Create and Maintain Encumbrances (30.2.1)
  • 23 Apr 2024
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Create and Maintain Encumbrances (30.2.1)

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Article summary

Business Process Overview

Encumbrances are used to obligate Appropriations for goods or services ordered and subsequently are unobligated when the goods or services are received and approved for payment. Creating a manual encumbrance requires the Agency Encumbrance Processor to enter the same information that is provided by MFMP and the Agency Business System for adding an encumbrance.

Business Process Diagram

Business Process Diagram for 30.2.1 Create and Maintain Encumbrances

Business Roles

The Business Process Flow Diagrams use horizontal swim lanes to depict where activities are performed by different parties or systems. Each swim lane is titled with a role, either agency-based or within DFS, and in some cases, is representative of an external entity or system. The swim lanes may change from page to page within a single business subprocess as more or fewer roles are required to execute sections of the business subprocess. 

Business Process Flows Details

The tables below describe steps in each business subprocess as reflected on the Business Process Flow Diagrams. The tables also reflect information associated with each step describing the intent of the specific process. Florida PALM screenshots are included within the sections to allow connections to be made from specific business subprocess steps to screens within Florida PALM. This information should be read in conjunction with the Business Process Flow Diagrams.

Process Step ID

Process Step Title

Description of Process

1

Inbound Encumbrance Load (POI002)

A flat file interface is established with Agency Business System and Florida PALM to obtain Encumbrance data. Florida PALM receives PO data from agency business system in a standard file format.


The PO Reference field may be used to capture an agency assigned identifier.


2

Inbound Encumbrance Spreadsheet Upload (POI004)

The Agency PO Spreadsheet Upload Processor can use the Inbound Encumbrance Spreadsheet Upload to prepare and enter encumbrances for import into Florida PALM.


A SpeedKey may be used in the PO Spreadsheet Upload to populate the PO/encumbrance distribution lines with ChartField values. Agencies will have the opportunity to define their own SpeedKeys.


The PO Reference field may be used to capture an agency assigned identifier.


3

Perform Interface Error Checking

Edit validations are performed on each interface before the data is allowed to load to the PO/Encumbrance tables. If file is rejected, all transactions in the file are rejected and the file must be resubmitted once issue is resolved.


 If the file is not rejected, edit validations are performed on each transaction before the data is allowed to load for processing in the PO/Encumbrance module.


 Edit Validations include:

  • Chartfield Validation
  • Amount Validation
  • Open Period Validation
  • Supplier Validation

 

Additional Interface exceptions may occur when the data is validated against specific interface edits. Examples include: duplicate data in the file, incorrect data, missing required fields, and inactive ChartFields. Agencies will need to resend any transactions that error in a future interface.


4

Load Inbound PO Data

Florida PALM loads the Encumbrance data and systematically generates the encumbrance ID. An Approval Required field is provided in the interface file and on the spreadsheet to mark the transactions for approval.


Additional validations (e.g., budget check) will be performed during the transaction life cycle. Agencies can correct errors in Florida PALM on the Add/Update PO page. The agency would need to correct their business system if corrected in Florida PALM.


5

Request Encumbrance

The Agency Encumbrance Approver can request an encumbrance be entered or updated directly in Florida PALM.


6

Create/Update
Encumbrance

An Encumbrance may be established manually or updated by an Agency Encumbrance Processor with information as requested by the Approver or someone else in the agency.


A SpeedKey may be used to populate the encumbrance distribution lines with ChartField values when entering a manual encumbrance. Agencies will have the opportunity to define their own SpeedKeys.


7

Run Edit Check

The Edit Check Process for encumbrances entered manually in the system will occur on the PO save. The Edit Check Process will validate that ChartField values are active, validate Combination Edit rules applicable to the transaction and validate that the accounting period is open.


If edit errors are identified the transaction will not process. The user will get a popup message on the PO save if the encumbrance fails the combo edit rules.


8

Resolve Edit Errors

Edit errors that occur when an Encumbrance is entered manually must be resolved prior to the transaction proceeding. The system will not allow the PO/Encumbrance to be saved until all the required fields are provided with valid active values.


