0100 Accounting and Financial Reporting

The Office of the State Controller (OSC) is responsible for the uniform NCAS and related subsystems, which maintain timely, reliable, accurate, consistent, and complete accounting information on the State of North Carolina government entity. The uniform NCAS includes the financial policies, procedures, and computer software that affect all departments and agencies of the State.

Each state agency is responsible for maintaining a complete general ledger and supporting subsystems for all funds and accounts for which it has responsibility. All financial transactions should be posted in detail in accordance with the prescribed statewide uniform chart of accounts and approved NCAS accounting policies and procedures. The ledgers should be posted, balanced, and reconciled at least monthly; however, it is strongly recommended that all agencies move toward more frequent updates with the ultimate goal of daily update cycles. On-line NCAS agencies will follow the prescribed procedures for the NCAS on-line general ledger.

GASB Statement No. 39 impacts colleges and universities that have foundations and similarly affiliated organizations whose financial data is not currently blended in the institution's annual report. These organizations must be included as part of the institution's financial reporting entity (i.e., as discretely presented component units) if they are found to be "significant." The University of North Carolina General Administration and the Community College System Office have established a uniform threshold for identifying which organizations are "significant." Under this threshold, organizations whose assets or revenues are 5% or greater of the institution's assets or revenues will be considered "significant" to the institution.

This policy applies to reporting units included in the State’s Annual Comprehensive Financial Report (ACFR) that have separately issued financial statements audited by a private CPA firm and which meet at least one of the following enclosed criteria.

The following standards should be followed in the preparation of separately issued financial statements for licensing boards of the State of North Carolina ("Boards").

The following applies to separately issued and audited GAAP-based fund (or departmental) financial statements issued for reporting units that are not legally separate.

The maximum amount of vacation leave that may be carried by an employee from one calendar year to another is 30 days. Any excess at calendar year-end, except for the provisions of Section 35.26 of Session Law 2018-145, is converted to sick leave and does not appear as a liability. Section 35.26 of Session Law 2018-145 provides for the reduction of any vacation leave remaining on December 31 of each year in excess of 30 days shall be reduced by the number of Special Annual Leave Bonus days awarded in Session Law 2018-145 that were actually used by the employee during the year such that the calculation of vacation leave days that would convert to sick leave shall reflect a deduction of those days of special annual leave awarded that were used by the employee during the year. The number of Special Annual Leave days awarded in Section 35.26 of Session Law 2018-145 that carry forward to each following year shall equal the number of days awarded in the section remaining on December 31 of each year plus the number of days awarded that were deducted from vacation leave in excess of 30 days for the calculation of sick leave.

Infrastructure assets are long-lived capital assets that normally are stationary in nature and normally can be preserved for a significantly greater number of years than most capital assets. Examples of infrastructure assets include roads, bridges, tunnels, drainage systems, water and sewer systems, dams, and lighting systems. Infrastructure assets acquired prior to July 1, 2001 may be classified as part of other capital assets (e.g., buildings).

Land is the real estate property held by the State. It can be purchased or donated. Since land is considered not to have a limited useful life and its salvage value is unlikely to be less than its acquisition cost, land is not depreciated.

When the State does not hold title to property acquired with federal funds, the property should not be capitalized. (Possession does not equal ownership). The property, however, can be inventoried for tracking purposes.