Finance Glossary

Account Assignment Model
An account assignment model is a reference for document entry. It can contain any number of account items that may be left incomplete. During document entry you can change, add to, or delete the proposed data. You can also call up any number of account assignment models and switch from a model to standard item entry procedure and back again. You can also assign equivalence numbers to account assignment models (i.e., utility bills shared across agencies). In this case, you simply enter a total amount that is then distributed to the items within the model according to set ratios.

Account Balance
Account balance is a representation of business transactions posted to an account in summary form. It is separated according to posting periods, debits, and date created. In addition, the balance of the posting period and the cumulative balance of the account are generated.

Account Sets
Account sets are groups of G/L accounts within the Chart of Accounts.

Accounting Document
AASIS stores transactions in an electronic form called a document. An accounting document records financial information for each transaction that occurs in AASIS.

Activity Types
Activity types can be utilized by many cost centers. An activity type is a standard rate to charge costs as a per unit charge (e.g., labor rate for plumbers).

Arrears
A term used to describe an account that is not current.

Asset Class
Fixed Assets are categorized into asset classes, for example, vehicles, furniture, machines.
Asset classes may include:
· Assets under Construction (AuC)
· Low-value assets
· Leased assets
· Financial assets
· Technical assets
Each asset master record must be assigned to one asset class. The asset class controls account postings.

Asset Document
An asset document is proof of a business transaction. Asset documents are a representation of the original document in the AASIS system.

Asset Under Construction (AuC)
An AuC is an asset that is in the process of being constructed (e.g., a building or road).
An AuC is a temporary asset and will not be depreciated. It will be distributed and settled in another transaction when the asset has been completed. Upon settlement, it will be capitalized and begin depreciating.

Balance Sheet
Balance sheet is an accounting statement of the organization at a specific time.

Blocked Status
A condition of material whereby it is unavailable for movement or allocation or reservation.

Blocking/ Unblocking
Blocking / Unblocking disallows or allows postings to G/L and A/P accounts.

Budget Control
Transactions entered in AASIS will check for budget. If budget is exceeded at the time the transaction is entered, an error will be issued and prevent the transaction from posting.

Budget Quad
Term used to represent the four elements of Budget Control. These elements are: Fund, Funds Center, Functional Area, and Commitment Item.

Capital Lease
Leases can be operating or capital. A capital lease is an asset that is on the books and is depreciated. It is an asset that is either intended to be purchased or used long enough that its residual value at the end of the lease is very low.

Capitalization
Capitalization is the posting procedure that established the fixed assets balance on the balance sheet.

Cash Journal
The cash journal is a bank accounting subledger for the management of cash in business. It supports posting cash receipts and payments. The cash journal can be used independently of other posting transactions.

Chart of Accounts (COA)
The Chart of Accounts (COA) is the systematically organized list of all the General Ledger account master records that are required in a company code. The COA contains the account number, name, and control information for General Ledger account master records.

Clearing Process
A procedure where open items in an account are marked cleared. You can clear open items if you can assign an amount of equal value to the opposite side of the account (debit or credit). The resulting balance of the items is zero.

Commitment Item
A commitment item equals a character code, which is a further breakdown of an agency’s appropriation and will be used in budget/actual variance reporting. It is one of the four elements of the Budget Quad that establishes budget control.

Contract/Outline Agreement
A legal agreement between the state and a vendor with the intent to procure materials or services of estimated quantity and known price.
Current term: Term Contract.

Cost Allocations
Methods of allocating costs from sender to receiver cost objects.

Cost Center
Master record organization unit that represents the operating structure, performance-based budgeting, cost pools and associated funding. They represent a defined location of cost incurrence.

Cost Elements
Cost elements describe the origin of costs. They are a master record description of revenues and expenditures. Cost elements are defined as either primary or secondary.
Primary cost elements are master record descriptions of revenues and expenditures. They have a one to one relationship with G/L accounts.
Secondary cost elements are master record descriptions of allocations used only in the Controlling module. They have no relationship to G/L accounts.

Cost Object
A cost object is a project, cost center or internal order.

Cycle Counting
A method of physical inventory where inventory is counted at regular intervals within a fiscal year.
These intervals (or cycles) depend on the cycle counting indicator (ABC indicator) set for materials. Cycle counting allows fast-moving items to be counted more frequently than slow-moving items.

Delivery Completion Indicator
This is a field value in the goods receipt process that, if selected, will indicate the delivery for a particular purchase order item is complete.