Processors should confirm the validity of the ChartField values and the ChartField String used on the transaction and make necessary updates. Agency Encumbrance Processor should confirm that the date of the transaction falls within an open Budget Period.


If errors persist after making updates, and a SpeedKey is being used, The Agency Encumbrance Processor should consult with Agency COA Maintainer to determine if the SpeedKey was established inaccurately. The Agency Encumbrance Processor may resolve by deleting the transaction if needed.


9

Initiate Encumbrance Workflow (POW001)

If the Encumbrance passes the initial edits the encumbrance workflow will initiate. Encumbrances established manually require approval from the Agency Encumbrance Approver before being submitted for the Budget Check process. Agencies have the option to assign both the Agency Encumbrance Processor and the Agency Encumbrance Approver role to the same person.


The encumbrance may be updated on the Add/Update PO page to resolve accounting errors, and for budget errors that occur during the Budget Check. 


The Monitor Encumbrances business subprocess shows the steps related to monitoring and resolving encumbrance errors.


Reference documents may be attached manually in Florida PALM to the PO Encumbrance.


Agency encumbrances entered by interface or Spreadsheet Upload may be designated as pre-approved by entering a “N” in the Approval Required field in the interface or spreadsheet upload or may be designated to process through the approval workflow. It depends on your agency policy.


Encumbrance Workflow is used to return any items requiring action to the Agency Encumbrance Processor.


The Encumbrance Aging Report may be used to monitor encumbrances.


10

Review Encumbrance

An Agency Encumbrance Approver reviews the PO encumbrances selected for approval, The approver will review ChartField values, Supplier information and amounts.


If an error is found, the Agency Encumbrance Approver has the option to return the encumbrance to the Agency Encumbrance Processor for corrections or may choose to deny the Encumbrance.


11

Deny Encumbrance

If an Agency Encumbrance Approver denies the Encumbrance, the encumbrance is returned to the Agency Encumbrance Processor to edit, delete, or cancel the encumbrance. When the encumbrance is denied the Agency Approver will enter a comment with the reason for denial.


The PO/Encumbrance cannot be cancelled if it has been Budget Checked, or partially paid on a Voucher. A cancelled PO/Encumbrance is traceable in the system.


If a PO/Encumbrance is deleted the record is deleted entirely and is no longer viewable in the system. A PO/encumbrance cannot be deleted if it has been budget checked, or partially paid on a voucher, it is not on hold or dispatched, and it is not a blanket PO.


12

 

Approve Encumbrance

The Agency Encumbrance Approver approves the PO Encumbrance, and the PO/encumbrance continues to the Budget Check process.


13

Run Budget Check

Each Encumbrance is subject to Budget Check where availability of spending authority is validated. If there is not available spending authority, the transaction fails and must go through exception handling to continue.


Any Budget Check errors are followed up for resolution through the Monitor Encumbrances business subprocess.


The Agency Encumbrance Processor, and others, use the Budget and Cash Exceptions Report and the Outstanding Encumbrance Error Report to manage budget exceptions.


14

Record Encumbrance

Encumbrances passing Budget Check are recorded in the Encumbrance Budget Ledger and Budget is consumed. The Encumbrance Aging Report (POR002) is available for managing encumbrance activity.


Each encumbrance is released when a Voucher is created referencing the encumbrance. The PO details including theChart of Accounts values are brought into the voucher from the encumbrance.


Encumbrances may be partially reduced when vouchers do not consume the entire encumbrance. 


To change the Chart of Account values on the voucher the Agency Encumbrance Processor must first update the encumbrance with the new values, a change order is not required to update Chart of Account values. 


A change order is required if the PO/Encumbrance was dispatched and then a field such as Supplier ID, PO Line Amount, PO Line Quantity is changed/updated on the PO/Encumbrance.


15

Dispatch PO

A PO/Encumbrance must be dispatched before it is available to be used on a voucher transaction. To be eligible for dispatch, a PO/Encumbrance must have:

  • A status of Approved
  • A budget checking status of Valid


The dispatch process does not pick up PO/encumbrances that are On Hold.


