Annual Financial Report
The PROGRAM CLASSIFICATION STRUCTURE (PCS) is a set of categories and related definitions, which allows its users to examine the operations of a post secondary education institution as they relate to the accomplishment of that institution's objectives. Primary categories include…
- Public Service
- Academic Support
- Student Services
- Institutional Support
- Operations & Maintenance of Plant
- Scholarships and Fellowships
- Other Activities
PCS codes are used to categorize transactions for the University’s Annual Financial Report as well as a wide variety of surveys including the Department of Ed’s annual IPEDS survey. PCS codes are assigned centrally to each department/cost center within the financial system.
NOTE: It is important for departments to notify Financial Reporting Services if the primary function of a cost center changes so that we can update the associated PCS code.
Service Centers Administration
A recharge center is an operating unit that exists principally to provide goods or services to KU departments and recovers less than $10,000 in annual operating expenses unless the unit’s primary customers are sponsored projects or external customers.
Operating costs are recovered by charges (sales) to those departments and entities receiving the goods or services. Recharge centers develop rates based on incurred (historical) cost and rates should be designed to break even over predetermined periods of time (not to exceed 12 months).
Example: Academic Units charging for copier and fax machine usage.
A service center is an operating unit that exists principally to provide goods or services to KU departments and recovers more than $10,000 in annual operating expenses or the unit’s primary customers are sponsored projects or external customers.
Operating costs are recovered by charges to those departments and entities receiving the goods or services. Service centers develop rates based on incurred (historical) cost and rates should be designed to break even over a 12 month time period (unless approved in advance by the Vice Provost for Administration and Finance).
Examples: Chemistry storeroom, Animal Care Unit
- Units wishing to establish a service center fee must prepare a detailed justification and submit it through the appropriate administrative channels to their Department Head/Dean. The proposal for establishing a service center fee should present a clear and compelling argument for its implementation. Data should include, but not be limited to, the items listed below. Answers to the questions should be as full and precise as possible.
- How is this proposed service center fee related to the instructional, research or public service mission of the University?
- Why is the fee being implemented or changed?
- Was this service/good previously provided?
- How was the amount of the fee determined? (Include specific calculations)
- What service/goods will be provided for that fee?
- How much money will the fee generate per year?
- How will the fee income be spent?
- Source of funds for capitalized start up costs?
- Who will be the likely customers and what is the anticipated fiscal impact on them?
- What is the overall benefit to the proposing unit?
- What is the cost/benefit to the University as a whole?
- If approved, the Department Head/Dean will forward the proposal and justifications to the Service Center Rate Reviewer, Sarah Carver. The reviewer will carefully scrutinize the submitted justification and, if necessary, request further information about the proposal. Prior to making a recommendation, the reviewer may consult with the proposing unit or appropriate office to modify the proposal. In addition, the review may contact units likely to be impacted by the fee.
- Based upon its evaluation, a recommendation to approve or disapprove the fee will be made to the Vice Provost for Administration and Finance.
- The reviewer will work as expeditiously as possible, but departments should recognize the evaluation of fees is a complex process that may take considerable time.
Facilities and Administrative (F & A) Costs
In connection with our sponsored projects, the University collects Facilities and Administrative Costs (also known as indirect costs). Facilities and Administrative Costs represent a reimbursement to KU for our overhead expenses (e.g. utilities, equipment wear and tear, central office support, etc.). The KU Center for Research is responsible for collecting and redistributing all Facilities and Administrative Costs. The University’s strategic plan for the use of this revenue is to further support campus research. Therefore a portion of all Facilities and Administrative revenue is returned to the PI and department or unit.
The specific reimbursement percentage collected is based upon a negotiated rate with the Department of Health & Human Services, Division of Cost Allocation, Dallas Region (DHHS). This negotiated rate is for a specific period of time and has to periodically be renegotiated. The Comptroller’s Office Financial Reporting team is responsible for creating the initial cost proposal that is negotiated with DHHS. This negotiated rate applies to all Federally-sponsored projects as well as other sponsors. Projects funded by industry have a special rate based upon KU’s negotiated rate.
Accounts Receivables Report
When a department has receivables, which is billing for commodities or services and expecting payment, an accounts receivable report is required to be submitted to the Comptroller’s Office Financial Analysis Department on a monthly basis. For further information and help concerning the report call Sarah Carver at 864-5920.
Reimbursable Endowment Funds
The procedures are the same as all other purchases with the exception that a completed Endowment Fund Payment Verification Form must accompany the paperwork.