[CAFR-Contacts-News] CRF reimbursement of state agency requests

Tue Nov 3 11:08:37 PST 2020

Good morning,

There has been a process for agencies to request reimbursement of eligible costs from DAS with the Coronavirus Relief Fund (CRF), which is part of the CARES Act. In anticipation of the upcoming CRF reimbursements coming to agencies, please accept this email about the process agencies should follow with respect to the system.

1.      As previously noted, if CRF is reimbursing a cost incurred in FY 2020, the cost remains an FY 2020 cost, for both the CAFR and SEFA. Note that this is not a "reimbursement" as defined in OAM 15.45.10<https://www.oregon.gov/das/Financial/Acctng/Documents/15.45.10.pdf> Accounting and Financial Reporting: Interfund and Interagency Transactions: Interfund Services, Reimbursements and Transfers. Instead, the expenditures are being "refinanced" from non-CRF to CRF.

2.      The reimbursements cannot be accounted for as a reduction of expenditure (ROX). Rather, the accounting treatment needs to follow OAM 15.42.00<https://www.oregon.gov/das/Financial/Acctng/Documents/15.42.00.pdf> Accounting and Financial Reporting: Federal Grants. If additional limitation is needed, agencies should work with their CFO and LFO analysts.

3.      Consistent with the attached, state agencies should be creating a new D23 fund(s), pointed to State Fund Group 2020 since this represents an expenditure of CARES Act dollars, and report the reimbursed expenditures in the new D23 fund(s), offset by the transfer in. Unless there is a proprietary fund capital asset acquisition reimbursed with CRF (an infrequent occurrence), at the conclusion of CRF, transfers in should equal expenditures for this D23 fund, meaning there should be no ending equity. For governmental funds, the G54 code is R1 and the G54 description should be "Coronavirus Relief Fund - 21.019" or something similar. The CFDA number needs to be included, which is 21.019.

4.      The D23 fund(s) that are created should be in the same GAAP fund that reported the original expenditure, with the exception of GAAP Fund 0001, which should direct the new D23 fund to GAAP Fund 0054. This is because CRF is coming to agencies from DAS as Other Funds, therefore it cannot be pointed to GAAP Fund 0001. In our view, attempting to have one CRF D23 fund per GAAP fund for CRF reimbursements should be pursued if possible. This process has been discussed and cleared with Secretary of State Audits Division.

5.      Agencies with multiple GAAP Funds being reimbursed with CRF can work with DAS to (1) send the reimbursements directly to those new D23 funds, (2) send it to one existing D23 fund per GAAP fund being reimbursed, and then the agency further transfers it to other D23 funds within the GAAP fund, or (3) send it to one D23 fund, and then the agency transfers them to the ultimate D23 funds reporting the expenses. If possible, the first or second option is best. Please be mindful of the workload to DAS Accounting in this process.

6.      In my discussions with Secretary of State Audits Division, it's critical that agencies maintain the transaction documentation of the original entry for audit examination. Summarized information will likely be insufficient.

7.      Agencies will be able to crosswalk their reimbursement requests to their actual reimbursements. In our reimbursements for March - July, if there is a difference, we will describe the cause of the difference and the dollar amount in our email notifying the agency.

8.      For the reimbursements of FY 2020 costs, SARS will be giving a post-close adjustment in early 2021. These post-close adjustments will not impact an agency's Gold Star status.

9.      Agencies will need to submit SEFA Corrections Forms for these FY 2020 reimbursements in FY 2020 to add expenses and FY 2021 to remove the expenses.

If there are questions, please contact your SARS analyst as this relates to the accounting of CRF, rather than the DAS CRF team.

Thank you,

Rob

Robert W. Hamilton, CPA
Statewide Accounting and Reporting Services Manager
Chief Financial Office
Department of Administrative Services
Cell: (971) 719-3031
http://www.oregon.gov/DAS/financial/acctng

Data Classification: Level 1 - Published

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