for the VT Department Fiscal Manager Session TWO
- What is SCHEV money?
- What is a Service Center?
- What is a Various fund?
- What is a Cost-Share fund?
- What are Local funds?
- What is a Tuition fund?
- What are VTF Research funds?
- What is an Industrial Affiliate fund?
- What about the Foundation?
- Do we have money for fill in the blank?
- Banner Chart of Accounts
Terminology: ETF (Equipment Trust Fund) = HEETF (Higher Education Equipment Trust Fund) Also called SCHEV money because SCHEV (State Council for Higher Education in Virginia) administers the program HEETF is a statewide bond-financed program started in 1986 to provide a continuous stream of dollars to Virginia universities for EQUIPMENT purchases related to research. It is renewed annually, from about $7M in 1999 to $14M in 2016 The Budget Office oversees the program and distributes the money Budgets are in place in December of each year
Summer: VT receives annual ETF allocation from the state August: Departments enter item-by-item requests in ETF system Fall: new Banner fund numbers are created for this year’s ETF money, e.g., 114048 – ETFP29-Biological Sciences December: budgets are in place in the new Banner funds December thru June: departments order and receive the equipment – OR— journal-entry equipment purchases made earlier in the fiscal year to the ETF fund June: money should be spent by fiscal yearend June 30: unspent balances roll forward to the new fiscal year with rule code B03
Equipment items must be approved in the Budget Office ETF system and assigned an ETF item number The equipment purchased with SCHEV dollars serves as the collateral on the bond issued by the state
The equipment must be kept on active inventory for seven years
Each department gets a single new Banner fund each fiscal year
Budget may not be transferred in or out of the ETF Banner fund
The ETF Banner fund acts as its own non-sufficient funds “bucket” www.obfp.vt.edu/budgetprocesses/etf.html www.obfp.vt.edu/budgetprocesses/etf.html
¾ Library books, films, videos, DVDs and other materials ¾ Microfilm collection and materials ¾ Library shelving ¾ Office furniture or appurtenances ¾ Transportation equipment ¾ Equipment affixed to a building ¾ Climate control and security systems ¾ General telecommunication equipment ¾ Buildings ¾ Equipment with a useful life less than 3 years ¾ General application software (e.g. Microsoft Office) ¾ Items costing less than $500 ¾ Used equipment ¾ Copiers and Fax machines ¾ Maintenance agreements, site licenses, warranties ¾ Training and consulting services ¾ Boats
Big-ticket lab items
Buy a small number of expensive things and there is less to keep track of
Buy items that will be around a long time
ETF money is often used for faculty startups
Some other considerations: You can only pay for something with ETF money if it is approved by the Budget Office and has an ETF item number You may buy equipment on another fund in the fall BEFORE the ETF money is released, and then journal the purchase to the ETF fund Avoid buying small-dollar items and computers, because they MUST be kept on active inventory for seven years
A “sort of” self-supporting operation in a department, usually operating out of a single Banner overhead fund, e.g., 230369 – LS1 Vivarium Over 100 service centers are currently in operation, to the tune of $9.2M annually The biggest (dollar wise): Nanoscale Characterization and Fabrication Lab VTCRI HNL VCOM II SRF VBI Core Lab Genome Sequencing Vet Med Res – Small Animal VBI Core Computation Life Sciences Vivarium CPES Research Lab AOE Wind Tunnel CRI Vivarium Center for Survey Research Smart Road Chemistry Stockroom
Money comes in through RECOVERIES (intra-university payment) Rates are set and reviewed annually by the Controller’s Office Rates are designed to cover costs They use overhead fund numbers for convenience but are excluded from the Overhead NSF pool Each service center fund stands alone for non-sufficient funds checking Expenses on average are about 50/50 salary vs. operating
A RESIDUAL is the unspent money left over at the end of a fixed-cost sponsored contract. You may request the DIRECT portion of a residual by sending a Residual Request Form to OSP
The residual amount is placed as budget money in a VARIOUS fund, which typically belongs to an individual faculty
A VARIOUS fund looks like a sponsored fund in Banner, and the balance rolls forward at yearend, but it is NOT tied to a scope of work or begin and end dates. Fund Code Fund Title Financial Manager 440795 Residual funds Ng, Wing Fai 440544 Residual Revenue Diller, Thomas E. 445179 Residual Revenue From 415901 Kurdila, Andrew J. 440354 Various Nelson, Douglas J. 440567 Various Funding Sources Fuller, Christopher R.