16

Outbound Encumbrance Extract (POI001)

Florida PALM interfaces with MFMP and Agency Business Systems, as applicable, to provide encumbrance information, including encumbrance errors, updates, and closures.

Encumbrance Transaction Entry Page:

Encumbrance Transaction Entry Page

Encumbrance Distribution Entry Page:

Encumbrance Distribution Entry Page

Demo Video

Click the image below to view a demonstration video on creating an encumbrance. 


Accounting Events

Accounting events originate during transaction processing in the applicable Source Module. The accounting events impact the Source Module, Commitment Control ledgers, and the General Ledger (Actuals).

  • Source Module accounting entries require user input (I) of the primary line (i.e., expenditure, revenues) with an automated (A) system offsetting line (i.e., payable, receivable) during transaction entry. The source model transaction must pass Edit Check, Budget Check, and Cash Check (on applicable entries) before posting the transaction.
  • The Run Budget Check (Commitment Control) process automatically affects balances in the appropriate budget ledger (i.e., appropriation, spendable cash) if the transaction passes the budget check process.
  • After the transaction is posted in the source module, an automated system process summarizes and posts the entries in the General Ledger module to the Actuals Ledger.

The table below provides the most common accounting events applicable to this business process.

Acct Event ID 

Accounting Event

Source Module
 Accounting Entry

Commitment Control
Ledger(s) Impact

General Ledger (Actuals) Entry

PO01

 

Establish Encumbrance

No Entry

Establishes Encumbrance and reduces Available Appropriation and Allotment balances.

o Entry

Reports

Key Reports are displayed as icons with the Report Number on the Business Process Flow Diagrams. The table below provides the reports identified to be produced at a particular process step or is used to support the completion of a process step.

Report Number

Report RICEFW ID

Report Description

Report Source

Report Frequency

Audience

R1

KKR018

Agency Obligations Report – A custom report that provides encumbrances and payables by ChartField combinations.

PeopleSoft

Daily, Monthly

Agency

R3

KKR058

Budget and Cash Checking Exceptions/Warnings Report – A custom report that lists transactions budget and cash check exceptions and warnings along with transaction amounts, to include the type of exception and where an override was applied.

PeopleSoft

Daily, Monthly

Agency, DFS

R4

POR002

Encumbrance Aging Report – A report that lists all encumbrances, the date encumbrance was established, and the date the last activity occurred.

Data Warehouse

Daily, Monthly, Annually

Agency

R5

POR006

Purchase Orders Under Pending Approval Group (WorkCenter) – A report that lists purchase orders that are under the 'Pending Approval' group.

PeopleSoft

Daily

Agency

R6

POR009

Outstanding Encumbrance Error Report – A report that lists unresolved encumbrance exceptions.

PeopleSoft

Daily

Agency

Note: A complete list of reports may be found in the Reports Catalog.

Interfaces

The table below provides the Interface IDs for each interface identified on the Business Process Flow Diagrams.

Interface Number

Interface Description

Interface Frequency

Source

Target

POI001

Outbound Encumbrance Extract – Outbound interface containing encumbrance errors, updates, and closures.

Daily

Florida PALM

Agency Business System

POI002

Inbound Encumbrance Load – Inbound interface to establish and maintain encumbrances. 

DailyAgency Business SystemFlorida PALM

POI004

Inbound Encumbrance Spreadsheet Upload – Inbound interface to load, establish, and maintain encumbrances via spreadsheet (Excel) upload.

Daily

Agency Business System

Florida PALM

Note: A complete list of conversions may be found in the Interface Catalog.

Forms

The table below provides the Form Numbers for any forms identified on the Business Process Flow Diagrams.

Form Number

Form Description

Audience

N/A



Workflows

The table below provides the Workflow Numbers for any workflows identified on the Business Process Flow Diagrams. 

Workflow Number

Workflow Description

Audience

POW001

Encumbrance Workflow – Workflow to route encumbrances for approval.Agency

Version History

Date

Revision Description

12/01/2023

Original Version

01/16/2024Minor updates to Process Step #2 from Solution Design Segment II
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