1302 PR.05 Closing an Account Segment

Revision Date: 
July 30, 2013

1 – Introduction to Accounting Segment Closures

This procedure assumes an understanding of the Chart of Accounts and of projects, awards and organizations as implemented at the University. For more information refer to the COA Handbook and Procedure 1302 PR.01, Overview of Projects and Awards.

1a.  Overview of Closures

What does it mean to close an accounting segment?

Closing an accounting segment means that the segment (Project, Task, Award, Expenditure Type or Organization) will no longer accept charges.  As a result that segment is no longer part of a valid PTAEO and may not be used in accounting transactions.

When will an accounting segment need to be closed?

There are different reasons for closing an accounting segment, some determined by central process owners and others determined by all distributed departments.

Project and Task – Projects and tasks are typically closed when an activity is no longer being performed and there is little or no activity. The remainder of this document provides additional details about the process for closing a project or task.

Organization – Organizations are typically closed for two reasons:

  • There is little or no activity and the department is cleaning up PTAOs or reports
  • The organization is obsolete due to a reorganization or change in business operations.

The following are links to the procedure and form that deal with closing orgs:

Award – The process for closing an award varies based on the type of award. For this reason, there is not currently a standard form for requesting award closures.

  • For sponsored awards, contact GCFA (Grant & Contract Financial Administration) at 203-785-3630.
  • For gifts and endowments, contact Gift Administration at gift.awards@yale.edu or 203-436-5285
  • For all other awards, contact COA at coa@yale.edu.

Expenditure Type – The decision to close an expenditure type will always be made by Chart of Accounts in collaboration with other central processing departments (including General Accounting, Financial Reporting, Financial Planning & Analysis, Gift Administration and GCFA). Due to the controlled nature of this process, there is no distributed form for requesting that an expenditure type be closed. All requests to close an expenditure type should be emailed to coa@yale.edu.

Effect of Closing a project and/or task

  • Once an operating project and/or task has been closed, it may not be re-opened. New activities require a new project or task. Closed projects and tasks may not be “recycled”, as it will distort historical reporting.
  • Any charges after the project/task close date will be invalid. 
  • The department will be able to view the history of the closed project/task using BRIO or Data Warehouse reports. See additional details on closed segments and reporting in Section 3 of this document.
  • When a project is closed all related tasks will also be closed. 

1b.  Overview of the Request Process

Who requests an accounting segment closure?

All departmental closure requests must originate from a person authorized by the department (or his/her designee) responsible for the segment’s owning Organization.

How do I submit a request?

Request forms should be sent by email to coa@yale.edu.

Does the request need to be reviewed in my department?

Yes – all request forms require departmental review and approval prior to submission to COA.  Please note that the requestor and department approver must be different people.  The department approver must have authority over the organization listed as the project “owner”.  Approval can be indicated in one of three ways:

  • Approver sends the request to coa@yale.edu,
  • Approver is carbon copied on the request submission, or
  • Approver’s authorization is included in the request’s email string.

You may be asked to provide additional information or revisions

If you are notified that the request needs additional information or revision:

  • Enter the additional data or make the appropriate changes to the form.
  • Resubmit the form for approval.

Receive notification of approval or rejection

When a decision has been made on the request for a new linkage you will be notified:

If…

Then…

The request is approved

  • You will receive an e-mail from COA stating:  Your request to close the following projects and/or tasks has been approved by the Chart of Accounts department.  Please note that such closures are performed as part of the month-end financial close process.  You will receive a confirmation from the processor when the closure is complete.  Please refrain from charging additional transactions to this project and/or task.

The request is rejected

  • Chart of Accounts will notify you of a question about or problem with your request.
  • You may revise the request and resubmit it, if appropriate.

Avoid common mistakes by:

  • Filling out the form clearly, completely and correctly.
  • Ensuring that every PTAEO combination for the closing segment has a zero balance, no commitments, assets or liabilities (see General Closing Information below).

