Documents Page

101 Payments to Individuals

Posted on

The Payment to Individual Report (PIR) is used to request all payments to individual non-employees. In the process of fulfilling their mission to instruct, conduct research, and perform public service, departments within the University of Wisconsin-Madison may find it necessary to pay individuals who are not employed by the university

Policy/Procedure: 101-Payments to Individuals
Date: 06/09/2010 (Last updated: 04/13/2015)

Statement of Policy

The Payment to Individual Report (PIR) is used to request all payments to individual non-employees. In the process of fulfilling their mission to instruct, conduct research, and perform public service, departments within the University of Wisconsin-Madison may find it necessary to pay individuals who are not employed by the university. An individual is defined as “a person who is not a company, partnership, corporation, association, organization, trust or estate, and for whom an employer-employee relationship does not exist.” See UW System Administrative Policy SYS 235: Personal Services Payment for more details. This policy includes paying individual non-employees for goods and services, prizes and awards, fellowships, and scholarships. Travel and expenses are reimbursed separately using e‑Reimbursement

UW-Madison Accounting Services will comply with the rules set forth by the UW-System, Board of Regents and federal government concerning non-salary payments as established in the following documents:

Procedure

I. General Guidelines

The Payment to Individual Report (PIR) is used to request all payments to individuals except salaries, employee reimbursements, and payment to subcontractors and architects. An individual is defined as “a person who is not a company, partnership, corporation, association, organization, trust or estate, and for whom an employer-employee relationship does not exist.” See UW System Administrative Policy SYS 235: Personal Services Payment for more details.

Examples of valid payments processed with a PIR:

  • Direct-charge payments to individuals for services, prizes and awards, scholarships, rents, royalties, and participant support.
  • You may use the PIR to pay a non UW employee for services.
  • You may use the PIR to pay a fee that is less than $100 to a registered UW student.
  • If you are processing scholarship payments to U.S. Residents on Program 9, please review the Automated Departmental Scholarship procedures. Contact your Dean’s Office for further information on this process as each Dean’s Office has a representative in charge of submitting scholarship payments to U.S. Residents on Program 9 using the Automated Departmental Scholarship procedures mentioned above.
  • All payments to an Individual, Sole Proprietorship, Partnership, or Limited Liability Companies (LLC) as described in the 1099-MISC/1042S Tax Reportable Transactions by Account Codes.

Notes:

  1. Fee for services payments over $100.00 to students or any payment to a UW employee must be pay rolled.
  2. Lists are not allowed to be submitted with a PIR effective 02-19-2010.
  3. For non-employees who file for reimbursement of travel costs, please follow the guidelines outlined in Policy 203-Payment for Services and Travel and Expense Reimbursement for Non-employees.
  4. If a transaction is over $5,000, a requisition is required unless the department has delegated authority to do Entertainment Contracts; see Purchasing Policy and Procedure, Entertainers/Speakers/Instructors and Consultant Contacts.
  5. See UW System Financial Policy and Procedure Paper #36 for further instructions.
  6. Contact John Dreger at 333 E Campus Mall #9701 for instructions regarding the processing of student loans.

Account Codes

  • Code payments for services to SFS Account Code 2620.
  • If the coding for payment is using Program 9, the Dean/Director’s Office must send the PIR to the Student Financial Aids Office for approval.
    • Program 9 can only be used with SFS Account Codes 5711 and 5713.
  • Provide the individual’s home mailing address when using the following SFS Account Codes on the PIR: 2620, 2621, 3750, 3860, 2637, 5709, 5710, and 5711.
  • SFS Account Code 2637 (Reportable) should conform to our procedures for paying human subjects.
  • 1099-MISC/1042S Tax Reportable Transactions by Account Codes are posted online.

II. Definitions of Payments That Can be Made Using a PIR

A. Scholarships/Fellowships

Student assistants are enrolled University of Wisconsin graduate students, and, on occasion, undergraduate students, who are appointed and paid directly through department channels. Payments for assistantship stipends must be pay rolled. Payments to undergraduates are generally reported on the grid form and those to graduate students are reported on a PIR. The titles authorized for student assistants are Research Assistant, Program/Project Assistant, Teaching Assistant, and Undergraduate Assistant. Additional student appointments, which also must be pay rolled., are Fellow, Scholar, Trainee, Advanced Opportunity Fellow, Special Graduate Trainee and House fellow/Resident Assistant.

