PDT2022

1. DFA FINANCIAL CONTROL
UPDATE 2022
Donna M. Trujillo

2. MANUAL OF MODEL
ACCOUNTING PRACTICES
(MAP’S)
The Financial Control Division
(FCD) of the New Mexico
Department of Finance and
Administration was created by
NMSA 1978, §6-5-1 as amended.
The responsibilities enumerated in
NMSA 1978, §6-5-1 through§6-5-6,
constitute the strategic, operational,
reporting, and compliance
objectives of FCD and, collectively,
its mission of effectively accounting
for and controlling the use of State
resources.

3. MANAGEMENT TEAM
The State has established a management team to achieve the
objectives. This team consists of the state agencies’ chief
financial officers (CFO). Rule 2.20.5 NMAC, an administrative
rule issued by FCD, establishes the responsibilities of a CFO.
Those responsibilities parallel the state agency strategic,
operational, and reporting and compliance objectives
established by statute and by Rule 2.20.6 NMAC.

4. INTERNAL
CONTROL
ENVIRONMENT
The internal environment includes the tone
of an organization, influencing the risk
consciousness of its people, and is the
basis for all other components of an
enterprise’s risk management.
The State of New Mexico has a low risk
tolerance. This is reflected in its adoption of
generally accepted accounting principles as its
budgetary basis, its adoption by rule of operating
standards, its recognition in statute of model
accounting practices, and its implementation of an
enterprise resource planning tool based on “best
practices.

5. CHANGES TO
MAP’S FOR
FISCAL YEAR
2023
FIN 4 – Purchasing
FIN 5 Payables
FIN 13 – External
Systems

6. FIN 4 – PURCHASING
2022 CHANGES FIN 4.1.D.3 – Amount only
box must be selected on all
purchase orders and
requisitions
All purchase orders and requisitions should be
created in SHARE with the amount only box
selected. If the quantity box is checked, the system
will expect the receipting process to be followed,
which is not configured for agency use.

7. FIN 4.13.1 – INDIVIDUALS ARE
REQUIRED TO ATTEND DFA
PURCHASING 101 AFTER
RECEIVING A PROCUREMENT OR
MAP’S VIOLATION
Upon the DFA determination of a MAP violation by
the agency, the state agency Department CFO, the
agency Chief Procurement Officer, and those
individuals identified with the procurement violation
must attend a DFA Purchasing 101 training class
within 90 calendar days of the determination letter, or
at the first date the DFA training class is offered.
Upon the State Purchasing Agent’s determination of a
procurement violation by the agency, the state agency
Department CFO, the agency Chief Procurement Officer, and
others identified as involved with the procurement violation
process must register, attend, and pass the required training
class as directed by the State Purchasing Agent within 90
calendar days of the determination letter, or on the first date the
training class is offered. These same individuals must attend
DFA Purchasing 101 within 90 days of the determination letter.

8. FIN 5
PAYABLES-
2022
CHANGES
FIN 5.4.D.3 – Warrant cancellations must be submitted to
FCD electronically.
• The Warrant Cancellation form along with a copy of the Affidavit or
Warrant should be emailed to vendor.relations@state.nm.us. On the
subject line of the email please list the Business Unit and “Warrant
Cancellation” (example: 34100 Warrant Cancellation). Hard copies are
no longer required.
FIN 5.3.D.6 – Mailout agencies must be approved by FCD.
• State agencies that receive warrants through the mail should verify all
warrants listed on the warrant register.
• The warrant register should be signed and returned to the FCD
Distribution Center by email within 5 business days of receipt of warrants.
• All agencies must be approved by the FCD Director or FCD Deputy
Director to be on the mail out program.
FIN 5.8.D.4 – Board/Commission members must notate on
the ISTE how long a meeting lasted and if attendance was
in person or virtual.

