Accounting Journals (Including Internal Charge-Back Journals)
Manual accounting journals are submitted for a variety of reasons, most notably to:
- Record accrual entries. Under GAAP, revenues are recognized when goods/services are delivered or performed and expenses are recognized when goods/services are received
- Amortize prepaid expenses and receivables
- Correct accounting errors in previous journal postings
- Record internal charge-back, allocation and transfers. For example:
- Internal transfer of support of unrestricted funds to another area or department
- Allocate procurement card charges to appropriate expense ledger account and spend category
- Charge-back other departments for goods or services provided internally within the University
Please visit the Policies, Procedures, Guides, and Forms pages for information on accounting policies and procedures for creating accounting journals.
Internal Charge-back, Allocation and Transfer Journals
Internal charge-back, allocation, and transfer journal entries must net to zero within the financial statements line, i.e. no impact on total University’s revenue or expense line item.
- Journal entries for internal charge-back, allocation and transfer should use the same Spend category and ledger account for debit and credit side of the entries. At the very least, the debit and credit side of the entries should use the ledger accounts which are mapped to the same financial statement line
- If the journal entries do not net to zero within the same statement line, the University is misstating certain expenses
- No Revenue category nor ledger account should be used related to internal charge-back, allocation or transfer journal entries
- Internal charge-back journals must be posted in the same fiscal year during which the goods or services were provided. Exceptions permitted for grant funds 1802 and 1805 which can cross fiscal year as long as the expenses are within the Grant’s period of performance.