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General Accounting

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Melinda L. Pearson, CPA, Director
Voice: (804) 225-2376
Email: Melinda.Pearson@doa.virginia.gov or gacct@doa.virginia.gov
FAX: 804-225-4250

New Information

Overview

The general accounting unit maintains the general ledger for the Commonwealth and produces all central information for cash-basis accounting, budget monitoring and Appropriation Act compliance. The general ledger computer system provides the means to enforce state appropriation law.

The Code of Virginia establishes the basis for statewide general accounting. Principal Code direction(s) include the following.

The Comptroller shall...maintain a complete system of general accounting to comprehend the financial transactions of every state department...all unsettled accounts on the books of the Comptroller shall be balanced on the last day of each fiscal year, and the balances brought forward on the first day of the new fiscal year. For this purpose there shall be a general ledger of accounts, which shall...show the balances due to or from the Commonwealth. (§2.2-802, §2.2-809)
The Comptroller shall...maintain unified accounting and control (by) prescribing what accounts are to be kept by each agency, in addition to the system of general accounting maintained by the Comptroller. (§2.2-803)

The General Accounting unit is also responsible for overseeing, evaluating, and reporting on agency financial accountability and compliance with Commonwealth Accounting Policies and Procedures, with the goal of assisting agencies in meeting their responsibilities for protecting Commonwealth resources and for supporting and enhancing the recognition of Virginia as the best managed state in the union.

DOA's General Accounting unit also houses the state's pre-audit and post-audit activity, since it involves the promulgation and interpretation of policies, procedures and controls governing the disbursement of public funds, and the review of a sample of transactions prior to payment to ensure that policies and controls are being used. This responsibility has been generally delegated to individual agencies and their performance is monitored and reported to the Governor and Cabinet.

The Code of Virginia established the basis for statewide pre-audit. Principal Code direction(s) include the following.

The Comptroller shall...not issue a disbursement warrant unless he shall have audited, through the use of statistical auditing or other acceptable means, the bill, invoice, account, payroll or other evidence of the claim, demand or charge and satisfied himself as to the regularity, legality and correctness of the expenditure or disbursement, and that the claim has not been previously paid (§2.2-1822).

Organization

General Accounting has several subactivities.

Appropriation Control

This subactivity involves the internal control procedures used by state government to enforce compliance with appropriation law. Following enactment of the Appropriation Act, two agencies become responsible for ensuring that appropriation law is followed. DPB authorizes the expenditure of appropriated funds through the allotment process, while DOA enforces this authorization through the automated edits and manual procedures that support the general ledger. This subactivity includes the preparation of year-end reconciliations that account for all expenditures as authorized in the Appropriation Act.

Audit Monitoring

During the course of the Auditor of Public Accounts audits of agencies and institutions, internal control and compliance matters are frequently noted. Agencies and institutions are required to submit a Corrective Action Workplan (CAW) pursuant to CAPP Manual Topic 10205. The Department of Accounts receives and evaluates the CAW for reasonableness and monitors the status of corrective action implementation.

Centralized Pre-audit

This subactivity covers agencies not qualified for Decentralized Pre-Audit that are required to submit documents to DOA to support all disbursements. Centralized agencies include a few agencies that have not demonstrated the capability to manage a delegated program, and small agencies for which the cost of delegation is greater than the efficiency benefits to be gained. Finally, a few agencies, primarily those which house elected officials, are considered too sensitive to delegate.

Comptroller's Debt Setoff Program

Section 2.2-4806 of the Code authorizes the recovery of overdue debts owed the Commonwealth from amounts to be paid for procured goods and services. This is a debt setoff program similar to that used by Tax to recover debts from state tax refunds. Since its inception in 1991 through FY 2001 this program has recovered approximately $31 million in overdue debts owed the Commonwealth.

Decentralized Pre-audit

Since 1992, DOA has been in the process of decentralizing the pre-audit function to individual agencies under a delegation of authority from the State Comptroller. This activity includes the identification of qualified agencies, negotiation of delegation agreements, and quality control reviews that monitor delegated pre-audit performance for compliance with published policies and procedures and advice to agencies of corrective measures that may be needed.

General Ledger Accounting

This subactivity involves maintaining the official accounts for the Commonwealth. These accounts are recorded in the state general ledger system (CARS). Transactions are entered by agencies on-line during the workday and computer edited in nightly batch runs. Various accounting reports are generated for use by agency and DOA staff to reconcile the accounts each day and identify and resolve any discrepancies that are identified. Complex problems must be researched and resolved by DOA staff. All disbursements of public funds must be processed through the general ledger. This subactivity also includes management of the state-aid-intercept program and a daily reconciliation of the state's cash position to the books of the State Treasurer.

Higher Education Institution Restructuring

Statutory changes necessitate unique accounting and disbursement processing for certain higher education institutions. This initiative provides for multiple categories of financial management models that require unique disbursement and general ledger recording.

Information Security Officer Services Program

This activity involves providing Information Security Services to Small Agencies. The objective of this program is to help Small Agencies implement the Commonwealth of Virginia Information Technology Security Policies and Standards. Implementation of the Commonwealth's Information Technology Security Policies and Standards requires the agency to have access to information security expertise. The information security specialists responsible for this activity will provide the Small Agencies with policies, templates and consulting services to ensure that small agencies meet each of the Commonwealth's Information Technology Security Policies and Standards.

Interest Calculation

Virginia statutory and appropriation law frequently allocates interest income earned by the Treasurer to specific nongeneral funds. This subactivity includes the detailed calculations and record keeping necessary to allocate interest and demonstrate compliance with the related legal provisions.

Loan, Line of Credit and Grant Coordination

The Appropriation Act provides for intra-governmental loans and lines of credit from the Treasury to support state programs that are anticipating nongeneral funds from federal grants and contracts, bond sales, and similar situations. This subactivity also includes the processing of state grants to nonstate agencies as authorized by the Appropriation Act and regulated by DPB.

Support Locality Revenue Deposits

DOA has general oversight for deposit reconciliation for all sources of state revenue. However, a separate subactivity involves the processing of deposits from local governments and the court system. Given the many different administrative environments found among local governments and the various state courts, DOA has assumed a higher level of processing responsibility for these deposits. Each month DOA handles an average of 33,000 local deposit certificates that account for between $55 million and $70 million in state receipts. A related responsibility is the monthly summarization and certification of recordation taxes, a portion of which are ultimately due to localities. This subactivity also includes procedures for refunding forfeited bail bonds as ordered by a court.