Financial Basics: UNL Funding and Cost Objects (8:40)

Cindy Miesbach Author

07/24/2018 Added

602 Plays

Description

This video introduces the UNL's main funding sources and explains how funds are identified with the cost object numbering system.

Searchable Transcript

Search:

[00:00:00.000]This video introduces the University of Nebraska - Lincoln’s main funding sources and
[00:00:06.600]explains how funds are identified with the cost object numbering system.
[00:00:12.366]Cost objects are numbers assigned to track and categorize UNL’s financial activity.
[00:00:18.600]Familiarity with funding sources and the cost object numbering system will help you to identify the owner of a cost object
[00:00:26.433]and the source of funding in SAP and on financial reports.
[00:00:32.299]Four main funding sources support UNL.
[00:00:35.500]The first is state-aided funding, which primarily consists of state funds appropriated by the Unicameral; and tuition revenue.
[00:00:43.533]Next are Revolving/Auxiliary funds, which are dollars generated and used by some university entities.
[00:00:51.733]The third funding source is comprised of grants and contracts,
[00:00:55.433]which are awared to the University for specific purposes and include rules for how the funding may be spent.
[00:01:02.633]Finally, there is University of Nebraska Foundation funding which is comprised of financial gifts from donors.
[00:01:10.466]These four major funding sources are broken down into more detail and identified by cost objects.
[00:01:17.966]Cost objects are numbers assigned to track and analyze UNL’s financial activity.
[00:01:24.600]The phrase “cost object” refers to two types of numbers: cost centers and WBS numbers. First, let’s look at the cost center numbering structure.
[00:01:37.400]Cost centers apply to the first two funding sources – state aided and revolving/auxiliary funds.
[00:01:45.033]Cost centers are 10 digits long and each digit provides information about where the funding comes from and who is responsible for it.
[00:01:55.000]The first digit represents the campus -- 2 is for UNL, which most likely will be the funding that is most familiar to you.
[00:02:03.100]Occasionally, you might see cross campus postings – 3 for University of Nebraska Medical Center, 4 for UN-Omaha,
[00:02:12.466]5 for UN-Kearney, and 9 for University of Nebraska’s Central Administration.
[00:02:20.100]The 2nd digit represents the funding source. A “1” indicates state aided, 2s and 3s identify revolving and auxiliary funds respectively.
[00:02:30.833]Both revolving and auxiliary funds are considered “self-supporting” because the revenue is earned
[00:02:37.633]and used by University entities that perform some type of fee-based activity.
[00:02:44.566]Revolving funds are typically earned by an academic department whose primary mission is academic, but which incidentally earns revenue.
[00:02:53.666]Examples of revolving funds include funds earned by providing a good or service to the campus or to external entities,
[00:03:01.333]registration fees charged by a department hosting a conference, funds received from student lab fees,
[00:03:09.100]or the incidental remainder of grant funds after completion of the grant-funded project.
[00:03:15.466]In each instance, the revenue would post to the earning department’s revolving cost center.
[00:03:22.300]Auxiliary Funds (3’s) are earned by non-academic, self-supporting entities whose reason for existing
[00:03:29.000]is to provide their specific service to faculty, staff and students in a personal capacity.
[00:03:37.500]Examples of auxiliary funds are housing and parking fees charged by Housing and Parking Services,
[00:03:44.500]revenue from athletic ticket sales, and revenue earned by Campus Union service providers.
[00:03:51.933]There are also cost centers whose second digit is 9.
[00:03:55.233]These are endowments that are managed by the functional Accounting Office and will not impact departments.
[00:04:02.600]The 3rd and 4th digits identify the subprogram, which equates to the college or administrative area.
[00:04:09.333]For example, by looking at these digits, you would know if the cost object belongs to the College of Arts and Sciences, which is numbered 05,
[00:04:19.033]or Business and Finance, which is 43.
[00:04:23.700]The 5th and 6th digits identify the department and are always looked at in conjunction with the subprogram.
[00:04:31.533]For instance, there are many departments numbered “12” but 0512 specifically identifies the English Department
[00:04:40.000]within the College of Arts & Sciences.
[00:04:42.966]4312 identifies the Budget Office within Business and Finance.
[00:04:48.566]There is a reference sheet for subprograms and departments available online.
[00:04:54.600]The last 4 digits of a cost center are purely to create a unique value after the first 6 digits.
[00:05:01.166]If a department only has one cost object, which is more common in administrative areas, the last four digits of that single cost object are usually 0001.
[00:05:14.033]Departments can request additional cost objects as needed to allow them to manage their funds.
[00:05:20.733]The form to request a new cost center is available online.
[00:05:26.500]Now let’s discuss the other type of cost objects – WBS numbers.
[00:05:32.033]WBS numbers are used to identify Grants & Contracts and Foundation Funds.
[00:05:37.566]WBS numbers are 13 digits long and are also smart numbered. WBS numbers for UNL will start with 2.
[00:05:46.766]The 2nd digit represents the funding source.
[00:05:50.066]4s, 5s and 6s identify grants and contracts. A 4 or 5 indicates a federal grant.
[00:05:57.700]Any grant that is NOT federal, meaning it could be from the State, another university, or a company that is funding UNL research, is identified by a 6.
[00:06:09.033]7’s are typically foundation funds. However, some departments hold their foundation funds in a 26 WBS.
[00:06:18.633]9’s are either loan funds – meaning they are funds reserved for student loan programs --
[00:06:24.833]or plant funds which are used for construction and renovation of University facilities.
[00:06:30.833]9’s are managed by the functional Accounting Office and will not impact departments.
[00:06:36.933]Just like cost centers, the 3rd and 4th digits of a WBS number identify the subprogram and the 5th and 6th identify the department.
[00:06:46.733]The 7th through 10th digits are used to uniquely identify the grant, which SAP calls “a project.”
[00:06:55.200]The last three digits, known as a WBS element, identify sub-parts of the grant.
[00:07:01.900]When you are pulling financial reports in SAP, it is important to understand how the first 10 digits and the last three digits of a WBS number are used.
[00:07:14.166]The first 10 digits of a WBS identify the project as a whole. The last three digits allow the grant manager to track sub-parts of the grant.
[00:07:24.533]For example: if a faculty member receives a grant from the USDA to study grains, all funds related to that grant would have the ten digit project number.
[00:07:35.200]However, assigning specific WBS elements to each sub-part of the project
[00:07:41.566]makes it possible to track funding and spending at a more refined level of detail.
[00:07:47.400]For example, in this instance, a separate WBS element could be assigned to parts of the grant related to corn, milo and wheat.
[00:07:57.733]Sometimes WBS elements are used to track spending for multi-year grants.
[00:08:03.100]For example, if spending on a 3 year grant needs to be tracked by the year, a WBS element can be assigned for each year of the grant.
[00:08:13.000]The additional granularity of data provided by WBS elements can help you to refine your financial reports in SAP.
[00:08:22.666]Thanks for taking time to learn a little about UNL funding sources and about the smart numbering of cost objects.
[00:08:29.800]This information should help you better understand financial information in SAP and in various financial reports.

The screen size you are trying to search captions on is too small!

You can always jump over to MediaHub and check it out there.

Comments

0 Comments

Financial Basics: UNL Funding and Cost Objects (8:40)

Description

Searchable Transcript

Comments icon comment

Related Channels

Comments