Reporting Requirements for Annual Financial Reports of State Agencies and Universities
Additional Requirements for GASB 34/35
Reporting Federal and State Revenues Received from Agencies
Federal and state grants received from other agencies are recognized as either federal or state interagency pass-through revenue. Funds passed through to other agencies are recognized as either federal or state interagency pass-through expenditures.
If the grant originated from federal dollars, use the federal pass-through revenue COBJs:
- 3971 – Federal Pass-Through Revenue, Non-operating
- 3978 – Federal Pass-Through Revenue, Operating
These codes are used because the revenue originates from federal dollars and normally will remain federal dollars.
If the grant revenue originated from state appropriations, use the state grant pass-through COBJs:
- 3725 – State Grant Pass-Through Revenue, Non-operating
- 3842 – State Grant Pass-Through Revenue, Operating
It is important to use the correct COBJs to reflect pass-through revenues because these revenues are matched statewide to the pass-through expenditures.
If a university grants money from federal or state sources, it must record line items on its financial statements for federal and state pass-through expenditures. These must be entered using the appropriate COBJs:
- 7971 – Federal Pass-Through Expenditure, Non-operating
- 7978 – Federal Pass-Through Expenditure, Operating
- 7614 – State Grant Pass-Through Expenditure, Non-operating
- 7615 – State Grant Pass-Through Expenditure, Operating
Pass-through transactions must balance. However, an operating pass-through expenditure reported by the disbursing agency can balance with the recognition of non-operating pass-through revenue by the recipient agency and vice versa.