The Appropriations, Segregations and Cost Centers (ASC) process is that step in the Financial Cycle where the spending limits authorized by the Legislature and /or the Division of Budget are set up in the Central Accounting System (CAS).  It also includes the establishment of detailed agency plans which will enable agency management to measure the performance of individual work units.

     The ASC process provides management control at three distinct levels.  These levels are described below:

• Legislative Control is provided by the appropriations contained in the Budget Bill.  Appropriations are authorizations by the Legislature to spend money.  They included limits on the amounts which may be spent and the purposes for which the money may be spent.  The system strictly controls the money spent during the year for an appropriation.  The system will not allow spending for a given purpose to exceed the amount appropriated. 
• Executive Control is provided by the segregation s made by the Division of Budget (DOB).  Segregations are the authorization to expend part or all of an appropriation.  The system provides the same control for segregations as it does for appropriation.  The system will not allow spending to exceed the amount segregated.

           DOB also controls spending through the use of appropriation 
           interchanges and apportionments. Both an interchange and 
           apportionment transfers spending authorization from one area
           to another.  The amount and type of such transfers which can 
           be effected without legislative approval is restricted by law.
           
           The final control available to DOB is the expenditure limit.  An 
            expenditure limit is a spending ceiling set up on a group of 
            segregations.  The system will not allow expenditures for the 
            group to exceed the specified ceiling. 

• Agency Administrative Control is available for agency management through the use of cost centers.  Cost Center Profiles are the characteristics of individual units in agencies incurring expenses and receiving revenue.  Cost Center Plans are used by agency managers to monitor the performance of these units.  While these plans do not serve to directly control expenditures (as do appropriations and segregations), they do provide a basis for management reports which can direct the attention of the agency's management to potential problem areas.

     The following pages discuss the individual documents used in the ASC process.  Included is a description of each document and the procedures associated with each document.  

APPROPRIATIONS

    Appropriation documents are used to establish and update the appropriations within the system.  An appropriation is an authorization by the Legislature  to spend for specific purposes.  Generally an appropriation becomes available at the beginning of the State's fiscal year (April 1) and becomes unavailable, except for commitments already made, at the close of the State's fiscal year (March 31). Appropriations which have commitments against them continue to be available until the following June 30 (General Fund or September 15 (all other funds).  On that date, the appropriations lapse and no further payments may be made against them.

     The Office of the State Comptroller (OSC) is responsible for monitoring expenditures and encumbrances during the year to assure that appropriation amounts are not exceeded. 

     There are two types of Appropriation Documents:  The Appropriation Add/Delete (AC1331) and the Appropriation Change (AC1331A).  The Appropriation Add/Delete records such authorized actions as:

• the establishment of a new appropriation
• the deletion of an existing appropriation.  An appropriation may be deleted only if there are no segregations in the system for the appropriation. 

The Appropriation Change records such authorized actions as:

• an increase to an existing appropriation.
• a decrease to an existing appropriation.
• the repeal of an existing appropriation. 
• the reappropriation of an existing appropriation
• a change to the appropriations attributes.  Appropriation attributes may be changed only if there are no segregations in the system for the appropriation.

     Appropriation Documents are completed by the ASC unit within OSC.   The primary source of information used in preparing these documents is the Budget Bill.  After the documents are prepared, they are batched, and entered into the system. 

     At the end of each year, the system automatically creates batches of new appropriation records based on the  appropriations entered during the previous year.  The system prints a report which lists these appropriations and provides a space for writing in the new year's dollar amounts.  Using the Budget Bill as its source of information, the ASC unit can write the appropriated dollar amounts on the report, and use this report as an input document.  This eliminates the need to complete an Appropriation Document for those new appropriations which have the same attributes except for year and lapse date as those authorized last year. 

SEGREGATIONS 

     A Segregation is the authorization issued by DOB to expend part or all of an appropriation.  This authorization comes to OSC via a Certificate of Approval (Budget Certificate).  Expenditures and encumbrances may then be controlled to assure the limits are not exceeded. 

     The Budget Certificate is the document which directs OSC to :

• create a new segregation
• increase an existing segregation
• decrease an existing segregation
• delete an existing segregation
• change the attributes of an existing segregation

     The Budget Certificate provides OSC with the information needed to complete the two page Segregation document.  The Segregation Document is used to enter these authorized actions in the system.

     This document is two parts-the Appropriation ID page  (AC1332A), and the Segregation Detail page (AC1332).  The Appropriation ID page is necessary because it is the key to the segregation detail records.  The Segregation Detail page is the input document use to establish and update segregation detail records. 

     The Segregation Document is prepared by  the ASC unit within OSC. After the documents are prepared, they are batched, and entered into the system

     At the end of each year, the system automatically creates batches of new segregation records based on the segregations entered during the previous year.  The system prints a report which lists these segregations and provides space for writing in the new year's dollar amounts.  ASC can write the New Year segregated amounts on the report and send it to data entry as an input document. This eliminates the need to complete the Segregations Document for those segregations which have the same  attributes as those authorized in the past. 

     The time limit for a segregation is the same as the time limit for the related appropriation.  The lapsing date is the date after which no more money can be spent from an appropriation and its segregations. 

INTERCHANGES

     Interchanges and apportionments are transfers of part of an authorized spending amount from one appropriation to another.  An interchange is a transfer between appropriations contained on the same schedule in the Budget Bill.  A schedule usually consists of a list of appropriations for a single agency.  With the approval of the Director of Budget, the agency may transfer, or interchange, an amount from one appropriation to another within the schedule.  The total amount for any appropriation in the schedule, however, may not be increased or decreased by more than the total of 5% of the first five million dollars, 4% of the second five million dollars and 3% of the amount in excess of ten million dollars in the appropriation. 

