Select a government type/Select basis of accounting
This government type selection will limit the accounts to those applicable to the selected government type. Although the listing provided intends to be all inclusive, it is possible that needed account codes will not be included. If this occurs, please use the All option to view the entire chart of accounts and contact LGCSFeedback@sao.wa.gov so the listing can be updated.
Select export type
The Excel option provides a spreadsheet which you can format. The PDF is formatted to highlight the different categories of account codes. For display purposes, the account codes contain decimal points which should be excluded in your annual report.
Select a reporting level
Above and Prescribed option includes those accounts which are aggregates of detailed account codes and are not valid for reporting in addition to Prescribed accounts which are the valid BARS account codes. Prescribed option only lists valid BARS account codes.
Your annual report requires seven digits for all account codes however, their display in the chart of accounts varies. The expenditure or expense accounts are presented without object codes. Object codes are available in the BARS Manual. The reporting at the subobject level is not required.
2.4.1.10 A budget is a legal document that forecasts the financial resources of a government and authorizes the spending of those resources for a fiscal period. At a minimum, local governments’ budget must meet the requirements of Washington state law and the State Auditor’s Office. The SAO does not prescribe how to budget or what a budget should look like. The adopted budget should be of sufficient detail to be meaningful and meet the intention of the law. The SAO considers budgets showing revenues and expenditures at the legal fund level to be the minimum acceptable level of detail.
2.4.1.20 Budgeting is more than just an activity to satisfy state law. It is a sophisticated process of strategic planning, communication and policy development resulting in a detailed plan of operations for allocating and monitoring the use of limited resources among various competing demands. Teaching how to budget is outside the scope of the BARS. However, there are many educational resources available to local governments, such as the Municipal Research and Services Center (mrsc.org) and the Government Finance Officers Association (gfoa.org).
2.4.1.30 Glossary of budgetary terms:
Annual/biennial appropriated budget – A fixed budget adopted for the government’s fiscal period. The appropriated budget was traditionally used to determine a government’s property tax levy, and a ceiling on expenditures was made absolute so that the expenditures of a government unit would not exceed its revenues. This budget was also historically a balanced budget, estimated revenues equaling appropriations. The appropriated budget is still used to set tax levies and some budget statutes still require balanced budgets, but it is more generally used to authorize a specific amount of expenditures regardless of whether estimated resources meet or exceed that amount. Appropriated budgets are required by statute in cities (Chapter 35.32A RCW, Chapter 35.33 RCW and Chapter 35A.33 RCW), counties (Chapter 36.40 RCW), and most other local governments in Washington State. These budgets are also called legal budgets, adopted budgets, or formal budgets. The appropriated budgets should be adopted by ordinance or resolution.
Appropriation – The legal spending level authorized by a budget ordinance or resolution. Spending should not exceed this level without prior approval of the governing body.
Capital improvement budget – Consists of two elements: the annual/biennial portion of capital projects and annual/biennial appropriations for the purchase, construction or replacement of major fixed assets in the current fiscal period.
Comprehensive budget – An government-wide budget that includes all resources the government expects and everything it intends to spend or encumber during a fiscal period. The comprehensive budget contains annual/biennial appropriated budgets, the annual/biennial portion of continuing appropriations such as the capital improvement projects, debt amortization schedules, and grant projects, flexible budgets and all non-budgeted funds.
Continuing appropriation – A fixed budget which authorizes expenditures for a fiscal period that differs from the government’s fiscal year, such as capital projects, debt issues, grant awards, and other service projects. These expenditures require an ordinance or resolution to authorize the project, establish the assessment roll, adopt the debt amortization schedule, or accept the grant award. Such ordinances or resolutions set an absolute maximum or ceiling on the expenditures, but the time period for incurring expenditures does not coincide with the government’s fiscal year; it may even cover several years. The major difference between annual/biennial appropriated budgets and continuing appropriations is that the latter do not lapse at fiscal period end; this implies that no legislative action is required to amend the annual/biennial portion of a continuing appropriation, unless the total authorized expenditures would exceed the entire appropriation.
Encumbrances – Commitments related to unperformed (executory) contracts for goods or services should be utilized to the extent necessary to assure effective budgetary control and to facilitate cash planning. Encumbrances outstanding at year end represent the estimated amount of expenditures ultimately to result if unperformed contracts in process are completed; they do not constitute expenditures or liabilities.
Final amended budget – The original budget adjusted by all reserves, transfers, allocations, supplemental appropriations, and other legally authorized legislative and executive changes applicable to the fiscal year, whenever signed into law or otherwise legally authorized.
Fixed budget – Those budgets which set an absolute maximum or ceiling on the expenditures of a particular fund, department, or other specific category. A fixed budget can be either an annual/biennial appropriated budget or a continuing appropriation. Fixed budgets must be adopted by ordinance or resolution, either for the government’s fiscal period or at the outset of a service project, debt issue, grant award, or capital project.
Flexible budgets – Are usually regarded as managerial tools, which do not set a ceiling on expenses or expenditures but establish a plan for them at various levels of service. They are especially appropriate for the day-to-day operations of a public utility where it is essential to plan fluctuations in the demand for services and where revenues will automatically increase with demand, so that a balanced budget does not depend on establishing a ceiling for expenses.
