purpose, intended use of card

. Number and type of cards

. Detail method of controls

. Justification

The Office of Accounting and the Office of State Procurement shall review requests to establish agency credit cards and provide the Chief Fiscal Officer of the State their recommendation.

The Chief Fiscal Officer of the State shall not be liable for any unauthorized expenditure through the use of credit cards.

The administrative head of the board, commission, agency, department, or institution shall be responsible for ensuring that only authorized charges are paid as the result of the use of any authorized credit card and the collection for any unauthorized expenditures that may occur. The administrative head of the board, commission, agency, department or institution may appoint a travel administrator to administer travel functions within their activities. However, the responsibility for taking corrective action for any abuses discovered rests with the administrative head of the board, commission, agency, department or institution. Individuals on State business shall use the Arkansas Business Travel Card-Individual Account (BTA) or provide themselves with sufficient funds or personal credit cards for necessary travel expenses. Nothing in this regulation removes the responsibility of the administrative head of an agency from being required to report to the Chief Fiscal Officer of the State and the Division of Legislative Audit incidences of fraud and/or theft as required by law.

PLEASE NOTE: For more specific information on the Travel Card Program refer to the State Procurement web site @ http://www.accessarkansas.org/dfa/purchasing/index.html. An exception to provision(s) established in this rule shall only be granted by the Chief Fiscal Officer of the State based on written request and justification from the administrative head of an agency or institution. All requests for exceptions should be addressed to the State Procurement Director, who will make a recommendation to the Chief Fiscal Officer of the State regarding such request(s).

History. Acts 1979, No. 676, § 6; A.S.A. 1947, § 12-2378.5; Acts 1995, No. 1258, § 1; 2001, No. 1453, § 26.

R 1-19-4 -1008Travel Advance Revolving Funds

In accordance with ACA 19-4-1008, the Chief Fiscal Officer of the State may approve the establishment of a revolving fund by an agency, department, board, commission or institution to be used to make advances of expense funds for authorized travel by officials, employees of State agencies, boards, commissions, and institutions of higher learning and students when travel is in conjunction with institution-sponsored events or programs.

The Chief Fiscal Officer of the State shall not be liable for any unauthorized expenditure through the failure of any official, employee or student to reimburse revolving funds for travel advances. The responsibility of ensuring that only authorized expenditures are paid by the use of any advance from an established revolving fund and the collection of advances made from a revolving fund ultimately rests with the administrative head of the board, commission, agency, department or institution.

The administrative head of the board, commission, agency, department or institution may appoint a travel administrator to administer travel functions within their activities. However, the responsibility for taking corrective measures for any abuses discovered rests with the administrative head of the board, commission, agency, department or institution.

Establishment of a Revolving Fund

A Travel Advance Fund is established by submitting a request to the Department of Finance and Administration-Office of Accounting.

The administrative head of every board, commission, agency, department or institution that wishes to establish and operate a travel advance revolving fund shall do so in accordance with the policies set forth by, and with the approval of, the Chief Fiscal Officer of the State. In addition, a custodian must be designated who will be responsible for operating, maintaining and processing all transactions in the account(s). All Travel Advance Funds in operation on the effective date of this rule are hereby approved.

Policy

The cost of registration and conference fees may not be included in the travel advance request. State personnel who hold an approved State travel card are discouraged from using the Revolving Travel Fund. Should it become necessary for a cardholder to apply for a travel advance, a letter of request from the traveler's immediate supervisor will be submitted to the Travel Advance Fund Custodian justifying the advance by explaining why anticipated expenditures may not be charged to the traveler's credit card.

Amounts to be advanced:

Travel Advance Revolving Funds may be utilized to make advances of amounts not to exceed 50% of the total anticipated travel expenses, not including those expenses that are direct billed to the agency or charged on the Sponsored Business Travel Card.

Within Arkansas:

Anticipated meals (airfare, lodging, vehicle rental) should be direct billed using the "Sponsored Business Travel Card."

Within the Continental United States:

Anticipated meals and taxi (airfare, hotel, and vehicle rental) should be direct billed using the "Sponsored Business Travel Card."

Outside the Continental United States:

Where the travel destination of the traveler and/or group does not provide access to the Sponsored Business Travel Card (SBTC) or other electronic means of accessing funds, the cash advance may be 75% of total anticipated travel expenses less air fare and hotel which may be direct billed using the Sponsored Business Travel Card.

When the travel destination of the traveler and/or the group does provide access to the Sponsored Business Travel Card (SBTC) or other electronic means of accessing funds, the cash advance should not be authorized but in no event will it exceed 50% of the total anticipated travel expenses. Airfare and hotel may be direct billed.

PLEASE NOTE: Travel advances for student/client/group activities as defined by ACA 19-4-904(d) may be made for 90% of the anticipated expenses that are not to be direct billed to the institution.

Specific exceptions to this policy may be addressed via e-mail to the director, Office State Procurement at OSP@dfa.state.ar.us subject: travel advance. State agencies, boards, commissions and institutions of higher learning shall require employees and/ or students to file an agreement authorizing the agency/institution to recover any amounts advanced for travel expense purposes from the amounts claimed and allowed the employee or student as reimbursement for actual expenses incurred or add them to the receivable account of the student.

