Research Paper On Funds Appropriation and MGMT

FI104 – Umoja Funds
Management Overview
Umoja Funds Management Overview – Version 24

Last Modified:
Copyright 14-Aug-13
© United Nations 1
Agenda
Course Introduction
Module 1: Umoja Funds Management Introduction
Module 2: Funds Management Master Data
Module 3: Budget Distribution
Module 4: Budget Implementation
Module 5: Budget Closing Operations
Course Summary
Course Assessment
Course Survey
Copyright © United Nations 2

Course Overview
The purpose of the Umoja Funds Management Overview course is to provide a basic
understanding of the Funds Management (FM) module within Umoja. This course
teaches users about the new business processes and procedures as a result of the
Umoja Foundation implementation.
Prerequisite Review
You should have completed the following prerequisite courses:
• Umoja Overview
• Umoja Master Data & Coding Block Overview
Course Duration: 2 hours

Course Objectives
After completing this course, you will be able to:
• Define the concept of Funds Management (FM)
• Explain the high-level FM process
• Explain the key FM terminology and business concepts
• Explain the Umoja roles required to perform the FM process
• Explain the FM Master Data maintenance elements
• Describe how FM is integrated into other areas of finance
• List the types of Umoja ECC reports available for FM

Agenda
Course Introduction
Course Assessment
Course Survey

Module 1 Objectives
After completing this module, you will be able to:
• Define the FM module of Umoja
• Explain the benefits of incorporating an integrated FM structure at UN
• Recognize how the FM module interacts with other modules of Umoja

Roles & Responsibilities
The following roles are involved in Umoja FM:
• Creates initial appropriations and allocations for

subsequent allotment issuances
• Evaluates and processes redeployment allotment
requests
Budget Office User • Creates, amends, reviews and closes Earmarked Fund
documents (Funds Reservation, Funds Pre-
Commitment Travel Funds Commitments and Funds
Blocks) per UN financial regulations and rules
• Approves and reviews Budgeting Workbench postings

via workflow
• Reviews and certifies inputs of Budget-Office on
Earmarked Funds documents (Pre-commitments,
Budget Office
Funds Reservations and Funds Blocks) via workflow
Approver • Liquidates open commitments
• Assists in opening and closing the budget periods,
re-evaluates the Purchase Orders (PO’s) and performs
budget period-end fund balance carry forwards

• Carries out the system reconciliation and

Accounting Office re-initialization activities
User • Opens the budget years when requested at year-end
by the Budget Office - Approver
• Creates and updates the FM derivation rules for

ensuring postings to FM actual ledger (9F) and the
Availability Control Ledger (AVC) (Z1 and Z2)
FM Support - User • Undertakes the system reconciliations and
re-initialization of the AVC ledger
• Performs Umoja module reconciliation activities
• Analyses the FM tables postings

• Reviews and approves Earmarked Funds documents

FM Funds • Liquidates Earmarked Fund documents when
remaining balances are no longer required
Commitment • Serves as the “Approving Officer" for Funds
Approver Commitment approvals
• Certifies Earmarked Funds documents

• Certifies Earmarked Fund documents for liquidation
FM Earmarked Funds
• Serves as a Certifying Officer
Documents Certifier • Liaises with Finance Budget Officer and Funds
Management Requisitioner

• Maintains and updates the FM Master Data

elements, including:
– Fund Groups
– Commitment items/groups
– Budget periods/groups
FM Master Data – Functional areas/groups
Maintainer – Funds centers/groups
– Funded programs/groups
• Carries out all additions, modifications and
expirations of the Master Data elements, including
updating of FM derivation rule values
• Liaises with the FM Support User role to update the
FM derivation rules, as required

What is Funds Management?
Funds Management (FM) is a module within Umoja configured to monitor revenues and
expenditures, as well as budget-related business transactions within the organization.
The primary tasks of the UN staff involved in the FM business transactions include:
• Recording the budget appropriations approved by the UN General
Assembly and revenue allocations approved by the Controller
• Recording the subsequent allotments that permit additional
spending authority
• Tracking the expenditures for individual responsibility areas
• Monitoring the funds movements in light of the budget available
• Processing the budget entry documents to allow spending
• Certification processes of budgets and associated budget
documents
• Supporting the International Public Sector Accounting Standards
(IPSAS) 24 – Presentation of Budget Information and
Financial Statements
• Carrying out the performance reporting activities

Why do we Need Funds Management?
The UN records transactions on a modified cash basis. The FM module of Umoja is an
effective means of monitoring budget at all levels of the organization.
FM provides the ability to:
Clearly report back to member states regarding appropriated, allotted and voluntary
funds
Present detailed analyses of budget utilization that can be reviewed at several levels
of the organization
Enhance the transparency within UN programs as to where funds are actually

being expended
Present improved reporting features for budgetary purposes
Support UN’s recent capabilities to adopt and support the IPSAS reporting requirements