Operating budget – Presents the estimated expenditures and available resources necessary to provide the services for which the government was created. An operating budget will contain flexible budgets and fixed budgets; the fixed budgets will include annual/biennial appropriations for services and the annual/biennial portion of continuing appropriations for debt service and for service projects.
Original budget – The first complete appropriated budget. The original budget may be adjusted by reserves, transfers, allocations, supplemental appropriations, and other legally authorized legislative and executive changes before the beginning of the fiscal year. The original budget should also include actual appropriation amounts automatically carried over from prior years by law.
Working capital budget – Combines flexible and fixed budget elements in one document for enterprise and internal service funds. Current operations are flexibly budgeted based on the estimated level of services to be provided and long-range sources and uses of assets are controlled by annual/biennial appropriations and continuing appropriations.
Capital assets are real and personal property used in operations, above a specified value, the government intends to use or keep for more than one year. Capital assets include land and land rights; buildings, their furnishings, fixtures, and furniture; infrastructure assets, intangible assets equipment, machinery, vehicles, and tools.
Capitalize means to report an expenditure for real and personal property or intangible assets as a capital outlay. These expenditure transactions are coded to 594 and 595 account codes.
Accountability means the obligation to demonstrate good management of or control over those matters for which the government is responsible.
Capital assets management system is the set of written policies and procedures used to control a government’s capital assets and demonstrate accountability. Public officials have several broad responsibilities with respect to capital assets such as tracking assets for accountability purposes; maintaining records for insurance purposes; ensuring assets are safeguarded from loss, waste, damage, or neglect; for compliance purposes such as when purchased with federal funds; and long term capital budgeting and planning.
Capitalization threshold is a dollar amount set in a formal policy defining when an item with more than one or more years of usefulness will be classified as a capital asset.
Physical inventory is a procedure where the existence of assets on the inventory list is confirmed by physically observing the assets at their location in the field.
Small and attractive assets are assets that last longer than one year, but do not qualify as capital assets. They are less than the capitalization threshold and may be susceptible to theft or misuse.
Cash basis accounting only reports inflows and outflows of cash. When a capital asset is purchased the entire expenditure is recognized in the period as “capital outlay” when the cash outflow occurs. Because the entire asset cost is reported when it was purchased the reporting of depreciation accounts is not appropriate.
Determination of when a purchased item is classified as a capital asset (and reported as a “capital outlay”) will depend upon the capitalization threshold established in policy of the government. Each government should establish a formal policy that includes a capitalization threshold.
The cash basis financial reporting requirements for capital assets are limited; however, this does not remove the responsibility of the government from its stewardship of public resources. Entities must have policies and procedures in place to track, demonstrate accountability and ensure security of their capital assets.
Specific capital asset tracking requirements of the State Auditor's Office are contained on the subsequent pages. In addition, the federal government has issued property management requirements that apply to all governments that receive federal assistance. Title 2 of the Code of Federal Regulations (CFR) sections 200.310-316 outlines specific requirements related to real property, equipment, supplies and intangible property purchased with federal funds. Note that these requirements involve broad stewardship responsibilities and specific accounting records.
The duty to make certain that public property is adequately protected and that its use is properly managed is one of the fundamental responsibilities of government officials. Local governments with capital assets should develop policies and procedures for management of these public resources. At a minimum the policies should be reviewed and approved by the governing body. Once a policy is adopted, it should be periodically reviewed and updated to ensure it meets the needs of the local government.
The following are items the government must consider when developing policies for tracking and safe guarding their capital assets.
Capitalization threshold– Governments must set the dollar amount at which the purchase of an asset with a useful life of more than one year will be classified as a capital asset, for which the expenditure will be recognized as a capital outlay. A government may establish a single capitalization threshold for all capital assets or different capitalization thresholds for different classes of assets. The threshold should be established at a small enough level such that the assets excluded would be clearly insignificant to financial reporting in aggregate. In establishing a threshold, governments may consider the types and groups of capital assets they own, management information needs, and best practices (see below). Local governments that are recipients of federal grants should ensure capital asset thresholds will allow the government to meet federal requirements in the 2 CFR §200.313 related to tracking assets purchased with federal funds.
Inventory requirements – Policies should require inventories at reasonable intervals to verify the existence and condition of capital assets. The policy should define the categories or types and threshold of assets to be inventoried. These policies should require an inventory interval based on the nature of assets, number of assets and extent of decentralization. The policy should also assign overall responsibility for conducting the inventory – ideally by personnel other than those charged with custody of the assets. The policy should include how to follow up on damaged or missing assets, including when inventory results or issues are communicated to the governing body. The policy should direct losses of public resources to be reported to our office, as required by state law.
Inventory policies should conform to any statutory or regulatory requirements, such as the requirement for counties to inventory all capital assets per RCW 36.32.210 or the requirement for all assets over $5,000 per unit purchased with federal grant funds to be inventoried at least once every two years per the 2 CFR §200.313.
Recordkeeping – Policies should address how the capital assets will be tracked and what records will be maintained for operational and accountability purposes. Governments should maintain records of what they own, where it is located, the condition, and who is responsible for the asset. Records should be sufficient to prove any losses for insurance purposes. Inventory and maintenance records will confirm that a lost or damaged asset has been in use recently, which will support the validity and timeliness of a theft or damage report. Specific information captured may vary by type of asset.