Procedure for Obtaining Travel Advance Fund

The traveler completes the "Revolving Travel Fund Repayment Agreement" Form.

The traveler obtains approval of his/her supervisor as indicated on the form and forwards the completed forms to the Travel Advance Fund Custodian.

Travel advance requests, including those submitted by mail, should be processed with advance check prepared within five (5) working days after receipt provided that travel advance check should not be released more than 10 working days prior to planned travel. Employees should be notified when travel advance checks are available, and/or the advance checks should be routed to the traveler.

Repayment of travel advances: travel advances will be repaid according to the following guidelines:

. A "Travel Reimbursement"Form, TR-1 or equivalent, should be filed within five (5) working days after the traveler returns to his/her official station. Failure to submit the TR-1 or equivalent to the proper unit in a timely manner may result in the traveler being permanently barred from utilization of the Travel Advance Fund.

. Anyone who has been issued a State travel card and who obtains a travel advance without first obtaining written authorization from his/her supervisor may be permanently barred from using the Travel Advance Fund.

. If the traveler is no longer employed by the issuing organization and the travel advance has not been repaid by the borrower, the debt will be forwarded to the proper unit within the agency for collection.

History. Acts 1973, No. 876, § 15; 1979, No. 833, §§ 6, 7; A.S.A. 1947, § 13-341; Acts 1991, No. 21, § 2; 2001, No. 1453, § 27.

ACA§ 19-4-1102 Repealed

History. Acts 1973, No. 876, § 15; A.S.A. 1947, § 13-341; Acts 1997, No. 541, § 2; 2001, No. 1453, § 33.

R 1-19-4 -1108Public Records

The law defines public records as writings, recorded sounds, films, tapes, electronic or computer-based information or data compilations in any medium required by law to be kept or otherwise kept and which constitute a record of the performance or lack of performance of official functions which are or should be carried out by a public official or employee, a governmental agency or any other agency wholly or partially supported by public funds or expending public funds.

All public records shall be open to inspection and copying by any citizen of the State of Arkansas during the regular business hours of the custodian of the records, except as otherwise specifically provided by law.

Refer to Arkansas Code ACA 25-19-105 for exceptions, charges for providing copies of records and required response time to requests for copies and ACA 25-19-109 for special requests for electronic information.

R 2-19-4 -1108Records Retention

All records that are public property are required to be maintained by the agencies that generate the documents. The type of business record in question and the business process it supports determines the length of retention. Generally, all records should be maintained a minimum of three fiscal years. All records and supporting documentation must be maintained until they have been audited and may not be destroyed until permission has been granted by the Division of Legislative Audit. Other records such as records for grants are maintained according to State or Federal laws.

Public records can only be destroyed after permission is granted by the Division of Legislative Audit.

Storage of records in electronic form is permissible in some cases. Refer to Arkansas Law ACA 19-4-815, 19-4-1108, 25-32-112, 13-4-203, 25-32-117, 25-32-118.

Contact for Information: Division of Legislative Audit, Arkansas History Commission or your Assistant Attorney General.

History. Acts 1973, No. 876, § 14; A.S.A. 1947, § 13-340.

History. Acts 1973, No. 876, § 14; A.S.A. 1947, § 13-340; Acts 1993, No. 1073, § 17.

History. Acts 1973, No. 876, § 14; A.S.A. 1947, § 13-340.

History. Acts 1973, No. 876, § 14; A.S.A. 1947, § 13-340; Acts 2001, No. 1453, § 37.

ACA§ 19-4-1208 Repealed

History. Acts 1983, No. 781, § 1; A.S.A. 1947, § 13-374.

History. Acts 1983, No. 781, § 3; A.S.A. 1947, § 13-376.

History. Acts 1983, No. 781, § 2; A.S.A. 1947, § 13-375; Acts 2001, No. 1453, § 40.

History. Acts 1973, No. 876, § 22; A.S.A. 1947, § 13-348.

History. Acts 1973, No. 876, § 22; 1975, No. 985, § 1; A.S.A. 1947, § 13-348.

History. Acts 1973, No. 876, § 22; A.S.A. 1947, § 13-348; Acts 2001, No. 1453, § 41.

General Assembly.

History. Acts 1973, No. 876, § 22; A.S.A. 1947, § 13-348.

History. Acts 1973, No. 876, § 22; 1975, No. 985, § 1; A.S.A. 1947, § 13-348.

History. Acts 1973, No. 876, § 22; 1977, No. 641, § 1; A.S.A. 1947, § 13-348.

History. Acts 1973, No. 876, § 26; A.S.A. 1947, § 13-352; Acts 2001, No. 1453, § 42.

History. Acts 1973, No. 876, § 26; A.S.A. 1947, § 13-352.

R 1-19-4 -1503Property Management Responsibility

It is the responsibility of the executive head of every State agency, board or commission regardless of whether they participate in AASIS to maintain a record of all property of the agency belonging to the State of Arkansas.

All new acquisitions shall be promptly added to the detail of capital assets and all items transferred, lost, stolen, destroyed or sold must be promptly removed from the detail of capital assets. General information and guidance on capital assets is located in the Capital Asset Guidelines, P 1-19-4 -1503 (Capital Assets Guidelines).

