FIN-022: Oversight of University and/or Medical Center Operating and Capital Budgets and Long-term Financial Plans
Academic Division, Medical Center, and the College at Wise.
Guidelines are provided regarding responsibility for the University’s and/or Medical Center's operating and capital budget and long-term financial planning processes in order to: (1) provide reasonable assurance of the integrity of funding processes; (2) manage available resources to a consistent standard of accountability; (3) support progress towards strategic goals; and (4) facilitate informed decisions around the investment of financial resources in operating activities and capital assets.
This policy articulates the responsibilities of the Vice President and Chief Financial Officer, Chief Financial Officer of the Medical Center, Senior Vice President for Operations and State Government Relations, vice presidents, deans, unit heads, Financial Planning & Analysis, and/or the Medical Center Budget Office for the funding processes including:
- Developing and approving University and/or Medical Center operating and capital funds and long-term financial plans.
- Establishing spending authority (through management of fund balances).
- Monitoring and controlling expenditures against the fund balances with guidance from the approved operating and capital funds.
Responsibility for establishing spending authority (through management of fund balances) and monitoring and controlling expenditures against the approved operating and capital budgets for other fund sources within the University’s financial systems is delegated accordingly:
Area/Type of Funding
Grants and Contracts
Executive Director of Sponsored Programs
Assistant Vice President for Commercialization & Compliance
Gifts, Endowments, F&A Recoveries, Local Plant, State Plant < $1M, Agency
Associate Vice President for Financial Operations
CEO, Medical Center
Vice Chancellor for Finance & Operations, College at Wise
Represented by any project worktags with the default fund FD055 Capital Project Default; any acquisition of property, new construction; and improvements to property, plant, or equipment costing $3 million or more. (Some capital project worktags are used for capitalizable expenditures less than $3 million; these are not capital projects.)
Centrally Managed Funds:
Includes those fund sources managed by the Office of Financial Planning & Analysis, including restricted and unrestricted State, institutional Endowment Income and Gifts, and other institutional funds.
Decision Brief: A written summarization of any funding increase for all capital projects.
A fund (a five-digit alpha-numeric field in the University’s financial system, but not the Medical Center’s accounting system) that represents a pool of money differentiated by sources and constraints placed on the use of the resources. Examples include state vs. local funds, restricted, restricted expendable (earnings on endowment or gifts), unrestricted, etc. The type of funds is indicated in the chart of accounts as defined in the table below:
FDH082 Agency Funds (Local)
Funds on deposit with the University by outside agencies/organizations that are not a part of the University but have a close relationship.
Funds generated by an entity which exists to furnish goods or services to students, faculty or staff and which charges a fee that is directly related, although not necessarily equal to the cost of the service. Examples are housing, dining, and athletics.
FD024 Restricted Endowment Income Fund, FD007 Unrestricted Endowment Income Fund, FD011 Unrestricted Medical Center Endowment Income Fund, FD012 Unrestricted Medical Center Endowment Income Fund (State 03090
Funds from the distribution on the University’s endowment.
Facilities and Administrative Cost Recoveries
Funds derived from recovery of facility and administrative indirect costs from external research sponsors.
All GF accounts with the exception of those in endowed funds (income and principal)
Funds provided from donors to the University.
Grants and Contracts
FDH056 Grants & Contracts
Funds derived from external sponsors who provide funds in response to a proposal for specific instruction, research, or public service activities.
FDH024 Local funds with the exception of those listed in other categories
Funds derived from earnings on short-term investments, and other (licensing, affinity card, etc.) revenues.
FDH017 State Funds Operational, FDH020 State Funds Non-Ops
Funds derived from the state general fund appropriation, tuition revenues (of non-self-supporting programs), and other activities.
General tax revenues that are appropriated by the General Assembly for the use of the institution.
Major Capital Projects Program:
The capital project plan, updated annually and approved by the Board of Visitors.
Resources which are earned or generated by the University such as tuition, F&A recoveries, grants and contracts, auxiliaries, or private resources.
