EU MILITARY OPERATIONS - ACCOUNTING

ATHENA

EU MILITARYEU MILITARYOPERATIONS OPERATIONS

--ACCOUNTINGACCOUNTING

[email protected]+32 2 281 2014

ATHENA

Where do you think the Where do you think the information needed for the information needed for the

reports is coming fromreports is coming from

??AccountingAccounting

ATHENA

Introduction

1. Purpose of

• keeping accounts of cash transfers received, of expenditures committed and payments made, as well as inventory of the fixed assets financed by ATHENA budget,

• recording all financial transaction in the execution of Common Costs and through ATHENA pre-financed expenditures,

• enabling the production of financial reports and annual accounts.

2. References

Council decision 2008/975/CFSP of 18 May December 2008• Chapter 10, Accounting and Inventory• Chapter 11, Audit and Presentation of Accounts

Act of the Special Committee - Financial Rules (as of JAN2009)• Part I, Article 8, 9 and 10 describing the tasks of Budget-, Contracting- and Accounting Officers• Part I, Chapter VIII – Accounting

ATHENA

Introduction3. Principles and Standards

• Unitary (consistent) Chart of accounts• Double entry (method of) book-keeping• Recording “day by day” and “operation by operation”• EURO - Accounting currency• Segregation of the duties• Exclusive responsibility of accounting officer for treasury

4. Main actors (within the HQ’s) • Authorizing Officer (AUT)• Initiating (Budget) Officer (INI)• Accounting Officer (ACT)• Property Accounting Officer (PAO)

ATHENA

IntroductionAccounting, starts.....

by the first budgetary operation (even in PrepPhase)

.....will be executed consistently …..

until the last record is done, the accounts are closed and the final report has left the HQ;

……and thus it lasts

from Preparatory Phasethrough Active Phaseto end of Winding Up Phase.

ATHENA

Agenda

1. Principle and standards

2. Actors, tasks, work flow

3. Accounting documents

4. Chart of accounts

5. Budgetary and general accounting

6. Accounting information system

ATHENA

Principle and standards(in accordance with Financial Regulation)

• article 42Accounts are kept iaw IPSAS (International Public Sector Accounting Standards) accrual, comparable, consolidated statement, fair and true view, materiality taking in account the specific nature of military operation.

• article 44Entries in the accounts made by using the double entry method in the currency of € equivalence between amount debited and credited transaction in a currency other than € requires the € counterpart

• article 45Accounting record shall specify the origin, content and booking reference of each data item and shall refer to relevant supporting documents

ATHENA

Principle and standards(iaw Financial Regulation)

• article 46Supporting documents are the basis and the proof for any entry into the accounts produced on paper or on a medium which guarantees the reliability of the content

Supporting documents are, e.g.• purchase order, invoice• contract,• agreement,• property delivery receipt.

• article 47Validation of booking entry is required, prohibiting any change or deletion.

ATHENA

Principle and standards(iaw Financial Regulation)

• article 49 (3.)Accounting operations are to be recorded day by day and operation by operation.Financial operations are:

• introduction/decommiting/closing of commitment and their validation• introduction of invoice• linking of invoice to certain commitment and 1st validation• validation of Payment order• any cash transaction• invoicing and introduction of recovery orders

• article 49 (6.)Monthly centralising of all records.

• article 49 (8.)Periodical reconciliation.

ATHENA

AGENDA


2. Actors, tasks, workflow





ATHENA

Actors and tasks

Task AUT INI .

In terms of Budgetary accounting

•Initiating of budgetary/legal commitment x•Validation of budgetary/legal commitment x•Introduction of Third Party data x•Checking and initiating of invoice x•Linking invoice and commitment x•Validation of linking x•Preparation of Payment Order x•Validation of Payment Order x•De-Committing/Closing of Commitment x•Validation of De-committing/Closing x

•Production of Budget Execution Report x

Accounting Officer•Checking and validation of third party data, Payment Order, invoice and supporting documents for cash transaction x

ATHENA

Actors and tasks

Task ACT AUT .

In terms of Cash transaction

•Checking and validation of the Payment Order, invoice and supporting documents for cash transaction x•Preparation of the document for the cash transaction (cash on hand or transfer) x•Signing the cash transaction x x•Recording of cash disbursing x•Checking of bank statement x•Recording of bank transfer x•Reconciliation bank/cash x

•Treasury management x

•Production of Cash Flow Table x

ATHENA

Actors and tasks

Task INI ACT .

In terms of general accounting

Ensuring that the correct sub-article is used for:•Initiating of budgetary/legal commitment x•Introduction of invoice x•Linking invoice and commitment x•De-Committing/Closing of Commitment x

•Reconciliation of the related ledgers x

ATHENA

Actors and tasks

Task PAO AUT ACT .

in terms of fixed assets

•Establishing the inventory of fixed assets x•Assisting the establishment x•Authorising the sale/disinvestment of fixed assets x•Updating the inventory related to:

•Receiving of fixed assets x•Movement of fixed assets x•Disinvestment of fixed assets x

•Submission of the supporting documents to the INI for introduction into the accounts x •Depreciation of fixed assets x•Reconciliation of the fixed assets accounts x•Production of summary fixed assets report x

ATHENA

Workflow

To ensure the daily booking and accounting you need

a) a workflow including all actors as are:

