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<p class="MsoNormal"><span style="font-family:"Arial","sans-serif";color:#1F497D"> </span><span style="font-family:"Arial","sans-serif";color:#1F497D">All- please find the email from Matt Clarkson of OMES Financial Reporting with guidance concerning the posting
of the FY16 appropriations reconciliations you received notice of on September 9<sup>th</sup>. Please use in discussion with your auditors for consistency in reporting for the financial as of 6/30/2016. The figures should not be reported as FY16 receivables
and you may use your professional judgement whether to include a “subsequent event” footnote disclosure or not.</span><span style="color:#1F497D"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
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<p class="MsoNormal"><b><span style="font-size:10.0pt;font-family:"Tahoma","sans-serif"">From:</span></b><span style="font-size:10.0pt;font-family:"Tahoma","sans-serif""> Matt Clarkson [<a href="mailto:Matt.Clarkson@omes.ok.gov">mailto:Matt.Clarkson@omes.ok.gov</a>]
<br>
<b>Sent:</b> Wednesday, September 21, 2016 8:09 AM<br>
<b>To:</b> Campbell, Karla<br>
<b>Subject:</b> RE: Late Appropriations<o:p></o:p></span></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><span style="color:#1F497D">If you could pass it on to any institutions who have a similar question, I would appreciate that.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
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<p class="MsoNormal"><span style="font-family:"Arial","sans-serif";color:#1F497D"> </span><span style="color:#1F497D"><o:p></o:p></span></p>
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<p class="MsoNormal"><span style="color:#1F497D"><o:p> </o:p></span></p>
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<p class="MsoNormal"><b><span style="font-size:10.0pt;font-family:"Tahoma","sans-serif"">From:</span></b><span style="font-size:10.0pt;font-family:"Tahoma","sans-serif""> Matt Clarkson [<a href="mailto:Matt.Clarkson@omes.ok.gov">mailto:Matt.Clarkson@omes.ok.gov</a>]
<br>
<b>Sent:</b> Tuesday, September 20, 2016 11:28 AM<br>
<b>To:</b> Campbell, Karla<br>
<b>Cc:</b> 'Billy Swindell'<br>
<b>Subject:</b> Late Appropriations<o:p></o:p></span></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Karla,<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">I have not heard back from SAI, but after doing some research on the matter, this is the position I am taking on the FY16 surplus appropriations:<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Based on this revenue recognition table provided in GFOA’s Blue Book, the handling of the appropriations is determined by the category they belong under.
<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><img border="0" width="829" height="623" id="Picture_x0020_2" src="cid:image001.png@01D213DF.5F75DC00"><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">The stance I understand your auditors to be taking appears to be treating the appropriations as “imposed nonexchange revenues.” Those would be recognized when the claim to the money is legally enforceable AND at the start of the period
they are intended to finance, in this case fiscal year 2016. However, I don’t believe that appropriations belong in that category because the imposed part of the transaction happens at the primary government. For instance, the taxes collected were not receivable
by the higher education components, but by the State of Oklahoma’s general revenue fund.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><img border="0" width="684" height="200" id="Picture_x0020_3" src="cid:image002.png@01D213DF.5F75DC00"><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Instead, the nature of appropriations seems to be a better fit under the category of “voluntary exchange transaction” because the legislature determines how the general revenues are split out.
<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><img border="0" width="674" height="191" id="Picture_x0020_4" src="cid:image003.png@01D213DF.5F75DC00"><o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">Based on this assessment, the revenues would be receivable when the “eligibility requirements are met,” and the way state appropriations are handled, the only eligibility requirement would be the legislature releasing the funds. As such,
I do not believe the appropriations of the FY16 surplus were receivable by the higher education component units until the legislature determined the amount. Because this did not happen until well into FY17, it would not be receivable until FY17.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">As to whether a disclosure in the subsequent events note is necessary, I would say that it is a matter of professional judgement. Our policy with the State CAFR is pretty conservative, and generally we do not to disclose something unless
it would have a negative impact on the financial statements.<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal">If you would like any further assistance, please let me know,<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal" style="text-autospace:none"><b><span style="color:black">Matt Clarkson
</span></b><span style="color:black">| Financial Reporting Supervisor<o:p></o:p></span></p>
<p class="MsoNormal" style="text-autospace:none"><span style="color:black">p. 405-521-2759 | f. 405-521-2001<o:p></o:p></span></p>
<p class="MsoNormal" style="text-autospace:none"><span style="color:black">Central Accounting and Reporting | OMES<o:p></o:p></span></p>
<p class="MsoNormal" style="text-autospace:none"><a href="http://omes.ok.gov">omes.ok.gov</a><span style="color:black"><o:p></o:p></span></p>
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<p class="MsoNormal"><o:p> </o:p></p>
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