Fiscal Non-Profit Administration

GLOSSARY

Glossary

Effective Date: January 1, 1999

Glossary

Advance	A payment made by State Treasury check or other appropriate payment mechanism to a recipient upon its request either before outlays are made by the recipient or through the use of predetermined payment schedules.
Award	Financial assistance that provides support or stimulation to accomplish a public purpose. Awards include grants and other agreements in the form of money or property in lieu of money, by the State Government to an eligible recipient. The term does not include: technical assistance, which provides services instead of money; other assistance in the form of loans, loan guarantees, interest subsidies,. or insurance; direct payments of any kind to individuals; and contracts which are required to be entered into and administered under procurement laws and regulations.
Awarding Agency	(a) With respect to a grant, cooperative agreement, or cost reimbursement contract, the State agency, and (b) with respect to a subaward, the party that awarded the subaward.
Audit Trail	The ability to trace each transaction forward from the source of documentation through all journals and ledgers to the summary statements and financial reports, or the reverse.
Auditor's Opinion	An auditors opinion stating that the financial statements present fairly the financial position, results of operations and (when applicable) changes in financial position in conformity with Generally Accepted Accounting Principles (GAAP) (which include adequate disclosure). This conclusion may be expressed only when the auditor has formed such an opinion on the basis of an examination made in accordance with Generally Accepted Auditing Standards (GAAS) or Generally Accepted Government Auditing Standards (GAGAS) (Unqualified Opinion.)
Auditor's Report	In the context of a financial audit, a statement by the auditor describing the scope of the audit and the auditing standards applied in the examination, and setting forth the auditor's opinion on the fairness of presentation of the financial information in conformity with the GAAP or some other comprehensive basis of accounting.
Balance Sheet	A Statement which discloses the assets, liabilities, reserves, and equities of a fund government unit at a specified date, properly classified to exhibit financial position of the fund or unit at the specified date.
Board	A duly appointed/elected governing body of an entity with legal authority and responsibility to direct and authorize its overall activities and how it utilizes and accounts for available resources. All nonprofit corporations must have an organizational structure and rules or by-laws by which they are managed.
Budget	A plan of financial operation embodying an estimate of proposed expenditures for a given period and the proposed means of financing them. Used with any modifier, the term usually indicates a financial plan for a single fiscal year. The term "budget" is used in two senses in practice. Sometimes it designates the financial plan presented to the appropriating governing body for adoption and sometimes, the plan finally approved by that body.
Budget Amendments	Changes to the approved budget plan which have been authorized by the governing body and, where applicable, approved by the State awarding agency.
Cash Contributions	The recipient's cash outlay, including the outlay of money contributed to the recipient by third parties.
Closeout	The process by which the State awarding agency determines that all applicable administrative actions and all required work of the award have been completed by the recipient and State awarding agency.
Contract	A mutually binding legal relationship obligating the seller to furnish the supplies or services (including construction) and the buyer to pay for them. It includes all types of commitments that obligate the agency to an expenditure of funds and that, except as otherwise authorized, are in writing. In addition to bilateral instruments, contracts include (but are not limited to awards and notices of awards; job orders or task orders issued under basic ordering agreements; letter contracts; orders, such as purchase orders, under which the contract becomes effective by written acceptance or performance; and bilateral contract modifications.
Cost	The total direct and allocated expenses determined in a uniform manner related to a particular service or program. Cost may be determined on a cash, accrual or other basis as may be acceptable to the State awarding agency. Cost does not include transfers of funds and may exclude other types of expenses as directed by the awarding agency.
Cost of Equipment	The net invoice price of the equipment including the cost of modifications, attachments, accessories, or auxiliary apparatus necessary to make the property usable for the purpose for which it was acquired. Other charges such as the cost of installation, transportation, taxes, duty or protective in-transit insurance, shall be included or excluded from the unit acquisition cost in accordance with the recipient's regular accounting practices.
Cost-type Contract	A contract or subcontract under a grant in which the contractor or subcontractor is paid on the basis of the costs it incurs, with or without a fee.
Date of Completion	The date on which all work under an award is completed or the date on the award document, or any supplement or amendment thereto, on which State sponsorship ends.
