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.
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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.
A governmental accounting system should be organized and operated on a fund basis. A fund is defined as a fiscal and accounting entity with a self-balancing set of accounts recording cash and other financial resources, together with all related liabilities and residual equities or balances, and changes therein, which are segregated for the purpose of carrying on specific activities or attaining certain objectives in accordance with special regulations, restrictions, or limitations.
Basis of accounting refers to when revenues and expenditures are recognized and reported in the financial statements.
Revenues are recognized only when cash is received and expenditures are recognized when chargeable against the report year’s budget appropriations as required by state law. This generally results in revenues being recognized when delivered to the government or government’s agent and expenditures being recognized when paid. Warrants and checks are considered paid when issued. An exception to expenditure recognition would be during any open period after the close of the fiscal year when expenditures can be charged against the previous period for claims incurred in the previous period. Open periods are required by statute for cities (RCW 35.33.151 and RCW 35A.33.150) and allowed for counties (RCW 36.40.200). Special purpose districts which use the county or a city as their treasurer may use the same open-period as their treasurer. If a district acts as its own treasurer, no open period is allowed by statute.
Revenues and expenditures should be reported at gross amounts by account and not netted against each other.
Revenues and expenditures should be recognized for all receipts and payments of a government’s resources, including those where the cash is handled by an agent (such as a bank, underwriter, etc.) on behalf of the government rather than handled directly by the local government. For example, debt proceeds wired directly to an escrow account, payments by the State Treasurer’s Office to vendors for items purchased with LOCAL resources, etc.
Interest earned on investments may be recognized at cost, amortized cost or fair value in accordance with the government’s disclosed accounting policy.
In addition, revenue and expenditures should also be recognized when the government agrees to forgo revenue in exchange for reduction of expenses (offsetting agreement) or receipt of an asset (e.g., acquiring an asset in exchange for reduced permit fees, etc.). In such cases, the transaction should be recorded as if the cash was received and expended in order to reflect the legal transaction.
This basis results in no reported assets other than cash and investments and no reported liabilities. For example, purchases of capital assets are expensed during the year of acquisition without any capitalization of capital assets or allocation of depreciation expense. However, please be aware that certain liabilities should be reported on Schedule 09 and in the notes in financial statements.
In fund financial statements, governments should report governmental, proprietary, and fiduciary funds to the extent that they have activities that meet the criteria for using these funds.
Presented below is a system to classify all funds used by local government and the assignment of code numbers to identify each type of fund. A three digit code is used: the first digit identifies the fund type and the next two digits will be assigned by the governmental unit to identify each specific fund.
Since counties account for special purpose districts in their accounting systems as agency funds, they often provide the districts with reports showing assigned fund codes 630-699. These codes refer to the fund from the county perspective. A district has to “reassign” the county code to the code appropriate to the fund type it is reporting (e.g., if the district’s general fund is coded in the county records as 663, the district in its annual report has to code this fund as 001).
For reporting purposes local governments are required to follow the described below fund structure. However, the local governments may create other funds for accounting or managerial purposes. When preparing external financial reports, those accounting or managerial funds should be rolled to appropriate fund types (e.g., there should be only one general fund or if an entity accounts separately for operating, capital or/and debt activities of its proprietary function, those activities should be rolled up into the appropriate enterprise fund, etc.)
Code 000 - General (Current Expense) Fund – should be used to account for and report all financial resources not accounted for and reported in another fund. For reporting purposes the local government can have only one general fund.
Although a local government has to report only one general fund in its external financial reports, the government can have multiple general subfunds for its internal managerial purposes. These managerial subfunds have to be combined into one general fund for external financial reporting.
Code 100 - Special Revenue Funds – should be used to account for and report the proceeds of specific revenue sources that are restricted or committed to expenditure for specific purposes other than debt service or capital projects. Restricted revenues are resources externally restricted by creditors, grantors, contributors or laws or regulations of other governments or restricted by law through constitutional provisions or enabling legislation. Committed revenues are resources with limitations imposed by the highest level of the government (e.g., board of commissioners, city council, etc.) through a formal action (resolution, ordinance) and where the limitations can be removed only by a similar action of the same governing body. Revenues do not include other financing sources (long-term debt, transfers, etc.).
The term proceeds of specific revenue sources establishes that one or more specific restricted or committed revenues should be foundation for a special revenue fund. They should be expected to continue to comprise a substantial portion of the inflows reported in the fund. It is recommended that at least 20 percent is a reasonable limit for restricted and committed revenues to create a foundation for a special revenue fund. Local governments need to consider factors such as past resource history, future resource expectations and unusual current year inflows such as debt proceeds in their analysis.
