SUBSECTION 2.2.6.1
TRANSFERS

2.2.6.1.1

Transfers

Effective Date:

Sept. 1, 1998

All interfund transactions except loans or advances (refer to Section 2.2.4.3.2), quasi-external transactions (refer to Section 2.2.6.2), and reimbursements (refer to Section 2.2.6.3) are transfers. There are two major categories of interfund transfers: residual equity transfers and operating transfers.

2.2.6.1.1.a

Residual Equity Transfers--Residual equity transfers are non recurring, non routine transfers of equity between accounts. Two examples of residual equity transfers are contributions to or return of contributions from proprietary fund type accounts and transfer of residual equity balances from discontinued accounts.

Residual equity transfers are generally infrequent. The key to identifying residual equity transfers is their non recurring or non routine nature. If transactions are recurring or routine, particularly if they involve a subsidy relationship, they are reported as operating transfers. (Refer to Section 2.2.6.1.1.b.)

Residual equity transfers are reported as direct additions to or deductions from the appropriate fund equity GL code in governmental and trust fund type accounts. Residual equity transfers to proprietary fund type accounts are recorded in GL Code 9300 "Contributed Capital." Residual equity transfers from proprietary fund type accounts are recorded as reductions of either contributed capital or retained earnings as appropriate in the circumstances.

Residual equity transfers in governmental and trust fund type accounts are to be recorded in GL Code 9210 "Residual Equity Transfers." (Refer to Section 2.2.6.4.2 for illustrative entries.) All residual equity transfers are to be in balance at the agency level; i.e., within an agency all GL Code 9210 entries are to net to zero, except for the following:

• Transfers to/from account groups,

• Transfers between state agencies, and

• Transfers to/from GL Code 9300 "Contributed Capital" in proprietary fund type accounts.

2.2.6.1.1.b

Operating Transfers-- Operating transfers include all interfund transfers which are not residual equity transfers.

Operating transfers are classified as "other financing sources (uses)" on governmental fund type account operating statements and as "operating transfers" on proprietary fund type account operating statements. In the case of transfers appropriated as expenditures, the GAAP and budgetary accounting treatments will differ. For budgetary reporting, appropriated operating transfers are considered "expenditures," while for GAAP reporting purposes, they are considered "other financing sources (uses)."

The following are considered operating transfers:

• Legally authorized transfers from an account receiving revenue to an account that will expend the resources.

• Transfers of general tax revenues or other dedicated revenues to a debt service fund type account.

• Transfers from the general fund to a special revenue or capital projects fund type account.

• Operating subsidy transfers from the general or a special revenue fund type account to an enterprise fund type account.

• Transfers from an enterprise fund type account to finance general fund expenditures.

Operating transfers are recorded as expenditures using Object M or as revenues (refer to Section 2.2.6.4.3 for illustrative entries) using the following non-revenue source codes:

0480 - Operating Transfers - In

0481 - Operating Transfers - Out

0482 - Investment Administration Transfers (SIB only)

0483 - Retirement System Transfer

0680 - Pension Benefit Reserves Transfers In (DRS Only)

0681 - Pension Benefit Reserves Transfers Out (DRS Only)

0726 - Non-cash Revenue Transfers - Compensation

0727 - Non-cash Revenue Transfers - Other

0781 - Operating Transfers - Arbitrage

0782 - Operating Transfers - Arbitrage Reimbursements

0783 - Operating Transfers - Debt Service

0784 - Operating Transfers - Debt Service Reimbursements

0785 - Operating Transfers - Sales Taxes

0786 - Operating Transfers - Motor Fuel Taxes

0787 - Operating Transfers - Fiscal Agent

0788 - Operating Transfers - Property Taxes

0789 - Operating Transfers - Higher Education Fees

Operating transfers are to net to zero at the agency level.