Also included in the appendix are asset category definitions, capitalization/tracking thresholds, depreciation methodologies and examples of expenditures for each class of assets. All user agencies and service bureau agencies shall record their capital assets on AASIS based on established tracking and capitalization thresholds located in the Capital Asset Guidelines. Detailed instructions on adding or removing capital assets are located under Asset Management on the AASIS web site at http://www.aasis.state.ar.us/Training/CourseWare/CWareAM.htm. Reporting agencies shall record their capital assets on their books of record based on established tracking and capitalization thresholds located in the Capital Asset Guidelines.

Capital Assets Defined

Capital assets include: land, land improvements, buildings, building improvements, construction in progress, equipment, infrastructure, easements, works of art, historical treasures and any other tangible or intangible assets used in operations with an initial useful life in excess of one year.

PLEASE NOTE: Capital assets may include leased assets. For guidance on the potential capitalization of leased assets, see R 1-19-11 -238for guidelines on leases of tangible personal property (equipment) and R 1-22-2 -114 for guidelines on leases of office space, buildings, structures, parking lots and grounds.

Capital assets purchased should be recorded and reported at their historical costs, which include the vendor's invoice, sales tax, initial installation cost, modification cost, attachments, accessories or apparatus necessary to make the asset usable and render it in service. Historical costs also include ancillary charges such as freight and transportation charges, site preparation costs and professional fees. Capital assets donated should be recorded at fair market value at the time of donation.

PLEASE NOTE: The book value of assets shall never be increased to reflect appraised value, insurance value, etc.

Low Value Items

Although capital assets costing less than the capitalization/tracking threshold as detailed in the Capital Asset Guidelines Appendix are not considered capital assets for financial statement reporting purposes, the executive head of each State institution, department, board, commission or other State agency is not in any way relieved of the duty to account for all State property under his/her control regardless of the dollar value. Items costing in excess of $500 particularly susceptible to pilferage such as tools, computers, electronic equipment, etc., shall continue to be maintained on capital asset records as Low Value in order to prevent losses and to maintain proper accountability. Items costing less than $500 individually that are part of or used with a group or set such as kitchen utensils, groups of chairs, hospital linens should be capitalized in groups or sets at total cost as Low Value Collective items. A listing of the contents of the aforementioned sets or groups should be maintained by the agency for internal control and audit purposes.

Donated Items

A donation is defined as a voluntary non-exchange transaction entered into willingly by two or more parties. Both parties may be governments, or one party may be a non-governmental entity, including an individual. Equipment donated to State agencies shall become property of the State and shall be accounted for and disposed of according to the procedures set forth for property of the State.

Donors may set restrictions on the use and disposition of property donated. In such instances the donor's guidelines shall be followed. Adequate records must be maintained to demonstrate the guidelines were followed.

All donated equipment shall be valued and placed on the agency's capital asset records at the fair market value of the donated property at the time the donation is received. Donated items determined to have no value for its manufactured purpose shall be treated as consumable material, (i.e. donated items used for parts or training aids).

PLEASE NOTE: A voluntary contribution of resources between State agencies is not a donation. Such transaction should be accounted for as a transfer.

Confiscated Assets

Although not voluntary, confiscated assets awarded to an agency by judicial decision are accounted for in the same manner as donations.

Loaned Assets

Loaned assets are assets that are possessed but not owned by an agency. The agency may have fiduciary or administrative responsibility for such assets, but the agency only has temporary control of the asset and does not hold the asset's title or other ownership responsibility. These assets include, but are not limited to, art collections owned by families, estates or others, as well as equipment on loan from the federal government. Such assets shall not be included in the agency's capital asset records.

Other adequate supplemental records must be maintained by the agency on assets loaned (not donated) to the agency. The records must include an acquisition date, an adequate description of the property, location, if feasible, serial number, if applicable, the entity that owns the asset. Such information may be required to be reported to the Department of Finance and Administration-Office of Accounting-Comprehensive Annual Financial Report (CAFR) Section-(DFA-OA-CAFR Section) in the Year-End Disclosure Package.

The assets shall be subject to all other property procedures of the agency including, but not limited to, inventory and lost/stolen procedures.

State Owned Motor Vehicles

Motor vehicles shall be recorded and maintained in the capital asset records of the State Financial Management System. Refer to R 1-19-4 -903 and the Department of Finance and Administration-Office of Information Services web site http://www.state.ar.us/dfa/info_svcs/index.html for additional information on motor vehicles.

Capital Asset Additions

All additions are to be promptly added to the agency's detail of assets in the State Financial Management System. In the event that assets, which should have been added, are not included on AASIS prior to the end of the fiscal year, the agency shall remit a complete "Create Asset Master Record" Form located at http://www.arkansas.gov/dfa/aasis_forms/formsassetchangetrnsfretire.html to the DFA-OA-CAFR Section for each capital asset to be added to AASIS. The DFA-OA-CAFR Section will complete the necessary transactions to add the asset to the agency's capital asset records.

Depreciation

Generally Accepted Accounting Principles require capital assets to be reported and depreciated over their estimated useful life in the government-wide financial statements. Capital assets that are inexhaustible are not depreciated.