Depreciation
The asset master record contains the depreciation terms. The depreciation method is determined according to the asset class. The depreciation method is straight line. The Asset Manager determines the useful life when they create the asset record.
Depreciation is posted automatically on a monthly basis. There are 24 depreciation periods per year.

Document
The AASIS system records at least one electronic document for every business transaction. Each document receives a unique document number. The document remains as a complete unit and can be displayed at any time until it is archived.

Document Principle
AASIS stores transactions in electronic documents. Thus, each time you post transactional data, you are creating or maintaining documents.
A document is composed of a document header and line items. Each posting (document) must have at least the following information: document and posting dates, document type, company code, currency, posting keys, account numbers, and amounts. A document must balance before it is posted: that is, the debit amounts must equal the credit amounts.
Each posting receives a unique document number. Document numbers provide the audit trail for all transactions within AASIS.

Document Types
Document types are used to manage accounting documents in AASIS. The document type controls the document header and is used to differentiate the business transactions to be posted (for example, customer invoice, vendor payments, etc.). Documents can be viewed, sorted, and archived by document type.

Dunning
When a customer neglects to settle their account on time, a reminder note is sent requesting payment. In AASIS, this reminder is referred to as a dunning notice.
Effective Price
Price calculated taking into account all existing pricing conditions (e.g. taxes, delivery costs, and discounts). Also known as the net price.

Fixed Asset
A fixed asset is any non-inventory item that agencies must control.
Fixed assets include:
· Capitalized Assets - assets with a value of more than $1000 and a useful life of one year or more (e.g. Land, Buildings, Equipment, Land Improvements and Infrastructure)
· Controlled Assets - low dollar fixed assets that are easily accessible (e.g. cellular phones, handguns)
· Intangible Assets (e.g. patents, licenses, purchased software)
· Leased Assets

Functional Area
A Functional Area represents a CAFR program, as well as lower level programs as defined by agency needs. It is one of the four elements of the Budget Quad that establishes budget control.

Fund
A Fund represents Cash and Treasury Funds. The current comparison is to the fund, sub-fund, and sub-sub-fund structure. Each Fund in AASIS is an independent master data record and is one of the four elements of the Budget Quad that establishes budget control.

Funds Center
A Funds Center represents the purpose described in the appropriation act and is one of the four elements of the Budget Quad that establishes budget control.

Funds Management
The task of Funds Management is to budget all relevant revenues and expenditures for individual areas of responsibility and to control future funds movements according to the distributed budget, as well as preventing the budget from being exceeded.

General Ledger
The General ledger (G/L) serves as a complete record of all business transactions. This integral part of the Financials system is integrated with all relevant financial operations. Financial data is entered into AASIS and posted to the general ledger immediately.
The General Ledger is a financial accounting ledger that is defined for generating closing reports as required by law. The balance sheet and the income statement are based on the General Ledger.

Goods Movement
A transaction of materials that causes a change in inventory. The movement can be physical or status driven.

Goods Receipt
A goods receipt is a document in AASIS that acknowledges the receipt of a material or service from a supplier, other agency locations, or any outside contractors. This document is one of the three documents in the three-way match concept that must be recognized in the system in order for a vendor to be paid. The other two documents are the purchase order and the vendor’s invoice.
It is on the goods receipt that the Agency Goods Receipt Technician indicates the acceptance of the quantity and quality. AASIS will then automatically match this information with the purchase order and the vendor invoice before the payment can be made.
A goods receipt generates an expense against a funds center.

GR (Goods Receipt) Blocked Stock
Stock type in which materials that may be subject to conditional acceptance and not yet placed in final storage may be recorded into. ”GR blocked stock" is not yet regarded as part of the receiving company's own stock, but is tracked in the purchase order history.

GR/IR Clearing Account
The GR/IR account is a general ledger account that includes postings for goods received but not yet invoiced, and also postings for goods invoiced but not yet received.

Industry Sector
The industry sector indicates the branch of the industry in which the material will be used.

Info Record
Info records are unique records of particular vendor/material combinations. The info record contains data such as prices and conditions, the number of the last purchase order, tolerance limits, and planned delivery time (lead time) required by the vendor to deliver the material.

Intangible Asset
Intangible assets are considered fixed assets. They include:
· patents
· licenses
· purchased software
· goodwill

Internal Order
An internal order is a small or short-term job. They are like projects, just smaller. Internal orders are used as accumulators for temporary costs that may then be allocated to other cost objects.