How Are Budgets Analyzed Within Umoja Foundation?
There are six ways of classifying and analyzing budgets in Umoja Foundation:
Fund Funds Center

(Source of (Area of
budget) responsibility)
Commitment
Functional Area
Item
BUDGET (Programmatic
(Nature of
view)
expenditure)
Funded Program
(Activities/operations Budget Period
carried out for defined (Budget cycle)
period of time)

Example: Analyzing Budgets within Umoja Foundation
You could view or analyze the UN budget using one, or a combination of, these six ways:
• UNIFIL Supply Section

• PK Fund OLA - UNIFIL
• UNAMID Transport Section
• United Nations General
Fund Funds Center • MONUSCO Human Rights Office
Fund – UNA
(Source of (Area of • UNSCOL Public Information
• PK Reserve Fund
budget) responsibility) Office
• Post Local General • UNAMID Peace

Service Staff Gross Commitment Process
Salary Functional Area
Item • PKM Finance
• OE Transport Service BUDGET (Programmatic
(Nature of • UNSCOL Special
Air Crew view)
expenditure) Coordinator
• OE Medical Service
Funded Program
• DDR – Disarmament, (Activities/operations Budget Period • P13
Demobilization & carried out for defined (Budget cycle) • P14
Reintegration period of time) • B13
• Capital Construction • B15
Projects

Postings to Funds Management
Postings to FM may originate from any other Umoja module.
PS * MM/SRM SD RE
Project Material Sales & Real
Systems Management Distributions Estate
External External
ProGen Actual Postings Galileo
FI Sales Orders
Financial
Accounting
Purchase Req. Lease Outs
CO
FM GM
Controlling
Funds Grants
(Cost
Management Management
Accounting)
Limited Project Management functionality available in Cluster 1 & 2

Terms used in FM Module
Here is an example of the postings created in various modules when purchasing goods
from a vendor:
Procure to Pay
FI FM CO GM
Process
Purchase Pre-
No Posting Pre-commitment No Posting
Requisition commitment
PO from
No Posting Commitment No Posting Commitment
Requisition
Goods/Services DR Expense Expenditure Expenditure

Actual
Receipt(GR) CR GR/IR Clearing with GR status with GR status
Expenditure Expenditure
Invoice Receipt DR GR/IR Clearing Update expense
with invoice with invoice
(GR) CR Vendor if required
status status
Expenditure Expenditure
DR Vendor
Payment with payment No Postings with payment
CR Cash and Bank
status status

Key Activity Cycles within FM
The three core components of FM are:
Budget Distribution Issuance of funds
Budget Implementation Budget consumption
Budget Closing Operations Close and report on budget(s)

Learning Checkpoint 1
When you create a purchase requisition, a posting is documented in which Umoja
modules?
Select all that apply.
A. Funds Management
B. Controlling
C. Grants Management
D. Treasury

When you create a purchase requisition, a posting is documented in which Umoja
modules?
A. Funds Management
B. Controlling
C. Grants Management
D. Treasury
Options A and C are the correct answers. A

Purchase Requisition is equivalent to a
pre-commitment. If the Purchase Requisition is
funded by a grant, then an equivalent posting
occurs in the Grants Management module.

Which of the following are core components of FM?
A. Budget Distribution
B. Treasury
C. Budget Implementation
D. Budget Closing Operations
E. Accounts Receivable

Which of the following are core components of FM?
A. Budget Distribution
B. Treasury
C. Budget Implementation
D. Budget Closing Operations
E. Accounts Receivable
Options A, C and D are correct answers. Budget

Distribution, Budget Implementation and Budget
Closing Operations are key components of FM.

Module 1 Summary
The key points covered in this module are:
• FM is a module within Umoja configured to monitor revenues and expenditures,
as well as budget-related business transactions within the organization
• FM consists of six means of analyzing budgets under Umoja: fund, commitment
item, funds center, functional area, funded program and budget period
• The three core components of FM are: Budget Distribution, Budget
Implementation and Budget Closing Operations

Agenda
Course Introduction
Course Assessment
Course Survey

Module 2 Objectives
• Explain Master Data and its uses within Umoja
• Describe how Master Data fits into the overall FM process
• Name the elements that constitute the FM Master Data

Key Terminology
Key Term Description
Commitment Item It represents individual revenue and expenditure line items

within FM.
Fund In Umoja, it represents the foundation for tracking, controlling

and reporting on available financial resources.
It is an organizational unit within the FM module that controls
Funds Center a budget. It is time dependent and has the valid from and to
dates. Every funds center corresponds to a cost center.
It is a program for operational purpose with a defined
Funded Program timeframe. It can range from simple activities to complex
projects and can cross fiscal years, funding sources and
organizational units.
It is a Master Data element that is maintained within the FM
Functional Area module. It is also used in FI and CO to classify revenues and
expenditures of an organization by function.
Budget Period It is a term used within FM. It relates to the validity period of
budgetary transactions.