– Budget officer– Contracting officer– Accounting officer– Property accounting officer

b) a workflow covering all areas of accounting as are:– Implementation of the budget– Introduction of commitments, invoices and recovery orders– Introduction of non-consumable goods received and its linking to the certain

invoice– Linking of commitments and invoices– Validation of payments (Payment Order)…………………………………………………………………………– Performance of cash payment documents– Disbursing– Bank transfers

ATHENA

Workflow

INITIATOR Creation of the Commitment

AUTHORIZING OFFICERCheck and validation of entries

Validated and recorded(End of Workflow)

“RETOUR”(Back for

Corrections)

Refuse

End of process

for contracts and commitments

ATHENAATHENA

WorkflowPayments

INITIATOR Checking and introduction of the invoice and supporting

documents, linking with the existing commmitment

AUTHORIZSING OFFICERCheck of invoices and supporting documents, validation

of entries,

End of Budget executionWorkflow

“RETOUR”Back for

Corrections

“RETOUR”Back for

corrections

ACCOUNTANTFinal validation of book entries

Start of the cash payment execution

Outcome:

Outcome: Proposal for Payment Order

Refuse

PROPERTY ACCOUNTING

OFFICER

Outcome: Validation of and Signature on Payment Order

Transfer or payment form

Joint signature of authorising andaccounting officer

Bank or Cash Box

ATHENA

Agenda


2. Actors, tasks, workflow





ATHENA

Accounting documents:Journals and a General ledger

Documents

• they shall consist of electronic documents• keeping all transactions • ensuring the availability of all data necessary for reports and accounts.

Accounts: Budgetary Execution Report, Financial Statements (statement of financial performance; statement of

financial position; cash flow statement)

Inventory:Keeping the information of fixed assets financed through ATHENA

and used for the operation.

Supporting documents:• purchase order, contract, agreement,• property delivery receipt.

ATHENA

Agenda


2. Actors and tasks





ATHENA

Chart of accountsChart of accounts (COA) are given by ATHENA and are binding for all levels Budget

execution and its accounting. COA ensures consistency, budgetary and general accounting and as well

enabling consolidated accounts.

Structure of the chart:

Budget article Sub-Article General account code . Analytical Purpose Classification of the entry

(debit, credit, cost, asset)0220 – CIS 0220 1000 – Purchase 2402 0220 1000 xxxx2 - asset

0220 2000 – Service 6005 0220 2000 xxxx1 - expense 0220 3000 – License 2110 0220 3000 xxxx2 - asset 0220 9900 – unspecified 6005 0220 9900 xxxx1 - expense

Therefore:Uniquely linked to each other and unchangeable.

ATHENA

Agenda


2. Actors and tasks





ATHENA

Budgetary accounting

Budget implementation and execution

cash based report

General accounting

Credited/debited and classified accounts

accrual based accounts

Will not be performed within the operation until a compatible accounting information system is delivered for the use in OHQ and/or FHQ

Budgetary and general accounting

ATHENA

Agenda


2. Actors and tasks





ATHENA

Accounting information system

Financial Rules, article 52:Requires an accounting information system available to OHQ and FHQ

• ensuring reliability, security, inviolability and ability to provide standardised reports and accounts;

• in addition, this system shall• be easy to use • be useable in theatre in a simplified form• be compatible with accounting information system used on different levels of the operation• enable production of consolidated accounts at the central level of ATHENA mechanism

ATHENA

What do we need

You need anAccounting Software

Assets

Budget Payments Contracts

(2009)

FinancialData

(Reports)

as precondition

ATHENA

• Deployable : At least 3 sites

– Athena (Brussels), OHQ, FHQ

– Transfers and consolidations must follow the chain of command

– Communication aspects

FHQ

OHQ

Athena

FHQ

ATHENA

ATHENA accounting tool (Deployed in EUTM SOMALIA)

Financial disputesmanagement

Payments and cash flow management

Reports

ECM

Contract Management

EBM

Budget Management

EPM

Purchase management

Third party management

Stock / AssetManagement

Analytical accounting

General accounting

PIA

ATHENA

• Multi-Operations & multi-HQ sites• Double-entry public bookkeeping • One single book-entry

Simultaneous update of charts(general, budgetary and analytical)

and Third parties• Book-entries inter-HQs• Multi-currency

Specificities• Integration of all ATHENA functionalities• Incorporation of the necessary controls

• Access to data• Activities to be performed by specific roles

Public Integrated Accounting (PIA)

ATHENA accounting tool (Deployed in EUTM SOMALIA)

ATHENA

Functional use

PIAAccounting Software

Revenue Management

FinancialData

Assets

EBM EPM ECM

ATHENA

Functional architecture

Brussels

ATHENA

OHQ OHQ OHQ OHQ OHQ

FHQ FHQ

Specific parameterisation(including Workflows)

ATHENA

Functional architectureAthena server

PIAEPM Title 1

Athena BXLCommon costs

AthenaConsolidation

ConsolidationOperation A

“Council network”

Local dBaseFHQ BEBMEPMECMReporting

ConsolidationOperation B

Local dBaseFHQ DEBMEPMECMReporting

Data Transfer

OHQMission A

FHQMission A

OHQMission B

FHQMission B

Data Transfer

ATHENA

ATHENA operating manual

Athena Operational Manual has been prepared to support any actor in any cases of performing the “Accounting” tasks in an operation.

6 -11 Inventory and related software8 – 1 Accounting8 – 2 Administrative and accountancy documents8 – 3 Accounting software9 – 2 Closure of accounts

and SOP like:

Model of accounting SOPModel of cash flow management SOP

ATHENA

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EU MILITARY OPERATIONS - ACCOUNTING

Documents

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