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Fund Balance with Treasury

Reconciliation Procedures

Treasury Financial Manual Guidance

I TFM 2-5100 Reconciling Fund Balance with Treasury Accounts
Fund Balance with Treasury Reconciliation Procedures: A Supplement to I TFM 2-5100

About the Reconcilation Process

Why We Developed this Process

We want you to know the importance of timeliness and accuracy in performing your reconciling and clearing duties.

You, the reconciler, are assuring that your portion of the Fund Balance with Treasury is properly reported on your financial reports and to Treasury's General Ledger.

This Web site contains the methods that you should use in reconciling Deposit, Undistributed and Check Issue differences effectively, and easily. You are shown how and where to get the information you need to clear your differences.

Why You Need to Reconcile

The validity of the classified receipt and outlay data published in the financial reports of the U.S. Government by the Financial Management Service depends on the accuracy of the monthly Statement of Transaction (FMS-224) and Statement of Accountability (SF-1218 and FMS 1219) submitted by all departments and agencies. The purpose of reconciling is to ensure the accuracy and timeliness of deposit and disbursement data reflected in the Fund Balance with Treasury.

Internal control systems ensures that all funds are recorded and accounted for correctly. You should always be suspicious of problems that won't go away. You are the "first alert" when indicators of fraud are present. Your concerns should be relayed to a supervisor who, after appropriate review, will determine whether or not the office of Inspector General (OIG) should be involved. Your OIG routinely examines the internal control system for faults and vulnerabilities.

Agencies should identify and clear differences within 2 months of occurrence. During the reconciliation process, be aware of conditions creating your differences. Keep records of the causes of differences and analyze monthly to see if the same conditions are recurring; i.e., differences between months, missed bank-cutoff times, failure to get copies of the documents, bank-processing errors, your agency reporting/processing errors, or Treasury errors.

Reconciling the Deposit Statement of Difference

At the close of each accounting month an FMS 224 or FMS 1219/1220 is transmitted to FMS via GOALS II for transactions (receipts and outlays) that occurred during the month. If no transactions occurred, a report with the words "No transactions" must be submitted. You may refer to the Treasury Financial Manual (I TFM 2-3100 or I TFM 2-3300) for detailed information on preparation of the FMS 1219, SF1220 and FMS 224.

Agencies should maintain transaction logs as a part of their internal accounting system. The transaction log for deposits should contain detail information that relate to the SF 215 (Deposit Ticket ) and the SF5515 (Debit Voucher). The totals of these logs for each month should agree with the totals reported on your FMS224 or FMS1219.

An automated comparison of totals is made of the deposit data submitted by you on Line 3, Section III of the FMS 224 or Section I, Line 4.20 and Section II, Part B, Column 3 and 4 of the FMS 1219 with that submitted by commercial banks and or FRB's through the CA$HLINK II system. An FMS-6652 "Statement of Differences-Deposit Transactions" is generated if there is a difference between the FMS 224/ 1219 and CA$HLINK II. A copy of the FMS-6652 is available GOALS/IAS as well as the DT/DV Detail Support Listing. If there is no difference, you will not receive an FMS-6652, but a copy of the DT/DV Detail Support Listing will be available to you for your records on line in GOALS.

To identify items that are causing a difference compare the documents listed on the DT/DV Support Listings to the documents listed on the transaction logs prepared by your agency.

Prepare a list of all unmatched items. The total unmatched items should agree with your Statement of Difference. The unmatched items should be researched and resolved within 2 months of occurrence.

Reasons for Unmatched Items

Problem: Items on agency listing but not on Treasury Support Listing.
Solution: Possible causes for this discrepancy is that your bank entered the wrong Agency Location Code (ALC) into the Ca$h-Link II system or your bank failed to enter the document into the Ca$h-Link II system all together. You will have to contact your bank for correction.
Problem: Item on Treasury Listing but not on agency listing.
Solution: If you have a copy of the document, report it on your next FMS 224 or FMS 1219/1220 as a prior period adjustment. If you do not have a copy of the document, contact the bank for clarification. The bank may have entered a wrong ALC.
Problem: Agency reported document in the wrong month.
Solution: Adjust the amount to the correct month in section III of the FMS 224 or section II, Part B and Column 3 and 4 of the FMS 1219.
Problem: Bank reported document in the wrong month.
Solution: Contact CAD for a date correction. CAD will need a fax of the confirmed copy of the document.
Problem: Incorrect amount reported on Treasury Support Listing.
Solution: Contact your bank for a correction.
Problem: Incorrect amount reported by agency.
Solution: Report the difference on your FMS 224 or FMS 1219/1220.
Problem: Agency reported deposit activity as net disbursements.
Solution: Verify that there is an offsetting differences in the SOD - Disbursements. On the FMS 224 adjust between Section II, Lines 1 and 2 and Section III, Lines 2 and 3; on the FMS 1219 adjust between Line 2.80 and Line 4.20. Be sure to use the appropriate month.

