Vice President for Finance
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Vice President for Finance
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Budget Policies and Procedures
Budget
Adjustment Process A. General Information After the University’s operating budget is finalized and approved by the Board of Trustees, it may be adjusted throughout the fiscal year via the budget adjustment process. This process is the University’s official approval vehicle whereby general fund budgets are allocated, and sometimes reallocated between the various organizations, programs, accounts and expenditure categories to meet University and unit objectives. Inherent in the budget adjustment approval cycle are policy guidelines and procedures which serve to set the framework for decision making. The budget adjustment process stems from a specific set of policies which dictate how general funds are to be budgeted and accounted for. These policies are reviewed and updated periodically as the University’s needs change. Standardized procedures are in place that outline how budget adjustments are effected on a University-wide basis and how this function is done in an efficient and cost-effective manner. Together, the policies and procedures bring structure and consistency to the budgetary adjustment process. The following sections describe the important policies and procedures of the budget adjustment process at the University of Louisville: There
are two different kinds of budget adjustments that a unit can request
to adjust its operating budget:
B. Budget Transfer Process A unit (CSD) may find it necessary to reallocate general funds to another unit to cover anticipated expenditures. Budget transfers are initiated only by those who have expenditure authority over the funds. This is an inherent responsibility of budget control and not a delegated one. A budget transfer is defined as the reallocation of University general funds with no change in the overall University budget. That is, the requested budget increased amount is directly offset by a corresponding budget decrease amount. A characteristic that distinguishes a Budget Transfer from a Budget Revision is that the University’s bottom line revenue and expenditure budget remain unchanged by a Budget Transfer. Most budget transfers are considered to be routine in nature and because of this, are normally processed with only a cursory review by the Office of Budget & Financial Planning (BFP). It is important to verify that the information on the BTR form is correct and that the funds slated to be decreased are indeed available for transfer. All transfers are however, reviewed in light of the University’s budgetary policies. C. Budget Transfer Request (BTR) Form A request to reallocate funds internally, is always made on a Budget Transfer Request (BTR) form, which is available on the BFP website. To make a transfer of general funds, the originator prepares a BTR form, carefully following the instructions provided on the website. A BTR form can accommodate up to three transactions per form. The requested transactions shown on a single form must be related, or tied together programmatically. Separate forms are to be used in cases where transactions are not related to one another. Because budget entries cannot be “netted” together as done for budget revisions, individual transactions are required. If more than two programs and/or accounts are affected by a transfer, they must be entered on the form as individual transactions (lines) showing offsetting increase and decrease accounts.A transfer of funds can be made on a one-time basis, affecting only the current fiscal year. The unit may enter a Continuing Annual Requirement (C.A.R.) amount on the form to depict a permanent, recurring entry. It is, however, a memo entry only. A C.A.R. budget transfer is a permanent transfer that adjusts the general fund budget in subsequent fiscal years and can only be made during the budget development process using the online budget preparation system. The BTR form is completed electronically. It is easy to understand and has been designed to make it simple and easy to complete. It is understood that the unit’s Dean or Vice President endorses each electronic BTR before the form is submitted for posting. Appropriate coordination and communication between organizational units is a necessity. Programmatic justification is also required and must be provided by the unit initiating the request. Upon completion, the BTR form is forwarded as an email attachment to the originating unit’s assigned Policy and Budget Analyst in the Office of Budget and Financial Planning (BFP). The form is printed and reviewed by the Policy and Budget Analyst and subsequently posted to the University’s financial system. This normally takes about one to two working days after receipt. The printed form is retained by Budget and Financial Planning and is filed in the program’s budget file as the official audit document of the transaction. A copy of the form is returned to the initiating unit. Step-by-step instructions for completing the form are provided on the VPF website. If you need additional assistance, please call your Policy & Budget Analyst in the Office of Budget & Financial Planning; he or she will be happy to help. D. Budget Revision Process A Budget Revision is an adjustment to the University’s operating budget that changes the bottom line of the overall general fund budget. There are two major categories of budget revisions that a unit can request. They are requests for additional allocation of new general funds and requests for a budget increase offset by an increase in revenue or departmental expense credits. Units may request additional new