University at Buffalo Crest.

Policy Information

Date Established: 8/19/2019
Date Last Updated:
Category:
Financial
Responsible Office:
Financial Management
Responsible Executive:
Vice President for Finance and Administration

Policy Contents

Financial Management of Departmental Events Policy

Summary

This policy provides guidelines for the financial management of departmental events fees to support:

  • Accurate cost calculations
  • Consistent operational practices to document revenue, costs, and fees
  • Compliance with SUNY and university policies
  • Adequate internal controls

Policy Statement

The University at Buffalo (UB, university) establishes and maintains departmental event rates in accordance with the State University of New York (SUNY) Fees, Rentals, and Other Charges Policy. A departmental event is a departmentally sponsored function (e.g., conference, banquet, retreat, outing, fair) for which a fee is charged to participants.

These general principles govern the development of new rates or changes to existing rates:

  • Rates are set based on the full cost of the event for which the fee is charged, including allowable costs.
  • Rates must recover costs when no other dedicated funds are available for that purpose.
  • A consultation process with participants is encouraged, when appropriate. The consultation process may use a committee with representation from the impacted group.
  • New rates and changes to existing rates  must be reviewed and approved by:
    • Financial Management
    • Department chair or head
    • Unit Business Officer (UBO)
    • University Controller
  • Rates must be reviewed annually and adjusted as necessary.

Departmental Event Rate Development

The cost of an event is charged to participants through a rate. Rates are developed to cover the cost of operations, including but not limited to salaries, benefits, supplies, catering, and speakers. All costs included in developing the rate must be:

  • Allowable
  • Directly attributable to the event
  • A necessary and appropriate component of the rate
  • Documented
  • Reviewed post-event and at least annually

The department must:

  • Review departmental event rates and cost components for each event for reasonableness post-event and at least annually
  • Complete the Departmental Event Fee Approval
  • Forward documentation supporting the calculations for new departmental event rates and adjustments to existing rates to Financial Management for review and approval
  • Maintain documentation of the details of the rate calculation and approval

Departmental Events Allowable Expenses – State and UB Foundation

Allowable Expenses

Expense Type

 

Purpose

 

Description

Allowable

State

Allowable

UBF

Salary and Wages

Administrative Staff

Actual anticipated percentage of effort by the staff and work should be directly related to the rate being charged (current salary and fringe)

Yes

Yes

Salary and Wages

Faculty

Cost of instruction for academic staff and technicians who perform duties in conjunction with a credit-bearing or required course leading to a  degree (tuition and State support are provided for this purpose)

No

No

Food and Beverage

Student or Participant Food or Beverage

All students or participants receive the food and beverage and it must be a necessary component of the event rate

Yes

Yes

Food and Beverage

Faculty and Staff Food and Beverage

The food and beverage is part of a group meal where the faculty or staff members presence is needed  and other separate food and beverages are not available

Yes

Yes

Food and Beverage

Faculty and Staff Food and Beverage

The food and beverage is separate to the student or participant, but is related to the specific departmental event

No

Yes

Food and Beverage

Alcoholic Beverages

When there is any alcoholic beverage related to event rate

No

Yes

Travel

Student or Participant Travel costs

Any student or participant travel costs that are a necessary component of the event rate

Yes

Yes

Travel

Student or Participant Lodging

Any lodging that is a necessary component of the rate

Yes

Yes

Travel

Faculty and Staff Travel

The travel is separate from group, but is related to the specific departmental event

No

Yes

Travel

Faculty and Staff Lodging

The lodging is required of the participants and the staff and they are staying at the same location

Yes

Yes

Printing and Postage

Printing and postage

The printing and postage charges are reasonable and a necessary component of the event rate

Yes

Yes

Materials, Supplies,  Equipment

Materials and supplies specific to the event

Can result in a tangible product retained by the participant or where a special service is provided

Yes

Yes

Materials, Supplies,  Equipment

Supplementary text, software and resource materials

These are not available through the university bookstore but are required for departmental event

Yes

Yes

Materials, Supplies,  Equipment

Scientific chemicals and laboratory waste

Required part of event and necessary component of rate as proper disposal is also required

Yes

Yes

Materials, Supplies,  Equipment

Equipment expense is less than $5,000

Cost of $1-$999 – expense total cost in the year purchased
Cost of $1,0000 – $ 4,999 expense cost over a three year period

Yes

Yes

Materials, Supplies,  Equipment

Classroom equipment

Typical classroom furniture, used for multiple instructional purposes and part of a regular instructional budget