The purpose of depreciation is to spread the cost of the asset over the asset's economic life. The straight-line depreciation method will be used to calculate depreciation. Depreciation data will be calculated and stored by AASIS for each eligible asset of user agencies and service bureau agencies. Reporting agencies shall have a GASB 34 compliant fixed asset system to record fixed assets and calculate depreciation data. Accumulated depreciation shall be summarized and posted to the accounting general ledger of the State Financial Management System.

Each State agency, board or commission shall utilize the estimated useful lives outlined in the useful life appendix P 2-19-4 -1503. Additionally, each agency shall annually evaluate the estimated useful lives assigned to their assets to ensure depreciation is spreading the cost of the asset over the asset's economic life. If the current estimated useful life varies more than one year from the estimated useful life assigned to the asset, the agency shall request approval from DFA-OA to change the estimated useful life. Upon approval the estimated useful life of the asset will be changed, and the related accumulated depreciation and depreciation expense will be adjusted on a prospective basis.

Equipment Transfers - Inter-Agency

The transfer of equipment accountability from one agency to another agency shall be approved by the DFA Director prior to the transfer. (ACA 19-4-1503 )

If the transfer involves the transfer of funds, the agency wishing to transfer the asset shall submit a request to sell the asset to the Department of Finance and Administration-Office of State Procurement-Marketing and Redistribution (DFA-OSP-M & R), and the agency wishing to receive the asset shall submit a letter of acceptance to DFA-OSP-M & R. Upon receipt of sale approval (by the selling agency) and invoice (by the receiving agency), the agency receiving the asset may transfer the asset value to their capital asset records.

If the transfer does not include the transfer of funds, a transfer request including an acknowledgement from the receiving agency, board, commission or institution shall be submitted to the Department of Finance and Administration-Office of Accounting-Reconciliation Section as the DFA Director's designee for approval. Upon receipt of an approved transfer request, the agency receiving the asset may transfer the asset value to their capital asset records and, if a reporting agency, the agency transferring the asset may remove the asset from their capital asset records.

Removal of Equipment

Upon determination by the owning agency that property is no longer usable in its original State or no longer needed, Department of Finance and Administration-Office of State Procurement-Marketing and Redistribution Section (DFA-OSP-M & R) should be contacted for proper disposition (disposal, cannibalization or sale). See additional instructions in R 1-19-11 -243 Marketing and Redistribution.

Lost/Stolen Property

When an agency is unable to locate property contained on its capital asset records, the following possibilities must be considered:

History. Acts 1973, No. 876, § 23; 1975, No. 881, § 1; 1981, No. 251, § 1; 1983, No. 164, § 1; A.S.A. 1947, § 13-349; Acts 1987, No. 18, § 1; 1987, No. 646, § 3; 1989, No. 506, § 1; 1995, No. 1122, § 1; 1997, No. 747, § 1; 2001, No. 166, § 1; 2003, No. 1795, § 1.

R 1-19-4 -1602State Insurance Contribution Payments

Payments by agencies and institutions participating in benefits offered by DFA-Employee Benefits Division (DFA-EBD) shall be made payable to the DFA-EBD vendor set up for voluntary products for State insurance contribution payments (currently vendor number 9990386 in AASIS). Invoices entered into AASIS with a payment method of "A" will be directly deposited into the State Employee Benefits Trust Fund Account by Automatic Clearing House transaction. Invoices with a payment method of "W" will produce a warrant, which should be delivered by hand or mailed to DFA-EBD. The payment will be processed and manually deposited in the State Employee Benefits Trust Fund Account. Payments not received by DFA-EBD by the due date will be subject to penalties and benefit termination.

Supportive Papers for State Contribution Payments

No supportive documents are normally required to be submitted with the State contribution payments; however, agencies that are paying a different amount for added extra help positions than the amount billed should submit a copy of the billing along with the changes/corrections to DFA-EBD. Any permanent budgeted position changes/corrections should be reported to the DFA-Office of Budget for future billings. It remains the agencies' responsibility to retain all appropriate supporting documentation in their files for audit purposes.

Agencies participating in the DFA-Employee Benefits Division health and life insurance plans are required to enroll and maintain records for eligible employees. Employee benefit master data shall be maintained as required by Employee Benefits Division for the purposes of eligibility and employer matching contributions.

R 2-19-4 -1602Retirement Contributions

Agencies participating in the Arkansas Public Employees Retirement System (APERS) are required to monitor regular and extra help hours for all positions to comply with employer retirement matching contribution requirements and balance Arkansas Public Employee Retirement monthly reports. Agencies are required to submit employee contributions and employer matching payments within 10 calendar days after each payroll processing date. Agencies shall receive pre-printed remittance forms from APERS and will be provided additional forms as requested Generic remittance forms may be found at http://www.apers.org/pdf/form remittance.pdf for emergency use. Complete the agency name, payroll cycle and agency number when using these generic forms. Reporting instructions are available at http://www.apers.org/employerassistance_p1.html

R 3-19-4 -1602Deferred Compensation Plans

Authority

Arkansas Annotated Code 21-5-504 states:

History. Acts 1969, No. 199, § 8; A.S.A. 1947, § 12-3208; Acts 2001, No. 1453, § 43.