Key Terminology
It refers to the programmatic management of the sources and
applications of funds. It is the tracking and controlling of
Funds Management detailed budgets through the monitoring of funds-relevant
business transactions (expenditures and revenues) of an
organization.
Budget Consuming This is a financial transaction that consumes the available
(Real) budget by a defined amount.
Non-Budget Consuming This is a financial transaction that is only recorded for
(Statistical) reporting purposes. It does not consume the available budget.
Funded Program Not It refers to any funded program not receiving funding from a
Relevant (FPNR) grant.

Master Data Review
The purpose of this section is to explain the various FM Master Data elements to the
end users. There is a separate set of users who maintain and update the Master Data.
Defines your system bounds

Funds Management Area
Currency (USD)
Key
Day-to-day data which depends Reference
on accurate master data Key data that serves as a
Data
basis for transactions
Budget Entry Documents, Funds
Reservations, Funds Pre- Fund, Budget Period,
Commitments, Funds Master Funds Center, Functional
Commitments and Funds Block Data Area, Commitment Item,
Funded Program and Grant
Transactional Data
Only as good as underlying (Documents)
information
Operational/Statutory

Funds Management - Master Data Elements
The following FM Master Data elements are referenced within FM:
Fund Source of Budget
Budget Cycle Budget Period Funds Center Area of responsibility
Master Data
Elements
Activities of
operations carried Nature of expenditure
Funded Program Commitment Item
out for defined period
of time – within a
project Programmatic view
Functional Area

Master Data – Comprehensive Example
Consider a scenario where the UN General Assembly passes the resolution to establish a
new mission in Mali. Within FM, it could be assigned the following Master Data elements:
Budget Period
(Budget cycle) P14 ( Peacekeeping July 2013 – June 2014 )
Funds Center
(Area of MINUSMA Transport Section
responsibility)
Fund
(Source of budget) United Nations Mission in Mali (MINUSMA)
Commitment Item OE Transport Service Rental

(Nature of expenditure) Ground Vehicle
Functional area*
(Programmatic View) PKM Transport Logistics
Funded Program
(Activities or operations carried
out for defined period of time - FPNR (Funded Program
within a project) Not Relevant)
* Functional Area is a Master Data Element spanning across missions, due to its programmatic nature.
Master Data: Commitment Item
Commitment item represents individual revenue and expenditure line items within FM.
The features of a commitment item are as follows:
Commitment items can be statistical (non-budget consuming) or real (budget consuming)

postings, for example, depreciation (statistical) and salary (real)
Commitment items get their postings from various Umoja modules, for example, Purchase
Orders (SRM), expenditures (FI) and secondary cost allocations (CO)
Commitment items are linked to G/L accounts (FI) and secondary cost elements (CO)
Commitment items can also be created for FM use only. In such cases, they would be used to
record allotments only and a group of commitment items will be tied to it for recording
purposes. A group of commitment items is referred to as a commitment item group. A similar
concept is used with object code groups (classes), such as class 220 or 022

Simultaneous Posting and Derivation: Integration
Below are the coding block elements and the corresponding entries in FI, CO, FM and GM:
Module FI Financial Acct CO Controlling FM Funds Mgmt GM Grants Mgmt *
ENTERPRISE STRUCTURE CODE

COMPANY CODE CO AREA FM AREA
GL Acct related GL Account Cost Element Commitment Item Sponsored Class
Funding Source Fund Fund Fund Fund

Related Grant Grant Grant Grant
Cost Center
Coding Block Elements
Business Area (org structure: Department, Funds Center Funds Center

Organizational & Division, Unit)
activity related Internal Order
Funded Program Sponsored Program
Work Breakdown Structure
Profit Center
Segment
Programmatic
Functional Area Functional Area Functional Area Functional Area
Grant Budgeted Validity

Financial Period Fiscal Year Fiscal Year Fiscal Year
Period
Related
Budget Period Budget Period Budget Period Budget Period
Underlined items are owned

Legend: FI Entry Derived Derived or entered
by corresponding module

Master Data: Fund
UN is a fund-based organization. A fund in Umoja represents the foundation for
tracking, controlling and reporting on available financial resources. Other Master Data
elements are tied to a fund.
Some features of funds are as follows:

• They can be grouped together for reporting and controlling purposes
• For example, a Fund Group can be created to report on overall Peacekeeping
operations
Select Types of Funds*
Regular Peacekeeping Voluntary

SPM UNSCOL – 10UNA TF AU-UN Joint Mediation
UNIFIL – 20OLA
Support Team Darfur- 32JMX
and 33JMS
* Fund types shown are only applicable for Umoja Pilot and Cluster 1.
Master Data: Funds Center
Funds center is an organizational unit within FM that controls a budget. The features of
funds center are as follows:
Each funds center is linked to a cost center (1-to-1 basis)
Funds centers can be grouped for reporting and controlling purposes
Budget is consumed as postings are made to funds centers with committed and actual values
The life of a funds center can be defined using valid from and valid to dates

