1. 1 Revenue Management Program (RMP) Campus Budget October 23 – 24, 2006

2. 2 Campus Budget – Oct 2006  AGENDA –Overview –Major changes  Supplemental Allocations –SWAT  Budgeting for Prior Year Encumbrances  Allocating Prior Year Balances –Equity and Budgets  Building a Budget –Detail - How the budget is built  First Year (2006-2007)  Subsequent Years

3. 3 Major Changes  Supplemental Allocation Orders  Funding Encumbrances from prior years  Balances Remaining –Allocating in future years  Building the budget and reconciling it

4. 4 Components of the “New” Campus Budget  General Fund state support  Campus Estimated Revenue  Supplemental Funds Received (SWAT)  Equity Reserve for Prior Period Encumbrances  Equity Reserve for “Roll Forward” funds  Campus planned use of Unallocated Equity or Campus planned contribution to Unallocated Equity

5. 5 Sample Budget Template

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7. 7 Past  Budgeting within the Budget Act Appropriated General Fund – The Old Way –Budget Administration handled by CO Financial Management Services (FMS) –FMS processes two notices  Notice of Allocation Order to campuses  Transaction Request to the State Controller –Both the campus and the SCO recorded a budget entry –If either party recorded these transactions in error there was a reconciling factor in the SAM99

8. 8 Present  Budgeting within the CSU Operating Fund Today –State University Trust Fund (SCO Fund 0948) –CSU Operating Fund (CSU Fund 485) –Budget Administration handled by CO Financial Management Services –FMS processes a Systemwide Allocation Transfer (SWAT Notice)  Notice Sent to: –Campuses Budget Office –CO Systemwide Financial Operations –CO SFO will distribute an AD NOAT to campus –Both the campus and the SCO will record an ACCOUNTING entry  Campus MAY record a budget entry

9. 9 Future  Budgeting within the CSU Operating Fund in the Future –State University Trust Fund (SCO Fund 0948) –CSU Operating Fund (CSU Fund 485) –Budget Administration handled by CO Cash Management Operations –CMO processes two notices  Systemwide Allocation Transfer (SWAT Notice) –Sent to campus budget office  CSU Cash Posting Order –Sent to campus accounting office –There is no activity between the CSU and the State Controller –Campus MUST record an accounting entry –Campus MAY record a budget entry

10. 10 Past, Present and Future  Past –Allocation Orders for all Budgeted Funds  From CO to SCO  From CO to campus  Campus posts a budget entry

11. 11 Past, Present and Future A little more detailed  Present –Allocation Order to General Fund for Final Budget State Support Only  Not operating within the general fund –CO will process PFA moving funds to campus trust account at SCO  CO will notify SCO – (PFA)  CO will notify Campus – (SWAT and AD-NOAT) –SWAT - Systemwide Allocation Transfer  Campus posts a budget –Revenue budget in 506100 –Expenditure Budget in appropriate program –AD-NOAT  Campus posts an accounting entry –Credit revenue 506100 –Debit fund Balance Clearing

12. 12 Past, Present and Future  Future –CO will process a cash transfer to the campus account at CSU Central Bank –CO will notify Campus (SWAT and Cash Posting Order) –SWAT - Systemwide Allocation Transfer  Campus posts a budget –Revenue budget in 506100 –Expenditure Budget in appropriate program –Cash Posting Order  Campus posts an accounting entry –Credit revenue 506100 –Debit Cash –No more allocation orders to campus

13. 13 Supplemental Allocation Past, Present and Future Summary

14. 14 Supplemental Allocation Past, Present and Future Summary

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16. 16 The “Old” Way

17. 17 The “New” Way

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20. 20 News Flash  GOOD NEWS –No More FIRMS Budget Edits  Submission is a breeze with lack of error messages –No More SAM99 for General Fund (0001)  One Big Pot of Money at the Chancellor’s Office  BAD NEWS –No More FIRMS Budget Edit  Need new method to ensure accuracy –No SAM99 for CSU Operating Fund (485)  Need new method to ensure accuracy

21. 21 Building the Campus Budget  Final budget allocation from CO to Campus –The only notification the campus will receive for this amount is the annual Final Budget Memo from the CO –Campuses will not have a general fund account at the State Controller  All CSU General Fund monies will be held centrally in a CO managed account at the SCO

22. 22 Budget Control Ideas  Campus Budget Controls (CSU Fund 485) –Ideas to control/reconcile budgets  06/07 Transition – Campus PFA (690003)  State Appropriation Adjustment (690106)  SWAT In (506100)  Campus Revenue from Fees (5XXXXX)  Beginning in 07/08 – Fund Equity (305002)