Internal Order Plan
An internal order plan is a detailed budget to help track and report financial activity.

Inventory
An inventory in AASIS is all stock or items used to support production, maintenance, repair, and customer service. Inventory represents all things used to generate revenue such as rental capital assets, serialized materials, expensed materials, spare parts, and production materials held on the factory floor.

Inventory Management
Inventory management involves the maintenance of stock levels.

Inventory Materials
Inventory materials are stocks used to support production, maintenance, repair, and customer service.

Invoice Verification
Invoice verification is the entry and checking of incoming vendor invoices. Vendor invoices are compared with the purchase order and the goods receipt, and are checked for content, price, and quantity.
This is also referred to as a “Three-way Match.”

Journal
A list of all postings for a period, which can be generated at any time.

Journal Entry
A standard G/L journal entry is an ad hoc financial transaction triggered by a business event.

Ledger
Ledger is the framework containing specifications for representing transaction figures that apply to specific sub-areas of accounting and to a specific reporting or evaluation purpose.

Legacy System
A pre-existing system that interfaces with AASIS and is necessary to provide input.

Line Item Display
Line item display is the display of document line items for one or more accounts. The precondition is that the accounts are kept with line item displays.

Low Value Asset
A low value asset is one with a total cost of acquisition that does not exceed a specified amount. In AASIS, they are assets that are under $1000 and have a useful life of less than one year.
Low value assets are expensed in the month in which they are acquired.

Master Data
Master data is related information that forms the basis of all system processing. Master data is shared across application modules and it has an organizational aspect.
Master data records remain in the database over an extended period of time. Master data is usually created once and maintained centrally for all users to eliminate data redundancy. This also ensures data consistency and integrity.

Material
A material is an item that resides within an inventory that can be traded, used in manufacturing, consumed, or produced.
A service may also be treated as a material.

Material Group
Material group is a group of materials or services that have similar characteristics. Groups of unique materials or services on the Material/Service Master are linked to a commodity, (through a field called material group) like stationary or janitorial services.

Material Master Record
A material master record in AASIS is a data record containing all the basic information required to manage a material or service. It contains data of a descriptive nature as well as data that carry control functions.

Material Requirement Planning (MRP)
MRP calculates material requirements for the needed demand and creates planned orders and purchase requisitions to fulfill demand for a specific time.

Movement Type
A three-digit key that indicates the type of material movement occurring in AASIS. A movement type enables the system to find predefined posting rules determining how the accounts of the Financial Accounting system are posted.

Net Price
Price arrived at after taking all vendor surcharges and discounts into account. Also known as the effective price.

Non-Stock
Material that you purchase for immediate consumption. Non-stock will not be tracked in inventory after purchase.

Number Assignment
The process of assigning numbers to objects (for example, materials or documents).
In AASIS numbers can be assigned to objects internally (AASIS assigns) or externally assigned (user assigns the number to the object manually).

Open Items
Incomplete transactions, such as a vendor invoice which has not been paid. In order for an open item transaction to be considered complete, the transaction must have been cleared.

Open Reservations
Open reservations are unfilled material requests.

Order Price History
Series of prices representing the purchase prices charged by a vendor for a material or service over a certain period of time.

Order Unit
Unit of measure enabling Purchasing to order a material in a unit that differs from the base unit defined for the material.

Outline Agreement
An outline agreement is a legal, long-term agreement with a vendor in order to procure known materials or services with estimated quantities and known prices.

Over-delivery Tolerance
Percentage (based on the order quantity) up to which an over-delivery of this item will be accepted.

Parked Document
Document parking can be used to enter and store (park) incomplete documents in AASIS without carrying out extensive entry checks. Parked documents can be completed, checked and then posted at a later date--if necessary by a different user or a higher level of authority.
Documents can be parked when:
· there is not enough information to post a transaction
· a higher level of approval is required

Periodic Processing
Periodic processing is consistent periodic closings of general ledger accounts to enable period over period analysis and reporting.

Physical Inventory
A manual process whereby existing quantities of stock are recorded. The recorded physical quantities are compared to stock that is reported in AASIS.

Pick List
A list of materials to be picked/withdrawn from stock. The pick list process specifies what stock to pick in order to fulfill a reservation or perform a goods issue.

Plant
A plant is an organizational unit that provides materials and services.

Posting
A posting is each entry in a transaction that changes the balance on an account.

