You were talking about forecasts when you said it was easy

And even if we weren't, even GL accounts aren't quite so straightforward as you're claiming. And I know you know that, but here's an example from the Oregon Accounting Manual (first good reference I found googling):

Oregon Department of
Administrative Services
State Controller's Division

Number
15.60.30.PR

Criteria for Recording a Capital Lease

.101
An asset and a liability should be recorded in an agency's accounting records as a capital lease when the present value of the minimum future lease payments is $5,000 or more and any one of the following conditions in (a) through (d) and the condition in (e) are met:
a. Ownership of the leased real property or personal property will be transferred to the agency at the end of the lease. In this case, record the liability as a lease-purchase contract payable, general ledger account 1715.
b. The lease contains a bargain purchase option. A bargain purchase option exists when the lessee can exercise a provision in the lease to buy the asset sometime during the term of the lease at a price considerably lower than the fair market value of the asset. Also, if there was reasonable assurance or it was the agency's intention at the start of the lease that a purchase option would be exercised, the lease would be considered a capital lease. In this case, record the liability as a lease-purchase contract payable, general ledger account 1715.
c. Lease terms are 75% or more of the real or personal property's useful life. The length of the contract would have to be at least 75% of the actual life of the asset. This would be the case if, for example, an agency has a lease contract for a motor vehicle that extends for 48 months and the agency estimates the useful life of the vehicle at 60 months. In this case, the term of the lease runs for 80% of the normal life of the asset, meeting the criteria. If the term of the lease had been less than 45 months, the lease would not have qualified under this criteria since 45 months is 75% of the useful life of the asset. In addition, if the beginning of a lease term falls within the last 25% of the total estimated useful life of the leased asset, including earlier years of use, the lease is considered an operating lease. Record the liability as an obligation under capital lease, general ledger account 1716.
d. The net present value of future minimum lease payments at the inception of the lease are 90% or more of the fair market value of the real or personal property. A calculation is made for both the lessee's incremental borrowing rate and for the lessor's implicit interest rate. The present value amounts are then compared to the fair market value of the asset. If the present value amount of either of the calculations exceed 90% of the fair market value, the lease should be classified as a capital lease. Report the liability as an obligation under capital lease, general ledger account 1716.
e. In addition to one of the items above, the lease must not have a cancellation clause in the contract to be considered a capital lease. If the lease contract has a cancellation clause, it cannot be considered a capital lease and should be reported as an operating lease. A true cancellation clause allows the lessee to terminate at any time for any reason. A clause specifying the cancellation of the lease due to nonappropriation of funds does not eliminate the possibility that the lease is a capital lease. If the chances of the lease being canceled due to nonappropriation are considered to be remote (normally true in the State), the lease must fail all other criteria before considering it an operating lease.

.102
If the lease does not meet any one of the above criteria in .101 (a) through (d) and the condition in (e), the lease should be recorded as an operating lease in the agency's accounting records. See OAM 15 80 00 on Commitments for more information on operating leases.

It goes on for several more pages. And this is just about recording a lease. And it depends in several places on "implicit interest rate" and "fair market value".

That complexity.

Now, do you want to keep asserting that a high school graduate could do the books for the FDA?

http://www.careerbui...89-301684476-wm-6

Duties and Responsibilities
Â Prepares spreadsheets for project budgets
Â Inputs annual budget in Pentamation
Â Tracks grant and project expenditures, files claim payments, records financial entries
Â Maintains communication with project directors/supervisors
Â Works in coordination with current accounting staff for fiscal project management
Â Performs other duties as assigned

Requirements Qualifications
Â High School Diploma with a minimum of 5 years accounting experience
Â Experience in general office procedures
Â Strong organizational skills and flexibility
Â Ability to maintain a professional and cooperative working relationship with office personnel, staff and public.
Â Ability to work under tight deadlines
Â Proficiency in Excel, Word, Outlook and Pentamation software

then the FDA would have a clue :-)