Although payments for assistantship stipends must be sent through payroll, other payments to support research of research assistants or student appointments should be requested on the Payment to Individual Report. An example of this type of payment is a travel award to a research assistant.

Lump sum payments for scholarships/fellowships which are not related to student assistant-ships are generally requested through the Payment to Individual Report using the appropriate student aid class codes. Examples are athletic scholarships, participant payments, and departmental scholarships. For scholarship payments to U.S. Persons it is highly encouraged that the Scholarship Process be used and by contacting your Dean’s Office. However, effective 01/01/2015 all scholarship payments (whether for graduate or undergraduate students) to Nonresident Aliens (NRA) must be processed through Payroll due to the immigration documentation and taxation requirements.

B. Prizes and Awards

Cash prizes and awards which are in any way related to a person’s employment with the University MUST be paid through the payroll system as a lump sum payment. An example of this type of payment is an award to a faculty member for excellence in teaching. The payment will be subject to tax and social security withholding and will be reported on the employe’s W2 form.

Cash prizes and awards are considered taxable income and are reported to federal and state tax authorities. In contrast, scholarships and fellowships are taxable only to the extent they exceed tuition, books, and course-related supplies and equipment. Scholarships and fellowships to U.S. residents are not reported to federal and state tax authorities. It is very important that scholarships and fellowships be reported on the appropriate scholarship/fellowship account code. Scholarships and fellowships recorded on a prizes/awards class code will receive incorrect tax treatment. If you are unsure if a payment qualifies as an award or a scholarship, the determining factor should be whether the student has unrestricted access to the funds. It is most likely a scholarship if the recipient must be currently registered or registered in the future at an educational institution in order to receive the payment. It is most likely an award if the recipient is entitled to receive payment regardless of student status.

C. Services (Refer to account Codes 26xx for Specific Account Codes)

D. Research Subject Payments (Account Code 2637)

E. Royalties (Account Code 3860)

F. Rents (Refer to Account Codes 23xx for Specific Account Codes)

III. Instructions for Completing the Payment To Individual Report Form

Vendor # Each vendor or individual will be added to our SFS Accounting System Vendor File and be assigned a vendor number. For Accounting Services use only, leave blank.
Voucher # Each payment made in the SFS Accounting System will be assigned a voucher number. For Accounting Services use only, leave blank.
Payee name The full, legal name of the payee (last name, first name, middle initial).
Amount Enter the total amount to be paid to the individual before any applicable tax withholding.
Funding Information Enter the specific funding information to which the payment is to be charged. This includes Account, Fund, DeptID, Program, Class (Bldg #), Budget Year, and Project.
Taxpayer ID# (SSN, EIN, ITIN) The Social Security Number (SSN), Employer Identification Number (EIN), or Individual Taxpayer Identification Number (ITIN).

Enter the individual’s social security number or individual taxpayer identification number (ITIN), if any. This is the tax identification number under which any reportable payments will be reported to tax authorities. Accuracy is extremely important. Taxes must be withheld from reportable payments if a social security number or ITIN is not provided.

An individual who is a nonresident alien and does not have a social security number or ITIN, should apply for a social security number, if eligible, or for an ITIN, if not eligible for a social security number. After application has been made, enter “applied for” in this space, and see Accounting Services Policy and Procedure Manual on Tax Reporting and Withholding on Non-Salary Payments.
Invoice # Leading characters PIR plus the date of service, complete as PIRMMDDYY. Where there is an attached invoice, PIR plus the invoice number should be used.
Payment Handling Code Determines how the check will be routed. For Accounting Services use only, leave blank.
Mail To Address Enter the address to which the check should be mailed or special handling instructions (i.e., call for pickup, campus mail, etc.).

  • If the check is to be picked up, enter “please call (name) at (x-xxxx) when check is ready.
Permanent Home Address Enter the individual’s permanent mailing address if different from the “Mail Check To” address. This is the address to which a tax form will be mailed at the end of the calendar year.
If State Employee indicate Agency/Dept If paying an employee from another state agency or department, please agency and/or department.
Currently Enrolled UW Student Is the payee a student currently enrolled at a UW Institution? Check yes or no.
Residency If the payee is a legal United States resident or a resident of another country, check appropriate box. If resident of another country please enter the country name and VISA type in the space provided.
1099-MISC/1042S Tax Reportable Payment Select Yes, No, or Not Sure.