Disposition procedures – To the extent procedures are not defined by statute (such as Chapter 39.33, RCW for intergovernmental disposition of property, or property sales for ports in Chapter 53.08 RCW, etc.), policies should define authority and authorized procedures for determining assets require replacement or are otherwise surplus, and their subsequent disposition.
Asset replacement – Policies should provide sufficient direction on when assets should be replaced. Replacement may be based on a set schedule, based on specified conditions, or delegated to specified staff positions or groups to determine or recommend on an asset-by-asset basis. Replacement policies often differ by asset type and should be established to align with and support the governments capital budgeting and planning process.
These are assets that are below the government’s capitalization threshold for financial statement reporting purposes and last longer than a year, but may be susceptible to theft or misuse. Each government should perform an assessment to identify those assets that are particularly at risk or that otherwise need to be tracked for operational purposes. Governments should implement specific measures to track and control these assets to minimize identified risks, as appropriate for the nature of the assets, value of the assets, and risks. Controls may range from basic measures such as policies, tagging, assigned custody, restricted access or other physical controls - to limited systems such as check-out systems or reserve inventories (where only items not in use are tracked) – to comprehensive tracking and inventory controls such as that done for capital assets (compete tracking lists, periodic physical inventories, see below for more information). Governments should also consider the cost/benefit of tracking certain types of assets and the resources it has available when establishing control measures, as compared to the risks involved.
When a government has capital assets it must establish and maintain a tracking system for them. It may be maintained using either a computerized or manual system.
The tracking system must adhere to the formal asset policies approved by the governing body.
It must include:
1) Inventory list containing capital assets owned by the government.
2) Individual information record for each capital asset:
Acquisition information, including references to source documents and acquisition dates
Name and detailed description sufficient to define and identify the asset, including any identifying numbers or legal description where applicable
Location of the asset
Custodian responsible for the asset, if applicable
Cost of the asset/source of funding (federal grant, etc.)
Estimated life
Condition of the asset
Identifying number for the asset
Disposal – date and method used to determine disposal value
3) A reconciliation of the capital assets list and individual supporting asset records at least once per year to ensure the information is complete and accurate.
4) Adequate internal controls over additions and deletions to the capital asset tracking system to ensure the capital asset tracking system is kept up-to-date and accurately reflects all activity.
5) A method to track changes in custody and assigned responsibility for the assets.
6) Performance of a physical inventory, at reasonable intervals, as established by the government’s policy.
Capital assets purchased with federal funds are subject to federal property standards found in 2 CFR §§200.310-316. The requirements are known as the Uniform Administrative Requirements, Cost Principles, and Audit Requirements of Federal Awards (Uniform Guidance). They apply whether the assets are purchased in whole or in part with federal resources and are in addition to the accountability requirement prescribed by our office. The federal rules are in effect during the time the asset is owned by the government until official disposition has occurred. Also, government should be aware some federal agencies may publish deviations from the Uniform Guidance due to statutory requirements.
Reporting Requirements and Filing Instructions for Cities and Counties
4.1 Reporting Principles and Requirements
4.1.5 Reporting Requirements and Filing Instructions for Cities and Counties
4.1.5.10 Pursuant to RCW 43.09.230, Annual Reports are to be certified and filed with the State Auditor’s Office (SAO) within 150 days after the close of each fiscal year.
Footnotes [1] Cities were required to prepare the Schedule 06 beginning in reporting year 2019. Counties are required to prepare the Schedule 06 for reporting year 2020.
[2] Cities with total revenues usually less than $300,000 are also required to submit an Assessment Questionnaire.
4.1.5.20 The following matrix provides additional details regarding reporting requirements for governmental, proprietary and fiduciary funds.
Caution
4.1.5.30 Local governments with total revenues of $2 million or less are not required to prepare C-4 or C-5 statements unless debt covenants, a contract, a grantor or the city/county’s legislative body requires the city/county to prepare the financial statements or to receive a financial statements audit. If this request is made, C-4 and C-5 statements and notes should be prepared. The $2 million threshold calculation excludes any proceeds from issuance of long-term debt and resources held by the city/county in its fiduciary capacity. Local governments which choose not to prepare C-4 and C-5 statements must have their budgeted information available for the audit.
4.1.5.40 If more than $750,000 in federal funding was expended by the entity during the year and a federal single audit is required, the entity must prepare financial statements if it has expenditures of federal moneys from more than one program or cluster. However, an entity that normally does not prepare financial statements may not need to prepare them for the single audit if it has expenditures from only one program or cluster. Entities should consult with their local SAO team or the SAO HelpDesk if they have questions about this requirement.
4.1.5.50 Forms
The templates for Online Filing for Schedules 01, 06, 09, 15 and 16 are available on the BARS Reporting Templates page on the SAO website. When using the Online Filing option, the system will create the Schedule based on data provided by the city/county on these templates.
Blank forms for other schedules are provided on the BARS Reporting Templates page. The use of these particular forms is not required; however, information requested by the form is prescribed. Specific instructions accompanying each statement and schedule identify which, if any, details are optional.