23. 23 Sacramento State Example

24. 24 Sac State Example

25. 25 San Diego Example

26. 26 San Diego Example

27. 27 How the budget is built  Source of funds to consider –Prior Year Unspent Amounts (Fund Equity) –This will be left over Student Fee Money as all CSU State appropriated amounts will be spent in the year of appropriation –Current Year State Appropriation Amount (e.g., $.70) –Student Fee / Revenue Amounts (e.g., $.30)

28. 28 How the budget is built (continued)  Student Fee and Revenues: –SHALL be included: SUF, Non-Resident Tuition, Mandatory Course Fees, Application, Transcripts, Rejected Checks, Library, Administrative Allowances, CERF (573) Reimbursement, Parking (583) Reimbursement, and other Miscellaneous Fees –MAY be included (FSAC will review for final determination): Work Study, Contracts & Grants Overhead, Student Health Services, Independent Operations Revenue, Trust Transfers and other Campus Specific Revenues

29. 29 How the budget is built (continued)  How the budget is built (continued) –CMS Tools for Managing the Campus Budget  Sac State Example - CMS Scenario ChartField –Unique 485 Fund with a Global DeptID  $.06 ROLLFWD – Prior Year Unspent  ROLLFWD – PY Enc to Departments  ROLLFWD – BBA to Division Level .70 APPROP – State Appropriation for CY ~ Agrees to CO ACR (or new report) .30 FEES – Student Fee/Revenue for CY  ALLOC – Budget Out to Campus Departments –Primary 485 Fund with Campus User DeptID’s  $.03 ROLLFWD – PY Encumbrances for Departments .01 ROLLFWD – BBA for Division Level .90 ALLOC – Budget In for Campus Departments .00 BUDTX – Internal Campus Budget Transfers

30. 30 Ongoing Budget  Handling Your Budget on an Ongoing Basis –Need to Consider  Beginning Fund Equity (equal to PY Budget less Actuals) –Outstanding PY Encumbrances –Reserves  Major equipment purchase, working capital, emergency reserve, etc. –Remaining Fund Equity Balance  State Appropriation (.70 – CO to use for Payroll)  Estimated Fee Revenue (.30) –Campus Options  Rollforward PY unspent (encumbrance and BBA) and then allocate current year budget  Rollforward PY encumbrance amount only and then allocate current year budget (BBA is kept for campus-wide uses)  Rollforward 100% of PY encumbrances and a percentage of BBA and then allocate current year budget

31. 31 Equity and BBA  Relationship between Equity and BBA –Fund Equity – FIRMS Object Code 305002 (Fund Balance – Continuing Appropriation)  Cumulative Actuals Net Income/Loss EQUALS –Budget Balance Available plus Encumbrances OR Budget less Actuals  when “Budget” is equal to CY State Appropriation plus CY SWATs plus CY Actual Fee Revenue plus Beginning Fund Equity

32. 32 Equity Reserves  Reserve Policy –Current Equity Reserve Object Codes  Capital improvement  Equipment acquisition  Program development  Future debt service  Facilities, maintenance & repairs  Operations (working capital)  Campus/debt obligations (encumbrances)  Catastrophic events –Possibility for additional object codes to meet CSU Operating Fund reserve requirements

33. 33 It is what it is  It is what it is –Not required to accrue to Zero in CSU Fund 485 at Year End –Legal Expenditures and Encumbrances will reflect what really happened in that Fiscal Year –Management will want to establish Campus Reserve Policy with CO guidance  Major Equipment Purchases  Business Continuity Planning  Cash Flow / Working Capital Needs  Other

34. 34 Things to Remember  During 2006-2007 all campuses will de-allocate their remaining general fund balance to the CO (By year end 690106 in CSU Fund 485 will equal this amount)  Campus generated Payroll PFA transactions between General fund and Trust have been recorded in CSU Fund 485 FIRMS Object Code 690003  CO generated Payroll PFA transactions shall be recorded in CSU Fund 485 FIRMS Object Code 690106  For 2006-2007 the sum of 690003 and 690106 in CSU Fund 485 will equal the campus state support allocation  2007-2008 690003 no longer used –State support = 690106

35. 35 Example Worksheets  Excel Files from Presentation –Sac State Example –Summary of SWAT – PAST Present and Future –San Diego Example

36. 36 Questions - Contacts  Questions??? –Debbie Brothwell, SLO –Crystal Little, San Diego –Kendal Chaney-Buttleman, Sac State –Stacy Hayano, Sac State