Stop the practice of showing funds for 'in review' invoices as expenditure.
Current Alma practice is that EDI invoices automatically load into Alma and expend from a fund whilst still 'in review' and before the 'approval' stage.
Below are some examples where the practice of expending a fund whilst the invoice is still 'in review' is causing us issues:
We have full end-to-end invoice integration from our suppliers, via Alma and into Agresso. We don't send through manual invoices for payment. Our invoice data is automatically transferred through to Agresso every evening once an invoice has been approved. Only those invoices that have moved out of review are included in the export. Any invoices 'in review' will not be in the export but will be showing as expended on our system. This means that Agresso and Alma will always be out of step whilst we have invoices 'in review'. This makes it impossible to reconcile Alma and Agresso.
Some invoices have over 200 lines and it may take us some days to work through each transaction. There may be issues with incomplete or inaccurate data. We have to make a few manual amendments in order to ensure that the Agresso transfer completes successfully. Only once all of that is done do we 'approve'. Whilst this is happening our Alma and Agresso systems are out of sync. What is the point of the approval step?
We are working with IT on enabling the accrual accounting functionality so that our Finance Team don't have to maintain a separate spreadsheet of prepayments and meet monthly to reconcile. There is little benefit to be gained from working on this functionality if, once again, the two systems are always out of sync. We can't reliably turn up to meetings to discuss our accounts when the Alma reported expenditure includes invoices that aren't yet paid.
If an invoice arrives that doesn't have an Alma PO number on it, the transaction amount is expended but because there is no PO to match to the amount remains encumbered too.
Any 'in review' invoices should remain as 'encumbrance' until they have been 'approved' or have another 'pending expenditure' type invoice status.
Tracey Middleton
shared this idea
Dear colleagues,
Thanks you for suggesting this idea.
After reading it carefully, my understanding is that the need is for a new “entity” which will serve as a “bridge” between encumbrance and expenditure. This bridge will be named “Pending invoices”.
Any POL which is invoiced will be disencumbered and the amount will be added to the “pending invoices balance”. When an invoice is approved, the amount should be reduced from the “pending invoices balance” and added as an expenditure.
- Is this understanding correct?
- Do you think that the definition of using this "bridge" should be in institution level, or might be different from invoice to invoice?
Please note that this is a complicated addition. We will need to define the behavior in rollover, and in any place that changes balances etc.
Thanks for your collaboration,
Tamar Fuches
Alma product team
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j.morrow@neu.edu
commented
Thanks for the suggestion, Tamar. But I agree with the colleagues advocating for just not expending an invoice until it is approved. It is especially problematic at end of fiscal year as we don't want an invoice we haven't yet approved to show as an expenditure when we do roll over.
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Sarah Marchman
commented
Thank you for following up, Tamar. I think your understanding of the request is correct and what you describe is what our library would want (a new "pending invoice balance" amount that removes the encumbrance according to the rules and moves to an expenditure after invoice approval). I think keeping a transaction as an encumbrance on an "in review" invoice would not be helpful for us; that would still mean these transactions are hard for us to understand.
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Tracey Middleton
commented
Hi Tamar - agree with Oliver and Tom - it needs to be simple. Our preference would be for transactions to remain as encumbrances until the invoice is approved. No need to for a 'bridge' status.
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Tom Francis
commented
Thanks for the update Tamar. Personally I don't think there's any need for a new "entity" to be created; all we need is for a transaction to remain an encumbrance until the point an invoice is approved. I don't think there is a need to create an extra category between encumbrance and expenditure.
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Olivier Simioni
commented
Dear Tamar. Thanks for your proposal. I think it's too complicated to add a new status ("pending..."). One thing would be easy as asked in Tracey Middleton's message: "any 'in review' invoices should remain as 'encumbrance' until they have been 'approved'." To be more precise: this functioning is important when there is 'encumbrance' (invoice-line with POL). When there is no 'encumbrance' there is no need for an intermediate status. It's just that, until the invoice is validated, the funds should not be impacted.
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Olivier Simioni
commented
It would indeed be nice to fix that. One of the problems with that is at the end of the year. When there is not enough money left, the accounts disappear in the on review EDI invoices and we have to add the accounts manually whereas there is a POL in the invoice line that should make that automatically.
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Naomi Crotty
commented
Also agree. In addition it would be good if the exchange rate was also fixed when the invoice is approved in Alma, and not at invoice date, or date of invoice being keyed into or imported into Alma. This would make our actual expenditure in our local currency much more closely match the expenditure recorded in Alma. Particularly important for international invoices in the tens of thousands of dollars, and when we are trying to spend the budget to the last cent at EOFY.
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Tom Francis
commented
Almost time for my annual "has there been any progress with this?" comment...
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Karin Wikoff
commented
I totally agree -- now if I can just find my login so I can vote....
I was recently called upon to give a report to the College administration on how much money we anticipate spending on subscriptions from now to the end of our fiscal year. Unbeknownst to me, our Business Coordinator had requested that we hold 2 e-resource invoices until after Jan 1 (OK-ed by the vendor). So our Acquisitions people entered the invoices and just left them unapproved until January. Well, that was almost $30K that LOOKED like expenditures already spent which had NOT been sent to the College. When we went over my report before I sent it on to the College, we fortunately found these two invoices and manually deducted them from already-spent tallies and manually added them to still-to-be-spent tallies. It would have been a significant problem if I had underestimated remaining costs by $30,000!
I do NOT like having invoices which are just created but not approved be tallied right along with the approved invoices. Not. At. All.
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Tom Francis
commented
Has there been any progress with this lately? I recall there was a NERS option last year that would have addressed this, but in a way that created a different problem, and I don't think it got enough votes in the end.
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Katherine Rose
commented
That would be incredibly helpful to us. Whilst we're not yet using EDI invoices, we experience this problem with our foreign currency invoices. Because invoices in Alma are counted as expenditure at the invoice stage, rather than at the approval or final payment stage, we have no way of truly reflecting what we have actually paid from our finance system in Alma. We put this in the invoice payment voucher amount field, but this doesn't update the Alma expenditure.
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Tom Francis
commented
I heartily endorse this idea, and have just trimmed my voting elsewhere to free up three votes I can give to this.
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James Coates
commented
I wouldn't agree with this change. For one time purchases, at the point when most of our invoices appear on the system in review state the goods/service has been received or is available. Our accountants agree that the money is considered as being expended at that point. At the month end I report to them what is sat in the Review task list so that they can 'accrue' for that expenditure. Subscriptions will never match between Alma and our Finance system (also Agresso) because our accountants prepay and accrue by month (i.e. split each sub into 12 payments). Using accrual accounting in Alma only splits between two fiscal periods.