VARIOUS funds are identified in the Banner Data Warehouse (SCOOP) with a Dept-Fund-Category-Code of ’03’
COST-SHARING refers to an agreement made at the onset of a sponsored project that VT will spend some of its own money on the project
A COST-SHARE fund is created in Banner (as E&G) to track the VT expenses 138440: C/S for 416943 – H. Rakha
Typically budgets are NOT placed in these funds; they are used strictly to record expenses (about 95% salaries & fringes)
FY16 saw about $4M in cost-share expenses. Only 12% of that was budgeted in the funds.
Cost-Share expenses may also be recorded in other funds (e.g.,
SCHEV)
A Local Fund tracks activity within the university not supported by any of the normal funding sources Setting up a Banner fund allows use of the accounting system for expenditures These funds operate on a CASH basis: money comes in as REVENUE rather than Budget Many are fellowships or scholarships; others are for specific groups or events that get outside money 656139: Fellowships-VTF 876358 Kinney 656119: Hord Scholarship/Fellow – VTF 887440 659847: Summer Arts Festival 659848: Marching Virginians 654189: CEE Career Fair 655597: CIB Student Chapter Funds
Similar to AGENCY Funds (“assets held for distribution by the state as an agent for another entity…”) used for Study Abroad and Field Trips
FY16: Local Funds = $1M; Agency Funds = $4M
Each department has a Tuition Remission fund that holds money to pay tuition for students on Graduate Student Assistantships 997040: Tuition Rem Biology 998203: Tuition Rem Biology-Alt
Also called IFS money or IFS funds
$23M in total: 20% General Fund Financial Aid money; 80% unfunded waiver
Tuition is “awarded” when a student is placed on payroll (no fund is specified)
After the semester IFS money has arrived, the administrator goes back and “funds” the tuition by naming the specific Banner fund (either IFS or a sponsored fund if a GRA)
After the semester IFS money has arrived, the administrator goes back and “funds” the tuition by naming the specific Banner fund (either IFS or a sponsored fund if a GRA)
Sponsored project money can only be used for tuition in the exact proportion that the project paid the salary of that student.
The 998 “alternate” fund is used for special circumstances (e.g., cost- share) to track it separately. Will Walton in the Graduate School must transfer budget from the 997 to the 998 fund.
Yearend remaining balances do NOT carry forward to the next fiscal year.
For operational procedures of Tuition Remission System: http://graduateschool.vt.edu/funding/funding-information-for-departments/tuition- remission.html
A VTF Research Fund is set up by transferring money from the VT Foundation 441998: Fescue Toxicity 441177: VT Sheep Center 441976: Thornhill Professor Operating 441693: Newmont Research 441705: Transportation Research Fellow 444203: Advanced Modeling of Ballast Dynamics
These funds support professorships and many projects
They look a little like sponsored projects but they are NOT. The money comes from private donations, which cannot require specific deliverables or reports.
The funds behave much like a Various fund and the money carries forward.