general funds for either an unexpected emergency or some other pressing budgetary need. Requests for new general funds must be thoroughly justified and are understood to be endorsed by the unit’s dean or vice president prior to the form’s submittal to BFP. Approvals for new funds ultimately require the approval of the President or Provost or their designee. In selected instances, over-realized revenue–the amount of actual dollars realized above the original budgeted amount–or credits may be used to justify an increase to the unit’s budget. Such requests always require programmatic justification and supporting backup documentation. They routinely require financial analysis and are carefully evaluated by the Policy and Budget Analyst assigned to the unit. E. Budget Revision Request (BRR) Form Requests to adjust the general fund operating budget for new funds must be made on a Budget Revision Request (BRR) form. When requesting a budget increase, a unit prepares and submits an electronic BRR form, which is available on the VPF website. Upon completion, the BRR form is forwarded as an email attachment to the originating unit’s assigned Policy and Budget Analyst in Budget and Financial Planning. All budget revision requests are printed and analyzed by the Policy and Budget Analyst assigned to that particular budgetary unit. A recommendation is made by the budget analyst based on an analysis of the unit’s overall budget situation, taking into account program impact, financial and policy implications, and consistency with the University’s strategic plan. The budget analyst will: 1. Check to see that the budget revision requested is appropriate to accomplish the intent of the originator. 2. Review and evaluate the Description/Justification section for content, clarity and completeness. 3. Analyze the request for conformity to University policies. 4. Make a recommendation for approval or disapproval based on the merits of the case. The delegated authority for approving or disapproving the request is the Vice President for Finance for amounts up to $100,000. BRRs requesting funds in excess of $100,000 must always be approved by the President or Provost. If approved, a copy of the signed BRR is sent to the unit indicating the approval status and conditions of approval, thus closing the feedback loop. If not approved, an explanation of the disapproval is similarly noted on the form and returned to the unit. If the BRR is not approved at any step along the way, it is so noted and returned to the originating unit. The BRR form is customarily prepared by persons within a unit who are assigned responsibility for budgetary decisions. On occasion, the BFP staff will initiate a BRR form when the situation warrants but will not routinely prepare these forms for units. Detailed instructions about this process are provided on the VPF website for your convenience. You will note that the form has sufficient space to record up to nine lines of transactions. If more than nine lines are needed, a BRR with continuation pages should be used. This form also is available on the VPF website. If you need additional assistance, please call your Policy & Budget Analyst in BFP; he or she will be happy to help. Last update: 11/01/2006 Budget
Guidelines for Centers of Excellence 2. The Council on Postsecondary Education (CPE) award for University Centers of Excellence will be budgeted in a separately identified general fund account. These accounts will serve as cost centers for recording all direct costs relating to the CPE award. 3. Other departmental general funds, apart from the CPE award, supporting the Center of Excellence will be identified by the program director during the normal budgeting process. The budget for these line items will remain in departmental accounts, although they subsequently will be consolidated with the center award funds for financial reporting to the CPE. 4. Restricted funds including gifts, grants, and contracts that directly relate to the Center will be line item budgeted in separately identified restricted fund accounts. Consistent with budget guidelines, these restricted funds will be considered a part of the Center's overall operating budget and included as such on financial reports. 5. Adjustments to the approved budget will be made through the budget adjustment process in accordance with established University policies. Program directors may reallocate funds within the Center account as programmatically justified. Transfers between expenditure categories (i.e., movement from salaries to current expenses) are permitted. Please note, however, that program directors are required to provide written justification for significant budget transfers in the progress report to the CPE. 6. Fringe benefit costs for personnel assigned to the Center will be budgeted and expended in accordance with the University's established practices. The President will entertain requests from units to use unexpended fringe benefit budgets from the CPE award. 7. Funds remaining at fiscal close will be carried forward into the new fiscal year as allocated fund balances. Program directors will be required to rebudget the fund balances that are carried forward. Overdrafts on Center of Excellence accounts will be deducted from the subsequent year's budget allocation. 8. It will be the responsibility of the program director to prepare progress reports to the CPE and coordinate them with their dean. Reports should be forwarded through the Office of the Provost to the Office of the VP for Finance (VPF). VPF will be responsible for reviewing all financial reports and coordinating the final progress report with the Council staff. The President or Provost will approve all final reports. 9.
