Section 18-8-1.1-2 - DefinitionsThe terms and definitions included in this chapter are used by MDHS. The sources of these terms include 45 C.F.R. § 75.2, documents issued by the State Auditor's Office, the U.S. Office of Management and Budgets Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal awards, which has been codified at 2 C.F.R. §200, et seq., and applicable OMB circulars.
1. Accounting Procedures: Methods implemented to ensure that financial information is reflected in accounting records in a consistent, proper, and orderly manner.2. Accounting System: All records, formal and informal, together with the procedures related to the assembling, classifying, recording and reporting of information concerning the financial operations and conditions of a fiscal entity.3. Accounts Payable: Liabilities of the Subgrantee owed to persons, firms, or corporations for goods and services received. Obligations of subgrant funds must be liquidated no later than forty-five (45) days from the end of the subgrant period.4. Accounts Receivable: Amounts due to the Subgrantee from persons, firms, or corporations for goods and services.5. Accrual Basis Accounting: The basis of accounting under which revenues are recorded in the fiscal year they are earned, and expenditures recorded in the fiscal year they are incurred. Obligations of subgrant funds must be liquidated no later than forty-five (45) days from the end of the subgrant period.6. Accrued Expenditure: An expense incurred for goods and services received during a given period which has not been paid. Accrued expenses cannot be reported on the Final Claim Support Form.7. Acquisition Cost: The net invoice unit price of the equipment, including the cost of modifications, shipping, attachments, and accessories, necessary to make the property usable for the purpose for which it was acquired.8. Administrative Cost: Any expenditure for governmental functions normally associated with administration of a public assistance program. The cost must be included in determining administrative costs subject to the statutory limitation on administrative costs, regardless of whether the expenditure is incurred by the State, a subrecipient, a grantee, or a contractor of the State.9. Administrative Closeout: The process by which MDHS administratively performs subgrant closeout procedures upon determining that the Subgrantee failed to close out a program year within the specified amount of time or failed to properly adhere to established closeout policies and regulations.10. Allocation: The amount of funds provided by the Funding Division to a Subgrantee to incur obligations and expenditures over certain period of time.11. Appropriated Funds: A sum set aside by formal legislative action for a particular purpose for specific use during a specified period of time.12. Assets: The entire recourse of the Subgrantee fund, including any property (tangible or intangible) of monetary value.13. Audit: The process by which a MDHS and/or any other federal entity auditor examines, reviews, and assesses the financial records with supporting documentation of Subgrantees to evaluate the overall financial statements and/or to review and evaluate the programmatic measures.14. Award: Grants and other agreements in the form of money or property, in lieu of money, by the Federal/State Government to an eligible recipient.15. Bond: A form of money guarantee which protects against loss caused by another party or by some contingency over which that party may have no control. Any bond, in which may be required by MDHS, shall be obtained from companies holding certificates of authority as acceptable sureties, according to 31 C.F.R. § 223 . A list of these companies is published annually by the U.S. Department of the Treasury in its Circular 570.16. Bond, Bid Guarantee: A firm commitment such as a bid bond, certified check, or other negotiable instrument accompanying a bid as assurance that the bidder will, upon acceptance of the bid, execute such contractual documents as may be required within the time specified. This bond must be equivalent to five percent (5%) of the bid price.17. Bond, Fidelity: A bond against any loss resulting from fraud or lack of integrity, honesty, or fidelity of one (1) or more employees, officers, or other persons holding a position of trust with the Subgrantee, which must be payable to MDHS. This bond must be equivalent to twenty-five percent (25%) of the total subgrant amount.18. Bond, Payment: A bond executed in connection with a contract to assure payment, as required by law, of all persons supplying labor and materials in the execution of the work provided for the subgrant.19. Bond, Performance: A bond executed in connection with a subgrant to secure fulfillment of all the Subgrantee's obligations amount within a specified period of time.20. Budget: An authorized plan of proposed expenditures and the means of financing them with respect to an allocated amount within a specific period of time.21. Budgetary Accounting: A method of accounting, which allows for the comparison of actual revenues and expenditures to budget figures. In many cases, budgetary accounting applies to allocations and the expenditures authorized thereby.22. Budget Narrative: A written justification adequately explaining the Subgrantee's funding needs.23. Budget Summary: A compilation of the detailed data contained in the Cost Summary Support Sheet (To be provided