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Budget Office Business and Finance

terms and definitions.

Budget Calendar:
The University budgets on a fiscal year basis which includes the 12-month period of July 1 through June 30.

Funding Sources

State Aided - The state-aided budget is funded from State Appropriations and university-generated cash funds (primarily tuition income). These funds are available for expenditure during the course of the fiscal year (July 1 - June 30). The cost center assigned for identifying a state-aided funding source begins with 41.

Revolving - Funds that generate revenue such as laboratory class fees, workshop proceeds, seminar fees, revenue from music and theatre productions, etc. Revolving funds support expenditures specific to the course/activity that generates the revenue. A revolving fund balance is retained from year to year. The cost center assigned for identifying a revolving fund begins with 42.

Auxiliary - Revenue from an entity that exists to furnish goods and services to students, faculty, or staff and charge a fee directly related to its operations. Auxiliary enterprises include residence halls, food service, bookstores, etc. Auxiliary cost centers begin with 43.

Federal - Budgets that include federal grants and contracts and student aid programs supported from federal grants. WBS elements assigned to identify federal funding begin with 44 (Federal Letter of Credit) or 45 (Federal Advance).

Trust - Budgets supported by trust funds relate directly to non-federal grants or contracts, non-federal student aid programs, maintenance of student loan programs, endowment funds, and agency funds. WBS elements assigned to identify a trust fund begin with 46 (Trust Life to Date) or 47 (Trust Year to Date).

Plan GL Codes:
Plan GL codes are sometimes referred to as Plan Account Codes or Plan Cost Elements. These codes identify broad budget categories at a higher level than actual activity.

511000-517000

Planned Salary Categories

519xxx

Planned Benefits Categories

521000-570000

Planned Non personal Services Categories


The Plan amount reflects the current budget (also referred to as temporary budget) for the fiscal year.

The Plan changes when a temporary budget transfer is processed. A temporary budget transfer adjusts the amount available to spend for a specific line or category for the current fiscal year.

Within SAP you can view the date and amount of budget adjustments. The standard menu path is: Information Systems>Financial Accounting>Cost Center Accounting>Detail Line Items>Cost Centers>: BCS Plan Line Items Report

Budget transfer:
A budget transfer increases or decreases the budget available to spend in the current year. It provides funding to a specific area or for a specific purpose. A debit decreases the budget available. A credit increases the budget available.

GL Account Postings:
A GL Account Posting is primarily used as a means to correct a payment/charge that has posted to a cost center. A GL Account Posting is also used to correct a deposit made to the wrong revolving fund cost center. A debit increases cost center expense and decreases revenue recorded. A credit reduces cost center expense and increases revenue recorded.

Permanent budget:
Also referred to as the Original Budget, is the beginning July 1 budget for personal and non-personal services. The permanent budget is funding that is anticipated every year, unless budget reductions or other adjustments occur.

Permanent budget transfer:
An adjustment that is made to the Permanent Budget to address changes in future needs. Transfers processed this year affect the beginning operating budget for the next fiscal year. The transfer cannot be made to or from WBS elements or between funds, i.e., between revolving and state-aided cost centers.

Current/Temporary budget:
Also referred to as the Adjusted Budget, represents the current year's operating budget, July 1 through June 30. SAP financial reports refer to the current budget as Plan. The current budget includes the July 1 permanent budget and any current year adjustments (temporary budget transfers and/or prior year encumbrance budget adjustments).

Temporary budget transfer:
An adjustment that will affect only the current year budget and will not be included in determining the base budget for the next fiscal year. The adjustments are one-time and are only available for current year activities. Temporary budget transfers are reflected in the SAP financial reports. The transfer cannot be made to or from WBS elements or between funds (i.e., between revolving and state-aided cost centers).

Organizational Unit:
An organizational unit represents any type of organizational entity designated to perform a specified set of functions within the University. For example, departments will be represented by organizational units. It is by creating organizational units, and then identifying the relationships between the units, that you identify the organizational structure of the University.

Credit Expenditure:
Credit Expenditure is a credit that can be directly traced to a specific expenditure and does not qualify as revenue. The credit should be applied to the cost center that originally incurred the expense. Examples are returns, rebates, and discounts given on purchased goods and services.

Revenue:
Revenue is the income earned from a transaction such as the delivering or producing of goods, the rendering of services, or as a result of other activities directly relating to its operations.

Position Number:
A number assigned by the Budget Office which identifies the specific position to which the employee appointment information is assigned within the University's organizational HR hierarchy. Each position is created and maintained in SAP Organizational Management and tied to a personnel area, a job, a pay scale type (if applicable), an employee group and subgroup, pay scale group and a pay grade. The position number submitted on the PAF indicates the position the employee is assigned. The employee inherits the attributes assigned to that position.

Cost Element:
Cost element is another term for G/L account. It is a six-digit number that identifies the nature of revenue/expense. They identify broad budget categories and are at a higher level than actual activity. (e.g., Subscriptions: Budget-521000, SAP-521803; Computing Supplies: Budget 530000, SAP 531900).

Cost Center:
A ten-digit number used to plan, gather, and track costs for a University unit or department for State-Aided (revolving and non-revolving), Auxiliary, and other fund types. Within a department, multiple cost centers may be set up to further break down expenses by project or activity.

Encumbrance:
A commitment of budget via a secured means, purchase requisition, purchase order, etc.

A current year or temporary adjustment that frequently occurs is called a "Prior Year Encumbrance Forward". The Cost Center: Revenue and Expense Summary displayed reflects totals for year end, Periods 1-13. The Commitments column displays the total amounts for goods ordered/secured but not yet received as of June 30. The balance (%Variance) is reduced by the amount for the commitments. The funds have been "reserved" to pay for the goods.

Since the goods will arrive on or after July 1, payment will occur in the next fiscal year. The budget for the next fiscal year is increased by the amount of the prior year commitment.