Edit and Post Administrative Fees

Edit and Post Administrative Fees

To calculate Administrative Fees in FIMS and automatically create General Ledger Journal entries, run the Edit and Post Administrative Fees routine.

You must do the following before you can run the calculation.

1. Set up an Administrative Fee Code for every type of administrative fee.

This code contains key information needed in the calculation routine. See Maintaining Administrative Fee Codes.

2. In the Admin Fee field on the Fund 1 tab, enter the appropriate Administrative Fee code for each Fund.

Note: The Mass Fund Field Assignment can automate the process of entering codes in these fields. See Mass Assigning Fund Fields.

3. In the Fund Class code table, set up the default General Ledger accounts that FIMS will use for Administrative Fees.

This setting ensures that FIMS creates the appropriate expense and offsets account entries for the Funds paying the fees and the appropriate revenue and offset account entry for the operating Fund receiving the fees. Exceptions to the normal defaults may be set up for specific Funds on the G/L Overrides tab. See Maintaining Fund Class Codes.

4. Enter the Fund ID of your operating Fund (the Fund that receives the Administrative Fee revenue) in System Initial Setup. See Defining the Operating Fund.

Once Administrative Fee codes are set up for every method of fee calculation used by the organization, all Fund records have an appropriate entry in the Fee field, and default G/L accounts are set. You can run an Edit Report and post administrative fees to the General Ledger Journal.

Note: IMPORTANT: The Edit and Post Administrative Fees process returns an error when a Fund does not have the required Admin Fee code. For Funds that are not assessed a fee, enter a fee code of None.

1. In the Fund Management module, click the Processes tab.

2. Select Edit and Post Administrative Fees, and then click Run Process.

Edit and Post Administrative Fees Window

3. In the Type of Entries section, select the radio button associated with the type of Admin Fee entries you want to create: G/L Entries, Budget Entries, Spend Policy Cash Req, or Spend Policy Admin Fee.

• G/L Entries: Results in the creation of General Ledger Journal entries.

• Budget Entries: Does not create any General Ledger Journal entries. Instead, the Administrative Fees are entered in period 1 of the Budget fields of the administrative fee expense account for each Fund. The total fees are entered in period 1 of the Budget field of the administrative fee revenue account for the operating Fund.

• Spend Policy Cash Req: Allows you to use the Administrative Fee Calculation utility to calculate a Spending Policy amount. After the calculation report appears in the FIMS Viewer, you can click Create GL Entries on the FIMS Viewer menu bar. The system will ask if you want to update the Spending Policy. Click Yes to put the calculated amount in the Cash Requirement field of the Fund record. Keep in mind that this calculation routine cannot average more than one year’s worth of General Ledger data. Also, there is a separate and more sophisticated Spending Policy calculation routine in FIMS.

• Spend Policy Admin Fee: Allows you to calculate Administrative Fees and place that number in the Admin Fee field of the fundsummaryhistory table. Once it is in the table, you can subtract it from a Spending Policy amount or create budget entries and spread them over months or quarters in the General Ledger. After the calculation report appears in the FIMS Viewer, you can click Create GL Entries on the FIMS Viewer menu bar. The system will ask if you want to update the Spending Policy. Click Yes to put the calculated amount in the Admin Fee field of the fundsummaryhistory table.

• When this process is complete, you can manually adjust spending policy amounts to view and optionally modify the value in the field. The administrative fee figures appear in the Adm Fee column. You can run the Cash Requirements Reportto print the results. You can also run the Create Recurring, GL, or Budget Entries utility. Using this option to create budget entries allows you to spread the resulting budget either quarterly or over all periods, and it has a rounding option. You can optionally choose to subtract this amount from the calculated Spending Policy and then create GL, recurring, or budget entries.

  Note: The available fields on this window change depending on the option you select. For example, the Operating Fund Accounts fields are only available when you select the G/L Entries radio button.

4. In the Administrative Fee Revenue and Administrative Fee Offset fields, inspect the default accounts for the Operating Fund. The default values in these fields are based on the accounts specified in the Fund Class record for the Operating Fund (or on the G/L Overrides tab), but they can be changed.

Note: These fields are only available if you select the G/L Entries radio button in the Type of Entries section of this window.

5. Enter the G/L Apply Date. This date becomes the apply date for the fee transactions in General Ledger. The default value is today’s date.

