Statement of Functional Expenses

Overview

FASB requires not-for-profit institutions to present expenses by nature as well as function, as well as to provide an analysis of expenses showing the relationship between functional and natural classification. To support this new standard of reporting, there are two (2) classification types to add to general ledger accounts. You will need to configure them based on your school’s conventions.

  • The first new classification type is called a “GL Function Category.” This will be the high-level category for each function to be grouped into. The categories will be named Programs and Supporting Services, for example.
  • Function areas are called “GL Function Codes” in Veracross. Function codes are a further breakdown of the Function category they fall into.

Configuration Steps

1. Setup Function Codes and Function Categories (** Mandatory **)

On the System homepage, there are links in the ‘View Configuration’ and ‘Change Configuration’ sections to view, change, and add GL function categories. There are two default ones available that you can add or edit. As needed:

  1. Add function code categories and function codes. Each code needs a description and functional category.
  2. Associate GL accounts with the appropriate function code from a query or the GL account detail screen.

2. Set Up Account Type Categories (** Optional **)

In order to support expanded categorization and subtotaling (see example statement below), there is a categorization class on the Account Type table. On the System homepage, there are links in the ‘View Configuration’ and ‘Change Configuration’ sections to view, change, and add new GL account type categories. The sort key not only determines the order in which the categories appear in a dropdown list, but also the order in which they are presented on the Statement of Functional Expenses.

  1. Add new GL account type categories.
  2. Assign categories to account types.
  3. Run the GL Account Type Listing and associate the proper category with each relevant account type

Configure Desired Reports

Open the desired template and manipulate the function fields as needed. The YTD Activity Function Field is in the report as this is most relevant to this statement, but there are a variety of other function fields available in the “Function Field” query template category.

  • Parameters:
    • Fiscal Year – Required
    • Accounting Period – Required
    • Function Code – Optional

Note: You may select multiple function codes within one function field. This is useful for creating “Total” columns

  • Rename the function fields
    • In the template reports, function fields are named “Alter or Delete”
    • Select parameters and rename the column.
  • Delete the unused function fields

Templates

  • Three template reports can be found on the General Ledger Homepage, in the ‘Custom Reports’ section
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