4.1.5.60 Subsequent corrections
All subsequent discoveries of errors and omissions in the annual report – from the date of original submission up through the end of the audit applicable to that period – are requiredto be corrected by resubmitting the annual report. For any misstatements discovered during the audit, governments should ensure open communication with the audit team about the correction. Any misstatements discovered after the audit is completed that affect Schedule 01 should be recorded as a prior period adjustment. If misstatements discovered after completion of the audit are material, governments should immediately alert their audit team.
4.1.5.70 Filing instructions
Electronic reporting is strongly encouraged when filing annual reports. Annual reports should be submitted via the Online Filing option on the State Auditor’s website at: https://portal.sao.wa.gov/saoportal/. Acceptable file should adhere to the prescribed record layout and should be an Excel file. It should include column headings. All columns must be formatted as text except the Actual Amount column which is numeric. More details are provided on the website.
For questions and/or support e-mail the SAO HelpDesk through Online Services.
If the city or county cannot provide the annual report in the electronic format it should mail it to:
Annual Report State Auditor’s Office Local Government Support Team P.O. Box 40031 Olympia, WA 98504-0031
4.1.5.80 Certification
Electronic reporting through the SAO website will require electronic certification of the annual report during the final steps of the submission process.
If the city or county cannot utilize the electronic reporting, prepare the certification form (provided on the BARS Reporting Templates page), including signature and date and include this form when mailing your report.
4.1.5.90 The following matrix describes required statements and schedules for cash basis cities and counties and the scope of each schedule.
Footnote [1] There should be only one general fund. Also, if the local government accounts for the debt and capital projects related to proprietary activities in funds other than proprietary, these activities should be incorporated in the appropriate proprietary fund. All interfund transactions between funds which are combined for reporting purposes should be eliminated to avoid double counting.
Annual Report Disclosure Form MCAG No. _______ (City/County)
(This form is not required if you are submitting the annual report electronically.)
Use the column which is appropriate for your government type. Please place a check mark or "Y" if the statements/schedules are attached. If financial statements and/or are not applicable, mark the spot "NA" (not applicable). An "NA" in your government type column will indicate that a schedule is not attached due to lack of activities described in the schedule in reported year. The blocked spot indicates the schedule is not required for that government type.
Footnotes [1] Only cities and counties with revenue of $2 million or more are required to prepare the financial statements. See Caution, above.
[2] See BARS Manual for detailed instructions indicating which cities are required to prepare this schedule.
[3] Only cities with revenue usually less than $300,000 are required to prepare this schedule.
348.00 (Internal Service Funds Sales and Services)
348.00 (Internal Service Funds Sales and Services) – Allowed only in internal service funds. Read more about the use of 348.00 and internal service funds in the audit connection blog, “BARS Code Spotlight”.
308 / 508 (beginning/ending cash and investment balance codes)
Cash Basis Cash and Investment Balance Codes – 308.21/508.21: Allowed only in permanent funds and private-purpose trust funds. 308.31/508.31: Allowed in all fund types. 308.41/508.41: Allowed in all fund types except fiduciary. 308.51/508.51: Allowed in all fund types except fiduciary. *308.91/508.91: Allowed in all fund types except fiduciary. *Only the general fund can report a positive unassigned balance.
3.6.8.10 Changed "Programs must be approved by the behavioral health organization and the secretary of the Department of Social and Health Services" to "…secretary of the Department of Health" to match RCW 71.24.555
3.7.1 Updated references to Office of Management and Budget (OMB) Circulars 3.7.1.20 Included other federal financial assistance guidance 3.7.1.30 Removed reference to the American Recovery and Reinvestment Act (ARRA) 3.7.1.30 Added Identification of COVID-19 related awards requirements 3.7.1.41 Removed the Common Rule Administrative Requirements section 3.7.1.51 Removed the OMB Circular A-87 Cost Principals section
Updated section to remove references to reserved/unreserved and replaced with new cash and investment classifications 4.3.12.100 Updated the sample C-4 with new format
Section number updated to 4.14.13 (from 4.8.13). 4.14.13.100 Updated information on reporting pension (264.30) and OPEB liabilities (264.40) 4.14.13.110 Updated the due date instructions to list I.D. Numbers that do not require a due date to be reported.
3952000, Compensation for Loss/Impairment of Capital Assets
3952000, Compensation for Loss/Impairment of Capital Assets Added the following information: Insurance recoveries that are related to storm cleanup and are realized, or are measurable and available, in the same year as the related cleanup expenditures should be netted against those expenditures. Insurance recoveries that are related to cleanup and are recognized in subsequent periods should be reported as other financing sources or extraordinary items, as appropriate.
3132700, Affordable and Supportive Housing Sales and Use Tax
3132700, Affordable and Supportive Housing Sales and Use Tax A new BARS code 3132700 was assigned to code the sales and use tax authroized by the SHB 1406, Laws of 2019.
For BARS codes 5990000, Payments for Refunded Debt, these codes should be used for payments to an escrow agent for refunding debt payments and direct payments of refunded debt (e.g., BANs, refinancing or loans, etc.). Note this correlates to current refundings, advanced refundings utilize 5930000 codes.