Reconciling Disbursement Statement of Differences

How did this difference occur?

8 digit Agency Location Codes

Agencies that use Regional Finance Centers to issue checks (8 digit ALC's) report their disbursement activity monthly to Treasury/FMS using an FMS 224 Statement of Transactions. This activity is reported in section I of the FMS 224 as well as in section II, line 1, by month. This disbursing activity is also reported to Treasury by Regional Finance Centers (Treasury Disbursing Offices), as well as by the Interagency Payment and Collections (IPAC) System.

The amount reported for each month on Line I, section II of your FMS 224 is compared to the total accumulated for each month by Treasury from the two sources previously mentioned. If the amounts reported on the FMS 224 do not agree with the amounts reported to Treasury by the other sources, a Statement of Differences (SOD) is created. Notification of this is available in GOALS II, in the form of the FMS6652, Statement of Differences - Undistributed.

4 digit Agency Location Codes

Agencies that have authority to issue Treasury checks (4 digit ALC's) report their disbursement activity monthly to Treasury/FMS using the FMS 1219 Statement of Accountability and FMS 1220 Statement of Transactions. Since, four digit ALC's issue checks, they have two types of disbursement differences to address, Statement of Differences - Disbursement and Checks Issued Audit Differences.

This section addresses the Statement of Differences - Disbursements.

The Statement of Differences - Disbursements is created as a result of a comparison of IPAC transactions reported on Line 2.80, Section I, Part A, and broken down by month in Section II, Part A, Column 3 of the FMS 1219, to IPAC monthly totals accumulated by Treasury from the IPAC system.

How do you resolve your difference?

Agencies should maintain transaction logs as a part of their internal accounting system. The transaction log for disbursements should contain detail information that relate to the following forms.

  • SF1081 Voucher and Schedule of Withdrawals and Credits
  • FMS 7306 Paid Billing Statement for OPAC Transactions
  • SF 1166 Voucher and Schedule of Payments
  • FMS 1185 Schedule of Unavailable Check Cancellation Credits
  • FMS 145 Schedule of Canceled EFT's
  • SF 1098 Schedule of Canceled or Undelivered Checks
  • SF 5206 Adjustments of Check Issue Amounts

Form 1081 has no effect on your statement of differences since both sides of the entry are reported in section I of the FMS 224 for eight digit ALC's and on the FMS 1220 for four digit ALC's.

Form 7306 should agree to the amount of OPAC Transactions reported on your FMS 224 or FMS 1219.

Forms 1166, 1185, 145 and 1098 should agree with the amount of net disbursements reported on your FMS 224 or FMS 1219.

Eight digit ALC's

To identify items that are causing the Statement of Differences, compare your agencies internal schedule which supports the amount reported on your FMS 224 to the activity listed on your IPAC Support Listing and RFC Support Listing. These Support Listings can be found on GOALS II.

The total of the unmatched items should agree to your Statement of Difference. Research each item to determine the reason for the discrepancy. Action should be taken to clear the difference within 2 months of occurrence.

Common reasons for differences

Problem: IPAC bills reported by Treasury, but not by the agency.
Solution: Refer to the IPAC Contact List that can be obtained from GOALS/IAS. Based on the DO Symbol, a contact name and phone number can be obtained from the list. Contact that billing agency for supporting documentation. If you feel it is a legitimate bill then report it on your next FMS 224, Section I and in Section II, Line I as a prior period adjustment. If it is not a legitimate bill charge it back to the agency. Both the bill and the chargeback must be reported on your FMS 224 for the month it was created.
Problem: IPAC bills reported by agency, but not by Treasury.
Solution: Reverse the reporting on your FMS 224. Then contact the billing agency for more information.
Problem: Amount reported to Treasury by RFC does not agree with amount reported by agency.
Solution: Contact RFC for any missing schedules (SF1098, etc.). Report these schedules on Line I, Section II of the FMS 224 for the proper audit month.
Problem: Agency reported deposit activity as net disbursements.
Solution: Verify that there is an offsetting difference in the SOD-Deposits. On the FMS 224, adjust between Section II and Section III. Be sure to use the appropriate audit month.

Four digit ALC's

For Statement of Differences - Disbursements, compare your internal schedules that support the amounts reported by you on your FMS 1219, Section I, Part A, Line 2.80 and Section II, Part A, Column 3 to the IPAC Support Listing found in GOALS II. Prepare a listing of all unmatched items. Research each item to determine the reason for the discrepancy. Action should be taken to clear the differences within 2 months of occurrence.

