Definitions and Accounting Terminology Clause Samples
The "Definitions and Accounting Terminology" clause establishes clear meanings for specific terms and accounting concepts used throughout the agreement. It typically lists key words, phrases, or technical accounting terms and provides precise definitions to ensure all parties interpret them consistently. By doing so, this clause eliminates ambiguity and reduces the risk of misunderstandings or disputes over the interpretation of important terms in the contract.
Definitions and Accounting Terminology. Fiscal Year – July 1st of the current year thru June 30th of the following year Budget – available funds Fund – an account fiscally managed by the Business Office which can be classified as Unrestricted, Temporary Restricted or Permanently Restricted. Funds received from outside sources or from restricted or endowment funds may carry restricted spending procedures and/or requirements that must be followed in addition to normal College spending policies and procedures. Object Code – a set of numbers (Account Number) used for accounting purposes that describes the type of expenditure Encumbrance – The process of setting aside funds (obligation) to pay for an invoice or check requisition. Encumbrance is created upon the processing of a Purchase Order. Business Managers – Anyone who is authorized to approve Purchase Orders or check requisitions for their department. This person may also be a Procurement Cardholder. Senior Administrator – For the purpose of establishing signature authority, senior administrator is a college official who reports directly to the president and in charge of one or more departments. PO – Purchase Order
Definitions and Accounting Terminology