Direct Costs	Costs/expenses specifically traceable to specific goods, services, units, programs, activities or functions. Direct expenses differ from indirect expenses in that the latter cannot be specifically traced and so must be allocated on some systematic and rational basis. Direct costs are those that can be identified specifically with a particular final cost objective.
Disallowed Costs	Those charges to an award that the State awarding agency determines to be, unallowable, in accordance With the applicable State/Federal cost principles or other terms and conditions contained in the award.
Equipment	Tangible, nonexpendable, personal property including exempt property charged directly to the award having a useful life of more than one year and acquisition cost of $500 or more per unit. However, consistent with recipient policy, lower limits may be established.
Financial Statement Basic)	Those financial statements, including notes thereto necessary for the fair presentation of the financial position and results of operations of an entity in conformity with GAAP. The basic financial statements include a balance sheet an "all-inclusive" operating statement a budget comparison statement (for all governmental funds for which annual appropriated budgets are adopted) and a statement of changes in financial position (for proprietary funds pension trust funds and nonexpendable trust funds).
Fixed Assets	Assets with a life expectancy greater than 1 year which are intended to continue to be held or used, such as land, building, machinery, furniture, and other equipment.
Flex-time	A work schedule for employees outside of standard 8 AM to 5 PM work hours, usually ranging from-7:30 AM to 6 PM. It is used in an effort to increase productivity and efficiency, solve work force problems, or provide a choice for employees.
Funding Period	The period of time when State funding is available for obligation by the recipient and reimbursement.
Generally Accepted Accounting Principles (GAAP)	Uniform minimum standards and guideline for financial accounting and reporting. They govern the form and content of the financial statements of an entity. GAAP encompass the conventions, rules and procedures necessary to define accepted accounting- practice at a particular time. They include not only broad guidelines of general application, but also detailed practices and procedures. GAAP provide a standard by which to measure financial presentations. The primary authoritative body on the application of GAAP to state and local governments GASB, Governmental Accounting Standards Board.
Generally Accepted Auditing Standards (GAAS)	Standards established by the American Institute of Certified Public Accountants (AICPA) for the conduct and reporting of financial audits. There are 10 basic GAAS, classed into three broad categories: general standards, standards of fieldwork and standards of reporting. The Auditing Standards Board of the AICPA publishes Statement on Auditing Standards (SAS), together with the 10 basic standards, constitute GAAS. These GAAS set forth the objectives of the audit and establish measures that can be applied to judge the quality of its performance.
Generally Accepted Government Auditing Standards (GAGAS)	Standards established by the Government Accounting Office (GAO) in its publication Standards for Audit of Governmental Organizations, Programs, Activities and Functions ("yellow book") for conduct and reporting of both financial and performance audits. GAGAS set forth general standards applicable to both types of audits and separate standards of field work and reporting for financial and performance audits. The GAGAS standards of field work and reporting for financial audits incorporate and build upon GAAS.
Grant	An award of financial assistance, including cooperative agreements in the form of money, or property in lieu of money, by the State Government to an eligible grantee.
Grantee	The nonprofit agency to which a grant is awarded and which is accountable for the use of the funds provided. The grantee is the entire legal entity even if only a particular component of the entity is designated in the grant award document.
Grantor Department or Agency	The component of a State, which is responsible for the performance or administration of all or some part of a State award.
Independent Auditor	An auditor meeting the independence criteria set forth in GAAS or GAGAS.
Indirect Costs	Indirect costs are those: (a) incurred for a common or joint purpose benefiting more than one cost objective, and (b) not. readily assignable to the cost objectives specifically benefited, without effort disproportionate to the results achieved. The term "indirect costs," as used herein, applies to costs of this type originating in the grantee department. To facilitate equitable distribution of indirect expenses to the cost objectives served, it may be necessary to establish a number of pools of indirect costs within an organization unit. Indirect cost pools should be distributed to benefited cost objectives on bases that will produce an equitable result in consideration of relative benefits derived.
Internal Auditing	An independent appraisal of the diverse operations and controls within a government entity to determine whether acceptable policies and procedures are followed, established standards are met, resources are used efficiently and economically and the organization's objectives are being achieved. The term covers all forms of appraisal of a activities undertaken by auditors working for and within an organization.