9. FIN 5
PAYABLES-
2022
CHANGES
–CONT.
FIN 5.9 – Warrant issued for 80% advance travel cannot
be canceled through the normal cancellation
process.
FIN 5.10.B.1.d & e – attachments should be submitted in
SHARE as a PDF file (single file preferred). The payment
message box must be populated on all payment vouchers.
FIN 5.14.B.1.c & d– W9s must have a wet signature or
verified digital signature. Agencies are also required to
verify the accuracy and legitimacy of all W9 submissions
to prevent fraud.
FIN 5.16 – Purchasing card policies were updated.

10. FIN 13 – EXTERNAL SYSTEMS-2022 CHANGES
FIN 13.1.D.4 – External
systems must be approved in
writing by FCD on a go
forward basis.
Agencies must request
approval in writing from FCD
to use a subsidiary system. The
approval process will include
consultation with DFA, DoIT
and the requesting agency.

11. BOF DRAWS AND
REPORTING
8 July 2022
The FY22 year-end
submission deadline for all
draw requests for
processing in FY22 will be
July 8, 2022.
8 July 2022
Draw requests representing an
accrued grant expenditure that has
not been submitted by July 8,2022,
for the year-end statewide accrual
will be booked into the next fiscal
period (FY2023, fiscal period 1: July
2022).
2023
Timing differences may occur if
there are expenditures that
must be accrued to be GAAP
compliant but will not be
processed by the BOF until FY
2023.

12. BOF-
CONTINUED
The timing difference in the first year will result in a deficit fund balance
in your capital project fund.
GASB 34 Paragraph 112b Reporting Interfund Activity—Nonreciprocal
interfund activity. Please note that GASB defines operating transfers as
Other financing sources and uses, not as revenue (available and
measurable does not apply).
Note XX: Capital Projects Fund Balance
 Agency Fund number xxxxx is carrying forward a fund balance
deficit at year end in the amount of $xxxxx. The deficit reflects
timing differences of cash transfers from the Board of Finance
for expenditures accrued at year end. The deficits will be
funded by draws from the Board of Finance subsequent to
year-end.

13. GASB 87 - LEASES
GASB 87 is effective for the State of New Mexico Annual Comprehensive Financial Report
(ACFR) and all entities therein comprised, for the fiscal year ending June 30, 2022.
Leases subject to GASB 87 referred to as “Right to Use (RTU) leases" hereinafter are:
All contracts/leases that:
Have a calculated present value of $25,000 using the interest rate stated in the agreement or an
incremental borrowing rate (IBR) of 3% if rate is not stated,
Do not meet the definition of a short‐term lease (12 months or less),
Are not inter‐agency leases,
Are not contracts that transfer ownership; and
Are not otherwise excluded by GASB 87.

14. REPORTING TREATMENT-LESSEE
Fund Statements
• First year of contract
• Other Financing Sources
• Expenditure-New Lease
Contract-not budgeted
• First year and ongoing
• Expenditure-interest expense
• Expenditure principal
reduction
• No balance sheet items
G-W Statements
• RTU on balance sheet – grouped with
capital assets
• Lease Liability –ST portion –LT portion
--grouped with other noncurrent
liabilities
• Interest expense
• Amortization of RUA
• Identified in reconciliation statements

15. REPORTING TREATMENT-LESSOR
Fund Statements
• First year of contract
• Lease Receivable
• Deferred Inflow
• First year and ongoing
• Interest revenue
• Lease revenue
G-W Statements
• Lease Revenue
• Deferred Inflow
• Interest revenue
• Lease revenue
• Continued depreciation, if
applicable

