UCR

UCR Policies and Procedures

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Campus Policy Number 200-61
PAN Review Guidelines
Policy Owner: Financial Control
Effective Date: 5/1/08

 

I. OVERVIEW

This policy provides guidance regarding Post Audit Notification (PAN) review responsibility.

A. Scope: UCRFS and PPS PAN Reviews.

B. Objective:

Define the philosophy of PAN reviews

Describe accountability concepts as it relates to PAN

Describe the critical accountability and PAN roles of Transactor/Preparer and Reviewer

Provide the minimum procedures for PAN reviews

II. BACKGROUND

PAN was designed to help manage high-volume paperless financial transactions. A management function that PAN accomplishes is the paperless transaction approval process. PAN speeds-up the processing of high volume paperless financial transaction by eliminating the need for individual transaction approvals. Productivity gains can be significant where “blanket” approvals can be utilized over individual transaction approvals. PAN also enables the elimination of form routing approvals therefore significantly reducing transaction turn-around times.

PAN notices also provide early notification for correcting transaction errors before month-end. PAN notices alert Financial Managers that certain transactions have been processed. This can facilitate the subsequent monthly ledger review/analysis function.

Another critical management function that PAN accomplishes is establishing accountability. Each financial transaction should be processed within an established accountability structure that ensures no one employee has total control of a transaction without a timely subsequent review by another employee. Such a system reduces the risk of inappropriate actions or uncorrected errors. The PAN process provides for a minimal level of separation of employee duties through the required involvement of at least two employees in each transaction.

Therefore, the distinct Transactor/Preparer and Reviewer roles are the most critical to ensure success within the PAN process.
For transactions that do not process PANs, validation occurs during the monthly ledger review/analysis process. This monthly ledger review/analysis process compares financial activity against the financial representation of a unit’s operating plan (budget). The budget becomes the control point where actual financial activity is analyzed against.

Various UCRFS reports provide a monthly analysis that compares actual financial activity against established budgets. Principles of Resource Planning and Financial Management promulgates that these reports be prepared monthly and management respond to any financial activity deviations from budget. When financial activity is not consistent with planned budgets additional validations are required to ensure ledgers are in a reportable condition.
 

III. POLICY

Transactors are given the blanket authority to process budgetary and financial transactions for which he/she is qualified. Transactors/Preparers are empowered to perform their duties and are accountable for the accuracy and completeness of budgetary and financial transactions. The Transactor/Preparers must understand all relevant policies and regulatory requirements as well as the purpose of each transaction since these will be processed directly into the financial/PPS system generally without additional authorization.

Reviewers are also accountable for the accuracy and completeness of budgetary and financial/PPS transactions. Reviewers also must understand all relevant policies and regulatory requirements as well as the purpose of each transaction since these have already been processed directly into the financial/PPS system. Reviewers must have knowledge and understanding of his/her unit’s operating and funding structure to recognize inappropriate transactions. Reviewers must also exercise professional judgment in determining the extent of procedures necessary to achieve an adequate PAN review.
 

 IV. PROCEDURES

A. A PAN Reviewer, at a minimum, is examining each transaction that triggers a PAN notice for:

Appropriate FAU distribution (account, fund, activity, and function)

Completeness

 Accuracy

Compliance with policies, regulations, and other requirements

Overall appropriateness (e.g., associated with a budget and appropriate for the departmental operations and University funds).

For a list of UCRFS transactions that trigger a PAN review, go to: http://www.accounting.ucr.edu/forms/sourcecodes.xls .


B. All PAN transactions must be reviewed within two (2) business days. Accounts Payable transactions (e.g., travel vouchers, vendor payments, and Procards) are somewhat different from other PAN transactions. They result in the immediate disbursement of funds, and University policy requires a separate authorization. It is very critical that these transactions are reviewed within two business days.

C. PAN emails are sent daily.

D. Two day late UCRFS PAN notices are sent to the unit’s System Access Administrator (SAA). Five day late notices are sent to the organization’s CFAO, the Controller and Audit & Advisory Services.

E. Transactors/Preparers cannot review transactions they have generated.

F. Reviewers should immediately respond to any noted errors or in-appropriate transactions that could indicate fraud or loss of University funds.

G. Reviewers, working with their SAAs, should make arrangements with “Back-up” Reviewers for absences.

H. Within UCRFS, the “Review All” button is a “shortcut” device that facilitates reviewing multiple PAN review lines. It reduces the number of “clicks” when a reviewer is presented with multiple items to review. This does not however diminish the Reviewer’s responsibility for each transaction.
 

V. REFERENCES

UCR Policy & Procedure 300-64 Principles of Resource Planning & Financial Management: http://fboapps.ucr.edu/policies/index.php?path=viewPolicies.php&policy=300-64

Accounting Services: http://accounting.ucr.edu/

Audit and Advisory Services: http://audit.ucr.edu/

UCRFS Ledger Review Guidelines: http://fboapps.ucr.edu/policies/index.php?path=viewPolicies.php&policy=200-97

iViews UCRFS PAN: http://www.cnc.ucr.edu/camtasia/ucrfs_totals/PanReviewNv14/PanReviewNv14.html

PPS Pan Workshop: http://accounting.ucr.edu/ppspan.htm