     An apportionment  is a transfer of part of an appropriation from one state agency to another.  Unlike interchanges, apportionments can be made  between appropriations on different schedules in the Budget Bill.  The Budget Bill specifies the particular appropriations which may be apportioned. 

     A Budget Certificate provides OSC with the information needed to complete a Interchange/Apportionment Document (AC2390).  This documents is used to enter interchanges and  apportionments into the system. It always must have a net total of zero.  It is prepared by the ASC unit within OSC.   After documents are prepared, they are batched, and entered into the system.

     Many times before an interchange transaction can be processed, a segregation record must first be decreased.  This is accomplished by completing and processing the two page Segregation Document prior to processing the Interchange/Apportionment Document.  

     When processing an apportionment, it may be necessary to create a new appropriation record to receive the apportionment.  If so, Appropriation Add/Delete should be used to create a new appropriation record prior to processing the Interchange/Apportionment Document. 

EXPENDITURE LIMITS

     An additional spending control which is available to DOB is the Expenditure Limit.  This limit is placed on a group of segregations within an agency to control the encumbrances and expenditures against the segregations. The Expenditure Limit Document (AC2388) is used to enter the authorized expenditure limit information in the system. 

     The Expenditure Limit Document can be used to record such actions as :

• the creation of a new expenditure limit.  
• the deletion of an expenditure limit.
• a change in an expenditure limit.

     Expenditure Limit Documents are completed by the DOB.  After the documents are completed, they are batched and reviewed  within DOB.  The signed Expenditure Limit Document is the authorization for the expenditure limit to be entered into the system.  The document is logged-in at OSC, it is reviewed and entered in the system.  Reporting provides DOB with information about spending in relation to the expenditure limits. 

     At the end of each year a Create New Year Limit batch program can be run either before the Create New Year Appropriation, Segregation and Cost Center Batch Programs, or after the posting of the New Year Appropriation, Segregation, Cost Center batch programs.  A report is generated which lists the limits, places high values in the limit amount, and zeros in the year-to-date field.  DOB can correct this report and return it to OSC for input in the system.  This eliminates the need to prepare the Expenditure Limit documents and the Segregation Documents each year. 

ROLL-UP TABLES

     The Roll-Up Tables are the hierarchical relationships in the management reporting trees  The Roll-Up Table Maintenance Document (AC2403) is the authorization issued by an Agency and DOB, for OSC to enter the 'Reports to Unit Number' in the system.  These 'Reports to Unit Number'  begin with the cost center number at the bottom of the reporting tree, and point to the next level in the reporting tree.  The second level then points to the third and so on. 

     The Roll-Up Table Maintenance Document provides information to change the fund, organization, program and project hierarchies in the following ways:

• add a reporting level
• change the 'Unit Description' or 'Reports to Unit Number'.
• delete a reporting level.

                                       ROLL-UP TABLE FLOW

      The Roll-up Table Maintenance Documents are completed by agencies.  After the documents are completed, they are batched and sent to DOB.  DOB reviews and authorizes the document, and sends the batch to OSC for log-in, review and data entry.  The approved Roll-up Table Maintenance Document is the authorization for OSC action. 

     Once the Roll-Up Tables are established they continue to exist year after year, unless a delete action is initiated by the originating agency. 

COST CENTER PROFILES

      A cost center is typically an organizational unit which works to fulfill specific program goals.  The cost center unit is also the lowest accounting level to which a revenue is credited or expenditure is charged.  After revenues or expenditures are recorded against a cost center they are then 'rolled up' the organization, program and project tables for responsibility purposes.  In addition to pointing to the roll-up table attributes, cost centers point to the appropriations and segregations to be charged with the expenditures. 

     The Cost Center Profile Document provides the information needed to record these authorized actions:

• the establishment of a new cost center. 
• a change to an existing cost center. 
• the deletion of an existing cost center. 

                  COST CENTER PROFILE DOCUMENT FLOW

     Cost Center Profile Documents are completed and batched by the agencies.  They are sent to DOB for review and approval.  DOB sends the batch to OSC for Log-IN and data entry.  The signed Cost Center Profile Document is the authorization for OSC action.

     At the end of each year, the system creates batches of cost center profile records which existed during the previous year.  This eliminates the need to complete Cost Center Profile Documents for those cost centers which existed during the previous year and would be established during the new fiscal year based on new year appropriations and segregations.  (See Cost Center Profile Year End procedure  9.4300.)

COST CENTER PLANS

     A cost center is an unique combination of organization, fund, program and project, to which revenues are credited and expenditures are charged. 

     Cost Center Plans are management's estimates of how much will be expended by cost centers to meet program goals.  Cost Center Plans, like cost center expenditures, are rolled up the reporting hierarchies.  Variances from plans are therefore provided for each cost center and each reporting attribute (unit on a roll-up table).

     The Cost Center Plan Document (AC1234) is used to record management's estimates of cost center expenditures.  It can be used to enter the amounts at the beginning of the fiscal year or to change the amount already entered.

                     COST CENTER PLAN DOCUMENT FLOW

     Cost Center Plan Documents are completed by the agency.  The documents are then batched and sent to data entry and entered in to the system.

     It should be noted that the Cost Center Plan Document is only used for entering planned amounts for an existing cost center.  The planned amounts for a new cost center can only be entered after that cost center is created using the Cost Center Profile Document.