They may use the calculation below to determine whether an activity would qualify for reporting as a special revenue fund.
Other resources (investment earnings and transfers from other funds, etc.) also may be reported in the fund if these resources are restricted, committed, or assigned (intended) to the specific purpose of the fund.
Governments should discontinue reporting a special revenue fund, and instead report the fund’s remaining resources in the general fund, if the government no longer expects that a substantial portion of the inflows will derive from restricted or committed revenue sources.
All revenues have to be recognized in the special revenue fund. If the resources are initially received in another fund, such as the general fund, and subsequently remitted to a special revenue fund, they should not be recognized as revenue in the fund initially receiving them. They should be recognized as revenue in the special revenue fund from which they will be expended. So, the local governments can either receive resources directly into the special revenue fund, or account for the resources as agency deposits in the receiving fund and, after remitting them, recognize them as revenue to the special revenue fund.
Special revenue funds should not be used to account for resources held in trust for individuals, private organizations, or other governments.
The state statutes contain many requirements for special funds to account for different activities. The legally required funds do not always meet standards for external reporting. So, while the local governments are required to follow their legal requirements, they will have to make some adjustment to their fund structure for external financial reporting.
Code 200 - Debt Service Funds – should be used to account for and report financial resources that are restricted, committed, or assigned (intended) to expenditure for principal and interest. Debt service funds should be used to report resources if legally mandated. Financial resources that are being accumulated for principal and interest maturing in future years also should be reported in debt service funds. The debt service transactions for a special assessment for which the government is not obligated in any matter should be reported in an agency fund. Also, if the government is authorized, or required to establish and maintain a special assessment bond reserve, guaranty, or sinking fund, it is required to use a debt service fund for this purpose.
Note: Debt service funds should not be used in proprietary funds (400 and 500). Use enterprise funds (400) or internal service (500) for debt payments related to utilities and other business type activities.
Code 300 - Capital Projects Funds – should be used to account for and report financial resources that are restricted, committed, or assigned (intended) for expenditure for capital outlays including the acquisition or construction of capital facilities or other capital assets. Capital outlays financed from general obligation bond proceeds should be accounted for through a capital projects fund. Capital project funds exclude those types of capital-related outflows financed by proprietary funds or for assets that will be held in trust for individuals, private organizations, or other governments (private-purpose trust funds).
Note: Capital project funds should not be used in proprietary funds (400 and 500). Use enterprise funds (400) or internal service (500) for capital payments related to utilities and other business type activities.
Code 700 - Permanent Funds – should be used to account for and report resources that are restricted to the extent that only earnings, and not principal, may be used for purposes that support the reporting government’s programs – that is for the benefit of the government or its citizens (public-purpose). Permanent funds do not include private-purpose trust funds which account for resources held in trust for individuals, private organizations, or other governments.
Code 400 - Enterprise Funds – may be used to report any activity for which a fee is charged to external users for goods or services. Enterprise funds are required for any activity whose principal revenue sources meet any of the following criteria:
Debt backed solely by a pledge of the net revenues from fees and charges.
Legal requirement to recover cost. An enterprise fund is required to be used if the cost of providing services for an activity including capital costs (such as depreciation or debt service) must be legally recovered through fees or charges.
Policy decision to recover cost. It is necessary to use an enterprise fund if the government’s policy is to establish activity fees or charges designed to recover the cost, including capital costs (such as depreciation or debt service).
These criteria should be applied in the context of the activity’s principal revenue source.
The term activity generally refers to programs and services. This term is not synonymous with fund. As a practical consequence, if an activity reported as a separate fund meets any of the three criteria, it should be an enterprise fund. Also, if a “multiple activity” fund (e.g., general fund) includes a significant activity whose principal revenue source meets any of these three criteria, the activity should be reclassified as an enterprise fund.
The determination of an activity’s principal revenue source is a matter of professional judgement. A good indicator of the activity’s significance may be comparing pledged revenues or fees and charges to total revenue. For example, consider a county auditor’s office that charges fees to provide a payroll service to various taxing districts. Even if the fee is meant to cover the cost of the service, the county auditor function as a whole is primarily supported with tax dollars from the general fund. It would be allowable in this case to leave the activity all within general fund.
Finding an appropriate fund type requires a careful analysis since there is not always a clear choice. For example, building permit fees may be accounted for in the general fund or a special revenue fund in certain circumstances, such as when they are partially supported by taxes. However, if there is a pricing policy to recover the cost of issuing those individual building permits, they should be reported in an enterprise fund.