History. Acts 1979, No. 578, § 1; A.S.A. 1947, § 13-349.2; Acts 1989, No. 688, § 1; 1997, No. 758, § 1; 2001, No. 1453, § 45.

History. Acts 1973, No. 876, § 23; 1976 (Ex. Sess.), No. 1, § 1; 1977, No. 118, § 1; 1985, No. 820, § 1; A.S.A. 1947, § 13-349.

History. Acts 1973, No. 876, § 23; 1975, No. 980, § 2; A.S.A. 1947, § 13-349; Acts 2001, No. 1453, § 46.

History. Acts 1973, No. 876, § 23; 1977, No. 813, § 4; A.S.A. 1947, § 13-349.

Refer to R 1-19-10 -101 for information regarding Judicial Awards.

History. Acts 1995, No. 176, § 1.

Refer to R 1-19-10 -101 for additional information regarding Judicial Awards.

History. Acts 1973, No. 876, § 24; A.S.A. 1947, § 13-350.

PLEASE NOTE: Refer to ACA§ 19-4-806 for policies regarding Petty Cash and Imprest Funds.

History. Acts 1973, No. 876, § 24; A.S.A. 1947, § 13-350.

R 1-19-4 -1807Cash Management Improvement Act

Purpose of the Cash Management Improvement Act

The purpose of the Cash Management Improvement Act is to ensure efficiency, effectiveness and equity in the exchange of funds between the States and the federal government for federal assistance programs. The Cash Management Improvement Act of 1990 (CMIA) was enacted by Public Law 101-453, as amended by the Cash Management Improvement Act of 1992 ( Public Law 102-589 ), codified in the United State Code (USC) at 31 U.S.C. 6501 and 31U.S.C. 6503. The implementing regulations are found in the Code of Federal Regulations (CFR) at 31 CFR Part 205. The general provisions of the Act are as follows:

History. Acts 1973, No. 876, § 21; A.S.A. 1947, § 13-347; Acts 1989, No. 37, § 2.

State forms necessary to fulfill the requirements of 19-4-1901 through 19-4-1904 can be found within the following five (5) links: http://www.state.ar.us/dfa/intergovernmental/sf424.doc

http://www.state.ar.us/dfa/intergovernmental/ch-1_supplementary_grant_information_form.doc

http://www.state.ar.us/dfa/intergovernmental/ch-2_instructions_clearinghouse_supplement_form.doc

http://www.state.ar.us/dfa/intergovernmental/ch-_state_clearinghouse_app_supplement_form.doc

http://www.state.ar.us/dfa/intergovernmental/federal_grants/grant_award_notification_.doc

R 1-19-4 -1904Federal Grants and Aid

General Policies and Procedures

From time to time State agencies may request or receive federal funds in the form of grants or other aid. By nature, federal grants are subject to a full range of varying, yet specific, post award administrative requirements. To reasonably assure compliance with State and federal law as well as accurately report financial information, State agencies should maintain effective internal control over the financial administration of federal programs consistent with the following requirements:

U.S. Office of Management and Budget (OMB) Circulars A-87 Cost Principles for State, Local, and Indian Tribal Governments A-102 Grants and Cooperative Agreements With State and Local Governments, A-133 Audits of States, Local Governments, and Non-Profit Organizations, the recommendations and requirements contained in the A-133 Compliance Supplement (current edition), the Cash Management Improvement Act of 1990, the regulations promulgated pursuant thereto at 31 CFR Part 205, and other relevant grants management provisions applicable to the federal program in question, as announced in the Catalog of Federal Domestic Assistance and in The Federal Register.

These essential documents can be found within the following five (5) links:

http://www.whitehouse.gov/omb/grants/grants_circulars.html

http://www.fms.treas.gov/cmia/statute.html

http://www.fms.treas.gov/fedreg/31cfr205final.pdf

http://12.46.245.173/cfda/cfda.html

http://www.gpoaccess.gov/fr/index.html

Grant or Aid Preapplication

All preliminary, preapplication or informal proposals which may result in the commitment of personnel, space, facilities, equipment or State funds shall be submitted to the Department of Finance and Administration-Intergovernmental Services (DFA-IGS) with an Evaluation Report at the time it is submitted to the federal granting agency. DFA-IGS shall coordinate the review of any proposed program to prevent overlap, inefficiency or violation of legislative intent. (ACA § 19-4-1902, ACA § 19-4-1903 ) State institutions of higher education should submit preliminary proposals to DFA-IGS athttp://www.state.ar.us/dfa/intergovernmental/federal_grants/clearinghouse.htmlas informational only. (ACA § 19-7-604(b)(3) )

Grant or Aid Application

All formal proposals or other applications for federal funds in the form of grants, aids and reimbursements, except research grants or requests originating from a State institution of higher education, are to be submitted to DFA-IGS and the Governor's Office prior to submission to the granting source. The submission should include a summary of the application with the indirect cost rate of the applicant agency and a projection of the amount to be received as indirect cost reimbursement, if applicable. DFA-IGS is to file a summary of this submission with the Bureau of Legislative Research of the Legislative Council quarterly for review. (ACA § 19-4-1901, ACA § 19-7-604)

