Determine Appropriateness and Necessity

While most transactions can and should be handled through a subsidiary system (i.e. Payroll, Accounts Payable, Accounts Receivable, etc.) a journal entry into the GL can become necessary under specific circumstances. For example, a journal entry may be necessary to correct an error or to allocate charges that could not be processed in the subsidiary system.

Necessity

Before a journal entry is created, consider the following:

Is this journal entry cost effective to process? Small dollar amount transfers between non-sponsored sources of funds may cost more to process than the transaction is recording. Small dollar journal entries may be necessary to clear a balance on a chartfield before it can be inactivated. If you have specific questions about whether a journal entry is necessary, please contact Shared Services for assistance.

Has the journal entry already been corrected? If the originating department noticed the error, they may have already corrected it. If you are correcting another journal entry, contact the Journal Entry Requester listed in the journal header to ensure the correction is not duplicated.

Appropriateness

The University receives funding from many sources: tuition, patient care, state appropriations, the federal government, private organizations, and gifts from donors to name a few. Fund codes are used to group funding from similar sources that are used for a specific purpose. This structure allows Financial Operations to assist departments in ensuring that the activity is recorded in the appropriate manner. As we determine the appropriateness of transactions, it is important to recognize that we are always subject to external review.

Each Fund has specific rules regarding what type of charges are allowable. It is important to understand these rules before processing a journal entry into the GL. For example, money restricted for scholarship funds by a donor cannot be used to pay for a new computer.

Additionally, journal entries cannot be done on-line by departments for some Funds such as Endowments and Student Loans. More information on Funds and the type of charges which are allowable are located in Appendix A of the JE Training Guide.

In the GL, the account value indicates the type of activity which is occurring. As a result, some accounts are appropriate in some Funds and not in others. For example, Gift account 405075 will cause a journal entry to systematically fail in the General Fund 10000. Gift revenue is only allowable in Funds 30000, 40000 (rarely), 7XXXX and 8XXXX.