Post #311,602 by drook 7/23/09 4:28:08 PM Reply	You were talking about forecasts when you said it was easy And even if we weren't, even GL accounts aren't quite so straightforward as you're claiming. And I know you know that, but here's an example from the Oregon Accounting Manual (first good reference I found googling): Oregon Department of Administrative Services State Controller's Division Number 15.60.30.PR Criteria for Recording a Capital Lease .101 An asset and a liability should be recorded in an agency's accounting records as a capital lease when the present value of the minimum future lease payments is $5,000 or more and any one of the following conditions in (a) through (d) and the condition in (e) are met: a. Ownership of the leased real property or personal property will be transferred to the agency at the end of the lease. In this case, record the liability as a lease-purchase contract payable, general ledger account 1715. b. The lease contains a bargain purchase option. A bargain purchase option exists when the lessee can exercise a provision in the lease to buy the asset sometime during the term of the lease at a price considerably lower than the fair market value of the asset. Also, if there was reasonable assurance or it was the agency's intention at the start of the lease that a purchase option would be exercised, the lease would be considered a capital lease. In this case, record the liability as a lease-purchase contract payable, general ledger account 1715. c. Lease terms are 75% or more of the real or personal property's useful life. The length of the contract would have to be at least 75% of the actual life of the asset. This would be the case if, for example, an agency has a lease contract for a motor vehicle that extends for 48 months and the agency estimates the useful life of the vehicle at 60 months. In this case, the term of the lease runs for 80% of the normal life of the asset, meeting the criteria. If the term of the lease had been less than 45 months, the lease would not have qualified under this criteria since 45 months is 75% of the useful life of the asset. In addition, if the beginning of a lease term falls within the last 25% of the total estimated useful life of the leased asset, including earlier years of use, the lease is considered an operating lease. Record the liability as an obligation under capital lease, general ledger account 1716. d. The net present value of future minimum lease payments at the inception of the lease are 90% or more of the fair market value of the real or personal property. A calculation is made for both the lessee's incremental borrowing rate and for the lessor's implicit interest rate. The present value amounts are then compared to the fair market value of the asset. If the present value amount of either of the calculations exceed 90% of the fair market value, the lease should be classified as a capital lease. Report the liability as an obligation under capital lease, general ledger account 1716. e. In addition to one of the items above, the lease must not have a cancellation clause in the contract to be considered a capital lease. If the lease contract has a cancellation clause, it cannot be considered a capital lease and should be reported as an operating lease. A true cancellation clause allows the lessee to terminate at any time for any reason. A clause specifying the cancellation of the lease due to nonappropriation of funds does not eliminate the possibility that the lease is a capital lease. If the chances of the lease being canceled due to nonappropriation are considered to be remote (normally true in the State), the lease must fail all other criteria before considering it an operating lease. .102 If the lease does not meet any one of the above criteria in .101 (a) through (d) and the condition in (e), the lease should be recorded as an operating lease in the agency's accounting records. See OAM 15 80 00 on Commitments for more information on operating leases. It goes on for several more pages. And this is just about recording a lease. And it depends in several places on "implicit interest rate" and "fair market value". That complexity. Now, do you want to keep asserting that a high school graduate could do the books for the FDA? -- Drew
Post #311,608 by beepster 7/23/09 4:56:10 PM Reply	No, but a college grad could our accounting manual was over 300 pages. 9 levels of G/L accounting, 5 operating divisions, over 30 functional orgs split into a couple hundred or more individual departments. You pay taxes. I would expect that you would hold them a shade more accountable for keeping track of your money. Given the size of the GAO, I don't see why a resource or 2 couldn't be borrowed. I've done that job at a bigger organization. Its not simple...but its not rocket science. Its accounting. If your portfolio manager loses half your money...(or even just a couple grand) are you going to be that forgiving? (cause based on these posts..I want to be your financial planner) I will choose a path that's clear. I will choose freewill.
Post #311,618 by boxley 7/23/09 5:18:23 PM Reply	hire a couple of these at 17.50 an hr http://www.careerbui...89-301684476-wm-6 Duties and Responsibilities Â Prepares spreadsheets for project budgets Â Inputs annual budget in Pentamation Â Tracks grant and project expenditures, files claim payments, records financial entries Â Maintains communication with project directors/supervisors Â Works in coordination with current accounting staff for fiscal project management Â Performs other duties as assigned Requirements Qualifications Â High School Diploma with a minimum of 5 years accounting experience Â Experience in general office procedures Â Strong organizational skills and flexibility Â Ability to maintain a professional and cooperative working relationship with office personnel, staff and public. Â Ability to work under tight deadlines Â Proficiency in Excel, Word, Outlook and Pentamation software then the FDA would have a clue :-)
Post #311,620 by beepster 7/23/09 5:34:18 PM Reply	Maybe oversimplifying... ...but a couple of those and a Sr Budget Analyst (dc salary range 50-70k) would do the job quite handily. I will choose a path that's clear. I will choose freewill.
Post #311,637 by boxley 7/23/09 9:39:21 PM Reply	you are just like drook keeping the highschoolers in the basement :-)
Post #311,643 by beepster 7/23/09 9:50:06 PM Reply	c'mon dude one of the people on staff has to be in charge of telling the "little people" what to do while he reads the Post. I will choose a path that's clear. I will choose freewill.
Post #311,647 by boxley 7/23/09 10:13:03 PM Reply	makes me glad I never graduated highschool I went two years further than cousin jethro and he was a brain surgeon and double nought spy and the piled higher and deepers I am chuckling amongst at tech gatherings find it tres amusing until they find out its true

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