As part of the progress report to the CPE, special consolidated financial
reporting is required. It will be the responsibility of the program director
to maintain cost information, for both general and restricted funds, for
use in preparing the consolidated financial reports.
Last Update: 09-08-92
Soft
Money Policy The
1977-78 operating budget also serves as a benchmark, or reference point,
for subsequent budgets as to the type and mix of funds for each faculty
position existing at that time. Further, all existing faculty positions
were grandfathered for future years from the policy. After the 1977-78
fiscal year, all new tenure and tenure-track faculty positions must be
completely funded from hard money on a permanent, C.A.R. basis and shall
be designated as "hard money positions". DEFINITIONS: For
the purpose of this policy, the following definitions are provided: 1. "Hard money" is defined as funds derived from: a. appropriated funds from the Commonwealth, b. funds from tuition and fees,
c. certain income from endowment funds, as set forth in the policy
d. funds generated from professional practice plans, but limited
to 50%
f. external funding for faculty with continuous appointments
at the 2.
For purposes of this policy, "soft money" is defined as funds
derived from all other sources. Examples include gifts, grants, contracts,
unspecified clinical fees and the like. 3.
Tenured positions are those faculty positions held by persons in the professor
job classification series (assistant professor, associate professor, and
professor) who have been awarded academic tenure. 4.
Tenure-track, or tenurable positions are those faculty positions in the
professor job classification series for whom the incumbent may reasonably
expect to be granted tenure no more than seven years after employment,
or after equivalent service. 5.
Non-tenurable track positions are all other faculty positions for which
the incumbent will not be considered for tenure, e.g., adjunct faculty,
contract research appointments and limited contract appointment series.
(These employment contracts explicitly state at the time of hiring that
there is no commitment for tenure.) POLICY: 1. All tenured and tenure-track faculty positions, not grandfathered in 1978, shall be permanently budgeted on a "hard money" source of funds, as defined by this policy. This applies to positions currently vacant as well as filled positions. 2.
Faculty positions initially established on soft money shall be considered
tenurable only when all of the following conditions are met:
a. if the duties of the position substantially change and become
an b. the interest of the affected college or school is served, and
c. if hard funds are available to support the full salary and
associated
d. if requirements of affirmative action are met. (The
years of experience while in a nontenurable status that may be applied
toward tenure shall be agreed to by the faculty member, the dean, and
the academic vice president and shall be set forth in writing at the time
of the status change.) 3.
Requests for new tenurable positions which are not wholly funded from
hard money must specify the future source of hard money funding required
to cover the entire annual salary and related fringe benefits at the time
the Position Authorization Request (PAR) is submitted. 4.
For short-term departmental budgeting purposes, the funding of a faculty
position may be switched temporarily throughout the fiscal year. However,
the funding sources shall normally revert back to those found in the original
operating budget and shown as permanent, (C.A.R.) source of funds. That
is, funding sources which change during the year, e.g. for grant or contract
release or for other purposes of a one-time nature, shall be reconstituted
in the subsequent year's original, C.A.R. budget. 5.
It is the responsibility of the dean of the affected college or school
to ensure that each tenured and tenurable faculty position is budgeted
on a hard money source of funds, unless specifically grandfathered in
1977. 6. A loss of external funding that supports a non-tenurable position will result in a review of that position by the dean and the appropriate academic vice president. A written understanding shall be reached with the candidate and communicated at the time of hiring setting forth this policy. 7.
It shall be the responsibility of the dean of the affected college or
school to ensure that each new faculty position is in compliance of this
policy. PROCEDURES: 1.
Annually, during the development of the operating budget, the academic
unit reviews its tenure and tenure-track faculty positions to ensure each
one is properly budgeted in compliance with this policy. 2. At least annually, academic units/departments are required to verify the permanent, C.A.R. funding mix shown in their position control reports, to identify any tenured or tenurable positions which are not budgeted on a hard money source of funds. For any such position, the unit prepares a Budget Transfer Request (BTR) and Position Change Order (PCO) to restore hard money C.A.R. funding to the position. 3.
