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Reporting Requirements for Annual Financial Reports of State Agencies and Universities

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Reporting Requirements for Annual Financial Reports of State Agencies and Universities

Introduction

Highlights

This section provides a summary of highlights for this year’s requirements. The detailed information may be found in the related sections for each topic. The following are only highlights.

  1. Except where otherwise specifically stated in this website, all references to “agency” or “agencies” means any agency, university or component unit that has an “agency number.”
  2. Any agency not in compliance with the requirements in this document may receive a letter addressed to its executive management and may be referred to the State Auditor’s Office for audit consideration as authorized under Texas Government Code, Section 2101.0377.
  3. All deadlines set forth in HB 4510 (passed by the 88th Legislature) regarding the annual financial reporting dates are effective as of fiscal 2024. See Deadlines for more information.
  4. Each agency is required to post and reconcile its annual financial data to USAS and the agency’s accounting system on a GAAP basis by Nov. 1. The reconciliation must be at the general ledger account level and/or GAAP source/object level within the USAS D23 fund. Agencies must adjust any reconciling items in USAS so the USAS balance sheet/statement of net position or USAS operating statement/statement of changes in fiduciary net position and interfund/interagency activity report accurately reflect the agency’s financial position as supported by the agency accounting system. If the agency publishes an audited AFR and enters the pension information in its internal system, there will be a reconciling outage between the internal system and USAS. The agency must note this on the USAS Certification form through the ACFR Note and Reporting Certification (CNRC) web application.
  5. Details of submission requirements for agencies identified as “GR consolidated agencies” or “full reporting agencies” are provided in GR Consolidated Agencies Submission Requirements and Full Reporting Agencies Submission Requirements.
  6. Various web applications are used to submit certain AFR disclosures. Some of these web applications are submitted as a supplement to required note submissions — others are submitted in place of the traditional schedule submissions. Submit the agency’s notes from its published AFR sent as attachments in an email to frs@cpa.texas.gov. Each note should be submitted as an individually attached file.

    Web applications that are supplemental to the traditional note submission:
    Web applications that constitute submission of schedule information:
  7. If an independently audited annual financial report (AFR) is not required by statute but is available, the audited AFR and audit adjustments must be forwarded to the Financial Reporting section for review by Dec. 15.
  8. If an audited financial report or an audit adjustment is not in compliance with the reporting requirements, or there are issues or concerns with the adjustment, the agency must communicate with its financial reporting analyst prior to finalization of the report and/or adjustment.
  9. The agency must not round any of the numbers presented in its AFR. This includes numbers in notes as well as exhibits.
  10. For D23 funds in fund type 09 (GAAP suspense funds), ensure revenues and expenditures equal zero at the GAAP source/object level. For suspense funds used as a clearing account, also ensure the agency has zeroed out cash balances belonging to the state and reclassified those balances to the appropriate fund type at fiscal year-end. Funds held in the clearing account for an outside entity or for another agency remain in the clearing account. For more information, see Suspense Funds.
  11. Use the beginning capital asset balances found in the CANSS web application, the beginning long-term liability balances found in the LTLN web application and the beginning cash and cash equivalents balances found in the SOCF web application.
  12. Report inventories and prepaid items in governmental funds using the consumption method by reporting inventories and prepaid items as assets and deferring the recognition of expenditure until the period in which inventories and prepaid items are used or consumed. For more information, see Inventories and Prepaid Items.
  13. Research and Development (R&D) is a cluster on the federal schedule. Unlike other clusters, the R&D cluster is not defined by a list of assistance listing numbers (ALNs). Agencies must manually select the R&D tag when entering records to the SEFA web application. If you have questions on the R&D cluster, email sefa.texas@cpa.texas.gov.
  14. Each agency is required to reconcile its USAS CIST to its internal accounting system monthly. DAFR8660 – Fund Cash History by Agency Including Shared Funds reports USAS cash transactions to agencies that control the appropriated fund. The reconciliation starts with the DAFR8660 ending balance, adds deposits in transit and subtracts vouchers in transit to reconcile to the internal system balance.
  15. Enter T in the PDT field when T-code 225 is used to enter an RTI transaction on the Recurring Transaction Profile (55) screen.
  16. FMQuery – SIRS reports are presented on a pre-closing basis. Therefore, a separate calculation must be made when determining ending fund balance/net position balances. This separate calculation is not required for the DAFR reports, since DAFR reports are presented on a post-closing basis. For more information, see How GL Accounts Close for Specific GAAP Fund Groups.
  17. GASB 99 (effective as of fiscal 2024) addresses the classification and reporting requirements of derivative instruments and exchange-like financial guarantees. See Note 7 for more information regarding the disclosure requirements.
  18. GASB 100 (effective as of fiscal 2024) prescribes the accounting and financial reporting for accounting changes and error corrections.