Our Services: Accounts Payable Accounts Receivable Accounting Business Office Capital Asset Accounting Cashier's Office Controls & Accountability Costing Policy & Analysis Education & Support Services Equipment Management Employee ID Card Program Extramural Funds Accounting Faculty Home Loan Program Financial System Document Help General Accounting Internal Control Materiel Management Payroll Project Management Office Student Accounting Systems Development Systems Operations Tax Accounting Tax Reporting & Compliance Training Information Travel & Entertainment

Feedback Comments, questions or
  suggestions? Let us know.

Home  ·  FAQ  ·  Forms  ·  Help  ·  Search

Accruals and Deferrals

In compliance with Generally Accepted Accounting Principles (GAAP) goods and services must be recorded in the year they were received or performed and income must be recorded in the same year as the expenses that generated the income. The Auxiliary Voucher - Accrual Entry (AVAE) is used to make these adjustments.

Our ledgers at year end represent part of the University of California’s financial standing at that point in time. If goods or services have been received on or before June 30th and have not been recorded in the ledgers as an expense it represents an unrecorded liability. In the fiscal close certification letter, Deans, Chairs and Business Officers certify that there are no material unrecorded liabilities.

The cost (either from the invoice or an estimate from the purchase order or the vendor) of goods and services equal to or over $10,000 received on or before June 30 of the current year must be recorded in the ledger as an expense, not just as an encumbrance. Goods and services supplied to external customers by June 30 of the current year where the invoice is equal to or greater than $10,000 and were not recorded in the current year ledgers must be accrued. Departments may accrue or defer items under $10,000, but should not accrue or defer anything under $1,000.

There are 4 types of accrual vouchers:

• Accrued Expense
• Accrued Income
• Deferred Expense
• Deferred Income

« Back to Fiscal Close page