MFG Requirements for New or Additional Federal Funds

When new federal programs or new Comprehensive Employment and Training Act programs become available which require the benefiting State agency to employ additional personnel or require the benefiting State agency to obtain additional appropriations so that the program meets the requirements of or performs the objectives of the program, the head of the affected agency may request additional appropriations from the Governor and the Chief Fiscal Officer of the State. The agency's request must be on a "Miscellaneous Federal Grant" Form (MFG) and include supporting documentation, if applicable. The completed MFG and supporting documentation should be submitted to the agency's Budget Analyst at the Department of Finance and Administration-Office of Budget. After consulting the Legislative Council or the Joint Budget Committee, the Governor may approve or modify the requests. (ACA § 19-7-502 )

MFG documents can be found within the following two (2) links:

http://www.state.ar.us/dfa/budget/interim_forms/mfg_page_1.xls

http://www.state.ar.us/dfa/budget/interim_forms/mfg_page_2.xls

Quarterly Reporting Requirements

Information on all grants, aids, reimbursements and reimbursement plans, including research grants and those originating from a State institution of higher education, is to be reported to DFA-IGS quarterly. These reports shall be filed with respect to new federal programs or expansions of existing federal programs which were not in existence or which were not implemented by State participation at the time of the adjournment of the regular session of the General Assembly and entered into prior to the convening of the next regular session of the General Assembly. The DFA Director is to report to the Legislative Council on federal funds quarterly. The report is to summarize and itemize all programs which involve the expenditure of federal funds and is to include the following:

. a brief purpose of the agreement,

. the amount of federal funds to be expended,

. the amount of State matching funds, if required,

. the name of the administering agency or department, as well as any additional information that would assist the Legislative Council in determining the nature and purpose of the agreement.

Findings and recommendations by the Legislative Council from review of the quarterly reports are to be reported to each subsequent regular session. (ACA § 19-4-1904; ACA § 19-7-101, ACA § 19-4-1907, ACA§ 19-4-1908 )

Funds Receipt

The DFA-IGS is to be notified when a State agency receives notification or obtains any federal funds, grants, aids or reimbursements, including unsolicited federal funds. Such notification shall include reporting federal funds received for indirect cost reimbursements resulting from overhead cost of the entity or overhead cost allocated to the entity through the Consolidated Statewide Cost Allocation Plan. A summary of the notifications will be provided by DFA-IGS to the Bureau of Legislative Research of the Legislative Council for review quarterly. (ACA § 19-7-604, ACA § 19-4-1904 )

All such funds are to be deposited as all other State Treasury funds. Any federal funds received on behalf of public school districts shall be forwarded to the county treasurer or district treasurer as the district chooses. Federal funds received by the agencies set out in ACA § 19-5-205(b) shall be deposited in to the State Central Services Fund. (ACA § 19-3-501, ACA § 19-3-518, ACA § 19-4-408, ACA § 19-5-205 )

CMIA and other Interest Earned on Federal Funds

Interest earned on federal funds received under the State and Local Fiscal Assistance Act of 1972 is to be transferred from the Securities Reserve Fund at the direction of the Chief Fiscal Officer of the State based upon the related portion of the average daily balance of the federal funds on a quarterly basis. (ACA § 19-3-521 )

PLEASE NOTE: Refer to R 1-19-4 -1807.

Funds Disbursement

Disbursement made on specific funds receiving federal funding require the State Auditor to process warrants and the Treasurer of State to redeem the warrants presented for payment in accordance with the Federal Cash Management Improvement Act of 1990, Pub. L. 101-453, Oct. 24, 1990, 104 Stat. 1058, after the Chief Fiscal Officer of the State notifies them that the State agency director has certified that the Federal fund transfer request has been completed and accepted by the federal funding source and that the federal funds will be transferred for the benefit of the State fund to pay the warrants. (ACA § 19-4-1107 )

In the event of actions that would adversely affect funds received or related estimates, each agency head administering federal funds is required to immediately notify the State's Chief Fiscal Officer. (ACA§ 19-4-1306)

Recommendations of Governor

ACA§ 19-7-504 states that the Governor will submit recommendations to the General Assembly at the beginning of each regular session of the Arkansas General Assembly for any federal programs during the following fiscal biennium. Such recommendation is to include a recommended appropriation of federal and State funds necessary for each program. In the event the General Assembly fails to appropriate the funds for any program, the State will no longer participate in such program effective June 30th following adjournment of the regular session.

Accounting

The Federal Grants & Reimbursements, general ledger account 4050004000, is the only account used to record federal grant revenue received directly from the federal grantor or sub grantor that is not another State of Arkansas agency. Grants and Aid from Other State Agencies, general ledger account 6060001000, is used to record grants received from other State agencies. The State agency disbursing grant funds to another agency should use Grants and Aid to Other State Agencies, general ledger account 6061001000. Each agency will be required to provide the Department of Finance and Administration-Office of Accounting-CAFR Section a list of all federal funds with CFDA numbers, the general ledger account the revenue was recorded to and the related amount. For additional information on recording and tracking Federal Grants and Aid see P 1-19-5 -101 and Project Accounting http://www.aasis.state.ar.us/Training/CourseWare/CWarePRJACT.htm Tutorials on the AASIS web site.