A submission required by the Commonwealth of Virginia’s Department of Planning and Budget that outlines the University’s plan for expending appropriated state funds.
Six Year Plan:
A plan required by the Virginia Higher Education Opportunity Act of 2011 and the Restructured Higher Education Financial and Administrative Operations Act of 2005 addressing the University’s academic, financial, and enrollment plans.
The permission to make expenditures from a particular fund source for a specific period of time up to an established level, provided with the management of fund balances.
University and Medical Center Fund Summary:
The University’s and Medical Center's annual operating funds approved by the Board of Visitors.
The financial data required to submit a financial transaction in the finance system, such as Cost Center, Project, Fund, Grant, and Spend category.
Vice presidents, deans, and department/activity heads must actively participate in the development of the operating and capital funds and financial plans for the University. Each has responsibilities as noted below.
Each Dean or Unit Head is responsible for the funds owned by their organization. These responsibilities include, but are not limited to:
- Allocating funds among reporting units by evaluating the needs of all reporting units and to re-allocating among units to meet University priorities.
- Distributing funding reductions among reporting units by evaluating the needs of all reporting units and distributing differential funding reductions as needed to protect the core mission of the University.
- Requesting and prioritizing funding needs – both capital and operating – of reporting units during the annual funding process.
- Reviewing, approving, and forwarding to their respective VP periodic operating funds and capital budget submissions.
- Maintaining annual expenditures within the available funds for each respective operating unit. Overall fund deficits among a school/department are expected to be cleared by year-end at the major business unit (MBU) level in accordance with FIN-033: Maintaining Fund Balances.
- Assigning managers to complete monthly reconciliations in accordance with FIN-023: Reconciling Unit Accounting Records to verify expenditures do not exceed available funds.
Each Vice President (VP) is responsible for:
- Allocating funds among reporting units by evaluating the needs of all reporting units and re-allocating among units to meet University priorities.
- Distributing funds and funding reductions among reporting units by evaluating the needs of all reporting units and distributing differential funding reductions as needed to protect the core mission of the University.
- Requesting and prioritizing funding needs – both capital and operating – of reporting units during the periodic budget development processes.
- Reviewing, approving, and forwarding annual operating funding and capital budget submissions to Financial Planning & Analysis (FP&A).
- Maintaining annual expenditures of reporting units within the approved available funds for each respective operating unit. Overall fund balance deficits among a VP’s units are expected to be cleared by year-end at the MBU level in accordance with FIN-033: Maintaining Fund Balances.
- Overseeing the development of the annual University Budget, the annual tuition proposal, and general fund funding requests.
- Developing instructions, schedules, templates, and submission procedures which are promulgated to each VP, including the EVP for Health Affairs and the Vice Chancellor of the College of Wise:
- Allocating the total from state fund sources not to exceed the sum of appropriated state general funds plus estimated tuition and other non-general funds from centrally managed funds to each unit.
- Establishing state restricted designated worktags for any restricted appropriations from the state (for example, research initiatives or financial aid) in order to facilitate compliance with such restrictions.
- Submitting an Operating Plan to the Department of Planning and Budget that reflects the sum of appropriated state general funds plus estimated tuition and other non-general funds.
The Vice President and Chief Financial Officer is responsible for reviewing and submitting to the Board of Visitors, through the President, the University’s Annual Budget Summary, including tuition and fee rates.
- Overseeing the development of the University’s Six-Year Plan and the Major Capital Plan, as well as the execution of the Major Capital Projects Program.
- Submitting to the Board of Visitors, through the President, and the Commonwealth of Virginia the University’s Six Year Plan, Capital Plan, and capital budget requests.
- Coordinating the notification to the Governor and Chairs of the Senate Finance and House Appropriation Committees, in accordance with any applicable enacted state budget, of non-general fund capital projects approved within the Major Capital Projects Program.
- Managing the annual review and revision of the University’s Major Capital Projects Program, including the business/financing plans for each major capital project, and presenting the full Program to the Board of Visitors.
- Approving decision briefs regarding capital project budget increases and coordinating Board of Visitors approval of any budget increases in excess of 10 percent.