No

No

Materials, Supplies,  Equipment

Computer equipment or software maintenance

The equipment usage, primary software, computer maintenance, and related supplies or any other expense is covered by the Technology Fee

No

No

Materials, Supplies,  Equipment

Computer equipment or software maintenance

The computer equipment and software expenses (including maintenance) are unique to the charge, and are not covered by regular instructional budget or the Technology Fee

Yes

Yes

Other Expenses

General University Service Fee (GUSF)

The administrative  costs associated with revenue collected as part of the event rate

Yes

Yes

Other Expenses

Donations and contributions

This can include cash, property and services, made by the university to other entities

No

Yes

Other Expenses

Volunteer personnel

Volunteer costs are less than the calculated rate of hiring facilities or outside agencies to service the event

Yes

Yes

Other Expenses

Student or Participant Admission cost

The admission costs for trips are required for the departmental event

Yes

Yes

Other Expenses

Professional Services

Speakers, lecturers, or presenters that are a required component of the rate

Yes

Yes

Other Expenses

Bad Debt

Any losses from previous year or deficit in related event account

No

No

Other Expenses

Advertising, promotional material, start-up

Any costs for advertising, sending out promotional material, or expenses related to the start-up of the departmental event

No

Yes

Other Expenses

Fundraising

Any fundraising costs associated with the event rate

No

Yes

Break-Even Concept (Surplus and Deficit)

Departmental event rates must be developed so that revenues offset costs for each event. A surplus is not allowed for rates charged to internal participants.

Amounts charged to external users in excess of the internal rate should be excluded when calculating the surplus or deficit.

Variable Billing Rates

Internal university participants should be charged the same rate. However, if some users are charged a reduced rate or are not charged a rate, the standard (non-subsidized) rate must be imputed in calculating the rate’s annual surplus or deficit. This is necessary to avoid having some users pay a higher rate to make up for the reduced rate charged to other participants.

Subsidized Users

The university may choose to charge some users a lower rate or no rate; however, the fee rate must be calculated for all users based on total expenses.

The cost used by the subsidized user group must be recorded to ensure that they are not inappropriately charged to other users.

University Provided Subsidy

Departmental event rates must be fully costed (i.e., the rates should include all allowable costs associated with the activity or service provided); however, the university may choose to subsidize the costs of a rate. When rates are lower than cost, the resulting deficit cannot be carried forward as an adjustment to future fee rates. In instances when subsides are required to cover costs, the source of funding and account must be identified.

Rates for External Participants

The university allows external participants to be charged a higher rate than the rate charged to internal users. However, revenues and costs associated with external users must be tracked separately to avoid the perception of overcharging.

  • Rates charged to external users may include a markup of the costs, listed as a percentage
  • External rates should not be significantly different than the prevailing rate for identical services provided by commercial organizations in the area
  • Revenue from external users may have Unrelated Business Income Tax (UBIT) implications  

Billing and Invoicing

  • Invoices must be based upon documented and properly approved rates.
  • All invoicing should be processed on a timely basis and with current approved rates.
  • The department is responsible for monitoring collections on accounts receivable.

Revenue Collection

Acceptable Payments
Participant Payment Type
Internal Participant   •  Student billing system (HUB)
  •  Campus Cash
  •  Interdepartmental Invoice (IDI)
  •  Purchase Order (eReq)
  •  Revenue Transfer
External Participant   •  Wire Transfer (ACH)
  •  Electronic payment (ePay, UBF Checkout)
  •  Paper Check
  •  Credit card (requires prior approval)

Payment types not listed in table must be approved prior to collection from Financial Management.

Departments may elect not to accept internal methods of payment for the event.

Waivers and Refunds

The waiver and refund policy must be documented in the Departmental Event Fee Approval, as applicable.

Segregation of Duties

Departments collecting revenue should ensure that the appropriate segregation of duties is maintained to safeguard funds and the university’s reputation, as required in the Safeguarding Cash and Cash Equivalents Policy. For instance, a person who receives payments should not be the person who deposits payments or reconciles the account.

When staffing resources make segregation of duties difficult, compensating controls must be implemented to provide the appropriate checks and balances to detect errors, deter fraud, and prevent concealment of irregularities. Read about compensating controls in the Safeguarding Cash and Cash Equivalents Policy.

Departmental Event Accounts

All newly established departmental event fees must be deposited in a separate account. The preferred funding source is a State Income Fund Reimbursable (IFR) account. However, it may be necessary to establish a UB Foundation (UBF) account with payment through the UBF checkout system based on the nature of the fee. This requires prior approval from Financial Management and the University Controller.