At the time a new position (PCN) is created, a determination shall be
made by the dean as to whether it shall be a tenure or non-tenurable position.
That designation is so noted on the Position Authorization Request form
(PAR) to record this in the university's Position Control System.
Policy
on the Management of Endowment and Similar Funds The following policy guidelines are intended to ensure the effective management of endowment and similar funds and will enable accurate reporting to donors on how the funds are expended. B.
Definitions: For
purposes of this policy the following definitions will apply: 1.
Endowment funds are gift funds that are unrestricted or have been designated
to specific programs by individual donors under the terms of a legal gift
agreement. The principal of an endowment fund, or the face amount of the
bequest, can not be expended. Instead, it is invested for the purpose
of generating annual income which is budgeted each year for use by the
programs specified in the endowment instrument. The principal of one endowment
fund is also referred to as the "corpus" of the fund. 2. Quasi-endowment funds are funds that function as endowments except that the principal of the fund can be expended under certain limited conditions. Quasi-endowment funds may be established by action of the University's Board of Trustees, the Board of Directors of the University of Louisville Foundation, Inc., or by executive management. The principal is invested and the annual earnings produced by the fund are spent like endowment proceeds. 3.
The term "similar funds", for purposes of this policy, will
refer to either quasi-endowments or term endowments. 4.
"Program budgeted," for purposes of this policy, is a term applied
to the financial planning process in which program objectives are established,
revenues are projected, and proposed expenditures are reviewed and analyzed
to produce an annual operating budget for a specific activity. C.
Policy: 1.
Vice presidents and deans will ensure that endowment and similar funds
are used for the purposes intended by the donors. In cases where the fund
is unrestricted as to use and purpose, funds will be expended as approved
through the program budgeting process. 2. Vice presidents and deans will prepare annual reports on major endowment funds, briefly explaining how the funds were used by their college or school to meet program objectives and donor designations. Deans will submit their reports to the University Provost for central coordination and review. These will be forwarded to the President, who will inform the donors as appropriate. Vice presidents will submit their reports directly to the President. 3.
Endowments and similar funds will be "program budgeted" each
year for revenue and expenditures. The Office of the VP for Finance will
coordinate the budgeting process and will ensure that the budgets are
realistic and on a firm financial footing each fiscal year. Units will
actively participate in this process with the Office of the VP for Finance. 4.
Once approved in the budget process, planned expenditures from
endowment earnings will be budgeted in the units' annual operating budget.
These funds must be used to meet specific program objectives consistent
with donor designations. Furthermore, all budgets developed for these
funds will be included in the University's overall budget, submitted to
the Board of Trustees. The Controller's Office will ensure that expenditure
budgets are not overexpended and that expenditures conform to the annual
operating budget. 5.
The annual spending rate for endowment and similar funds is established
by the Board of Directors of the University of Louisville Foundation,
Inc. Currently this rate is 5.5% of the three-year moving average of the
market value of the endowment's investment portfolio as of the three previous
calendar year-ends (December 31). This rate will also be used as the basis
for establishing the continuing (CAR) budget with the remaining funds
used for one time, nonrecurring expenditures. (See section 7.) 6.
The principal of an endowment fund will not be expended for any
reason. In certain rare circumstances, the principal of a quasi-endowment
fund may be used, however, the unit requesting this must obtain the written
approval of the President or his designee. 7.
Continuing obligations (C.A.R.'s) including salaries, wages,
and fringe benefits may not be budgeted for more than eighty percent (80%)
of the annual spending rate of the fund, unless the President or his designee
has specifically authorized an exception. The remaining twenty percent
(20%) may be used for one-time, nonrecurring expenditures that are programmatically
justified. The eighty percent (80%) cap on C.A.R. expenditures is intended
to protect future budgets from fluctuations in interest rates and unplanned
growth of the C.A.R. budget. 8.
The following guidelines specifically refer to the establishment of positions
funded from endowments and similar funds: a.
If funds are earmarked for the establishment of a faculty position,
i.e., an endowed chair, units may not use the funds for other purposes
without permission from the President or his designee. b.
A faculty position funded from an endowment or similar fund will not be
established until there are sufficient annual earnings to provide the
annualized salary amount for the position plus an appropriate allowance
for fringe benefits. Where special circumstances warrant, the President
or his designee may make exceptions to this on a case by case basis. c.