6. (Optional) In the Include Funds with Fee Codes from / through fields, enter the range of fee codes that you want to calculate. Selection on this field are necessary if you have groups of Funds where administrative fees are posted on different schedules (indicated by the Frequency field in the Administrative Fee code table) or with a different valuation method.

Note: The fee codes in the range must be alphabetically contiguous.

7. (Optional) In the Include Funds from / through fields, enter FUND ID codes to limit results for only those Funds within the range of the codes chosen.

8. If you only want to calculate fees for Funds that were established prior to a particular date, enter the desired date in the Include Funds Established Before field. This is useful if, for example, your organization does not charge administrative fees for an initial grace period for a Fund.

9. Click the arrow in the Fee Code Frequency drop-down box and select the frequency that you want to include in the process. Only fee codes with the selected frequency will be included. Available selections include: All, Monthly, Quarterly, Semi-Annually, and Yearly.

10. If you are running the process for Funds that are associated with multiple fee codes, click the arrow in the Method When Multiple Fees/Fund drop-down and select the method that you want to use to calculate the appropriate fee: Average, Lowest, Highest, or Total.

11. Click the arrow in the Evaluation Method drop-down box and select the method that you want to use to assess the base value (in conjunction with the G/L accounts indicated in the Administrative Fee code table).

Note: The following evaluation methods base calculations on the G/L Year Begin Period and End Period fields and the General Ledger accounts indicated in the Administrative Fee code table. Once the base value is calculated, the annual fee is assessed based on information contained in the Administrative Fee code table. The annual fee is then divided by 12 and multiplied by the number in the Frequency field (for example, 3 = quarterly or 12 = annually).

Note: The Frequency and valuation period are independent of each other, and you could theoretically choose any two periods in the G/L year to calculate the average Fund value. However, you should generally use the beginning and ending periods of the actual valuation period.

Note: The Frequency field for the Administrative Fee code table only affects the fee calculation – it does not trigger an automatic calculation.

• Average Beginning and Ending YTD Balances: This method calculates fees based on the average of the Fund value for the begin period (beginning balance for the period) and the Fund value for the end period for each Fund.
• Ending YTD Balance: This method calculates fees based on the balance at the end of the ending period (for example, the Fund balance as of the end of the first quarter). Any value in the Begin Period field is ignored.
• Period Amounts: This method calculates fees based on the actual total of the period amounts in the range defined by the Begin and End periods. For example, if periods 1 and 3 are entered, the base value would be the sum of periods 1, 2, and 3. This method is useful if, for example, the fee is equal to the net income earned during the first quarter. In this case the Calculation Method would be a straight percentage (100%), the Frequency would be 12, and General Ledger accounts would reference the Interest Income accounts.
• Highest Period Amount: This method calculates fees based on the highest ending balance among the selected periods.
• Average Daily Balance: This method calculates fees based on the average daily balance. It determines the balance in the basis accounts (usually the net assets) for each day during the beginning and ending periods and divides the total by the number of days.
• Beginning Balances: This method calculates fees based on the beginning balance in the year specified for the Fund.

12. In the G/L Year for Calculation, Begin Period, and End Period fields, enter the G/L year and the beginning and ending periods that you want to use as the basis for calculating fees.

13. If you want to return dollars to Funds with a negative basis, select the Calculate Fees on Funds with a Negative Basis checkbox. If you want to eliminate any fee for Funds with a negative basis, clear the checkbox. This checkbox is cleared by default.

14. If you want to charge the minimum fee to a Fund even if the assessed value is zero, select the Charge the Minimum When Assessed Value is Zero checkbox. If you want to waive the minimum fee for these Funds, clear the checkbox. This checkbox is selected by default.

Note: The minimum fee must be indicated in the Administrative Fee code table.

15. (Optional but recommended) Click the Defaults button and save your configuration, so it will be available the next time you run the Edit and Post Administrative Fees utility.

Note: The GL Apply Date and Fund Established Date are not saved as part of the default settings.

16. Click OK.

17. Verify the Send To destination, and then click the Run Report button. The Administrative Fee Edit Report opens in the FIMS Viewer.

18. Review the report, and then click Create G/L Entries on the FIMS Viewer menu bar to create entries for the fees in the General Ledger Journal. You can also create Budget Entries, Spending Policy Cash Requirements, or Spending Policy Admin Fees.