Why move money to a VTF Research fund? Make the money available to pay salaries Use Hokie Mart, credit card and other Banner purchasing options Move money to where it’s more convenient and visible
VT has approximately 30 Industrial Affiliate partnerships with commercial industries These programs allow industries to help sustain research and teaching outside the Sponsored Programs world Each program is created to support a particular avenue of research Contributions come through the VT Foundation (now transitioning to OSP) and are transferred to Banner funds such as: 500105: UAV Physical Security Vulnerabilities 441514: Future Electronics 500039: Multifunctional Integrated Circuits 441375: Foundation Fed – WICAT 441763: Railroad Joint Design Evaluation Contributions are subject to a 7% fee (whether VTF or OSP) but no overhead is charged. Spending in FY2016 was approximately $7M as follows: 37% graduate student support; 28% other salaries & fringes; 35% operating IAP (Industrial Affiliates Program) funds have Fund Source 23396 in Banner
“Industrial Affiliates Programs are designed to facilitate the dialogue between academia and industry and the transfer of new knowledge to the general public. Supported by membership fees, these programs provide an avenue for industry to contribute to and sustain research and teaching in Virginia Tech departments and programs of interest. Members join in the support of an identified area of research for a stated period of time, with each participant receiving the same benefits from equivalent membership in the program. The benefits to be derived from such membership may include early access to technical information, participation in technical meetings, presentations, and access to the best and most productive graduate students as perspective employees.” https://www.research.vt.edu/industrial-affiliates-program
The Virginia Tech Foundation is a related corporation with an endowment of almost $800M. It operates as a separate financial entity with its own accounting system 883527: JB Jones Chair-Endowment 883965: Pierce D Angell Endowed Scholarship 881251: ME Unrestricted
From the department fiscal operation perspective, think of VTF as a different bank with its own procedures, in which funds intermingle with VT funds only in specific defined processes
The VTF system does NOT have: payroll; Hokie Mart; sponsored research; budget transfers
Many VTF funds are endowment or income funds related to scholarships and professorships, whose purpose is very focused
Some VTF funds are less restricted and expenditures can be initiated with VTF procedures –OR– money can be moved to the main VT system
When to spend VTF unrestricted: social events, alcohol, gifts, publications, renovations, software development
In the Banner Data Warehouse, the Fund Dimension holds a column/attribute called DEPT-FUND-CATEGORY-CODE:
01 Sponsored 02 VTF Research 03 Various 04 Overhead 05 Cost Share 06 State 07 Federal 99 Other
Hint: In MicroStrategy, this attribute is renamed
FUND DEPARTMENT CATEGORY CODE
e.g., equipment, renovations, salaries, travel, student projects, startups
- Who should pay, the department or the faculty? Does the faculty have Various or Overhead?
- Use E&G first (if you have enough to cover your salaries) – you want to use it up by yearend
- What is the purpose of the expenditure? e.g., in the College of Engineering, the Engineering Fee is available and must enhance the quality of the instructional mission -- could be salaries, special projects, equipment, furniture or renovations
- Overhead and Various have virtually no restrictions (but avoid salary payments)
- SCHEV (ETF) for equipment only
- Other pockets of money may exist, controlled either by the department or by faculty: Professorship or Fellowship operating VTF Research Foundation Unrestricted Continuing Education surplus IP Royalties Institutional Allowance Admin Fee
- The following can ONLY be used for their designated purpose: Sponsored projects Cost-Share Local Funds Service Centers IFS / Tuition Remission