PLEASE NOTE: Also refer to ACA § 19-4-2201 et seq. to review requirements for discretionary grants. Also refer to ACA § 19-7-101 et seq. for more information on Federal Funds.

History. Acts 1973, No. 876, § 21; A.S.A. 1947, § 13-347.

History. Acts 1973, No. 876, § 18; A.S.A. 1947, § 13-344

R 1-19-4 -2004 Responsibility for Reporting and Recovery of Losses Discovered Prior to Audit

The bonded disbursing officer for each State agency, board, commission or institution is responsible for, and held accountable for, reporting any losses of State funds to the Chief Fiscal Officer (CFO) of the State of Arkansas and to the Division of Legislative Audit (DLA). Losses include apparent unauthorized disbursements of State funds or the apparent theft or misappropriation of State funds or property.

No State agency, board, commission or institution has the authority to negotiate with any officer or employee for settlement of any losses of State funds without the approval of the CFO of the State.

The CFO of the State and the Director or Chief Officer of the respective agency, in coordination with the advice of the Attorney General (AG), has the duty to determine and initiate the appropriate action that is necessary to collect any amount found to be due the agency.

The recovery of losses under surety bonds must be coordinated with the CFO of the State and the DLA.

Recovery of Moneys Lost through Improper Redemption of Warrants/Checks If a vendor or individual (the payee) receives a replacement warrant/check and cashes both the replacement and original, the agency shall attempt to obtain repayment from the payee. Evidence of the collection attempt(s) shall be documented in writing. If attempts to collect fail, the agency shall report the incident to the CFO of the State, the DLA and the AG's office. If an individual who is not the payee, cashes a warrant/check, the agency shall report the incident to the CFO of the State, the DLA, the AG's office and to their local law enforcement office.

Recovery of Lost Assets (Not Warrants/Checks)

If theft of assets occurs, the agency shall report the incident to the CFO of the State, DLA, the AG's office and to their local law enforcement office.

R 2-19-4 -2004Recoveries of Losses Discovered by an Audit

Notice and Proof of Losses - Investigations - Restitution

The DLA, with the approval of the Legislative Joint Auditing Committee, will give notice and proof of loss to the Governmental Bonding Board on fidelity bonds. This is done when the audit report reflects apparent unauthorized disbursements or unaccounted-for funds or property for which the public official, officer or employee may be liable. (ACA 21-2-708 ) The DLA may request the appropriate prosecuting attorney or the AG to assist the State or the appropriate political subdivision in obtaining restitution when the audit report reflects apparent unauthorized disbursements or unaccounted-for funds or property for which the public official, officer or employee may be liable.

The Self-Insured Fidelity Bond Program and the participating governmental entity are considered victims. Restitution may be awarded to the participating governmental entity for the entire amount of its non-reimbursed losses and to the Self-Insured Fidelity Bond Program for the entire amount of its payment to the participating governmental entity in the event that any criminal prosecution against the official or employee causing the loss where such official or employee enters a plea of guilty or nolo contendere or where such official or employee is found guilty following a trial.

Disposition of Bond Proceeds

When the Board receives proof of loss from the DLA, the Governmental Bonding Board will determine whether the loss is covered under the Fidelity Bond Program. (ACA 21-2-709 )

When determined that the loss is covered under the Fidelity Bond Program, the Insurance Commissioner will authorize fidelity bond loss payments from the fund to the participating governmental entity on a timely basis.

All disbursing documents for bond claim payments must include as supporting documents:

History. Acts 1991, No. 768, § 3.

In both instances the completion of the form must be the first step in the process ("Create Treasury Fund Request" Form) to set up a new fund for receipting and expensing. The original form is submitted to the agency's DFA-Office of Budget Analyst (OB) for review. The Manager of the DFA-OA-Funds Group may initiate the establishment of new legal funds or the Chief Fiscal Officer or Director of the agency requesting a new sub-fund may initiate the process. The Budget Analyst approves the form by placing his/her initials on the fund request form and submitting it to the DFA-OA-Funds Group Manager. The information provided on the form is reviewed. Items that are incomplete are researched and corrected by the Funds Group Manager or DFA-OA-Funds Group staff.

The Funds Group Manager assigns an alpha numeric code to the fund as necessary to comply with the general naming convention used for all funds held by State agencies. After DFA-OA-Funds Group enters the new fund information into AASIS, the information contained on the request form is entered into a template and e-mailed to the Treasurer of State for entry into their system. The beginning date for usage is the date following entry into the AASIS system. The end date is always the biennium end date. The information contained on the funds request form is entered into the "Funds Control Log."

A copy of the e-mail is sent to the Auditor of State, Attorney General's Office, DFA Comprehensive Annual Financial Report Section Manager (CAFR) who verifies the fund type assigned and DFA-OA Funds/Appropriations Manager. A copy is filed in the DFA-OA-Funds Group files. The original printed e-mail letter is signed and faxed to the Auditor of State.

When the Treasurer of State has completed entry into their system, a return e-mail is made to the Funds Group Manager, and the DFA-OA-Funds Group "funds" log is updated to reflect the date of the "establishment" or "fund created" date. When the DFA-CAFR Section Manager responds with the correct fund type, the Funds Group Manager updates the fund type as necessary in AASIS, logs and files the response in the "saved e-mail" inbox.

