Annual Service Center Rate Reviews

For FY2015

Presented by General Accounting

Agenda Cost Pool Overview

Why must we do the Service Center Rate Review?

Address each tab of the rate review workbook

Questions & Answers

Cost PoolDoes the cost pool include all the actual expenses that helped generate revenue?

Does the cost pool include expenses that are not related to the business activities?

Supplies

Utility

Depreciation Expense

Overhead (paid)

Administrative costs (payroll, purchasing, billing, etc.)

Direct labor

Maintenance

Cost allocation

Costs per Service Line

Costs

Revenues per Service Line

Costs Costs

+/- +/- +/-Revenues - Costs

A B C

RevenuesRevenues Revenues

Service Center Rate Review

Know your costs

Why a Service Center Rate Review?

Compliance with Federal OMB Uniform Guidance Cost Principles (Subpart E) Audit Requirements (Subpart F §200.500) Specialized Service Facilities (Subpart E

§200.468)

http://www.ecfr.gov/cgi-bin/text-idx?tpl=/ecfrbrowse/Title02/2cfr200_main_02.tpl

Service Centers General Principles

Established to recover actual costs. Cannot charge internal users more than

cost May accumulate profits from external sales Rates do not discriminate between internal

users, especially Federal Rate modifications, when necessary Charges should be based on actual usage Expected break-even over 3 years

Service Centers General Principles

Surpluses from the service center should not be used to fund unrelated activities

Cannot accumulate cash in excess of established University guidelines

Keep all appropriate documentation (usage log, invoices, expense record, etc.)

Must maintain a published price list

Principle Review Steps Identify all services provided Determine direct costs associated with

each service Identify indirect costs associated with

service center Administrative Surcharges are not

recommended as they generally do not pass audit

General Questions? Can we include a “reserve” amount in the

rates to purchase new equipment?

Can we charge internal users based on market rates, or what other institutions charge?

Can we charge external users more than the cost of the good or service provided?

General Instructions Use the Excel rate review workbook found

at: http://www.fa.ufl.edu/wp-content/uploads/ga/Service-Center-Rate-Review-Template.xlsx

Enter data in the worksheets as directed by the instructions found at: http://www.fa.ufl.edu/wp-content/uploads/ga/Service-Center-Rate-Review-Instructions.pdf

General Instructions Who must complete the rate review workbook?

Federal revenues greater than $200,000AND/OR

Total Internal Revenue exceeding $1,000,000 AND/OR

Federal revenues greater than $50,000 that were not reviewed in the previous year.

All Service Centers, large or small, are expected to be in compliance with the OMB Uniform Guidance and should not charge more than cost.

Sheet 1a and 1b – Administrative and Operating Information

Contact Information

Operating Information (billing/customers)

Description of services provided

Sheet 1a – Administrative Information

Sheet 1b – Operating Information

Sheet 2 - Revenues A service line should be defined as a specific

service or product a customer agrees to pay for. Administrative support is not a service line but

a cost to allocate

Each service line revenue is tracked in MyUFL (department, flex) or using another internal system.

Unit should be a logical basis to establish rate(s). “Contract” type unit is not recommended

Internal and external rates can be different with external rates greater than internal rates.

Sheet 2 - Revenues

Sheet 3a and 3b – Non-Payroll Expenditures

Tab 3a shows expenses paid only by the Service Center chartfields

Tab 3b shows expenses paid by other chartfields (subsidies)

All expenses need to be allocated by Service Line Please specify the method used to allocate

the expenses. Each service line does not necessarily consume

resources (expenses) in the same proportion. Focus on GL accounts with large balances Allocation based on percentage of revenue is not

appropriate.

Sheet 3a – Non-Payroll Expenses Paid Only by Service Center Chartfields

Sheet 3b – Non-Payroll Expenses Paid by Other Chartfields

Sheet 4a and 4b – Salaries Paid by Service Centers and by Other Chartfields

Tab 4a shows Salaries and Benefits paid from Service Center chartfields

Tab 4b shows Salaries and Benefits paid from other chartfields (salary subsidies)

Sheet 4a and 4b – Salaries Paid by Service Centers and by Other Chartfields

Provide name, position title (description), chartfield and % of effort toward Service Center

If individual is paid from multiple chartfields, list the individual and each chartfield separately

Individual effort should correlate to allocations reported in the Effort Tracking System as Auxiliary/Other Institutional Activities (Aux/OIA)

Please specify the method used to allocate salary. A distinction between direct labor and

personnel with oversight and supervisory responsibilities may be useful.

Sheet 4a – Salaries Paid by Service Center Chartfields

Sheet 4b – Salaries Paid by Other Chartfields

Sheet 5a & 5b – Equipment Depreciation Provide Asset ID/Tag # and other required

information on Tab 5a Depreciation Report can be run from myUFL/Main Menu/Asset Management/MyAssets MyAssets/Reports/Depreciation Reports

Enter required depreciation information on Tab 5a

Enter Service Center % Usage on Tab 5a

Allocate the depreciation by Service Line on Tab 5b

Sheet 5a – Equipment Listing

Sheet 5b – Allocation of Equipment to Service Lines

Sheet 6 – Space Survey

Should agree to Space Inventory and Allocation Survey submitted for the same fiscal year

Identify all space used by or in support of the Service Center

Sheet 7 – Unallowable Costs

List any unallowable costs paid, so that these costs can be removed from the rate calculations.

If your Service Center has not incurred any of these unallowable costs, check the box for “None of these costs occurred” at the top of the page.

Sheet 7 – Unallowable Costs

Sheet 8 – Total Costs This data is populated automatically from other Tabs

Sheet 9 – Transfers Schedule

Please list any transfers in (enter as a positive figure) and transfers out (enter as a credit figure) for the accounts listed.

All overhead accounts 813xxx should not be included on this tab, but should be included on Tab 3a or 3b. Overhead charges are considered as allowable expenses and not as transfers out.

Explain any transfer in/out > $5,000 or 10% of revenue whichever is larger

Sheet 9 - Transfers

Sheet 10 – Profit/Loss Calculation Shows profit/loss by Service Line

Calculates whether Working Capital Balance (Cash Balance) is under/over amount permitted by University guidelines, which allow: 90 days average operating expenditures plus Profit from external sales plus Accumulated asset depreciation

The Service Center needs to reflect prior year profit/loss by service line and total profit from external sales on this tab.

Sheet 10 – Profit/Loss Calculation

Additional Notes and Deadlines

Refer to prior year review comments

Please contact General Accounting with any questions

Completed FY2015 workbooks should be returned by Friday, October 30, 2015.

Queries and Enterprise ReportingQueries UF_GL_TB_BY_FUND_DEPT_AUX_QRY

Trial Balance for ACTUALS ledger

UF_GL_JOURNAL_DETAIL_QUERY2Provides the details of entries making up the ACTUALS Trial Balance

Enterprise Reporting (Navigation: Main Menu>Enterprise Reporting>Access Reporting)

FIT Cube Cost Distribution Reports: Payroll or Fellowship Earnings

and Estimated Fringe Benefits by Cost Center by PersonNavigation: Public Folder> Human Resources

Information>Pay Information>Current Pay Cycle>Prompted Cost Distribution Reports

Provides earnings and fringe by person and cost center.

Contact Information

Jeremiah Carlson

jccarlson@ufl.edu

Ricabuena Gagné

bea1127@ufl.edu

Mike Johnson

michaelsjohnson@ufl.edu

General Accounting33 Tigert HallBox 113202

Phone 392-1326