| Accrual Accounting |
Accrual accounting is a method that records revenue when it is earned and records expenses when they are incurred, not when the cash is received. Different than cash accounting, this method provides a more realistic understanding of income and expenses and helps with long term projections. |
| Aging Report |
An accounts receivable aging report is a record that shows the unpaid invoice balances along with the duration for which they’ve been outstanding. |
| As of Date |
The as of date is the date specified in the parameters and shows the cut-off date of the information provided. |
| Assets |
Assets are defined as any resource of value that can be used to generate future economic value. |
| Balance Sheet |
A balance sheet, also known as the statement of financial position, is a financial statement that reflects the overall financial position of an organization at a specific period in time. |
| Cash |
Cash is money in coins or notes, as distinct from checks, money orders, or credit. |
| Cash Basis |
Accounting method which records revenues and expenses only when monies are exchanged. |
| Cash Equivalent |
Cash equivalents are short-term assets that are easily and readily converted into a know amount of cash. |
| Cash Flow Statement |
A cash flow statement, also known as statement of cash flows, is a financial statement that summarizes the amount of cash and cash equivalent entering and leaving an entity. |
| Cash Receipt |
Cash receipt is the collection of money (currency, coins, checks). A company’s receipts refers to the cash that the company received. |
| Chart of Accounts |
A chart of accounts (COA) is a financial organizational tool that provides a complete listing of every account in the general ledger of a company broken down into subcategories. The chart of accounts can be expanded and tailored to reflect the operations of the company. |
| Contra Asset |
A contra asset object code is an offset to another asset code (i.e. accounts receivable or capital assets) and typically acts as a reserve to reduce the associated asset code. |
| Credit |
A credit is an accounting entry that either increases a liability or equity account, or decreases an asset or expense account. |
| Current Asset |
A current asset is an asset that is expected to be sold or consumed within twelve months. |
| Debit |
A debit is an accounting entry that either increases an asset or expense account, or decreases a liability or equity account. |
| Encumbrances |
A main concept of government accounting, an encumbrance is a restriction placed on the use of funds to ensure there are enough funds for future expenses/obligations such as salary, loan payments, etc. |
| Endowment Fund |
Endowment Funds are funds with respect to which donors or other outside agencies have stipulated, as a condition of the gift instrument, that the principal is to be maintained inviolate and in perpetuity and invested for the purpose of producing present and future income which may either be expended or added to principal. |
| Fiscal Period |
A fiscal period at Indiana University is broken out into 12 separate periods based on months in the calendar year. Period one is equivalent to July during the fiscal year. |
| Fiscal Year |
A fiscal year at Indiana University spans from July 1st through June 30th of the subsequent calendar year. The last day of the fiscal year is June 30th. |
| Generally Accepted Accounting Principles (GAAP) |
US Generally Accepted Accounting Principles (US GAAP) is the combination of authoritative standards (requirements) and the commonly accepted ways of recording and reporting accounting information. |
| Governmental Accounting Standards Board (GASB) |
The organization responsible for establishing accounting and financial reporting standards for state and local governments and those entities that are funded by state and local government. |
| Historical Cost Principle |
The historical cost principle is used primarily for consistency and reliability among financial statements. According to the historical cost principle, an entity must report and account for items at their original cost when the asset was purchased. The amount reported should include all costs necessary to acquire the asset and prepare it for use including delivery and handling costs, site preparation fees, and installation costs. |
| Income Statement |
An income statement, also known as the statement of revenues, expenses, and changes in net position, is a financial statement that summarizes the revenue streams, expense categories, and overall profitability of an entity. |
| Journal Entry |
Journal entries are records of business transactions. A business transaction is the exchange of goods or services for a form of payment. A journal entry is used to record each transaction and include more information about the transaction such as date, amount, description of the entry, and a unique reference number, often called a journal entry number. |
| Liquidity |
Liquidity refers to the ease with which an asset, or security, can be converted into ready cash without affecting its market price. Cash is the most liquid of assets while tangible items are less liquid. |
| Materiality |
Highlights any variance that meets the specified materiality threshold specifically for the income statement. Materiality is set at 10% of the associated revenue stream. |
| Non-Current Asset |
Non-current assets are long-term assets that the organization expects to hold for longer than twelve months and cannot be readily converted into cash. |
| Reconcile |
The review of operating reports monthly to ensure that the revenue and expenditures posted to the account are those that were approved by the fiscal officer, or their delegate, and that they are allowable and appropriate. |
| Short-Term Investments |
Financial instruments, such as money market funds or certificates of deposit, that can easily be converted to cash usually within one year or less. |
| T-Accounts |
A tool used to help identify the ending balance of a given asset, liability, revenue, or expense. The left side is for debits and the right side is for credits. |
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