Separate funds are not required for bond redemption, construction, reserves, or deposits, for any utility. If separated, use 400 series number. Separate funds are not required even though bond covenants may stipulate a bond reserve fund, bond construction fund, etc. The bond covenant use of the term fund is not the same as the use in governmental accounting. For bond covenants, fund means only a segregation or separate account, not a self-balancing set of accounts.
Local governments may separate operating, capital projects and debt functions of enterprise funds. However, when reporting such proprietary activities, all those functions should be contained in one fund.
Code 500 - Internal Service Funds – may be used to report any activity that provides goods or services to other funds, departments or agencies of the government, or to other governments, on a cost-reimbursement basis. Internal service funds should be used only if the reporting government is the predominant participant in the activity. Otherwise, the activity should be reported in an enterprise fund. Cash basis special purpose districts (such as a fire or water district) should not use the internal service fund category.
Note: When calculating the predominant participant, purchases from fiduciary funds would be considered part of the reporting government’s activity, but the BARS coding would still be to an external customer.
If activity is determined to be fiduciary, the funds should be reviewed for trust arrangements and equivalents. The three criteria for determining if a fiduciary activity is a trust are:
The government itself is not a beneficiary
Dedicated to providing benefits in accordance with the benefit terms
Code 600 - Fiduciary Funds – should be used to account for assets held by a government in a trustee capacity or as a custodian for individuals, private organizations, other governmental units, and/or other funds. These include (a) investment trust funds, (b) pension (and other employee benefit) trust funds, (c) private-purpose trust funds, and (d) custodial funds.
Code 600-609 - Investment Trust Funds – should be used to report fiduciary activities from the external portion of investment pools and individual investment accounts that are held in a trust or equivalent that meets the criteria above.
In addition to the trust criteria requirements above, all individual investment accounts are required to be reported in an Investment Trust Fund.
Code 610-619 - Pension (and Other Employee Benefit) Trust Funds – should be used to report fiduciary activities for pension plans and OPEB plans that are administered through qualifying trusts. Qualifying trusts are those in which:
Contributions to the plan, and earnings on those contributions, are irrevocable. Pay-as-you-go plans do not qualify because they are “payments,” not contributions.
Plan assets are dedicated solely to providing benefits to plan members in accordance with the benefit terms. Different plans (for example a pension and an OPEB plan) cannot be commingled in the same trust. The assets must be partitioned for specific plans.
Plan assets are legally protected from creditors.
If you are acting as administrator for someone else’s pension/OPEB plans, the plans still must meet the criteria above to be reported in a trust fund.
Code 620-629 - Private-Purpose Trust Funds – should be used to report all fiduciary activities that (a) are not required to be reported in pension (and other employee benefit) trust funds or investment trust funds, and (b) are held in a trust that meets the following criteria: the assets are (a) administered through a trust or equivalent that meets the criteria above.
Code 630-698- Custodial Funds – should be used to report all fiduciary activities that are not required to be reported in pension (and other employee benefit) trust funds, investment trust funds or private purpose trust funds. The external portion of the investment pools that are not held in trust that meets criteria listed above should be reported in a separate external investment pool fund column under the custodial funds classification.
Note: The custodial funds are required to be used by business-type activities and enterprise funds, except when the resources will normally be held for less than ninety (90) days.
Code 699 - External Investment Pool Fund – The external portion of the investment pools that are not held in trust and meet criteria listed above. Although this is considered a custodial fund, it should be reported in a separate external investment pool fund column under the custodial funds classification.
Governments should establish and maintain those funds required by law and sound financial administration. Only the minimum number of funds consistent with legal and operating requirements should be established. Using numerous funds results in inflexibility, undue complexity, and inefficient financial administration.
Local governments should periodically undertake a comprehensive evaluation of their fund structure to ensure that individual funds that became superfluous are eliminated from accounting and reporting.
Elected officials should be educated to the fact that accountability may be achieved effectively and efficiently by judicious use of department, program and other available account coding or cautious use of managerial (internal) funds.
3.1.7.70 Budgeting, budgetary control and budgetary reporting
a. An annual/biennial budget must be adopted by every government. b. The accounting system should provide the basis for appropriate budgetary control. c. Budgetary comparisons must be included in the appropriate financial statements and schedules for funds for which an annual/biennial budget has been adopted.