 

2 – Request to close a Project or Task

2a.  Perform Pre-Closure Activities

In order to close an accounting segment, all pending transactions must be processed, certain balances must be cleared and all commitments must be cleared. The departmental requestor is responsible for performing the majority of these actions, but COA and GA User Support can provide guidance and direction as required.

(1)   Required: The summary checklist is included on the face of the Project & Task Closing Request Form and must be completed. 

(2)   Suggested: A more detailed checklist for all segments is found at Form 1302 FR.13 (Checklist for Account Segment Closures) and covers the following areas:

Balances

  • Check Asset, Liability and Fund Balance balances – they should net to zero  [BUG 403a and Review Tool for assets and liabilities]

 

Open (Pending) or Recurring Transactions

  • Make sure all final adjustments, transactions & transfers have been processed and have appeared on your statements [BUG 403a and/or Account Holder Report]
  • Clear all Accounts Payable advances associated with the project [Review Tool]
  • Change all new, pending or recurring transaction charging instructions to a new account. Examples include but not limited to:
    • POs and SciQuest [BUG 310a]
    • Commitments [BUG 310a]
    • Labor Distribution Schedules [LD System]
    • ISPs [ISP Report in the Portal / Account Holder Report – Detail Transactions]
    • EMS [Expense Management Reports in Portal]
    • Check and modify any VIPs [BUG 710a]
  • Determine whether any edits can or should be made to the budget – contact your budget officer with questions.  A budget/actual variances may be appropriate and acceptable for a period of time.
  • Communicate changes to all users of the project or task (all processing transactions or running reports).

 

Permission/Roles and Reports

  • If you know that this project is shared with other Orgs, contact all charging Orgs prior to closing
  • Review access and permissions to various accounting and reporting applications; change, as necessary.

 

Charging Linkages and Ownership

  • Check that the project/task being closed is not the prime project/task on your source.  If the segment being closed is a prime, you will need to contact Gift Administration at 203-432-1347 and provide a new prime project/task. Prime projects/tasks receive income distributions.

2b.  Complete and Submit the Project & Task Closing Request Form

Obtain the Project & Task Closing Request Form (1302 FR.09)

Obtain the Request form on-line from the PTAEO Maintenance site. Full instructions are included.

Complete all sections of the form. All fields are required, unless otherwise stated.

Timing Considerations – All segment closures are processed one day per month, immediately following the month-end financial system close. Request forms should be submitted to COA no later than 2 days prior to the calendar month-end (ex: September 28th) to allow for central review and additional clearing entries, if required.

2c.  Review the confirmation report and perform periodic monitoring

Review the information provided to you in the Confirmation report to confirm that it corresponds to your request.

  • Ensure that you have communicated changes (and new charging instructions, as applicable) to all individuals who process and review transactions for your department.
  • Notify the Processor or COA immediately if you find discrepancies or have questions.

In rare instances, a transaction could post to a closed accounting segment. Accounting and financial reports should be reviewed with care as part of standard monitoring procedures. If a department identifies charges that have posted to a closed segment, the responsible administrator or manager should contact:

  • the transaction processor to ensure that all future transactions are posted to the correct PTAEO and
  • COA for guidance on clearing and re-closing the accounting segment.

3 – Closed Accounting Segments and Reporting

Closed segments will generally appear on standard reports while there is detailed transaction data in the specified accounting period. If there is no transaction data for a period, the segment will no longer appear in the report as follows for certain commonly-used standard reports:

  • Account Holder Report, Position Plan, BUG 403a – segment will no longer appear after the fiscal year end (ex: any segment ended on or before June 30,xxx1 will not appear on reports for periods from July 1, xxx1 and forward)
  • Fund Balance Report –
    • Project will no longer appear after the fiscal year end (June 30,xxxx); this is similar to the reports noted above.
    • Task will continue to appear on the report until the project is closed.

Transaction history is visible on reports even after an accounting segment has been closed.