Master Data: Funds Center*
Conceptually, a funds center is an organizational unit within the FM module
(responsibility areas, departments) that controls a budget. It represents the structural
grouping into departments or areas of responsibility within the organization.
Funds Center AB
Central Department A Central Department B
Department A1 Department A2 Department B1 Department B2
* Illustrative

Example of UNIFIL Funds Centers*
Business Area
Force Commander
Conduct & Political &

Military Admin Humanitarian Legal Affairs Security
Discipline Civil
Allocations Only Allocations Only Allocations Only
Director of Mission Support
Chief Budget Officer Senior Admin Officer
Chief of Integrated Chief Regional Chief of Administration

Support Services ICTS Services
Funds Center Funds Center Funds Center
Funds Center
Aviation Mov Con Procurement General Services
Funds Center
Logistics Engineering Finance Intgt. Training Unit
Funds Center
Supply Transport HR Medical
Funds Center
Funds Center Funds Center
Funds Center
Military Support Property
Funds Center
* Illustrative
Note: Cost Center = Funds Center

Master Data: Functional Area
A functional area is a Master Data element that is maintained within the FM module. It
is also used in FI and CO to classify revenues and expenditures of an organization by
function. Some features of functional area are as follows:
It provides a programmatic view of UN – from a budgetary perspective
The life of a functional area can be defined using valid from and valid to dates
It will be used to determine UN IPSAS segments (used for financial statement

reporting)
Some examples of functional areas include UNFICYP

Political and Civil Affairs, PKM Transport Logistics, PKM
Medical, SPM Safety and Security and UNSCOL Special
Coordinator.

Master Data: Budget Period
Budget period is a term used within FM. It relates to the validity period of budgetary
transactions.
A budget period in Umoja represents the validity for which the budget is approved
Budget period provides a time dimension to all transactions in the context of

tracking and controlling the budget
It is independent of the fiscal year and can have freely definable time validity
Biennial budget period * Peacekeeping period *
• Begins 1 January of an even year and ends on • Begins 1 July of one calendar year and ends
31 December of an odd year 30 June of the following year
• Biennial budget periods begin with “B” and • Examples: P11, P12, P13, P14
then denotes the last 2 numbers of the year
• Examples: B11, B13, B15
* For all Budgets in Umoja: Fund stays constant, only budget period changes.

Budget Period: Examples
Note: All examples given below are presented using the following format:
Current System(s) Term = Umoja Budget Period + Fund = Validity of budget period
(Start Date to End Date)
Peacekeeping Examples (UNIFIL)
• OLA13 = P13+20OLA = July 2012 till June 2013

• OLA14 = P14+20OLA = July 2013 to June 2014
Special Case – Peacekeeping: Extended
• Addressed by Procurement
Regular Budget Examples (HQ/UNOG/SPMs)

• UNA13 = B13+10UNA = January 2012 to December 2013
• UNA15 = B15+10UNA = January 2014 to December 2015

Which of the following is NOT a FM Master Data element?
Select the correct option.
A. G/L code
B. Commitment item
C. Functional area
D. Funds center
E. Budget period

Which of the following is NOT a FM Master Data element?
A. G/L code
B. Commitment item
C. Functional area
D. Funds center
E. Budget period
Option A is the correct answer. G/L code is not a

FM Master Data element.

A peacekeeping budget period beginning from 1 July 2014 will be denoted as
__________.
Fill in the blank with the correct option.
A. P14
B. P15
C. B13
D. B15

A peacekeeping budget period beginning from 1 July 2014 will be denoted as
__________.
A. P14
B. P15
C. B13
D. B15
Option B is the correct answer. The Peacekeeping

budget periods begin on 1 July of one calendar
year and end on 30 June of the following year.
They are denoted with a “P” within Umoja.

Module 2 Summary
• Master Data is the business data applicable across business functions
• There are six elements of Master Data: fund, funds center, commitment item,
functional area, funded program and budget period
• Fund represents the lowest level of funding used for tracking, controlling and
reporting on available financial resources
• Funds center is an organizational unit that controls a budget
• Commitment item is the functional grouping of expenditures and revenues
• Functional area is a Master Data element used within FM and FI/CO to classify
revenues and expenditures of an organization by function

Agenda
Course Introduction
Module 2: Management Master Data
Course Assessment
Course Survey

Module 3 Objectives
• Clarify the role Umoja plays in the UN Budgeting process
• Explain the FM Budgeting Distribution process within Umoja
• Describe how the Budget Control System (BCS) is used to manage budget within
Umoja
• Describe the interactions between budgeting and other business process areas
within Umoja

Key Terminology
It is the highest level of funding approved by the General
Assembly. The amounts voted by the legislative organ for
Appropriation specified purposes for a financial period, against which
obligations may be incurred for those purposes up to the
amounts, so voted.
It is a resolution by the legislative organ of the organization
Appropriation Resolution of
approving the budget appropriations for a financial period
the Budget Resolution
and their financing.
It is the largest subdivision of the an organization in which
Appropriation Line the executive head is given authorizations to make
transfers without prior approval.
It authorizes the consumption of budget through
Budget Authority appropriation, apportionment, allotment, sub-allotment,
allocation and sub-allocation.