Common reasons for differences

Problem: IPAC bills reported by Treasury, but not by the agency.
Solution: Refer to the IPAC Contact List that can be obtained from GOALS II. Based on the DO Symbol, a contact name and phone number can be obtained from the list. Contact that billing agency for supporting documentation. If you feel it is a legitimate bill then report it on your next FMS 1219, Section I, Line 280 and Section II, Part A Column 3 as a prior period adjustment as well as on your FMS 1220. If it is not a legitimate bill charge it back to the agency. Both the bill and the chargeback must be reported on your FMS 1219 for the month it was created.
Problem: IPAC bills reported by agency but not by Treasury.
Solution: Reverse amount from FMS 1219 and FMS 1220. Then contact the billing agency for more information.
Problem: Agency reported deposit activity as net disbursements.
Solution: Verify that there is an offsetting difference in the SOD-Deposits. On the FMS1219, adjust between Line 2.80 and Line 4.20. Be sure to use the appropriate audit month.

Reconciling Check Issue Audit Differences

Your agency may receive correspondence monthly from Treasury/Financial Management Services' Cash Accounting Division (CAD) that notifies you of your Checks Issued Audit Differences. Checks Issued Audit Differences are created as a result of a comparison of Checks Issued totals reported on lines 2.10, 2.11 and 2.12 of the FMS 1219 to the Checks Issued amounts and related adjustments recorded in the Check Payment and Reconciliation System reported to Treasury by SF1179 Checks Issued Tape.

Agencies should maintain transaction logs to support the Checks Issued amount reported on the FMS 1219 and SF1179. The logs should contain a list of Treasury checks issued and SF 5206's, Adjustments of Check Issue Amount.

Compare the detail from the FMS 1219 transaction log to the detail data on the SF1179 transaction log. Unmatched items should be researched and cleared within in 2 months of occurrence.

Common reasons for differences

Problem: SF 5206 reported by Treasury but not by the agency.
Solution: Contact Treasury's Check Reconciliation Branch if a copy of the SF 5206 has not been received. Report the SF 5206 on line 2.11 in Section I Part A of the FMS 1219 and on the FMS 1220.
Problem: Check issued but not paid within 12 months.
Solution: If a Limited Payability Credit has been issued by FMS' Accounts Branch through IPAC, the credit is to be reported in Section I, Part A, line 2.12 and line 2.80 of the FMS 1219 as well as the FMS1220. If the Limited Payability Credit has been issued via SF1081, report the check issue difference in Section I, Part A Line 2.12 of the FMS 1219 and on the FMS 1220. Charge the same account as shown on the SF1081 or adjustments thereto.
Problem: Void checks were reported on the SF 1179 tape with dollar amounts.
Solution: Contact Check Reconciliation Branch and request that the checks be voided in the CP&R system. This has to be done within twelve months or Accounts Branch will issue a Limited Payability.
Problem: Agency incorrectly reported checks on line 2.10 of the FMS 1219.
Solution: Report the difference between the FMS 1219 and the SF 1179 tape on the next FMS 1219 on line 2.12.
Problem: SF 1179 tape has not been processed by Treasury
Solution: Contact the Check Reconciliation Branch.
Problem: FMS 1219 has not been processed received by Treasury.
Solution: Contact the agency office that submits the FMS 1219.

Things To Remember

  1. ASAP payments are reported as a reduction of collection activity in section III of the SF 224.
  2. FEDTAX II payments are reported as a reduction of collection activity in section III of the SF 224.
  3. Small Differences for deposits (amounts of $50 or less) are absorbed by Treasury/FMS.
  4. Cash Accounting Division can make CA$HLINK corrections if provided a confirmed or original copy of the SF215 or SF5515. However, these adjustments are limited to Agency Location Code, voucher number and voucher date. Your bank will have to make any adjustments to dollar amounts.
  5. Between month differences have can corrected by a date change in activity reported by your bank or Regional Finance Center or it must be corrected on your FMS 224 or FMS 1219.
  6. SOD-Deposits is for transaction accomplished at a financial institution, i.e. SF215's, SF5515's, ASAP and FEDTAX II transactions. Report based on date presented or mailed (voucher date).
  7. SOD-Disbursements is for IPAC, and RFC transactions, i.e., IPAC billings, SF1166, SF1098, etc. Report based on accomplished date recorded by Treasury.
  8. Reconcile your Differences. Do not make unsupported entries on your SF224 or SF1219/1220.
  9. FBWT Reconciliation training is available from the Treasury Agency Services (202-874-9560).
  10. FMS on-site visits are available. Contact CAD.
  11. Cash Accounting Division is here to assist you in your reconciliation efforts. We can be reached at (202) 874-9810.

Contact Phone Numbers

Cash Accounting Division
(202) 874-9810

Check Reconciliation Branch
(202) 874-8150

Accounts Branch
(202) 874-8253

CA$HLINK II System Owner
(202) 874-7132

Treasury Agency Services
(202) 874-9560

GOALS Marketing
(202) 874-8270

   Last Updated:  March 30, 2011

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