Cost Transfer Request (Non-Salary) Non-Grant – Any Fund Except 133 and 144

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Policy Number:

UW-3035

Old Policy Number:

703

Responsible Office:

Accounting Services, Division of Business Services

University Policy

Definitions:

Allocable

A cost is allocable if goods or services involved are chargeable or assignable in accordance with the relative benefits received by the projects. In order to be allocable a cost must be treated consistently in like circumstances.

Consistent

Free from variation/contradiction from standard UW business practices.

Necessary

Transfer is necessary to have costs applied to proper funding; original cost is essential to meet a certain result.

Permissible

Allowed under UW policies and state law.

Reasonable

Would a prudent person pay this amount for this item or “If it were published on the front page of the Wisconsin State Journal, would that be okay with you?"

Scope:

Applies to deans, directors, and staff who prepare non-salary cost transfers.

Policy:

Policy Statement

1. There are circumstances in which it may be necessary to transfer expenditures to a fund after the initial recording of the charge. A cost transfer request (non-salary) is an after-the-fact reallocation of costs. The cost transfer request (non-salary) is used to transfer funds/move expenditures from one fund, department, project, account, amount, etc., to another to assure the accuracy of the general ledger and data integrity. Here are some examples of typical circumstances in which cost transfers are allowed:
   • Correction of a clerical error
   • Reallocation of expenses where multiple accounts benefited
   • Reallocation of shared resource costs
   • Transfer of costs from divisional or discretionary funds to another
2. For purposes of this policy, non-salary costs are supplies, consultants, travel, equipment, and other non-payroll expenditures.
3. This policy applies to non-grant fund cost transfer requests (non-salary) only. For grant fund transfers, refer to the UW-4013 Cost Transfers policy.
4. There are two phases to the transfer process: the preparation phase and the review phase. Three distinct roles are performed during these two phases: preparer, first approver, and second approver. During the preparation phase, the preparer often has discovered an error or has been instructed to move funds, and as a result, initiates the transfer process. The person who initiates the transaction may be the first approver (e.g., principal investigator, department administrator; comparable to the approver role in e-Reimbursement).
5. The review phase entails a second person (e.g., division staff; comparable to the auditor role in e-Reimbursement) to review and process the transaction (or enter the transaction into the Journal Entry Tool [JET] if delegated, trained, and certified.). The preparer is usually at the department level but may be at the division level or Accounting Services. Who corrects the error is generally determined by who found it and who has the knowledge required to make the correction. Separation of duties is important; however, in small departments, one person may need to serve in all three roles.
6. To eliminate redundancy and increase the speed of processing non-salary, cost transfer requests (non-salary), the Division of Business Services has elected to certify individuals in using the JET. To receive certification, approvers must attend the JET training program and attest to their ability to perform JET entries correctly. The respective division must also sign a delegation agreement authorizing the individual to act on behalf of the division in the preparation and submission of cost transfer requests (non-salary) using the JET.
7. When the transfer is prepared by the division being credited, approval is required from the division being debited. Otherwise, the initiating division should notify the second division, as a courtesy, for informational purposes.
8. The roles and responsibilities of each individual are detailed below:

Table 1. Roles and Responsibilities

RESPONSIBILITY	PREPARER	FIRST APPROVER	SECOND APPROVER
1) Generate form
Know policy	X
Resolve problems	X
Update form based on approver's feedback	X
2) Confirm that:
This transfer is necessary		X
This transfer is reasonable		X
The expense is allocable to the funding source to which it will be charged		X
This transfer is consistent with standard university business practices			X
This transfer is permissible, given university policies			X
3) Verify that:
The form is complete		X
The information on the form is correct		X
The source to which the expense is being transferred has sufficient funds to cover the expense			X
The form is not missing any signatures from the previous step			X

Table 2. Additional Responsibilities for Each Role

ROLE	RESPONSIBILITIES
Preparer	Know and understand the UW cost transfer policy
Preparer	Generate the transfer request form
Preparer	Seek support in resolving difficulties with generating transfer requests
Preparer	Improve the accuracy of transfer request forms in response to feedback from approvers when requested to do so
First Approver	Know and understand the UW cost transfer policy
First Approver	Attend training in the non-salary cost transfer approval roles and responsibilities
First Approver	Determine whether explicit approvals are required from the "owners" of non-sponsored funding sources, and obtain the explicit approvals when necessary
First Approver	Route each transfer request form to the second approver
First Approver	Provide feedback to preparers when the accuracy of transfer forms does not meet an acceptable standard of quality
First Approver	Provide suggestions to preparers regarding strategies for improving the accuracy of transfer forms
First Approver	Recommend eliminating the authorizations for preparers whose forms do not meet an acceptable standard of quality despite feedback and quality improvement efforts
Second Approver	Know and understand the UW cost transfer policy
Second Approver	Attend training in the non-salary cost transfer approval roles and responsibilities
Second Approver	Verify that the transfer request form has been signed by the first approver, and return it to the first approver if it has not
Second Approver	Forward the transfer request to Accounting Services if the division chooses not to enter its own non-sponsored transfers directly into JET

Records Retention

Cost transfer requests (non-salary) fall under the following record retention schedules. The retention period for cost transfer requests (non-salary) is the fiscal year of creation plus an additional six years for the original record and thereafter destroyed. Duplicate documents should be destroyed when no longer needed. Do not retain duplicates longer than the original record.

Related UW–Madison Documents, Web Pages, or Other Resources:

Cost Transfer Request (Non-Salary) Procedures

External References:

UW System - Records Management

Policy Administration

Approval Authority:

Assistant Vice Chancellor of Business Services and Controller

Policy Manager:

Director of Disbursement Services

Contact:

Accounting Services -- Accounting Services, acctg@bussvc.wisc.edu, (608) 262-5748

Effective Date:

10-13-2009

Revised Dates:

05-02-2011

Retrieved:

12-03-2024 02:02:29