Key Terminology
Entry It refers to the recording of appropriations in Umoja.

It is used to:
• Move budgets from non-consuming budget types (e.g.
appropriations) to consuming budget types (e.g.
Transfer
allotments)
• Sub allot budgets within or between commitment item
groups
It refers to subsequent additions to the initial appropriation
Supplement budget that might be made after the original budget has
been approved.
It is the process used to give back to member states the
Return
unused portion of the budget.

Key Terminology
It makes available the current period amount for
commitment or obligation.
Allotment A financial authorization issued by/or on behalf of the

executive head of an organization to an official or an unit to
incur obligations for specific purposes and within specified
limits, during a defined period.
It is a plan in financial terms for carrying out a programme
of activities in a specific period. A programme budget
focuses upon the work to be undertaken and the objective
Budget sought through that work. It emphasizes the ends to be
achieved and translates them into the costs required for
their implementation, decisions relate both to resource
levels and to the results to be achieved.
It is a set of tools used within Umoja to establish and
Budget Control System (BCS) manage budget and compare budget with actuals for
sufficiency checks.

Key Terminology
Budgeting Workbench It is the FMMB input screen used for creating budget entry
documents and distributing budget within BCS.
Umoja ECC It is the main Umoja component comprising various

modules.

Budget Distribution
Budget distribution refers to the different processes that result in budgets being made
available for spending by authorized persons. These processes include:
1. Enter: Different kinds of appropriations are recorded in Umoja using this process
2. Transfer: Appropriations are not budget consuming, hence no spending can be
made against them. For spending to proceed, appropriations are transferred to
allotments. In addition, allotments can be further transferred to other types of
allotments (sub allotments and redeployments)
3. Supplement: If there is a need to increase an appropriation for whatever reason,
the process used is supplement
4. Return: When budgets are unused at the end of a given period, they are returned
to the General Fund

Budget Distribution – Key Benefits
Major benefits of the Budget Distribution process are:
Multiple entries of allotments in Sun system and Mercury

in different missions will be eliminated, as appropriations
will be entered and allotted centrally
Consistency in the allotment process across the missions

will be enhanced
Complete view of appropriations and allotments will be

available for the entire organization on a real time basis

Umoja Budgeting Activities: Process
The following process explains how the standard peacekeeping budgeting activities will
occur in Umoja:
After the budget is approved by the General Assembly, appropriations
are made. The total appropriation level (summary level – equivalent to
the total amount of the appropriation) is entered in IMIS. The UN
Controller may issue an advance allotment.
Allotments are entered in Umoja only at the class level.

Allotments for the following are still managed in IMIS: International
Staff Salaries, Troop Costs, COE and Self-Sustainment.
Actions must be subsequently taken within Umoja to distribute

budget for use against pre-approved and approved expenditures.
These activities will pertain to sub-allotments and
redeployments.
Note: Budgets exist in Umoja to enable budget control and to allow spending. Actual budget
formulation continues to be carried out outside Umoja and uploaded into the system. For
the budget period 2014, a control total will be entered in Umoja (at the appropriation level).
Process step performed in Umoja

Entering the Budget within Umoja
The budget can only be entered manually at the line item level.
Budgeting transactions within Umoja will provide UN the capability to automatically inform
identified counterparts of select budgeting activities, eliminating the need for manual
activities related to such periodic communications.
Note: Biggest change for Peacekeeping: You may now transfer funds across commitment
group/class via workflow.

Budget Control System
Description
In Umoja, the tool used to enter a budget allotment, as well as monitor and report on
its use is the Budget Control System (BCS).
BCS provides the users with a budgeting workbench, a functionality used for managing
budget entries and budget changes during the implementation, subsequent to the
approval of budgets. This tool is used to capture all phases of budget data, from
advance to initial allotment to all changes during a budget year. The BCS holds
information related to budget entries, commitments, actual expenditure and real and
statistical postings.
For a transaction to be performed successfully in the budgeting workbench, three key

elements of the system must be combined in a logical manner. These elements are:
Budget Process Document Type Budget Type

Budgeting Workbench – Processes
As indicated earlier, the four processes are Enter, Transfer, Supplement and Return.
Approval for any transaction raised using any of the processes is through workflow.
Enter (Appropriations)
• Used to bring appropriations into Umoja
Transfers (Allotments and Redeployments)

• Used to move appropriations to allotments or to redeploy funds within the same or across
commitment item groups
Supplement (Commitment Authority)
• Used when additional resources are needed in the same budget period
Return (Savings)
• Unused budgets or savings must be given back to the General Fund to be returned to
member states

Reports
The reports used across the Budget Distribution and Budget Closing processes are:
Budget Availability Control (AVC) Report

