Accrued Expenses

Accrued expenses are expenses of products/services received for which payment will be processed in the next period.  Accrued expense represents a liability (payable) to the university until the payment for the products/services has been made. As the university records liabilities only when it has external payables, internal purchases (from other University of Alberta units) are not subject to accrual.

Expense accruals are generally not required as units have additional time at the university’s month-end and year-end to submit invoices to Payment Services. There are however, some limited circumstances when an accrual may be required.

Accrual requirements (applicable to all funds):

  • Most units accrue at year-end only; some units may accrue more frequently.
  • Units are required to accrue expenses equal to or greater than $10,000.00 per item or an accumulation of items totaling $10.000.00 or more. At the discretion of the Senior Financial Officer (SFO), a lower threshold may be applied.
  • GST is not accrued as this amount is not material.
  • Corporate purchasing card expenses between March mid-month cutoff and March 31 -
    FS processes an institutional accrual for these expenses. SFO’s wishing to accrue these expenses at a detailed level may request an accrual by contacting FS.
  • Third party vendor interfaces - Payment Services will work with vendors to process transactions to March 31 within year-end deadlines. Where vendors are unable to make this deadline, units will be advised via FS-Bulletin and FS will process an institutional accrual. SFOs wishing to accrue these expenses at a detailed level may request an accrual by contacting FS.
  • Accrual of expenses is requested by submitting a GLJE Request (with attached Accrual Template form) and supporting documentation.
  • Signature from SFO on the GLJE Request form is confirming that the accrual is accurate, appropriate and that there is support at the unit level that the product/service has been received.
  • The following represent when an accrual may be required (taking into account the accrual threshold of $10,000.00):


Reason

Supporting documentation required

Product/service received, but no invoice

Vendor unable to generate invoice, but provides estimate via letter; Purchase Order

Portion of invoice is under dispute

Copy of invoice indicating amounts that are not in dispute.

Travel and Expense Module closes March 31

Copy of Travel and Expense Claim

FS Standard Support Template

FS Standard Support Template
Note: FS in consultation with the SFO will develop a Standard Support Template for those accruals that are recurring (within year, or from year to year).

Other

Will require additional explanation as to why an accrual is required. A copy of the invoice is required. If an invoice is not available, then SFO would contact FS to discuss and determine appropriate supporting documentation.

 

Note: Last updated: March 2018