Other Increases and Other Decreases in Fund Resources Added BARS Codes 3821000, Refundable Deposits, 3822000, Retainage Deposits, and 5821000, Refund of Deposits, 5822000, Refund of Retainage Deposits to be used for deposits that are not custodial activities. These codes are replacing 3891000, 5891000, 3892000, 5892000 which are no longer valid BARS codes.
3.1.3.10 Updated information about the "Green Book." 3.1.3.30 Added information that states the SAO is not part of the internal control functions of a government. 3.1.3.40 Updated the five components of internal controls. 3.1.3.90 Updated information about the different areas that should be reviewed for creating internal controls.
3.4.16.30 Included information about OPEB reporting requirements, the types of OPEB plans, links to the State Actuary tools used for liability calculations.
Removed "signed" in 3.6.620 b. which now says "A file must be maintained of those payers who have authorized to add moneys to your account electronically including the proceeds form third party vendors for credit card remittances."
Removed "signed" in 3.8.11.20 b. which now says "A file must be maintained of authorizations by payees who have therby agreed to have moneys added to their accounts electronically."
Added the fourth bullet in 3.8.11.30 which now says "Policies and procedures should be in place to validate these authorization to protect resources being transferred electronically."
4.8.5.40 Removed reference to the fact that the SEFA must be prepared on the same basis of accounting since Uniform Guidance does not require the SEFA. 4.8.5.50 Removed references to CFDA 10.665: Title I - Schools and Roads, Title II - Special Projects on Federal Land, Title III - County Projects in the Direct costs of expenditure transactions associated with grants, cost-reimbursement contracts, cooperative agreements, and direct appropriations. 4.8.5.128 Revised the requirements for Disbursements to Subrecipients to "expended" rather than "paid." 4.8.5.130 Updated the exceptions for EPA Drinking Water State Revolving Fund (CFDA 66.468) and Clean Water State Revolving Fund (CFDA 66.458). 4.8.5.230 Removed Note 8 American Recovery and Reinvestment Act (ARRA) of 2009 from the SEFA Notes Template.
Created a new note to move the guidance for component units, joint ventures, and related parties. Note - this information was previously located in the "Other Disclosures" note template.
Removed information for related parties, component units or joint ventures. Added information about Pollution Remediation/Retirement of Certain Assets.
Schedule 06 is required for CASH basis cities and towns for FY2019. Optional for CASH basis counties for FY2019, required for FY2020 reporting. Schedule 06 template is available on the BARS Reporting templates page.
Schedule 09
264.40, OPEB Liabilities
Added 264.40 to the Schedule 09 codes for reporting OPEB liabilities.
Schedule 09
263.93, Environmental liabilities
Added 263.93 to the Schedule 09 codes for reporting Environmental liabilities (e.g. pollution remediation, certain asset retirement, etc.).
New account for revenues for Medicaid payments related to an implementation of the Transformation Plans. The addition was communicated on August 1, 2018 in BARS Alert.
The account was divided between internal and external legal services. Within each category were created more separate accounts for different specific legal expenditures. The change will allow governments to analyze and compare costs much more effectively. This also aligns accounting records with procedures auditors are required by professional standards to perform on legal liabilities, so it will help make the audit process more efficient. This change was already announced in 2016 and was not required for the FY 2017 reports; however, the new accounts will be required for 2018 reporting.
Object code 50 was removed and the definitions of object codes 30 and 40 adjusted to include the transactions which were previously reported using object 50. For other details see BARS Alert issued August 1, 2018.
The recent changes in governmental accounting regarding fiduciary activities are effective for reporting periods beginning after December 15, 2018; however we incorporated the required changes in this version of manual. The additional information will be available on our website under Fiduciary Funds in BARS manual.
Also, updated was the discussion of enterprise [400] funds. There are no new reporting requirements and the update expands the current prescription.
The entire section was revised to provide a comprehensive guidance for accounting of capital assets. The update also incorporates the changes to RCW 36.32.210 which removed the annual inventory requirement. This change was communicated on March 21, 2018 in BARS Alert.
This section provides a short overview of other postemployment benefits (OPEB). Starting with financial reports for a fiscal year 2018, all local governments are required to report liabilities related to OPEB, if applicable. [This update provides also samples of disclosure regarding OPEB in the Reporting/Notes to Financial Statements section.]
New section was added regarding Equipment Rental and Revolving (ER&R) Fund. This guidance was previously available outside the BARS manual and it is now incorporated into the manual allowing an easy access.
Added a new section to provide a general overview of interfund transactions.
REPORTING
The recent changes in governmental accounting regarding fiduciary activities are effective for reporting periods beginning after December 15, 2018; however we incorporated the required changes in this version of manual. The additional information will be available on our website under Fiduciary Funds in BARS manual.
The following sections were updated 4.1.5.90, 4.1.6.80, 4.3.13 (also includes the change in the pension trust fund title), 4.8.2.50, 4.8.4.30, 4.8.13.50, Note X- Deposits and Investments – paragraph [7]. These changes involved only a title change from agency to custodial funds.
New note Fiduciary Activities was added to explain the change in counties’ reporting of 2017 money held for the special purpose districts. The affected counties were notified in an email dated May 29, 2018. The note is still required for the counties which will be reporting the special purpose districts for the firsttime in 2018. If they reported them in 2017, the note is not longer required.