Posting Key
The posting key is a two-digit numeric key that controls the entry of document line items. The posting key identifies the account type, debit or credit posting, and the layout of the screens. The posting key also determines which account type (vendor, customer, or general ledger) can be entered in the account field when posting a document.

Price Comparison
Comparative listing of bidders’ prices for all items that are the subject of a bid invitation, in matrix form.

Primary Cost Elements
Primary cost elements are master record descriptions of revenues and expenditures. They have a one to one relationship with G/L accounts.

Professional Service Contract
Professional service contracts outline services that are provided by professionals, including but not limited to: architects, interior designers, engineers, consultants, etc. This does not include non-professional services like janitorial cleaning, pest control, elevator repair, etc.
Contracts for professional services are established using a purchase order.

Project
Grants, capital work and large maintenance jobs are projects.

Project Accounting
Project Accounting is an AASIS financial module designed to manage the financials of projects. This module helps to plan, manage, control and track the costs of projects. The common tasks revolve around allocation of people, resources and money within the framework of schedule and task relationships.

Purchase Order
A purchase order is a legal, short-term agreement with a vendor to supply known materials or services with fixed quantities and firm prices. It provides the vendor with a reference document to link to the shipping (goods receipt) and invoicing (invoice verification) processes.
Purchase Orders are currently known as Firm Contracts.

Purchasing Group
The Purchasing Group in AASIS is a three-digit code used to track activity against an individual Buyer and aid in the security of procurement documents. The Purchasing Groups represent both Agency Procurement Specialists and State Procurement Specialists.

Purchasing Organization
A Purchasing organization tracks procurement activity for a specified group of people.

Quotation
A Quotation is a vendor’s response to an RFQ and contains the vendor's pricing and conditions for providing the material or service stated in the RFQ. In AASIS, the RFQ and Quotation have the same document number. Changes made as a result of Quotations submitted will modify the appearance of the original RFQ for that vendor.

Reconciliation Account
Every time you post an invoice or other financial transaction data to a vendor, customer, or asset (which are sub-ledger accounts), AASIS automatically updates a general ledger reconciliation account, which mirrors the transaction. These reconciliation accounts ensure that the balance of the general ledger accounts is always equal to the detail in the sub-ledgers. As a result, it is always possible to print a balance sheet without transferring data from sub-ledger accounts to the general ledger.

Recurring Entries
Recurring entries are General Ledger journals that periodically post to pre-defined General Ledger accounts for pre-defined amounts.
The entries will not update account balances until the specified due date. The posting key, account, line item amounts and coding block information remain unchanged in recurring entries.
You must specify the first and last dates and the frequency or time interval. The recurring entry program uses the recurring entry document to create an accounting document. AASIS automatically posts the required transaction on each of the due dates.

Reference Material
A material whose master data you want the system to copy to a newly created master record so that you can use it as a default

Release Strategy
The set of rules used to determine the approval process for procurement documents. A release strategy defines the approval level required for procurement documents. The rules dictating which dollar values require approval are defined in AASIS by release codes. For certain documents, approval is required before the document can be processed (e.g. a requisition must be approved before it is converted to a purchase order).

Request for Proposal (RFP)
An RFP is an invitation to a vendor to propose a solution to a defined need. The state issues an RFP seeking a variety of alternatives to fulfill the need for materials or, more typically, services.
Where the RFQ almost always results in the awarding of a contract to a vendor, the RFP may not. In AASIS, the only difference between the RFQ and the RFP is the name (i.e. Request for Quotation vs. Request for Proposal) that is printed on the document sent to the Vendor.

Request for Quotation (RFQ)
A Request for Quotation is a request to a vendor to submit a quotation regarding the supply of materials or performance of services. The document initiates the formal bidding process. An RFQ can be issued directly to one or more vendors.

Requestor
Any state employee who identifies a need for materials or services. A requestor identifies the need and then forwards their request to an Agency Procurement Technician for input into AASIS.

Requirements Tracking Number
Number that facilitates the monitoring of the procurement of required materials or services.

Requisition
A requisition is a request or instruction to procure a certain quantity of a material or a service so that it is available at a certain point in time.

Reservation
In AASIS, a request to the warehouse (plant) to provide a particular material to the requesting unit.

Return Delivery
Delivery returning goods that are part of your stock to an external supplier. A return delivery references a purchase order or goods receipt

Scrap Material
Scrap material is material that is not usable due to shrinkage, spoilage, broken, damaged, expired, discontinued, or no re-sale value.

