OSD Clarifies UFR Reporting of COVID-Related Funds

AAFCPAs recently received clarification for UFR filers related to reporting of certain COVID-related funding. (As a reminder, due to COVID-19, the Operational Service Division (OSD) granted a 30-day extension to the Uniform Financial Report (UFR) FY2021 filing deadline, now due December 15^th. UFR filers are not required to file a request for this extension.)

AAFCPAs hosted a CFO Roundtable in November for large Human & Social Services Agencies. We invited Jacquiline Brown, Director of Financial Compliance and Marie Imbert, Financial Reporting and Quality Assurance, from the Massachusetts OSD, who offered clarification on the following CFO questions:

Q: Many providers received Executive Office of Health and Human Services funding for covid testing or providing vaccinations. Are these revenues and expenditures expected to be shown in a separate Schedule B program?  Providers have a lot of questions on how to present these contracts in the UFR.

A: All revenue and expenses should be reported in the program directly affected.  In instances where it affects all programs such as COVID Testing for all programs it should be allocated as such. These expenses/revenues are not to be reported separately in a Schedule B program.

AAFCPAs advises clients to report the revenue and expenses to the programs where there was material use.

Q: Clarification of PPP revenues if provider has elected to recognize under ASU 470 (forgiveness of debt).  It is our understanding that this revenue will show up as other revenue on line 48R (individually in each Schedule B).  Under ASU 958 (recognize as a contribution), this revenue will show up on a contribution line.  Additionally, there may be instances where the expenses were incurred in FY’20 but the revenue is recorded in FY’21.  In this instance, the PPP forgiveness revenue should be recorded on the statement of activities on line #23 “other increase (decrease)”.

A: Correct. OSD confirmed AAFCPAs interpretation of compliance.

Compliance with state regulations surrounding the preparation and filing of the UFR is critical to the operations of human and social services organizations. AAFCPAs is widely regarded as the authority in the human and health services industry, a reputation we have worked hard to build and maintain. The UFR has been an area of focus for us since its inception in 1993. We strive to provide business solutions that assist our clients in complying with state regulations and avoid issues that could negatively impact profitability and operating net assets.

If you have any questions or need assistance, please contact Katie Belanger, CPA at 774.512.4033, kbelanger@nullaafcpa.com; or your AAFCPAs Partner.