A new reporting requirements regarding other than pension postemployment benefits (OPEB). Please see the Accounting/Liabilities/Other Postemployment Benefits section for more details.
The local government should prepare either the Schedule 07, Disbursement Activity and Schedule 11, Cash ActivityOR Schedule 06, Summary of Bank Reconciliation for 2018 annual report.
Clarified that the governments should be reporting both short- and long-term liabilities on the Schedule. Also added new ID. Numbers for registered warrants and lines of credits.
The local government should prepare either the Schedule 07, Disbursement Activity and Schedule 11, Cash ActivityOR Schedule 06, Summary of Bank Reconciliation for 2018 annual report.
Revision reflect the clarification for reporting federal grants provided by federal agencies.
Remove discussion regarding ARRA grants.
The example of reporting FEMA grants was updated.
Updated for changes related to reporting the following grants: EPA Drinking Water (CFDA 66.468), Clean Water (CFDA 66.458), USDA Interim Financing (CFDA10.760) and (CFDA 10.766).
Revised rules for reporting grants with missing CFDA numbers.
The Schedule was revised to provide relevant information needed in assessing and auditing governments’ risk management circumstances.
ONLINE FILING
Schedule 09
The Schedule 09, Schedule of Liabilities, includes a new validation check for net pension liabilities. Governments will receive a red flag if they have pension related liabilities but do not report them on the Schedule 09 or if they are using the incorrect ID No.
Overview of Significant Changes – Applicable to the Reporting Year 2017
Topic
Reference
Description of Changes
CHART OF ACCOUNTS
Revenue/Expenditure/Expense Accounts
3132400, Local Infrastructure Financing Tool (LIFT)
Added a new account for revenues from the local sales and use tax dedicated for LIFT projects.
Revenue/Expenditure/Expense Accounts
3340370, State Grant from CRAB
The title was changed to Rural Arterial Program (RAP).
Revenue/Expenditure/Expense Accounts
3340372, CRAB Road Arterial – Projects
The title was changed to County Arterial Preservation Project (CAPP).
Revenue/Expenditure/Expense Accounts
335/336
The titles for both categories was revised to State Shared Revenues, Entitlements and Impact Payments.
Revenue/Expenditure/Expense Accounts
3360425, Foundational Public Health Services
A new account was added for 2017 distributions from the DOH.
Revenue/Expenditure/Expense Accounts
3360642, Marijuana Excise Tax Distribution
A new account was added for the distribution of the marijuana excise tax from the State.
Revenue/Expenditure/Expense Accounts
3421000, Law Enforcement Services
The definition was expanded to include payments from the WASP for processing the sex and kidnapping offenders’ registration.
Revenue/Expenditure/Expense Accounts
3670000, Contributions and Donations from Nongovernmental Sources
The definition was clarified regarding connection fees.
Revenue/Expenditure/Expense Accounts
395, Disposition of Capital Assets
Added a clarification regarding use of the account in the proprietary fund.
Revenue/Expenditure/Expense Accounts
398, Insurance Recoveries
The account was split into two 3981, Insurance Recoveries for cash basis governments and 3985, Insurance Recoveries for GAAP. The split was necessary to accommodate reporting by cash basis proprietary funds since the BARS codes in 370 series are not available to them. The revised account 3981 replaces the original 372 code.
Revenue/Expenditure/Expense Accounts
51530, Legal Services
The account was divided between internal and external legal services. Within each category were created more separate accounts for different specific legal expenditures. The change will allow governments to analyze and compare costs much more effectively. This also aligns accounting records with procedures auditors are required by professional standards to perform on legal liabilities, so it will help make the audit process more efficient. This account will be required for 2018 reporting.
Revenue/Expenditure/Expense Accounts
51770, Unemployment Compensation
Changed references to section of the BARS manual to correctly refer the current title (Payroll Accounting vs. Unemployment and Deferred Compensation).
Clarified the definition regarding property insurance.
Revenue/Expenditure/Expense Accounts
51863, General Grants and Financial Assistance to Other Governments
Revised title to General Grants, Financial Assistance and Other Distributions to Local Governments.
Revenue/Expenditure/Expense Accounts
538, Combined Water/Sewer/Solid Waste Utilities
Revised title and definition to correctly reflect RCW 54.16.300 (i.e., Combined Utilities).
Revenue/Expenditure/Expense Accounts
562, Public Health
The WA State DOH added additional detail accounts 562.11-562.15 for local governments subject to the DOH’s jurisdiction.
Revenue/Expenditure/Expense Accounts
593, Advance Refunding Escrow
Added to the definition a reminder that this account should be reported also for proprietary funds.
Revenue/Expenditure/Expense Accounts
595, Roads/Streets and Other Infrastructure
Added to the definition a reminder that this account should be reported also for proprietary funds.
Revenue/Expenditure/Expense Accounts
599, Payments to Refunded Debt Escrow
Added to the definition a reminder that this account should be reported also for proprietary funds.
Account Structure
1.1.2
The section was revised to discontinue the old terminology regarding the seven-digit account codes (i.e., Prime, BASUB, etc.). The digits are now referred by their location within the code (i.e., first, second, etc.). This change was applied in all places in the BARS manual and the revised sections are not itemized in this listing.