• Shows spending authority at various funds centers
• Is used to review budget availability and consumption at
fund control level
Budget View by Document Type Report

• Lists budget entry by budget type and document type
• Displays entry amount and detailed accounting elements
associated with document type
Funds Budget Overview Report

• Shows an overview of budget amounts and availability
• Is used to review budget availability and consumption by
filtering at the fund, funds center, funded program or
commitment item level

In Umoja, if a UN staff member needs to upload additional budget due to an increase in
budgetary needs for select encumbrances/activities by redeploying funds from another,
they would carry out a ________________ in BCS.
A. Enter
B. Return
C. Direct Deposit
D. Transfer

In Umoja, if a UN staff member needs to upload additional budget due to an increase in
budgetary needs for select encumbrances/activities by redeploying funds from another,
they would carry out a ________________ in BCS.
A. Enter
B. Return
C. Direct Deposit
D. Transfer
Option D is the correct answer. A transfer is

equivalent to a redeployment of budget. All
budgetary activities will be carried out within the
BCS’s budgeting workbench.

BCS enables you to enter appropriated budgets for spending authority by which
methods?
A. Telegraph
B. Manually, using line item entries
C. Email
D. Fax

BCS enables you to enter appropriated budgets for spending authority by which
methods?
A. Telegraph
B. Manually, using line item entries
C. Email
D. Fax
Option B is the correct answer. Using BCS, you

may enter appropriated budgets for spending
authority manually, using line item entries.

Module 3 Summary
The key points covered in this module are listed below:
• Budgets exist in Umoja to enable budget control and to allow spending
• After the budget is entered, it becomes available for use against Earmarked Funds
and other financial transactions
• A budget period is the period of available budget authority. It is assigned to every
fund within Umoja
• The four primary activities carried out in the budgeting workbench are budget
entry, return, supplement and transfer

Agenda
Course Introduction
Course Summary
Course Assessment
Course Survey

Module 4 Objectives
• Describe the Earmarked Funds process
• Differentiate between the types of Earmarked Funds
• Identify the Master Data elements used within Earmarked Funds

Key Terminology
It is an informal reservation of allotted funds resulting from the
Pre-encumbrance
approval of a requisition.
They are reserved credits that support the settlement of
Earmarked Funds business undertakings. These business transactions require
setting aside budget resources for expected expenditures.
It is a type of Earmarked Fund to reserve budget amounts for a
future business event without the immediate creation of a
Funds Reservation Purchase Order or Purchase Requisition. Funds reservations
can be liquidated against other Earmarked Funds documents,
as well as against actual expenditures.
It is a type of Earmarked Fund to block funds from use against
Funds Block any expenditure. A funds block cannot be liquidated against
any other commitment or actual expenditure.

Key Terminology
It is a type of Earmarked Fund to pre-encumber funds in
current and future periods, if the budget is available. It is a
Pre-commitment reservation of an estimated amount of funds in anticipation of
entering a binding agreement to spend these funds on a future
date.
It is a type of Earmarked Fund to encumber funds in current or
future periods, if budget is available. Within Umoja, a pre-
Commitment
commitment is required in order to create certain funds
commitments.
It is a type of Earmarked Fund to encumber official travel funds
in current and future periods, if the budget is available. This
Travel Commitment
particular type of commitment does not require a pre-
commitment. It is only used for upcoming travel costs.

Types of Earmarked Funds
There are five distinct types of Earmarked Funds and they can take the following form:
Earmarked Funds
Travel
Funds Funds
Commitments
Pre-commitments Reservations
Funds
Funds
Blocks
Commitments
Note: Funds Reservations and Funds Blocks are typically created and managed at UNHQ.

How Are Earmarked Funds Utilized?
Within Umoja FM, Earmarked Funds documents are used to record entry of reserved
credits that support the settlement of business undertakings. Specific to Supplier
Relationship Management (SRM), Umoja funds commitments are used for a similar
purpose. These business transactions require setting aside budget resources for
expected expenditures. Here are some examples:
Funds Pre-commitment Travel Funds Note: MOD’s will also require a

Example: Purchase Requisition, Commitment Funds pre-commitment (not
MOD/OBMO Requisition Example: currently carried out in SUN).
Official Travel
for Training
Funds Commitment
Example: Purchase
Order, MOD/OBMO
Funds Reservation
Example: Elections,
Evacuation of
Mission Staff
Funds Block
Budget Example: DDR