Internal Control	The plan to safeguard assets, ensure the accuracy and reliability of accounting data, and to maintain adherence to policies and procedure.
Local Government	A county, municipality, city, town, township, local public authority, school district, special district, intrastate district, council of governments (whether or not incorporated as a non profit corporation under State law), any other regional or interstate government entity, or any agency or instrumentality of a local government.
Matching Requirement	Requirement for a non-profit grantee organization to provide partial support for the proposed budget which supports a particular program or service. (Cost-sharing or matching funds requirement). This is usually expressed as a percentage of valid expenditures.
Noncompliance	A finding which indicates that a grantee is not following the requirements of or conditions of the award/grant/contract.
OMB	The United States Office of Management and Budget.
Other Comprehensive Basis of Accounting	A comprehensive basis of accounting other than generally accepted accounting principles is one of the following: A basis of accounting used to comply with the requirements or financial reporting provisions of a governmental regulatory agency, a basis of accounting used to file income tax return for the period covered by the financial statements, or cash receipts and disbursements basis of accounting, and modifications of the cash basis having substantial support.
Personal Property	Property of any kind except real property. It may be tangible, having physical existence, or intangible, having no physical existence, such as copyrights, patents, or securities.
Petty Cash	A small amount of cash maintained to pay minor disbursements.
Prior Approval	Written approval by an authorized official evidencing prior consent of an act.
Program Income	Gross income earned by the recipient that is directly generated by a supported activity or earned as a result of the award. Program income includes, but is not limited to, income from fees for services performed, the sale of commodities or items fabricated under an award, and interest on state funds.
Project Costs	All allowable costs, as set forth in the applicable State/Federal cost principles, incurred by a recipient and the value of the contributions made by third parties in accomplishing the objectives of the award during the project period.
Procurement	The process of purchasing goods and services to be utilized by the grantee/contractor.
Reasonable Costs	A cost is reasonable if, in its nature and amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at. the time the decision was made to incur the cost.
Recipient	An organization receiving financial assistance directly from State awarding agencies to carry out a project or program. The term includes public and non-profit organizations such as, but not limited to, community action agencies, research institutes, educational associations, and health centers.
Restricted Funds	Funds received by an organization which can only be used for the specific purpose as indicated by the grantor.
Single Audit Act	Congress passed the Single Audit Act in December 1984 and OMB promulgated regulations in OMB Circular A-1 28, which sets forth the specific responsibilities to be adhered to by federal grantor agencies and their grantees for resolution of audit findings and recommendations applicable to awards for financial assistance. The purpose of the Single Audit Act is to require a single audit of each recipient of Federal financial assistance with the specific parameters of the amount of funding received to determine compliance with Federal laws in terms of their agreements. The single audit eliminates duplicate audits as It combines both fiscal and program compliance in an audit.
State	The State of North Carolina.
Subgrant	An award of financial assistance in the form of money, made under a grant by a grantee to an eligible subgrantee. The term includes financial assistance when provided by contractual legal agreement, but does not include procurement purchases, nor does it include any form of assistance which is excluded from the definition of "grant."
Subgrantee	The nonprofit entity or other legal entity to which a subgrant is awarded and which is accountable to the grantee for the use of the funds provided.
Suspension	An action by a State awarding agency that temporarily withdraws State sponsorship under an award, pending corrective action by the recipient or pending a decision to terminate the award by the State awarding agency. Suspension of an award is a separate action from suspension under State agency regulations.
Terms of a Grant or Subgrant	All requirements of the grant or subgrant, whether in statute regulations, or the award document.
Third Party In-kind Contributions	Property or services which benefit a state-assisted project or program and which are contributed by non-State third parties without charge to the grantee, or a cost-type contractor under the grant agreement.
Termination	The cancellation of State sponsorship, in whole or in part, under an agreement at any time prior to the date of completion.

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