Most departments have something like the following in place at minimum: 124788 Dept 107 Budget Pool (receives operating budget from dean) 125304 Dept.107 Salary Pool (receives salary budget from dean) 121030 M E Salary (most E&G salaries are charged here) 121970 M E Operating (general E&G operating expenses) 122450 Summer School Salary (E&G summer school faculty payroll) 230602 M E Overhead Acct (general overhead operating expenses) 230603 M E Rocket Lab (default “kickout” fund for payroll) 997107 Tuition Rem Mech Eng (covers GTA tuition charges) Sponsored funds are created by OSP Equipment Trust Fund (SCHEV) funds are created by OBFP each year Various funds are created in OSP from a department residual request VTF research funds are created in OSP from a department request Cost-share funds are created in OSP (??) Service Center funds are created in Controller’s Office Departments may request new E&G funds (from the Budget Office) and Overhead funds (from the VPRI) with few limitations
At year-end the Controller’s Office allows you to journal expenses in SUMMARY amounts at the Fund / Account level The following Journal Entry moves $201K in spending from Overhead to E&G, reducing the E&G balance and increasing the Overhead balance
Move these expenditure summary amounts from OVERHEAD to E&G FROM TO Amount 230602 15350 Building Rentals 121970 15350 29,633.59 230602 13410 Other Laboratory supplies 121970 13410 24,895.07 230602 12180 Other Telecom Services (State) 121970 12180 18,829.23 230602 1244R Service Center Services 121970 1244R 18,338.81 230602 11150 Medical/Hospitalization Insurance 121970 11150 16,844.25 230602 13120 Office Supplies - Gen. 121970 13120 16,830.05 230602 12831 Air Travel, Public Carriers 121970 12831 10,416.48 230602 22175 Other Computer Equipment <2000 121970 22175 10,304.04 230602 12890 Employee Training and Conference 121970 12890 7,627.82 230602 12810 Moving and Relocation Services 121970 12810 7,334.28 230602 22185 Computer Software Purchase <100,000 121970 22185 5,648.94 230602 22115 Desktop Client Computers <2000 121970 22115 5,372.60 230602 22620 Office Furniture 121970 22620 5,276.56 230602 12120 Outbound Freight Services 121970 12120 4,755.72 230602 13221 Piped-Natural Gas 121970 13221 4,527.42 230602 22186 Personal Computer Software <100,000 121970 22186 4,347.36 230602 22110 Desktop Client Computers 121970 22110 3,754.16 230602 12897 Registration Fees-Employee Training 121970 12897 3,725.00 230602 15358 Mini-storage Unit Rentals 121970 15358 3,300.00
201,761.38
The Chart of Accounts provides a way to categorize all funds and transactions in Banner Finance Element Levels Purpose
F Fund 7 VT Internal FUND ACCOUNTING Categories (E&G vs. Overhead vs. Auxiliaries etc.)
O Organization 6 VT Internal Organization (colleges & departments)
A Account 6 Describes what the money was spent on (salaries, supplies, travel etc.)
P Program 4 Richmond codes describing the Purpose of the expenditure
A Activity 3 Department-controlled additional attribute on individual transactions (optional)
L Location Used only in certain central offices
FUND Hierarchy (Banner Chart of Accounts) Fund Type Fund Group Fund Agency Fund Detail Fund Class Fund Source Fund 10 - Current Unrestricted Funds 1A - Agy 208 Unrestricted Operating A208 - Agency 208 Unrestricted Operating A80300 - Educational and General 1000 - 208 E & G Operating Funds 10500 - 208 E & G Other Than Cost Sharing 121030 - M E Salary 10 - Current Unrestricted Funds 1F - Agency 208 Returned Overhead Funds F208 - Agency 208 Returned Overhead Funds B80303 - Returned Overhead Funds 1300 - Returned Overhead Funds 13300 - Ret. Overhead College Share 230602 - M E Overhead Acct
ORGANIZATION Hierarchy (Banner Chart of Accounts)
President &BOV Executive Management Senior Management Management Department Organization U Univ. President & Governing Board PR Senior VP & Provost S08 College of Science M080 College of Science 0052 Physics 005200 Physics 005202 Center for Neutrino Physics
ACCOUNT Hierarchy (Banner Chart of Accounts) Account Type Account Group Account Subgroup Account Class Object Code Account EL Expenditures - Labor and Benefits LD Labor and Benefits - Direct Costs 112 Salaries 1120 Salaries - Classified - Budget 1123 Classified Salaries 11231 Classified Salaries CY
PROGRAM Hierarchy (Banner Chart of Accounts)
Program Group Purpose Program Class Program 10 Current Funds General Expenditures 101 Instruction 101100 General Academic Instruction 010011 General Academic Instruction 010012 Off-Campus Instruction
ACTIVITY Hierarchy (Banner Chart of Accounts) Activity Organization Activity Class Activity 010300 Civil & Environmental Engineering CONFTR Conference Travel GRCTR Green, Ressell Conference Travel