3.1.7.80 Transfer, revenue and expenditure account classifications
a. Interfund transfers, proceeds of general long-term debt issues and material proceeds of capital asset disposition should be classified separately from fund revenues and expenditures. b. Governmental fund revenues should be classified by fund and by the sources indicated in BARS Account Export. Expenditures should be classified by fund and by the categories indicated in BARS Account Export. c. Proprietary fund revenues and expenses should be classified in essentially the same manner as those of similar business organizations, functions, or activities.
a. Appropriate interim financial statements and reports of operating results and other pertinent information should be prepared to facilitate management control of financial operations, legislative oversight, and, where necessary or desired, for external reporting purposes. (RCW 35.33.141, RCW 35A.33.140 and RCW 36.40.210)
Expenditures of State Financial Assistance (Schedule 15)
4.8 SAO Annual ReportSchedules
4.8.16 Expenditures of State Financial Assistance (Schedule 15)
4.8.16.10 List on this schedule expenditures from grants received directly or indirectly from state agencies (334). Expenditures from state shared revenues and entitlements (BARS resource codes 335 and 336) do not need to be included on this schedule. List together all expenditures from grants received from the same state agency.
4.8.16.20 If the government receive state-funded equipment, supplies, or real property, report the fair value in the year received.
4.8.16.30 State-funded loans do not need to be reported on this schedule. Be sure that any loans received from state agencies are not actually federal in origin. In such a case, a federal loan passing through a state agency should be reported in the federal schedule.
4.8.16.40 Any payments that the entity receives as a fee for services in a vendor capacity should not be included on the Schedule 15.
Instructions to preparer:
4.8.16.50Often federal financial assistance received indirectly is a mix of federal or state money. If possible, identify the different sources and list them on appropriate schedules (i.e., the federal share on the Schedule of Expenditures of Federal Awards and the state portion on the Schedule of State Financial Assistance. If the state portion cannot be identified, list the entire amount on the Schedule of Expenditures of Federal Awards and describe the commingled nature of the funds in the notes to the Schedule of Expenditures of Federal Awards.
4.8.16.60 Local governments are required to update the incorrect financial data submitted on this schedule. The requirement applies to all errors found prior or during an audit.
Column 1 Provide the name of the grantor agency. Please clearly distinguish between agencies with similar names or initials.
Column 2 Provide the name of the each program for that agency.
Column 3 Use this column to report grant, contract or award numbers assigned by state agencies. If a number is not available, write NA.
Column 4 Use this column to report current year expenditures (determined on the same basis of accounting as the financial statements).
4.8.16.70 The template for Online Filing is available on SAO’s website page, BARS Reporting Templates. When using the Online Filing option, the system will create the Schedule based on data provided by the local government on the template. See attached example of the final version of the Schedule of State Financial Assistance.
344.71 (Transits, Railroads and Other Transportation Systems Services)
344.71 New Code - Include private vanpool charges, streetcar and monorail fares, disabled/aging transportation fees, etc. For cities/counties: this code is not reported on the road/street report to WSDOT.
369.70 (Pension/OPEB Contributions) Should only be used for contributions made to a pension/OPEB plan administered by the reporting government. Not for use in the fiduciary funds.
547.10 (Transits, Railroads and Other Transportation Systems Services)
547.10 New Code - This account should be used only if the local government operates its own, or with other governments, transit, railroad or other transportation system. These expenditures are related to public transportation. For cities/counties: this code is not reported on the road/street report to WSDOT.
Internal Service Funds - Added guidance on accounting for internal service funds providing services to fiduciary funds and the use of internal service funds at special purpose districts.
3.4.18.30, 3.4.18.45, 3.4.18.50 Added clarifications on reporting non-environmental asset retirement obligations and what can cause an asset retirement obligation
3.7.1 Changed title to Federal Awards to include all items that must be reported on the Expenditures of Federal Awards (Schedule 16). Updates, changes, and clarifications for reporting awards made throughout.
Added Footnote 2 for no activity governments reporting, no formal Schedule 22, but the government must attach bank statements and any meeting minutes for the fiscal year. 4.1.6.20 Clarified instances where special purpose districts do not need to prepare financial statements. 4.1.6.25 Updated the definition for no financial activity to include small automatic bank fees and SAO audit billings.
4.8.14.10 Added clarification that governments who file a no activity report will not be required to submit a formal Schedule 22, but will need to submit supporting documents.
Added Quick Links to specific guidance 4.14.5.70 Added additional information on COVID-19 Expenditures including donated personal protective equipment purchased with COVID-19 federal financial assistance, COVID 19 Vaccines - Immunization Cooperative Agreements CFDA #93.268, Provider Relief Fund (PRF) CFDA #93.498 4.14.5.155 Moved and retitled 4.14.5.230 to Preparing the preformatted SEFA template for upload to Online Filing 4.14.5.180 Added yellow flag caution under column 4 instructions. 4.14.5.230 Changed to example of finalized Schedule of Expenditures of Federal Awards.
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. OPEB liability reporting on the Schedule 09 required in 2019.
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, in the notes to the financial statements. [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.
