What Is a Business Purpose?
In every financial transaction you create, you will be asked for a “Business Purpose.” This is an essential part of each transaction and must be detailed and complete in order for the transaction to be processed, approved then paid.
A detailed Business Purpose includes all the information needed to understand exactly how Harvard’s funds have been used. Complete details include who, what, when, where and always include why.
The Business Purpose must show the approver, at a glance, that Harvard funds were expended for a bona fide Harvard business expense.
Examples of Business Purpose
|Incomplete Business Purpose||Complete Business Purpose|
|Lunch with students||
The easiest way to obtain this information is to ask the faculty or staff member to write the complete, detailed business purpose on the receipt. However you get the information, it is your responsibility to include all the required details in all transactions.
This information appears in various fields in the General Ledger, basically the huge check register for the entire university. If you only enter “Books” for a business purpose, all anyone will ever see is “Books,” which is not informative enough to identify exactly what was spent and for what purpose.
Chart of Accounts (Billing Code)
The Chart of Accounts (COA) is the coding structure through which financial transactions are handled. The COA consists of seven segments representing organizational structure and specific financial information. Each segment represents a specific type of information. All seven segments are required to process financial transactions.
Chart of Accounts Validator
The Chart of Accounts Validator tool helps you de-code your coding and to find inaccurate or non-valid coding if you get an error. Type your coding into the Validator, hit search, and find the result of your query.
What do the segments in a coding string mean?
There are 33 digits in a coding string divided into 7 Segments:
|Segment name||Description||How many digits?||Example|
|Tub||All of HLS is Tub 265||3||265|
|Org||Part / Area of HLS (program, office, department, etc.)||5||22222 is the Finance Office|
|Object Code||Kind of expense or income. Download a list of Commonly Used Object Codes (Excel).||4||6640 is Office Supplies|
|Fund||Source of the money||6||000001 is Unrestricted Undesignated funding|
|Activity||Specific project within HLS that is involved||6||550009 is Departmental Administrative Activity|
|SubActivity||Only used if necessary to denote segment of the Activity. If not applicable, this should be all zeros.||4||0013 is Facilities|
|Root||Specific to faculty member, only used when necessary (also sometimes used to identify buildings)||5||24917 is a specific professor’s root number|