Revenue/Expenditure Accounts Overview
1.14.10
The section was revised to discontinue the old terminology regarding the seven-digit account codes (i.e., Prime, BASUB, etc.). The digits are now referred by their location within the code (i.e., first, second, etc.).
ACCOUNTING
Diversion of County Road Property Tax
3.6.5.20
The BARS previous procedures were revised to better assist compliance with the provisions of the law.
Payroll Accounting
3.8.1
The title was change to Unemployment and DeferredCompensation to better reflect the content of this section. There are no changes in the prescription.
Loans
A new paragraph (3.9.1.30) was added. The paragraph discusses an issue of incorrectly using its own debt instruments as investments.
REPORTING
Reporting Requirements and Filing Instructions for Cities and Counties
4.1.5.10
The reporting matrix was updated to reflect optional reporting of the new Schedule 06.
Fiduciary Fund Resources and Uses Arising from Cash Transactions (C-5)
4.3.13.10, 4.3.13.40, 4.3.13.70
Adding a requirement for counties to include the special purpose districts on the statement C-5.
Also, the format of the statement C-5 was changed. The fiduciary funds should be aggregated according to the fund type (i.e., pension, investment, private-purpose and agency funds plus total column). The instructions and the Online Reporting were updated to incorporate these changes.
Schedule 01
4.8.1.50, 4.8.1.70
Since a requirement for counties to include the special purpose districts on the statement C-5 was added, Schedule 01 has to include data for these districts.
Column 4 – clarified the instruction regarding reporting of revenues and expenses for proprietary funds.
Schedule 06
Schedule 06, Summary of Bank Reconciliation was added. This Schedule is optional for cities and counties for reporting bank activities in the fiscal year 2017. Governments choosing to prepare Schedule 06 do not have to prepare neither Schedule 07 nor 11 for the 2017 fiscal year. Schedule 06 will be required schedule for reporting year ending December 31, 2018.
Schedule 07
Removing the requirement for this schedule, if the city/county choose to prepare Schedule 06.
Schedule 09
Added 4.8.13.71 and 4.8.13.81 regarding reporting loans with forgiveness clause.
Schedule 11
Removing the requirement for this schedule, if the city/county choose to prepare Schedule 06.
Note X – Pension Plans
Additional column for employers’ contributions was added to the matrix.
Note X – Other Disclosures
Added instructions for reporting special items, contingencies and litigations and government combinations.
ONLINE FILING
Annual Street/Road Finance Report
The pilot project with DOT has been extended another year to explore the possibility of an alternative reporting process to the existing Street/Road Finance Report required to filed to DOT for cities and counties.
Fund Balance – Beginning Check
A minimum variance requirement within $1,000 added summarizing Schedule 01 funds reported.
Overview of Significant Changes – Applicable to the Reporting Year 2016
Topic
Reference
Description of Changes
CHART OF ACCOUNTS
Revenue/Expenditure/Expense Accounts
31720, Leasehold Excise Tax
The definition was updated to clarify that this tax can be imposed only by counties and cities and other governments receiving their share of this tax should code the proceeds to 337, Local Grants, Entitlements and Other Payments.
Revenue/Expenditure/Expense Accounts
31740, Timber Excise Tax
The definition was updated to clarify that this tax can be imposed only by counties and other governments receiving their share of this tax should code the proceeds to 337, Local Grants, Entitlements and Other Payments.
Revenue/Expenditure/Expense Accounts
32180, Concessions
A new account was added. This account should be used for revenues from awarding rights to use government’s property. Previously these proceeds were comingled with proceeds from an actual sales and coded to account 36280, Concession Proceeds and 36290, Other Rents, Leases and Concession Proceeds. Proceeds from governments own sales should be accounted for in 34170, Sales of Merchandise.
Revenue/Expenditure/Expense Accounts
32191, Franchise Fees and Royalties
This account was updated to include royalty payments. Previously the royalties were accounted for in 36290, Other Rents, Leases and Concession Proceeds (e.g., property rights, etc.), 34790, Other Fees (e.g., publication royalties, etc.).
Revenue/Expenditure/Expense Accounts
36210, 36230, 36240, 36250, 36260
These accounts were combined into 36200, Rents and Leases. This account is designed only for rentals and leases which are not a part of the governments’ principal operation [those rents and leases should be accounted in the appropriate 340s service and sales accounts].
Revenue/Expenditure/Expense Accounts
36280, Concession Proceeds
Account removed. For revenues from awarding rights to use government’s property use 32180, Concessions. Proceeds from governments own sales should be accounted for in 34170, Sales of Merchandise.
Revenue/Expenditure/Expense Accounts
362900, Other Rents, Leases and Concession Charges
Account removed. The revenues should be accounted in 36200, Rents and Leases, 32191, Franchise Fees and Royalties 34170, Sales of Merchandise or other appropriate account.
Revenue/Expenditure/Expense Accounts
36850, Special Assessment- Operating
The title was changed to Special Assessment – Service and the definition was updated. If the service assessments are related to the governments’ principal operations, they should be coded in 340s as proceeds from sales of goods and services.