by the respective MDHS Funding Division).24. Capital Improvement: Expenditures made by the Subgrantee that either increase the value of real property or extend its useful life. Examples may include fences, outdoor lighting, heating/cooling systems, plumbing and minor renovations. Capital improvements are permissible only as allowed by programmatic regulations and approved through the programmatic division.25. Cash: Currency, checks, money orders, or bank drafts on deposit in the account of the Subgrantee agency.26. Cash Balance: Currency, checks, money orders, or bank drafts on deposit in the account of the Subgrantee agency less any checks written against these receipts.27. Cash Basis Accounting: The basis of accounting under which revenues are recorded when received and expenditures are recorded when paid.28. Cash Disbursement Journal: A journal kept to record in sequential order the expenditures of funds whether by check or other method of payment.29. Cash Federal/State: Cash held by the Subgrantee which has been received from the grantor agency and becomes a part of the total cash balance.30. Cash Local: Cash held by the Subgrantee which has been received from sources at the local level including private, county and/or municipal government sources.31. Cash Outlay: Total amount of cash spent by a Subgrantee during a specific period of time either for expenditures, transfers between funds or refunds of unexpended cash to the grantor agency.32. Cash Payment: The payment of cash for expenditures. Such payments may precede the expenditure (an advance), coincide with the expenditure (a direct payment), or follow the expenditure (the payment of a liability).33. Cash Program Income: Cash held by the Subgrantee that is directly generated by a supported activity or earned as a result of the subgrant.34. Cash Receipt: Cash received by a Subgrantee for which it acknowledges accountability.35. Cash Receipts Journal: A journal kept to record in sequential order, the receipt of all funds.36. Certification of Subgrant Compliance: A form by which the Subgrantee releases the unexpended and/or unobligated balance of the subgrant/agreement to MDHS (MDHS-SGCC-1012).37. Claim Support Form: The form used to report monthly costs incurred under MDHS subgrants and to request funds on a cost reimbursement or cash advances basis (MDHS-BA-CS-001 and MDHS-BA-CS-002).38. Closeout: The process by which MDHS determines that all applicable administrative actions and all required work elements of the subgrant/agreement have been completed.39. Closeout Form: A checklist used by the Subgrantee to ensure that all closeout documents are included as a part of the Subgrantee closeout package (MDHS-SGCC-1011).40. Cognizant Agency: The Federal agency responsible for negotiating and approving indirect cost rates for the Subgrantee.41. Commodities: Budget category that includes various consumable supplies, goods, or merchandise of every kind purchased by a Subgrantee or lower tier sub-recipient.42. Contract: A legal instrument by which a non-Federal entity purchases property or services needed to carry out the project or program under a federal award. The term contract as used in this manual does not include legal instruments that are considered Federal grants or subgrants. The nature of the relationship between the parties will determine whether the instrument is a contract or a subgrant.43. Corrective Action: An action or additional information from the Subgrantee that is required for the Subgrantee to be considered meeting a requirement.44. Cost Reimbursement: A method of funding subgrants under which the Subgrantee receives funds the following month for actual expenses incurred during the previous month. The Subgrantee is reimbursed for the Federal and/or State portion of cash payments reported on the monthly Claim Support Form: Advanced (MDHS-BA-CS-001).45. Cost Summary Support Sheet: A budget form used to describe the basis for determining the cost for the various activities on the Budget Summary (To be provided by the respective MDHS Funding Division).46. Cumulative Cost: Total cost incurred for a specific grant from the beginning date through the current period.47. Current Needs: A method of funding a subgrant where the Subgrantee evaluates its cash needs for sixty (60) days and submits a request for these funds thirty (30) days prior to the period funds will be needed. Pending receipt of federal funding, the Subgrantee may request payment for the Federal and/or State portion of expenses expected to be paid during the sixty (60) day period of projected cash needs once the subgrant agreement becomes effective. A 'Cash Advance Claim Support Form' (MDHS-BA-CS-002) and Supplemental Form are required under the current needs/cash advance method to initiate the payment process. A monthly 'Division Claim Support Form' (To be provided by the respective MDHS Funding Division) is also required to report costs incurred.48. Debarment: An action taken by a debarring official in accordance with Federal regulations and established procedures to exclude a legal entity or a participant from participating in covered transactions. A participant so excluded is debarred.49. Direct Cost: Cost immediately identifiable with specific subgrant activities that is recorded as a subgrant expenditure when incurred.50. Encumbrances: Commodities and services which have been ordered but the goods have not been received