Earmarked Funds Process
The Earmarked Funds process has four main activities:
Creation: All Earmarked Funds are created in Umoja
Approval: The Earmarked Funds will go through appropriate approvals via

workflow
Utilization: All expenditures will be recorded against Earmarked Funds
Liquidation: Upon Earmarked Funds being appropriately applied, a ‘set to

complete’ functionality in Umoja confirms its utilization

Earmarked Funds & Umoja Funds Commitments: Challenges & Benefits
Challenge Benefits
• UN works with large budgets spread • Automated tracking of Earmarked

over extended periods, which are Funds documents and other funds
implemented using fragmented commitments, which contribute to
systems accurate reporting
• Manual tracking of funds obligating • Improved visibility into budget
documents implementation (consolidated
• Currently, budgetary reporting is not reporting for expenditures)
uniformly carried out (example: travel • Consistency in budget
costs) implementation, since all funds
• Multiple systems used for budgetary holdings are being created in Umoja
reporting purposes • Control on budget overruns in real
time at point of creating a hold on
funds
• Facilitate compliance with IPSAS 24
for presentation of budget
information in financial statements

Earmarked Funds Journal Report
There are several reports available to assist the UN staff to review the items related to
Earmarked Funds. One of the more commonly used Umoja ECC reports is the Earmarked
Funds Journal Report.
Earmarked Funds Journal Report
• Provides a complete list of all Earmarked Funds

• Is used to review all Earmarked Funds, or a specific subset
Example: all funds reservations, funds blocks or pre-
commitments
FM Document Journal Report
• Provides a complete list of all Earmarked Funds, including

funds commitments created within SRM (Procurement)
• Is used to review actual vs. budgeted expenditures, as
related to Earmarked Funds

A ____________ cannot be liquidated against other Earmarked Funds documents and
actual expenditure.
A. Funds reservation
B. Funds block
C. Funds pre-commitment
D. Funds commitment

A ____________ cannot be liquidated against other Earmarked Funds documents and
actual expenditure.
A. Funds reservation
B. Funds block
C. Funds pre-commitment
D. Funds commitment
Option B is the correct answer. A funds block is

used to completely block off funds and cannot be
liquidated against other Earmarked Funds
documents and actual expenditure.

Which type of Earmarked Fund is used for education grants?
A. Pre-commitment
B. Funds commitment
C. Travel commitment
D. Funds block

Which type of Earmarked Fund is used for education grants?
A. Pre-commitment
B. Funds commitment
C. Travel commitment
D. Funds block
Option B is the correct answer. Funds commitment

is used to encumber funds in current and future
periods.

Module 4 Summary
The key points covered in this module are listed below:
• Earmarked Funds are business transactions that claim already allocated budget for
expected expenditures
• Funds pre-commitments, funds commitments, funds reservations, funds blocks
and travel commitments are grouped under Earmarked Funds
• Funds are earmarked in advance to ensure that they account for and reserve funds
required for future transactions
• Funds block are used for blocking funds from use against expenditure. These
cannot be liquidated against any other commitment or actual expense postings

Agenda
Course Introduction
Course Summary
Course Assessment
Course Survey

Module 5 Objectives
• Explain the purpose of the Budget Closing Operations process
• Differentiate between month-end closing and budget period closing
• List the IPSAS requirements for budget closing

Budget Closing Process
The FM Budget Closing process involves a number of activities that are carried out in
sequence before closing the FM ledger, to ensure that the fund balance is accurate.
After the Budgeting Closing process is complete:

Only valid obligations are retained in FM ledgers, in compliance with the financial
regulations and rules.
Sequence of FM activities Accuracy of funds balance

IPSAS Requirements
IPSAS requires closing budgets to accomplish the actions mentioned below. While IPSAS
24 (on budget reporting), does not require any change to the budget basis, there are
still implications related to budgeted amounts in the UN system organizations:
Dual recording will be required to prepare the Statement of Comparison of budget

and actual amounts. Each transaction will be recorded on two bases (budget and
financial reporting). Actual amounts on the budget basis will be reconciled to budget
amounts
The variance of actual amounts against appropriation amounts and variance of final
budget against original budget
Annual budget amounts will be required. Thus, multi-year budget amounts will have
to be split into annual amounts. The formulation and presentation of approved
budgets does not have to change
Analysis and explanation of major variances of budgeted to actual amounts must be

issued in conjunction with the financial statements

Primary FM Activities within Budget Closing Process
The primary FM activities related to budget closing consist of the following activities:
Review all current and non-liquidated commitments and close out expiring ones
(based on budget period)
Liquidate appropriate pre-encumbrances and encumbrances
Review pending requests for transfers (redeployments) that are within their
delegated authority
Revalue foreign currency transactions

Month and Budget Period End Closing
The budget closing operations in FM has two parts:
• Periods can be closed for the entire organization or by

individual FM account assignments
Month End Closing • Month-end closing includes the following steps:
‒ Open posting period
‒ Close posting period
‒ Revaluate open commitments
• Budget period end closing includes the following steps:

‒ Close open commitments
Budget Period Closing ‒ Transfer residual budget to non-consumable budget
type as balance must be returned to member states
‒ Review and maintain valid Earmarked Funds and
liquidate the expired Earmarked Funds
Note: Carry forward is not required while closing and transferring a budget period due to
activation of MYBE.