16. NEW SHARE ACCOUNT
NUMBERS FOR GASB
87
189000 Leased Assets-Non-Depreciable Assets
189010 Leased Assets-Non-Depreciable-Land
189020 Leased Assets-Non-Depreciable-Land Improvements
189030 Leased Assets-Non-Depreciable-Mineral Rights
189040 Leased Assets-Non-Depreciable-Art and Other
189050 Leased Assets-Non-Depreciable-Infrastructure
189500 Leased Assets-Depreciable Assets
189510 Leased Assets-Depreciable-Land Improvements
189520 Leased Assets-Depreciable-Bldf & Imp
189530 Leased Assets-Depreciable-Infrastructure
189540 Leased Assets-Depreciable-Airc, Auto & Trucks
189550 Leased Assets-Depreciable-Equip & Machinery
189560 Leased Assets-Depreciable-Info Tech
189570 Leased Assets-Depreciable-Furn & Fixtures
189580 Leased Assets-Depreciable-Library Books
192000 Accum Depr-Leased Assets
192010 Accum Depr-Leased Assets-Land Improvements
192020 Accum Depr-Leased Assets-Bldg & Imp
192030 Accum Depr-Leased Assets-Infrastructure
192040 Accum Depr-Leased Assets-Airc, Auto & Trucks
192050 Accum Depr-Leased Assets-Equip & Machinery
192060 Accum Depr-Leased Assets-Info Tech
192070 Accum Depr-Leased Assets-Furn & Fixtures
192080 Accum Depr-Leased Assets-Library Books
275000 Lease Liability ST
275001 Lease Liability LT
441500 Interest Earned on Lease
442200 Lease Revenue
442200 Lease Revenue
442204 Equipment - Rental Or Lease
442205 Vehicle - Rental Or Lease
499880 O/F Sources-Lease Financing
548882 Lease Interest
561880 New Lease Contract EXP
568880 Amortization EXP-RUA

17. GASB 84 FIDUCIARY ACTIVITY
Traditionally, the most common types of fiduciary activities have been defined benefit
pension and other post-employment benefit (OPEB) plans, which continues to be the
case under the new standard (but with a twist). Other activities that are determined to
be investment trust funds, private purpose trust funds and custodial funds will also
qualify as fiduciary activities and will need to follow the updated reporting guidelines.
The new standard differentiates between certain types of fiduciary activities:
• Fiduciary component units
• Pension and OPEB arrangements that are not component units
• Other fiduciary activities

18. GASB STATEMENT NO. 84
Paragraphs 6-11, defines fiduciary activities for purposes of
accounting and financial reporting. It focuses on 1) whether a
government is controlling the assets, and 2) the beneficiaries
with whom the relationship exists. Separate criteria apply for
fiduciary component units and postemployment benefit
arrangements that are fiduciary activities.

19. FIDUCIARY FUND TYPES

20. CUSTODIAL FUNDS-”CATCH ALL”
Custodial Funds are the only fiduciary fund type that may report assets of fiduciary activities that are not
held in a GASB PEB trust or a GASB other fiduciary trust.
A custodial fund is sometimes used as a clearing account for resources received but not yet allocated to
individual funds. For external financial reporting purposes, however, such resources must be allocated to
the funds that will ultimately receive them, since, once again, fiduciary funds, including custodial funds,
may not report a government’s own resources.

21. GASB 96 –SUBSCRIPTION-BASED INFORMATION
TECHNOLOGY ARRANGEMENTS (SBITA)
The requirements of this Statement are effective for fiscal years beginning
after June 15, 2022, and all reporting periods thereafter.
The objective of this Statement is to better meet the information
needs of financial statement users by (a) establishing uniform
accounting and financial reporting requirements for SBITAs; (b)
improving the comparability of financial statements among
governments that have entered into SBITAs; and (c) enhancing the
understandability, reliability, relevance, and consistency of information
about SBITAs.

22. FINANCIAL STATEMENTS PREPARED USING THE
CURRENT FINANCIAL RESOURCES MEASUREMENT
FOCUS-SBITA
If a SBITA is expected to be paid from general government resources, the SBITA should be
accounted for and reported on a basis consistent with governmental fund accounting principles.
An expenditure and other financing source should be reported in the period the subscription
asset is initially recognized. The expenditure and other financing source should be measured as
provided in paragraphs 16–18. Subsequent governmental fund subscription payments should be
accounted for consistent with principles for debt service payments on long-term debt.

23. QUESTIONS?