or the service has not been rendered for funds committed during current subgrant period.51. Equipment/Property: Tangible personal equipment/property of a non-consumable nature with a useful life of one (1) year or more. See also definitions provided in 2 C.F.R. §200 for capital assets, computing devices, general purpose equipment, information technology systems, special purpose equipment, and supplies. (Refer to the Property Management chapter of this manual for items that are classified as equipment, regardless of costs).52. Estimate: An approximate calculation or judgement of the value, number quantity, or extend of something.53. Expenditure: Exchange of an asset or incurrence of a liability for an asset, goods received, or services rendered after a voucher for goods and/or services is approved.54. E-verify: An internet-based system that compares information from an employee's Form I-9, Employment Eligibility Verification, to date from U.S. Department of Homeland Security and Social Security Administration records to confirm employment eligibility. (https://www.e-verify.gov/)55. Expense: Cost incurred (cash or noncash) which is presumed to benefit operations of the current fiscal period.56. Financial Statements: Presentations of financial data that shows the financial position and the results of financial operations of a fund, a group of accounts, or an entire Subgrantee unit for a particular accounting period.57. Finding: An item that is a requirement of the Subgrantee that has been identified by MDHS that requires additional action or information in order to be considered met.58. Fiscal Year: The twelve (12) month period that is the legal period for budgeting and accounting for the Subgrantee.59. Fixed Assets: Assets of a long-term character and non-consumable in nature which are intended to be held or used for a period exceeding one (1) year. This includes land, buildings, improvements, machinery, furniture and other equipment. Some exclusions apply.60. Fixed Price Contract: Contractual agreement whereby payments to the Subgrantee are contingent on the Subgrantee fulfilling the agreement terms.61. Fixed Unit Price: Method of funding subgrants under which the Subgrantee is paid a predetermined fixed price for services performed.62. Funding Division: A MDHS Division that provides monies from State and/or Federal sources to fund State and/or Federal contracts or subgrants for the provision of services for or on behalf of MDHS.63. Funding Source: A source from which funds are derived.64. General Journal: A journal or book of original entry that requires both the credited and debited amounts to be listed, along with respective amounts being credited or debited. Specifically, a journal consists of a chronological record of the transactions showing an explanation of each transaction, the accounts affected, whether those accounts are increased or decreased, and by what amount. It may also be known as a General Ledger.65. Generally Accepted Accounting Principles (GAAP): A set rules and regulations that represent the accepted accounting principles and practices.66. Indirect Cost: Costs incurred for common or joint objectives, and therefore, cannot be readily and specifically identified with a particular project or activity.67. Indirect Cost Plan: The documentation prepared by an organization to substantiate its claim for reimbursement of indirect cost. The plan provides the basis for review and negotiations leading to the establishment of an organization's indirect cost rate.68. Indirect Cost Rate: Expressed as a percentage of the indirect costs to a direct cost base pending prior approval by the appropriate authority.69. In-Kind Contributions: The value of non-cash contributions provided by the Subgrantee or non-federal parties. Contributions may be in the form of charges for real property and nonexpendable personal property or the value of goods or services directly benefitting and specifically identifiable to the project or program.70. Internal Control: The plan of organization and all of the methods and measures adopted within a fund or agency to safeguard its assets, check the accuracy and reliability of the accounting data, promote operational efficiency, and encourage adherence to prescribed managerial policies.71. Invoice: The original bill from the vendor indicating the price, description of goods or services sold and terms of the sale. This is used as documentary evidence that the service has been performed or the material received. If not an original, the invoice must read "customer copy."72. Lower-Tier Agreement: A legally binding document between a MDHS Subgrantee and another entity to provide a service required under the MDHS subgrant, rather than the direct delivery of the services by the MDHS Subgrantee. Lower-tier agreements must be approved by MDHS. All lower-tier sub-recipients must comply with the requirements specified in the MDHS Subgrant Manual.73. Matching Contributions Local Cash, Local In-Kind Program Income: The Subgrantee's non-federal cash, in-kind contributions program income used to meet federal matching requirements, including the outlay of other non-federal monies contributed to the Subgrantee by other public agencies, institutions, private organizations, and individuals.74. MDHS Subgrant Manual: A policy manual developed by MDHS that implements the agency's policies and procedures that are applicable to MDHS Subgrantees, agreements, and