Specific FM Closing Activities
Activities carried out in Field (Mission) and those at Headquarters (Centrally) are as
follows:
• Review open commitments by budget period, fund,

document value type
• Liquidate open commitments by budget period, fund,
Field Activities document value type
• Review parked budget transfer documents within
delegated authority
• Create budget period for new fiscal year

• Review parked Earmarked Fund documents (obligations)
Headquarter Activities • Liquidate open commitments based on statuary
expiration date
• Review and approve parked budget documents

Budget Closing Operations - Integration
After budget closing activities are completed:
A new budget and posting period is opened
Open commitments (obligations) are liquidated (per UN statutory limits). Operational costs
are completed after twelve months. Open commitments related to member states are
completed after five years
Budget balances are reconciled with other financial postings
Budget variances are analyzed in accordance to closing instructions to prepare the budgetary
performance report
Analysis and explanation of major variances of budgeted to actual amounts issued in

conjunction with the financial statements as per IPSAS 24 requirement

Within FM, budget closing operations can be summarized as being comprised of which
of the following two over-arching activities?
A. Month-end closing
B. Budget period end closing
C. Posting period
D. Liquidating Commitments

Within FM, budget closing operations can be summarized as being comprised of which
of the following two over-arching activities?
A. Month-end closing
B. Budget period end closing
C. Posting period
D. Liquidating Commitments
Options A and B are the correct answers. Month-

end closing and budget period end closing are the
two core activities that the UN Staff will participate
in, as related to budget closing operations within
the FM module.

Module 5 Summary
• The FM Budget Closing process involves a number of activities that are carried out
in sequence before closing the FM ledger, to ensure that the fund balance is
accurate
• The primary FM activities related to budget closing are: Review all current and
non-liquidated commitments, liquidate appropriate pre-encumbrances and
encumbrances, review pending requests for transfers and revaluate foreign
currency transactions
• The budget closing operations in FM have two parts: Month-end closing and
budget period closing

Agenda
Course Introduction
Course Summary
Course Assessment
Course Survey

Course Summary
The key points covered in this course are:
• FM is the ability to monitor revenues, expenditures and funds-relevant business
transactions within the organization
• Master Data is the business data applicable across business functions. There are
six elements of Master Data: fund, funds center, commitment item, functional
area, funded program and budget period
• A budget period is the period of available budget authority. It is assigned to every
fund within Umoja
• Budgetary information is entered or uploaded into Umoja to authorize the
spending authority
• Earmarked Funds are business transactions that claim already allocated budget for
expected expenditures

Agenda
Course Introduction
Course Summary
Course Assessment
Course Survey

Course Assessment
Now that you have completed all the modules in this course, you can test your
knowledge by completing the Course Assessment.
To receive credit for completing this course, you must pass this assessment with a
minimum score of 90%.
To complete the assessment you must return to the Learning Management System:
1. Log into Inspira
2. Navigate to Main Menu -> Self-Service -> Learning -> My Learning
3. Search for the name of the course under the My Learning Activities section
4. Click the Start link of the course assessment
5. Click the Submit button once you have completed the assessment

Agenda
Course Introduction
Course Summary
Course Assessment
Course Survey

Course Survey
Your feedback is important to the continuous improvement of our training program.
Please complete the evaluation for this course using the following steps:
1. Log into Inspira
2. Navigate to Main Menu -> Self-Service -> Learning -> My Learning
3. Search for the name of the course under the My Learning Activities section
4. Click the Start link of the course survey
5. Click the Submit button once you have completed the course survey

Congratulations! You have successfully completed the
Umoja Funds Management Overview course.

Research Paper On Funds Appropriation and MGMT

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FI104 – Umoja Funds

Umoja Funds Management Overview – Version 24

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Course Duration: 2 hours

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• Creates initial appropriations and allocations for

• Approves and reviews Budgeting Workbench postings

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• Carries out the system reconciliation and

• Creates and updates the FM derivation rules for

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• Reviews and approves Earmarked Funds documents

• Certifies Earmarked Funds documents

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• Maintains and updates the FM Master Data

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Enhance the transparency within UN programs as to where funds are actually

Present improved reporting features for budgetary purposes

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Fund Funds Center

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• UNIFIL Supply Section

• Post Local General • UNAMID Peace

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Limited Project Management functionality available in Cluster 1 & 2

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Goods/Services DR Expense Expenditure Expenditure

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The three core components of FM are:

Budget Distribution Issuance of funds

Budget Implementation Budget consumption

Budget Closing Operations Close and report on budget(s)

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Select all that apply.

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Select all that apply.

Options A and C are the correct answers. A

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Select all that apply.

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Select all that apply.

Options A, C and D are correct answers. Budget

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Commitment Item It represents individual revenue and expenditure line items

Fund In Umoja, it represents the foundation for tracking, controlling

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Defines your system bounds

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Fund Source of Budget

Budget Cycle Budget Period Funds Center Area of responsibility

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Commitment Item OE Transport Service Rental

Commitment items can be statistical (non-budget consuming) or real (budget consuming)

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