Secondary Cost Elements
Secondary cost elements are master record descriptions of allocations used only in the Controlling module. They have no relationship to G/L accounts.
Service
Intangible good characterized by the fact that its production and consumption, or usage, occurs virtually simultaneously.

Settlement Rules
Settlement rules are created to settle the costs to their final destination. The final destination can be a Cost Center, General Ledger Account, WBS Element, or another order.

Shelf-Life Management
Shelf-life management is the monitoring and planning of materials that have a limited useful life.

Shelf-Life Material
This is material that will be rendered unusable within a certain time frame.
The shelf-life date of a perishable material is normally entered at goods receipt.

Source of Supply
A source of supply can be an external source (vendor) or an internal one (for example, a central supply area) or outline agreements (longer-term purchase arrangements)

Special Purpose Ledger
Special Purpose Ledgers are collections of information from:
· AASIS application modules (FI, MM, CO, FM),
· external data transfers, and
· FI-SL (sub-ledger) adjustment postings in defined tables.
These defined tables then provide a database for user defined reporting.

Statistical Key Figures
Statistical key figures are used to record planned and actual statistical data. Values are stored in the Cost Center, Project or Internal Order structures.
Statistics can be used to allocate planned and actual costs.

Stock
Material that will be tracked in inventory.

Stock Overview
Overview of the stocks of a particular material across all organizational levels (for example, plant and storage location).

Stock Replenishment
Stock replenishment is the replacement of materials not associated with work orders or unplanned depletion.

Stock Transfer
A document that records the movement of stock from one location to another. This transfer is within a plant, such as from one storage location to another.

Stock/ Requirements List
Up-to-date overview of the stock situation of a material. The overview is generated using a function that draws together all the current and relevant data.

Storage Location
A storage location is an organizational unit that allows a difference of material stocks within a plant.

Subledger
Subledgers and the general ledger share the chart of accounts with all AASIS applications. Accounts Payable, Accounts Receivable, and Asset Accounting are subledgers. Subledgers provide more detailed information on the reconciliation accounts in the general ledger.

Synchronize Accounts
Synchronizing accounts means ensuring that the necessary links are created between G/L accounts and legacy systems or other AASIS modules.

Tax Code
Two-digit code that represents the specifications used for calculating and displaying tax.

Transactional Data
As individual transactions are posted in AASIS, transactional data is created. All the data that AASIS stores in documents is considered to be transactional data. Transactional data will vary depending on the module in which the posting occurs.
Some examples of AASIS transactions, which produce transactional data are:
· Enter a General Ledger Account Posting
· Process a Non-Purchase Order Invoice
· Create a Primary Cost Element
· Settle an Asset
Transactional data is created during normal day-to-day business transactions. Transactional data typically references master data and often takes advantage of information captured on a previous transaction.

Under-delivery Tolerance
Percentage (based on the order quantity) up to which an under-delivery of this item will be accepted.

Unrestricted Stock
Materials received into inventory that have no restrictions on the usage.

User Defaults
Pre-set values that AASIS automatically uses unless you enter a different value.

Value Contract
Contract (longer-term purchasing arrangement) which identifies the intent to purchase a certain value of materials or services.

Vendor
A business partner from whom materials or services can be procured externally in return for payment.

Vendor Evaluations
Vendor Evaluations is a program that provides a basis for decisions with regard to the selection and control of sources of supply. Vendor evaluations are automated based on a vendor’s timely delivery, recorded via the goods receipt, and accurate billing, recorded via the invoice.

Vendor Master Record
The vendor master record in AASIS is a data record containing all the information necessary for any contact with a certain vendor, in particular for carrying out business transactions. This record contains both Financial Accounting (Accounts Payable) and Purchasing data.

Vendor Partners
A vendor that is set up to function together with another vendor. Partners function in a “parent/child” relationship in AASIS.

Work Breakdown Structure (WBS)
A Work Breakdown Structure (WBS) is created when a project needs to track costs. It stores identification information for grant and capital work, i.e., CFDA, method of financing number, award or capital project number.

Work Breakdown Structure Element (WBSE)
WBS Elements are master records used to categorize various stages or programs of a project or grant with the associated funding.

Write-up
A write-up is the correction of past depreciation. Write-ups are necessary either when the depreciation posted was too high, or when the reasons for unplanned depreciation no longer exist.