any lower-tier agreements.75. Non-Expendable Equipment/ Property: Equipment or property that has a continuing use and an expected useful life of one (1) year or more. The equipment/property shall be tagged and placed on the Property Inventory Control List.76. Obligations: Amounts which a Subgrantee may be legally required to pay out of its resources including encumbrances, as well as, accounts payable and accrued liabilities.77. Outstanding Claimants: A list of all possible claimants to MDHS funds. Refer to Chapter 9, Closeout Procedures.78. Outstanding Encumbrances: The portion of the total prospective expenditures filed (such as purchase orders or executory contracts) that remain to be liquidated.79. Outlays: The spending or disbursing of money.80. Pass-through Entity; A non-Federal entity that provides a subgrant to a Subgrantee to carry out part of a Federal program.81. Performance Based Subgrant Agreement: A Subgrant agreement whereby payments to the Subgrantee or lower-tier subrecipient are performance based (contingent on the Subgrantee or lower-tier sub-grantee achieving specified elements of performance).82. Program Budget: A budget in which projected expenditures are assigned to specific activities.83. Program Income: Gross income earned by the Subgrantee that is directly generated by a subgrant or agreement supported activities.84. Property Inventory Control: List An updated list of all equipment purchased by the Subgrantee with subgrant funds, as required by the Property Management chapter of this manual.85. Property Management Policy: Uniform standards adopted by all divisions and the Property Unit within subgrant funds, as required by the Property Management chapter of this manual.86. Purchase Order: A document that authorizes the purchase of specified merchandise or services and authorizes the verification and holding of funds to cover the purchase.87. Questioned Cost: An amount expended or received by the Subgrantee that in the monitor's judgement: (1) Is noncompliant or suspected noncompliant with Federal statutes, regulations, or the terms and conditions of the Federal award;(2) At the time of the monitoring review, lacked adequate documentation to support compliance; or(3) Appeared unreasonable and did not reflect the actions a prudent person would take in the circumstances.88. Record Retention and Access Policy: Federal regulations that establish the requirements for record retention and access to records of Subgrantees and any lower tier subrecipients.89. Service Provider: A person or governmental department, agency, or other entity that receives federal financial assistance to carry out a program through a state or local government; but does not include an individual who is a beneficiary of such a program.90. Single Audit Act Amendments: A federal act passed by Congress in October of 1984, and amended in 1996, establishing audit requirements according to 2 C.F.R. §200, Subpart F, Audit Requirements, for subgrants that expend a total amount equal to or in excess of $1,000,000 in a single year. The Single Audit Act requires the reporting entity to have its federal financial assistance programs audited on an organization-wide basis by an independent Certified Public Accountant.91. Standard Assurance Policy: Assurances and certifications by a Subgrantee that they will comply with the regulations, policies, guidelines, and requirements imposed by the federal sponsoring agency and the grantor agency and ensure the compliance of any lower-tier subrecipients.92. Subgrant/Agreement: An award provided through a contractual arrangement by a pass-through entity (MDHS) to a Subgrantee for the Subgrantee to carry out part of a Federal award received by MDHS. It does not include payments to a contractor or payments to an individual that is a beneficiary of a Federal program.93. Subgrant/Agreement Modification: A contractual agreement that alters or amends any subgrant or agreement that has been approved by appropriate MDHS personnel.94. Subgrantee Travel Policy: Policy concerning in-state and out-of-state travel that defines uniform guidelines for the reimbursement of travel expenses of Subgrantees.95. Subrecipient: An entity that receives an award from a pass-through entity to carry out part of a Federal award; but does not include an individual that is a beneficiary of such award.96. Subsidiary Account: Group of related accounts which support in detail the summary data recorded in a control account.97. Subsidiary Ledger: A group of subsidiary accounts; the sum of the accounts should equal the balance of the related control account.98. Trial Balance: A list of the debit and credit balances of the individual accounts in a general ledger kept by double entry accounting.99. Unallowable Cost: A cost that is: (1) not allocable or beneficial to the subgrant, either directly or indirectly;(2) not treated consistently with costs incurred with non-federal funds;(3) lacking the necessary documentation required by statute or regulation;(4) not authorized under the subgrant agreement: or(5) not allowable under a specific statute, regulation, or policy.100. Unexpended Balance: The portion of an allocation received that has not been expended; the balance remaining after deducting the accumulated expenditures.101. Vendor: A company or individual who has rendered a service or sold merchandise to a Subgrantee or lower-tier subrecipient.18 Miss. Code. R. 8-1.1-2