University units should plan for future cost increases when budgeting
endowment and similar funds. Annual salary adjustments, increases in the
cost of fringe benefits, and other nonsalary cost increases normally will
be absorbed by the respective fund. When developing budgets, units will
ensure that routine cost increases can be accommodated in future years
within the projected available earnings of the fund. If this is not possible,
units must request a budget supplement to support these cost increases. d. If the annual earnings of an endowment are not sufficient to provide for the full funding of a faculty position (i.e., an endowed chair), they may be reinvested. Deans wishing to do this must specify the amount to be reinvested on the Endowment Program Budget Worksheet submitted to the Office of the VP for Finance.
Last Update: 09-08-92
Policy
on Continuing Education Financing B.
Policy: 1.
The primary objective of continuing education programs is to offer a wide
range of quality non-credit educational programs to the various publics
of the University's service area and to make these programs budgetarily
self-sufficient. Academic units are encouraged to broaden their continuing
education offerings and to cooperate with other colleges and schools in
joint continuing education ventures. 2.
Deans and directors of academic units will be responsible for assisting
in developing continuing education programs directly related to their
units and for cooperating with the University Center for Continuing and
Professional Education (UCCPE) in all aspects of continuing education
as defined above. 3.
University Center for Continuing and Professional Education (UCCPE)
will prepare annual budgets for continuing education programs to include
both revenue and expenditure projections. This budget will be the UCCPE
financial operating plan, as it relates to continuing education, for the
fiscal year and will be developed in concert with the Office of the VP
for Finance (VPF) and the guidelines published for the development of
the University's annual operating budget. The budget may be adjusted, either up or down, based on documented changes in realized revenue. This will be accomplished through the normal budget adjustment process. 4.
All revenue generated from continuing education activities, except
for programs covered by specific grants, is considered University general
fund revenue and will be deposited to appropriate general fund revenue
accounts, specifically established for this purpose. Units shall not deposit
revenue from continuing education programs into accounts of the University
of Louisville Foundation, Inc. 5.
All expenditures for continuing education programs are to be
expended from specifically budgeted general fund accounts established
for this purpose. All continuing education expenditure accounts will be
controlled, managed, coordinated, and monitored by UCCPE. 6.
All direct costs, directly related to continuing education programs,
including salaries and fringe benefits, are to be charged to the appropriate
continuing education budget. These costs are to be covered by revenue
generated by the continuing education programs. University
general funds will not be used to subsidize salaries of any individual
performing work as a part of any continuing education program. 7.
Surplus funds generated by continuing education programs will
be shared between UCCPE and the various academic units that generated
the courses, programs, and conferences. The amount of any year-end surplus
accruing to an academic unit will be determined as described in the policy
and procedure "Sharing Surpluses from Co-produced Programs"
dated February 3, 1992. This determination will be made after the fiscal
year end by UCCPE and will be confirmed by the VPF. Subsequently,
the VPF shall make the necessary budget adjustments to cause these amounts
to be added to the budget of appropriate units. The adjustments shall
be made early in the fiscal year following the continuing education activity
in a specified general fund account. 8.
As an alternative to co-producing programs, academic units may
have contracted with UCCPE on a fee for service basis. The deadline for
exercising this option expired June 30, 1992, as described in the policy
and procedure "UCCPE and Academic Unit Relationships". Under
the fee for service arrangement, all financial activity shall be processed
by UCCPE in accordance with paragraphs 3 through 6 above, even though
the academic unit bears all risk for the program breaking even. After
completion of the program, UCCPE shall deduct its fee from program revenue
and pay all direct costs from program revenue. Any remaining surplus will
be available to the academic unit in the form of a budget adjustment.
This transaction requires the academic unit to have a general fund revenue
account per paragraph 4 above.
