1103 PR.01 University Budgeting: Year-End General Appropriations ("GA") Surplus or Deficit Requests and Approvals

Revision Date: 
June 28, 2023

Contents

1.     Overview

2.     Submitting a Request

3.     Reviewing the Request

4.     Communicating the Decision

5.     Actions Post Decision

1. Overview

This procedure is designed to promote sound budgeting management practices.  This procedure describes the steps a Planning Unit lead administrator is required to take in order to receive an approval of a year-end request to retain a General Appropriations (“GA”) surplus or receive additional GA support due to a budget deficit. 

A. GA Surplus

Fund Accounting practices define the appropriate order in which to utilize funds to support expenses.  The proper order of usage is from most restrictive to least restrictive.  GA Support is the least restrictive funding source available to a planning unit.  During the fiscal year-end close, a planning unit may have positive net results in the unit-responsible GA funding source (defined as activity in YD000002 and YD000004).  A unit may anticipate operational activity in the following fiscal year that they would like to have funded by the residual GA Support of the current fiscal year.  When this exists, the planning unit may request to retain a defined amount of the GA Surplus by following this established procedure.  A request to retain a GA surplus may only be initiated if the available balance is due to excess GA Support.  Units with surplus balances due to over allocation or over assessment charging must complete a true-up calculation during year-end and return any surplus funds to the originally charged planning unit(s).  Initiating a journal entry to transfer a Net Results surplus, debiting FD30 and crediting a different non-FD30 fund, without approval from Budget Strategy, is not allowed.

B. GA Deficit

A planning unit may generate a year-end deficit due to unforeseen changes in activity that impact revenue and/or expenses.  At year-end, a planning unit with a residual unit-responsible GA deficit (defined as activity in YD000002 and YD000004) that cannot be supported through any other funds within the unit’s control, must request additional GA funding during the year-end close.  When calculating the year-end deficit amount, the planning unit should remove any previously approved out-of-budget requests.

2. Submitting a Request

The planning unit lead administrator should work with unit leaders to define the year-end request. 

In the case of a GA Surplus request, the unit should quantify how much funding it would like to request to be carried forward.  The planned use of the carryforward funds should be detailed.  GA Surplus funds should be requested only for one-time activity or activity that was budgeted for in the current fiscal year but was unable to be completed in the fiscal year and has no budgeted funding in the next fiscal year.  It is not appropriate to request a carryforward for on-going activity that has a budget in the next fiscal year.

In the case of a GA Deficit request, the unit needs to quantify the total deficit, net of any out-of-budget requests previously approved.  An explanation of the variance is required.  The unit must confirm all allowable alternate funding has been utilized before bringing forward a GA Deficit for consideration.

The planning unit lead administrator should use Form 1103 FR.01 University Budgeting: Year-End General Appropriations (“GA”) Surplus or Deficit Request to document the request.  The form should be submitted along with the year-end narrative and required financial schedules by the Financial Planning & Analysis deadline for year-end submission.  The form should be saved in the planning unit’s year-end folder on the bo-server.  Additionally, the planning unit lead administrator should include this information in the year-end narrative as requested in the year-end narrative template.

3. Reviewing the Request

A complete request is submitted for consideration to Budget Strategy.  The year-end closeout Budget Strategy meeting, during which requests are considered, is typically held the first week of August.  The Assistant Vice President for Financial Planning & Analysis consolidates all year-end materials and delivers the request to Budget Strategy for consideration and decision during the meeting.

Budget Strategy reviews the requests and renders a decision. 

The decision for requesting the retention of a GA Surplus or funding a GA Deficit may be one of the following:

  • Fully approved as requested;
  • Partially approved; or
  • Denied.

4. Communicating the Decision

When Budget Strategy decides on the request, the Assistant Vice President for Financial Planning & Analysis, or delegate, sends an email to the lead administrator/requestor informing them of the decision.  Based on timing, it is critical that the final actions, which most likely require a final journal entry in Workday, occur quickly.  Therefore, notification about a decision takes place no later than one business day following the Budget Strategy meeting.

5. Actions Post Decision

In order to facilitate the year-end closeout, immediate action must be taken based on Budget Strategy’s decision.  The planning unit’s budget analyst facilitates all required journal entries because the decision will be rendered during the adjustment accounting period when all journal entries must be initiated centrally.

A planning unit that has received approval to carryforward a GA Surplus provides a Chart of Account (“COA”) (non-GA) to the budget analyst for the journal to shift GA funds to that designated non-GA COA.  A planning unit that has not received approval to carryforward a GA Surplus has no additional action to take.  The final GA Support entry initiated by Financial Planning & Analysis returns the surplus funds to a central account.

A planning unit that has received approval for a GA Deficit has no further action to take.  The final GA Support entry initiated by Financial Planning & Analysis credits additional funds to the planning unit’s COA.