Internal Financial Processes

Operating Budget Submission

The past excel Budget template has now been replaced with a new on-line budget system in PeopleSoft Financials that provides budgeted and actual expenses for both FY17 and FY18 (through Feb 2018) by account code to assist in the formulation of the FY19 budget. We have created two levels of access – Budget Entry and Budget Approval. There are several levels of approvals – Budget Administrator (required), Dean/AVP (optional) and VP (required). Those administrative support personnel with Budget Entry access can only enter budget information into the new system. Any of the potential three levels of approval can also enter and/or modify the budget information. Once the proposed FY19 budget entry is complete, the budget is reviewed and approved by the Budget Administrator, then by the Dean/AVP (if warranted), and then by the respective VP. An approval in the system by the VP indicates to the Budget Office that the proposed FY19 budget is ready for review.

User instructions for completing and approving the new Budget template:

Budget Entry (PDF)

Budget Approval (PDF)

FY19 02 budget worksheet.xlsx

FY19 Anticipated Revenue worksheet final.xlsx

Budget FAQ's 2019 (PDF)

Annually, during the months of April and May, the Budget Office will analyze each template and discuss any concerns and questions with the BA of that department. These submissions will be summarized at the school and division level and discussed in detail with each Dean and Vice President. In addition, the entire campus’ projected spending allocations will be combined to analyze our expenditures in its entirety.

In May, the combined university budgets will be presented for discussion to the Executive Staff members and updates will be applied as needed.

In June the “control” budgets as well as account-code level budgets will be loaded into PeopleSoft.

Once the final budget is approved and the actual Fiscal Year begins, the Budget Office monitors the spending of all departments within. If one department overspends, in reality, it is taking away spending authority from another, causing a ripple effect that could harm the university’s financial integrity. Communication between each Budget Administrator and the Budget Office is critical. Unfortunately, unanticipated expenditures occur and a call to action may be needed at times. “Communication” is a key component to the financial success of the university.

Enhancement Proposal Submissions

An enhancement request is an official request for additional funding over and above the general operating funds assigned to a department. This request for supplementary funds may be for an increase to the annual operating budget, a “one-time” only request, or a combination of both.

By completing a one page request, the Executive Staff of the University and the Strategic Planning and Budget Committee have the information needed to prioritize and fund initiatives that support and advance the university’s Strategic goals. Enhancement requests should first consider the question – “Is this something that can be funded or supported through the management and/or reallocation of current operating budget?” Once operating budgets are properly right-sized, departments have the discretion to manage, direct and apply budgets as they have been allocated (within the fiduciary restrictions applied to each budget and account code; funds are not fungible across budget pools).

As departments consider formal enhancement requests, there are some considerations as to how those requests should be proposed. Some guidance for requests is offered below:

3-5 Year Large Expenditure Budget

In order to evaluate the long-term enhancement requests that departments are proposing, we must have a good handle on a 3-5 year large expenditure budget plan. This would involve large equipment replacements – such as an art kiln, science lab equipment, replacement of an entire lab of microscopes or room of athletic equipment, computer lab replacements, etc. In addition, expenses such as software renewals that may not be annual but once every so many years, school or department accreditations, Middle States and any other expenses that are needed on a non-annual basis should be included. This process helps to plan for the long term and set aside funds each year with knowing these upcoming expenditures. Annually each division will be asked to re-evaluate their 5 year large expenditures spreadsheet to submit to Administration and Finance.

Budget Overages

As discussed in the Expenditure Account Codes section of this guide, the budgets are recorded and “controlled” in the PeopleSoft Financial System at the budget category level for ease of summarizing the types of groupings to not have to manage overages and keep the amount of budget flexibility at a higher level. The Rollup budget categories are as follows:

010001 - Salaries and Wages (PIN/Regular Salaries and Benefits)

020001 - Technical and Special Fees (All Contractual Salaries and Benefits are included)

030001 - Operating Expenditures (Objects 03 – 13)

140001 - Land & Structures (Only Physical Plant, Auxiliary and Plant Fund Depts.)

For each transaction processed throughout the fiscal year, PeopleSoft performs an automatic budget checking process.

In general, most transactions should not fail the budget checking process, especially at the beginning of the fiscal year. By combining rollup level groupings, the likelihood that a transaction will fail budget checking is mitigated. As the fiscal year-end approaches, departments will have to be extremely cognizant of the remaining budget balances available. Departments have the ability to inquire online and run monthly reports to ascertain the status of their budgets.

If a transaction does lead to an overspending of one of these rollup levels, then an error is generated and processing cannot be done without the override and approval from the University Budget Office. The Budget Office will review the transaction and your department balances and contact the appropriate Budget Administrator to discuss how to proceed.

If a transaction does lead to an overspending of one of these rollup levels, then an error is generated and processing cannot be done without the override and approval from the University Budget Office. The Budget Office will review the transaction and your department balances and contact the appropriate Budget Administrator to discuss how to proceed.

Budget Adjustments and Transfers

Budgets are estimates created at the beginning of a fiscal year, with no crystal ball to determine the end results 100%. Based on the controlled budget feature in PeopleSoft, a more formalized process is needed when budgets need to be revised.

The majority of the budget revisions should be handled through the Enhancement Proposal process. However; there are times when an increase or decrease is needed to make corrections and right size budgets, transfer between rollup categories within the budget, transfer budget funds from one department code to another, or just a complete emergency and must do.

Budget Adjustments can come in two forms; a base adjustment or a one-time adjustment. A base adjustment is a permanent increase done to your original budget, as the reasoning is that of an on-going need year after year. An example of this could be an increase in the salary of a new employee from that budgeted originally. A one-time adjustment is a temporary adjustment just for the current fiscal year, and this could be generated from situations such as an encumbrance rollover or professional development funds rollover.

Budget adjustments are only to be used to transfer spending authority. They should not be used to move expenses that have posted from one department to another. If an expense belongs to a specific department, but another department is funding it, or part of it, a budget transfer should be made, and the expense should stay in the appropriate department.

If a budget adjustment is needed, written documentation (can be email or memo format) that all budget administrators affected are in agreement with the requested change to their budget balances (whether base or one-time) during the fiscal year is required.

NOTE: Budget transfers are not done to move an actual expense. Expenses should always stay in the department with which they belong. If an expense in incorrectly recorded, then follow the journal entry section below.

Written documentation is not required if a department needs to move funds from one "operating" budget category to another (i.e., from contractual services to travel to fund an unexpected trip) within the same budget department code.

Encumbrance Rollovers

Timing differences can be a challenge when it is near the end of the fiscal year. You may place an order for products in May and the bill for those items may not arrive until after July, which means the billing gets posted into the next fiscal year. To help offset this, the Finance & Admin office reviews all of the purchase orders that the Procurement Office rolls over into the following year. If the department code that the PO is charged to had a balance available at the end of the fiscal year to account for the expense, then the amount needed for the purchase order will be added into your budget as a “Budget Adjustment” for just the current fiscal year.

Journal Entries