The original fund request form is returned to DFA-OB after it is signed and dated for filing.

Establishing New General Ledger Codes

Additions to the existing general ledger chart of accounts are a result of either new legislation from the General Assembly (request will be by DFA-OA) or a request from an agency, DFA-OA, DFA-Budget Office or the AASIS Support Center staff. The form to request a new general ledger code is completed and signed by the originating party and transmitted by printed or electronic copy to the DFA-OA-Reconciliation Manager. The appropriate name, legal authority and AASIS coding structure for the new general ledger code is added onto the request form by the DFA-OA-Reconciliation Manager if the request is for an expenditure or balance sheet code. If the request is for a revenue code, the appropriate name, legal authority and AASIS coding structure is added to the request form by the Funds Group Manager. After establishing the code in AASIS, the DFA-OA-Reconciliation Manager notifies the Funds Group Manager by delivery of an initialed copy of the request form. The Funds Group Manager enters the information onto an e-mail letter template that is sent to the Treasurer of State. The Treasurer of State e-mails a verification notice to the Funds Group Manager that the general ledger account code has been added to the Treasurer of State's system.

Deposits to Treasury Detail

The reporting agencies, user agencies or Department of Finance and Administration-Office of Accounting-Service Bureau (in the case of agencies that have their accounting process performed by DFA) enter their receipts of income into cash journals for posting, which in turn creates the deposit slip for the agency to submit to the Treasurer of State with the corresponding checks, cash or warrants for non-Electronic Fund transfer deposits. Entries to record receipts of income or federal fund transfers that are received through the Electronic Fund transfer (EFT) process also create cash journals and the corresponding deposit slips; however, additional identifying information about the draw, such as the transfer document number from the Federal Reserve System, must be on the face of the deposit slip. The deposit slips are to be made on the day of the federal fund transfer request and presented to the Treasurer of State. These deposit slips are then matched to the incoming federal fund transfers and recorded into the Treasurer of State's records.

The agency submits the original deposit slip and three copies to the Treasurer of State. The Treasurer's staff records the Treasury receipt number on the third copy of the deposit slip which is given to the agency for filing in their records. The remaining copies are maintained in the Treasurer of State's records.

The Treasurer of State's posting of deposits and transfers ends at 2:00 p.m. each weekday, except for the last workday of the month which ends at 12 noon. Deposits delivered to the Treasurer's Office after those times will be posted the following business day. Processing of the receipts and disbursements into the proper funds follows. When all processing and daily reconciliation is complete, the Treasurer of State files the original deposit receipt, provides one copy to the Auditor of State and the final copy to the DFA- OA-FG. The DFA- OA-FG files the receipt copies in "daily batches."

The DFA-OA-FUNDS GROUP files are used to provide an agency a copy of misplaced receipts. If the DFA-OA-Funds Group Manager issues a revenue receipt correction, the Treasury receipt number will be obtained from these files and entered on the receipt correction sent to the Treasurer of State.

Revenue Receipt Corrections

Revenue receipt corrections are initiated by agency personnel to correct an incorrect characterization of the revenue or transfer of moneys receipted by the agency. This is accomplished by completing the "Revenue Receipt Correction" Form and recording it in both AASIS and the Treasurer of State's records. The electronic template is provided on the DFA web sitehttp://www.state.ar.us/dfa/accounting/funds_section.html.

The revenue receipt corrections requested by an agency are sent by e-mail to DFA-OA-Funds Group and accompanied by the electronic template with all pertinent information. The detailed instructions appear on the Excel template.

The Funds Group Manager reviews the information provided, and any missing information is requested from the agency person initiating the request. When completed, the deposit record is researched thoroughly to ensure the correcting entry will be accurate. DFA-OA- FG staff will post the correction into AASIS.

Revenue receipt corrections that involve either general or special revenue or those in which cash is taken from one fund and deposited into another fund require correction in the Treasurer of State's records. This is accomplished by the DFA-OA-Funds Group Manager forwarding a copy of the revenue receipt correction to the Treasurer of State's office to be posted.

The Treasurer of State and the Auditor of State choose to process certain documents manually rather than accept interfaces with updated records to process within their systems. The actual documents are printed out and the Funds Group Manager enters those document numbers in a document log. These documents, the list and the log are faxed to the Auditor of State and Treasurer of State for manual entry.

After the Auditor of State and Treasurer of State have entered them into their systems, they fax the log with the entry date on it to the Funds Group Manager. The document log is updated in the DFA- OA-FG computer files maintained by the Funds Group staff. The printed lists, logs and fax coversheets are filed in the Funds Group.

PLEASE NOTE: Revenue Receipt Correction forms for transactions are located at http://www.state.ar.us/dfa/accounting/funds_section.html.

PLEASE NOTE: The Treasurer of State investment policy may be viewed as appendix P1- 19-5-104.

PLEASE NOTE: Other forms applicable to the management of funds in the State Treasury are located on the DFA-OA web site at http://www.state.ar.us/dfa/accounting/index.html.

Returned Checks

Refer to R 3-19-4 -2004 "Returned Checks" for discussion of returned checks.