Record Retention

The department must maintain rate development documentation. Documentation includes the actual costs of providing the event, number of participants, billings, collections, and the annual surplus or deficit.

These records are subject to SUNY external audit and internal review.

Fees Charged to Students Without Approval

In the event that a fee is imposed upon students without following the guidelines in this policy, funds collected will be refunded to the payee in full upon request made to the campus or by directive from SUNY System Administration. Requests for refunds must be made within three years of collecting the fee.

Background

The SUNY Board of Trustees established levels of authority and requirements for university charges, as described in the SUNY Fees, Rentals and Other Charges Policy. This policy provides a framework for consistent operational guidelines to:

  • Estimate allowable costs
  • Identify unallowable costs
  • Bill for events
  • Collect and deposit revenue
  • Maintain documentation
  • Implement appropriate segregation of duties to safeguard funds

Applicability

This policy applies to all departmental event rates administered through State and UBF accounts that are not related to service centers.

Fundraising through University Advancement and Office of Alumni Engagement events are excluded from this policy.

Definitions

Deficit

The amount determined when  costs exceed revenues for a given fiscal year.

Departmental Event

An event hosted by a UB department, either on or off campus, where revenue is collected. Events include, but are not limited to a conference, banquet, retreat, outing, or fair.   

Equipment

An item of tangible personal property having a useful life exceeding one year.  

External Participant

Organization or individual whose ultimate source of funds is outside the university. External participants include faculty, staff, and students acting in a personal capacity. Affiliated hospitals and other individuals are also considered external users unless the university has subcontracted with them as part of a grant or contract, in which case they are an internal participant.  

Fee

Referring to the event, program, service, or product as a whole. There can be multiple rates for each fee.

Fiscal Year

The 12-month period used for accounting purposes; the university’s fiscal year is July 1 to June 30.  

General University Service Fee (GUSF)

Fee charged against external revenue. The service fee is a flat rate charged across all entities on funds generated through the use of university faculty or staff time or use of university facilities.  

Internal Participant

An academic, research, administrative, or auxiliary unit whose ultimate source of funds is within or flows through the university, including State and UB Foundation funds).

Rate

The individual prices paid or charged (internal, internal +GUSF, external) for all the different pricing options under a fee. There can be multiple rates associated with one fee.

Subsidized User

User who is charged at a lower rate or not charged at all.

Subsidy

Additional funding provided by a department or the university that assists in covering the costs.

Supplies

Personal property that is expendable with a useful life of less than one year, and that cannot be classified as equipment.  

Surplus

The amount determined when revenues exceed costs for a given fiscal year.

Unallowable Costs

Costs that cannot be included in calculating the cost of a service or activity.

Unrelated Business Income Tax (UBIT)

Taxes that result from income produced by the sale of goods or services to external users not substantially related to the university’s tax-exempt purpose.

Useful Life

The period of time over which a piece of equipment is expected to provide service.  

Responsibility

Departmental Management

  • Complete the Departmental Event Fee Approval  to begin the process of developing the rate.
  • Provide Financial Management with documentation supporting new rate calculations and adjustments to existing rates using the appropriate fee forms.
  • Assist Financial Management with break-even (pro-forma) analysis.
  • Establish a separate account in the university's accounting systems to record the actual revenues, billings, collections, and surplus or deficit.
  • Document the account and source of funding for subsidies.
  • Monitor collections on accounts receivable.
  • Review actual costs and billing rates annually; adjust when necessary.
  • Maintain records to document the actual costs of the program, number of participants, revenues, billings, collections, and the annual surplus or deficit.

Financial Management

  • Calculate departmental event rates with the assistance of the departmental management.
  • Calculate projected break-even (pro-forma) and perform annual reviews of break-even with assistance from departments.
  • Review and recommend approval of new rates and changes to existing rates.
  • Forward a copy of all approved rates to the Controller for final approval.
  • Perform periodic reviews of departmental event rates to determine consistency with this policy and SUNY guidelines.

University Controller, Unit Business Officer

  • Review and approve all rates, as appropriate.

Contact Information

Contact An Expert
Contact Phone Email
Financial Management 716-645-2640 ubs-fees@buffalo.edu

Related Information

University Links

Forms

Related Links

Presidential Approval

Signed by President Satish K. Tripathi

Satish K. Tripathi, President

8/19/2019

Date