Policy
on the Transfer of F&A Cost Recovery (Indirect) Funds Many private and locally funded grants and contracts, and all of the federally funded grants and contracts, have a provision for Facilities & Administrative (F&A) cost recovery built into them. This recovery provision is provided to fund the cost of administering and providing infrastructure support to the grant or contract effort. It typically goes to fund the hidden, but real, costs of the grant for related general administrative services and is negotiated with the federal government based on real costs the University has incurred in support of extramurally funded activities. The
negotiated F&A recovery rate, commonly referred to as a percentage
of direct costs, is used as a "benchmark" for other grants and
contracts that are private, local and state supported. The University
of Louisville on-campus F&A cost recovery rate is listed in the University
of Louisville Research Foundation (ULRF) Research Handbook. The employment
of this overhead rate to applicable grants and contracts generates revenue
for the University. B.
POLICY: The gross F&A indirect cost recovery accumulated within the ULRF in a given fiscal year shall be distributed under the following plan:
C.
RESPONSIBILITIES:
D.
PROCEDURE:
Policy
for Budget Entries and Revisions I. Background: The University’s adoption of PeopleSoft Financials and the development of a new PeopleSoft web-based Budget System for fiscal year 2003-04 brought about operational changes regarding the interaction between the Financials and Budget systems. This change necessitates outlining the responsibilities of the Controller’s Office, the Office of Budget and Financial Planning and the Office of the Vice President for Research with regards to establishing and maintaining budgets. The intent of this policy is to ensure that the initial load of the budget and any subsequent revisions are completed in a timely and efficient manner, by the office delegated that task. II. Policy: The Budget Matrix outlines the functional areas responsible for overseeing the initial load of the budget into PeopleSoft Financials and any subsequent revisions or adjustments. For the initial load of the budget, please refer to the Review, Approves Budget column for the functional area responsible for each program code grouping. Similarly, refer to the Reviews, Approves, Enters column under the Subsequent heading for the unit responsible for maintaining budgets throughout the year. As indicated by the matrix, only the functional area specifically designated can make manual entries into the system. In the event that correcting entries should be required, only the responsible office specified by the matrix should make these as well. III.
Procedures: Those units needing to make budget revisions for program codes
which Budget and Financial Planning is responsible for can refer to the
instructions and form at http://www.louisville.edu/vpf/budget/budadjdocs.html.
Guidelines
for Enterprise Activities The
basic elements of enterprise accounting include the following factors: 1.
Business activities, unlike expenditure-based activities, rarely
produce a break - even situation, or zero cash balance, at fiscal year-end. 2. Financial performance for self-supporting activities is best assessed through accrual accounting which matches revenues with related expenses. With accrual accounting, revenues are recognized when earned whether collected in cash or represented by receivables collectible in a future period. Similarly, expenses are recognized when charges are incurred whether paid in cash or represented by payables to be satisfied in future periods. Accrual accounting also requires the consideration, when material, of the effects of changes in inventory levels, bad debts, and charges for depreciation. 3.
Business activities typically require reserves for various purposes
such as working capital, capital equipment acquisition, contingencies,
etc. B.
Definitions: 1.
Enterprise Activities - Units operating on a self-supporting
basis where financial resources are received as a result of exchange transactions
involving the provision of services or the sale of goods. 2.
Business Plan - The document prepared annually by an Enterprise
Activity to substantiate its self-supporting nature. At a minimum, business
plans must include: a. A one-year budget of expected revenues (and recoveries) as well as planned expenses (including expenditures and non-cash expenses such as depreciation) and other charges (e.g. transfers to/from reserves.) b.
A three-year plan incorporating major capital activities and
service/sale strategies as well as the identification of any significant
factors which might affect the financial performance of the Activity. c.
Detailed calculations to support pricing strategies. d.
A history of the Activity's financial performance and service/sale
productivity for three years if the activity has operated that long or
for as long as specific financial records exist. (Where applicable the
budget and financial history must provide information about receivables
and payables.) C.
Criteria: Units
seeking designation as Enterprise Activities must satisfy the following
criteria to qualify for enterprise accounting: 1.
The unit must be self-supporting such that revenues and recoveries equal
or exceed expenses. 2.
There must be a direct connection between the unit's revenue/recoveries
and its expenses. 3.
The unit must depend on an expense-based fee mechanism for revenues/recoveries
resulting from the provision of services or the sale of goods. 4.
There must exist material amounts of: receivables/payables, inventories
of merchandise for resale or goods for use in the provision of services,
and/or capital equipment. D.