Revenue/Expenditure/Expense Accounts
36910, Sale of Scrap and Junk
The title was changed to Sale of Surplus and a definition was added.
Revenue/Expenditure/Expense Accounts
36950, Special Items
The account changed to account 385, Special/Extraordinary Items to better reflect the substance of the transaction [i.e., special items should not be classified as revenue] The account can be also used for extraordinary items, and the title was adjusted to reflect this.
Revenue/Expenditure/Expense Accounts
379, Capital Contributions
The account was removed since the capital contribution category is not applicable to cash basis governments. System development fees should be accounted for in 367, Contributions and Donations from Nongovernmental Sources unless the related costs of the physical connections, etc. are reported as current period expense – then the systems development fees should be reported as operating revenue (340s).
Revenue/Expenditure/Expense Accounts
380, Nonrevenues
The title of this section of the chart was changed to Other Increases in Fund Resources.
A new account 385, Special/Extraordinary Items was added [previously accounted for in 36950, Special Items – see above row for description].
The account 388, Prior Period Adjustments was changed to 38810.
Accounts 386 (1), Agency Deposits and 389, Other Nonrevenues were pooled and rearranged into:
38910, Refundable Deposits,
38920, Retainage Deposits,
38930, Agency Type Collections,
38940, Agency Type Deposits,
38960, Agency Type Interest Earnings, and
38990, Other Custodial Activities.
[Updated the definition of these codes to clarify that they should be used for custodial activities only – to record receipts and disbursements from fiduciary funds as well as any custodial activity reported in other fund types. Subaccount detail allows for reporting by major types of custodial activities in order to provide further clarity, align with internal tracking of custodial balances and support analysis.]
(1) The change applicable to the courts’ deposits and remittances was updated on March 14, 2017. The following BARS Alert was sent to all cities and counties at that time.
The BARS codes for agency deposits/remittances were revised this year and BARS account 386/586 was replaced by several 389/589 accounts. However, the recent submissions of the Schedule 01 indicate that this change creates some confusion. To avoid further misunderstanding at this time the Online reporting system will accept court related deposits and remittances coded as 386/586. All other non-court items should be coded to appropriate 389/589 accounts. We have updated the summary of significant changes in the BARS manual.
Revenue/Expenditure/Expense Accounts
51170, Lobbying Activities
New account. The lobbying services were excluded from account 51120, Advisory Services and are now reported separately.
[Lobbying expenditures are subject to specific compliance and reporting requirements, so governments need to separately track them. Also, the separation will allow cross-checking figure against PDC filings.]
Revenue/Expenditure/Expense Accounts
531, Storm Drainage Utilities
The account description was revised to ensure that this account is used only when a local government has a separate utility for storm drainage. The storm drainage projects that are an integral part of streets and roads should be accounted with transportation codes which are generally accounted for in governmental funds.
Revenue/Expenditure/Expense Accounts
580, Nonexpenditures
The title of this section of the chart was retitled to Other Decreases in Fund Resources.
A new account 585, Special/Extraordinary Items was added [previously accounted for in 36950, Special Items – see account 385 for description].
The account 588, Prior Period Adjustments was changed to 58810.
Accounts 586 (1) and 589, Other Nonexpenditures were pooled and rearranged into:
58910, Refunds of Deposits,
58920, Refund of Retainage,
58930, Agency Type Remittances,
58940, Agency Type Disbursements, and
58990, Other Custodial Activities.
(1) The change applicable to the courts’ deposits and remittances was updated on March 14, 2017. The following BARS Alert was sent to all cities and counties at that time.
The BARS codes for agency deposits/remittances were revised this year and BARS account 386/586 was replaced by several 389/589 accounts. However, the recent submissions of the Schedule 01 indicate that this change creates some confusion. To avoid further misunderstanding at this time the Online reporting system will accept court related deposits and remittances coded as 386/586. All other non-court items should be coded to appropriate 389/589 accounts. We have updated the summary of significant changes in the BARS manual.
ACCOUNTING
Deposits and Investments
3.2.1
Updated content to focus on an overview of requirements for deposits and investments and refer to the Office of State Treasurer’s Guide to Public Funds Investing for Local Governments publication for details.
Pension Liabilities
3.4.13.30
The Cash-Basis Pension - Illustration 1 spreadsheet has been updated with the 2016 PEFI collective pension amounts.
REPORTING
Fund Resources and Uses Arising from Cash Transactions (C-4)
4.3.12
The titles of subcategories were revised and the two sections below revenues and expenditures were rearranged to provide greater clarity and state-wide comparability. Also, a link was added to the checklist for preparation of financial reports.
Note X – Pension Plans
The pension note has been updated for the second year of pension reporting.
Liabilities (Schedule 09)
4.8.13.110
Added requirement for cities and counties to provide a BARS code for redemption and specific ID Numbers of debt related to streets/roads to accommodate the DOT Annual Street/Road Finance Report.
Assessment Questionnaire (Schedule 22)
For fiscal year 2016, all diking/drainage districts, cemetery districts, mosquito/pest/weed districts, TV reception districts and water conservancy boards are required to submit the Schedule 22.
ONLINE FILING
Annual Street/Road Finance Report
Steps added as a pilot project exploring an alternative to the DOT Annual Street/Road Finance Report.