Policy: 1.
The manager of a designated Enterprise Activity shall prepare
an annual business plan outlining yearly objectives, annual projections
of revenue and expenditures, pricing schedules for services, as outlined
above. Generally, the business plan shall mirror the management philosophies
and operating parameters outlined in the unit's Priorities for Action
(strategic plan). The business plan will be forwarded to the respective
vice president for review and approval. Once approved, informational copies
will be sent to the Vice President for Administration, the Controller's
Office and the Office of the VP for Finance for reference. 2.
Budgets shall be prepared for each Enterprise Activity in accordance
with established University guidelines. This will be done annually as
part of the regular process used in the preparation of the University's
annual operating budget. The budgets shall include realistic projections
of both revenues and expenditures consistent with the unit's business
plan. 3.
Revisions to the approved budget shall be made through the normal budget
adjustment process in accordance with established University policies
and procedures: a.
Enterprise Activity managers may transfer funds within the activity
as programmatically justified. Intra-departmental transfers between expenditure
categories (FRS subcode pools) are authorized. b.
Because of their self-supporting nature, interdepartmental transfers
for Enterprise Activities would normally not take place. When it is in
the best interest of the University, vice presidents may make exceptions
where two separate activities function dependently. An example of this
is the interdependence of the printing and publications operations. c.
Enterprise Activities shall receive no general fund subsidy from
the University. All requests to revise the operating budget must be funded
internally from realized revenue or interdepartmental charges. 4.
Enterprise Activities shall be exempted from the University's
Lapsed Salary Policy, Vacant Position Policy, Financial Management Incentive
Policy and Internal Reallocation Policy. The purpose of this exclusion
is to give maximum flexibility in financial management and to encourage
decentralized decision making by Enterprise Activity managers. 5.
Unencumbered funds remaining at fiscal close will be carried
forward into the new fiscal year as unallocated fund balances. Fund balances
will not normally be used to support operations, except for special provisions
outlined in the business plan. Each Enterprise Activity shall have its
own general ledger (GL) account where fund balances will accrue automatically.
The primary purpose of this provision is to allow Enterprise Activities
to accumulate funds over time to make major equipment purchases and to
fund other capital projects. 6.
Fringe benefit costs for personnel assigned to the Enterprise Activity
shall be budgeted and expended in accordance with the University's established
practices. Unexpended fringe benefits may be re-budgeted and used as programmatically
justified. 7.
It will be the responsibility of the Enterprise Activity manager
to prepare an annual progress report to the respective vice president.
Informational copies of these reports should also be sent to the Vice
President for Administration, Controller's Office and the Office of the
VP for Finance. E.
Procedures: 1.
A request to establish an Enterprise Activity will be made by
letter sent to the University Controller. The Controller will evaluate
the request against the objective criteria, as stated above, and make
a determination as to the appropriateness of the request. 2.
If approved, the Controller's Office, in coordination with the
Office of the VP for Finance, will establish special Enterprise Activity
accounts. Normally two accounts will be established for each Enterprise
Activity: a. A subsidiary ledger account for current operations which will accommodate all revenue and expenditure transactions. This account will be established in the "356XXX" series of accounts. b. A general ledger account which will "map" to the respective subsidiary ledger account. This account will summarize the activity for current year operations and will reflect all fund balances over a multi-year time frame. 3.
Vice Presidents may request that accumulated surpluses be transferred
to a University plant fund account to establish a separate fund (account)
for capital acquisitions. Requests will normally be made in writing and
sent to the University Controller who will evaluate the appropriateness
of the request. Once approved, the Controller's Office will make the necessary
transfer of funds to the plant fund.
Internal
Reallocation and Financial Incentive Strategy
Financial
Management Incentive Plan (FIP) The
Financial Management Incentive Plan (FIP) has been superseded by the Internal
Reallocation and Financial Incentive Strategy. This policy change was
implemented on July 1, 1994 as a result of all university units (both
academic and support) opting for the accelerated internal budget reallocation
initiative. For more information about this, please refer to the Internal
Reallocation and Financial Incentive Strategy. If
you have additional questions after reading this material, please call
your Policy and Budget Analyst in the Office of the VP for Finance.
The
Lapsed Salary Policy has been superseded by the Internal Reallocation
and Financial Incentive Strategy. This policy change was implemented on
July 1, 1994 as a result of all university units (both academic and support)
opting for the accelerated internal budget reallocation initiative. For
more information about this, please refer to the Internal
Reallocation and Financial Incentive Strategy.
Policy
on Capturing Vacant Position Funds The
Vacant Position Policy has been superseded by the Internal Reallocation
and Financial Incentive Strategy. This policy change was implemented on
July 1, 1994 as a result of all university units (both academic and support)
opting for the accelerated internal budget reallocation initiative. For
more information about this, please refer to the Internal
Reallocation and Financial Incentive Strategy.
Tuition
Remission Cost Sharing on Sponsored Projects for Graduate Research Assistants Tuition
costs included in all new sponsored project proposals should be requested
as a direct charge to the funding agency. Requests for matching from the
VPR to cover tuition costs should be made following the general
guidelines for cost sharing. 1. The full stipend (salary component) for the graduate research assistant must be provided from a sponsored research grant or contract. 2A.
To qualify for tuition remission under this policy, the research grant
or contract must provide full overhead cost reimbursement. The overhead
may not be waived, negotiated or cost shared. 3.
When the funding for a graduate research assistant’s stipend
expires, the tuition remission will likewise expire. Therefore, when requesting
tuition remission under this policy, principal investigators will develop
a contingency plan that identifies alternative sources of funding for
the student’s tuition. PROCEDURES 1. The Office of Grants Management will determine the appropriateness of requests and will approve tuition remission for the position. 2. All requests for tuition remission covered under this policy must accompany the grant or contract proposal when it is submitted for review to the Office of Grants Management. A preliminary evaluation will be made at the time of submission to ensure that all policy guidelines have been met. 3. Approved tuition remission will be provided upon receipt of an official grant or contract notice of award which meets the requirements outlined in 1, 2 and 3 of Policy and/or Objective section of this policy. No commitments, either verbal or in writing, may be made to a graduate research assistant until these requirements have been met and official award notice received. 4.
When the stipend is to be charged to a grant or contract account,
the tuition remission form must be approved by the Office of the Vice
President for Research. Only VPR approved tuition remission requests will
be processed by the Student Financial Aid Office. The Office of the Vice
President for Research will monitor accounts to assure sufficient funds. To obtain a copy of the grants and contract TR form go to the Grants Management WebSite and follow these instructions. Scroll down to the section on General Information and Forms. You can choose WORD or PDF format.
Tuition
Remission for Graduate Assistantship Policy POLICY AND/OR OBJECTIVE The University has a long-standing student financial aid program that remits tuition for selected graduate assistants and other advanced study students. Specifically, Graduate Teaching Assistants, Graduate Research Assistants, Graduate Service Assistants, University Fellows, IPIBS (Integrated Program in Biomedical Sciences) Fellows, and Diversity Scholars all receive a stipend for academic performance. These stipends normally range from $1,000 - $1,666 per month depending upon academic program. The University also provides participating students special student health insurance, funded centrally. Over time, changes in the student mix, the difference between resident and nonresident tuition rates, the mismatching of graduate assistant positions with tuition remissions and the unauthorized “splitting” of positions have led to serious budgeting difficulties. As a result, many tuition remission accounts end the year with significant operating deficits. The University has absorbed these unplanned expenditures in a number of ad hoc ways, most of which do not address long-term fiscal concerns. Academic units often cite that the rules for awarding tuition remission under this program are ambiguous and imprecise. Therefore, to remedy this situation, the following policy is being implemented. This change in the tuition remission policy should result in clearer guidelines and a structurally balanced budget for tuition for graduate students on assistantships, fellowships and other advanced study scholarships. PROCEDURES Effective July 1, 2003 the following policy is implemented to clarify the roles and responsibilities for fiscal oversight of tuition remission budgets for graduate assistantships 1.
Tuition remission
funded from the University’s General Fund budget may only be used
to support the tuition of specifically identified students designated
as Graduate Teaching Assistants, Graduate Research Assistants, Graduate
Service Assistants, University Fellows, IPIBS Fellows, and Diversity Scholars. |
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