Please use the 1099-MISC/1042S Tax Reportable Transactions document to determine whether a transaction you are processing needs to be reported to the payee for tax purposes. All transactions listed in the column labeled “1099-MISC/1042S REPORTABLE TRANSACTIONS INCLUDED IN THIS CODE” must be marked/checked as reportable on the processing form you are submitting (PIR, etc.).

If you are not sure please check the appropriate box on the form and Accounting Services will make the determination. Accuracy is a must in order to be in compliance with Internal Revenue Service (IRS) reporting requirements.
Date(s) of Service Enter the exact dates during which service was/will be provided.
Purpose of Payment Describe the purpose of payment.

  • Use e-Reimbursement for travel and expense reimbursements as outlined in
For more information, call Indicate the name and phone number of a person to contact if there are questions regarding the payment request.

Add additional contact information from the Dean’s Office to be contacted instead of the individual listed on the DP/PIR form. Add the contact’s name and phone number directly under the departmental contact person. (Hint: Use “Alt + Enter” when adding the additional information in the field. Using only the “Enter” key will result in moving to the next cell or field in the form.)

Accounts Payable will only contact the person indicated from the Dean’s Office as responsible for supplying additional information; not both. If Accounts Payable receives a form without an additional Dean’s Office contact name, the contact person indicated on the form will be the only one contacted.
Business Office Use Only Where taxes are calculated. For Accounting Services use only, leave blank.
Entertainer/Public Speaker Section Complete this section if the payee is an entertainer or public speaker.

  • Attach a completed, signed entertainment contract.
    • Only UW Purchasing can sign contracts for the University unless the Department has been delegated by Purchasing to sign contracts.
  • Payment may be subject to withholding if the entertainer or public speaker is not a Wisconsin resident.
    • If the payee is an entertainer or public speaker and is a non Wisconsin-resident then a completed Department of Revenue (DOR) Form WT-11 must be attached to the PIR.
  • See Accounting Services Policy and Procedure Manual on Tax Reporting and Withholding on Non-Salary Payments for complete instructions regarding the Wisconsin Entertainer Tax.
Federal Tax Calculation For Accounting Services use only, leave blank
Scholarship/Fellowship Section If the payment is for a scholarship or fellowship to a UW student, separately enter the portions of this payment which apply to Semester 1, Semester 2, and Summer Session. Enter the award date (date the student was notified of the award.)
Approving Signatures And Dates Before payments can be processed all signatures and dates must be on the PIR (Department Chairperson/Project Director, Dean/Director, Student Financial Aids if expense is charged to Activity 9, and Authorized Institutional Approval (Pre-Audit)).

  • If the payment is for a scholarship/fellowship on activity 9, the form will be forwarded by the Dean’s office to the Office of Student Financial Aids.
Submitting the form: Print and submit one copy of the form to Accounting Services, Suite 5301, 21 N. Park Street..

Photocopy original receipts that are not 8 ½ by 11 and attach the photocopy to the PIR instead of the original.

  • The Department keeps the original receipt as a back up for 90 days and then destroys it.
Forms Help Red triangles in various fields of the form contain comments designed to help you complete the form. Also, some form text is hyper linked to web information that will assist you in completing the form.

Questions regarding this form should be e-mailed to uwtravel@bussvc.wisc.edu.
Printing Your Form There are many versions of Excel on campus. The forms have been developed to print on one page. If you are having problems printing, use the Excel tool bar, select File, then Page Set Up. This will open a dialog box for you to select “Fit to 1 page”. If this solution does not work, please contact your IT support person for further assistance.

IV. Policies for Compliance

Certification of Compliance

UW System Administrative Policy SYS 235: Personal Services Payment requires a certification of compliance on all requests for payment. Your signature on the PIR or requisition is a certification that you have read UW System Administrative Policy SYS 235: Personal Services Payment and the transaction is in compliance with the policy.

Exception to FPPP #31

Section III of UW System Administrative Policy SYS 235: Personal Services Payment states “When an institution determines an employment relationship exists, the individual must be appointed and paid on payroll unless the exception under ‘Employment Procedures’ is met. The exception listed under ‘Employment Procedures’ includes payments of less than $500 for a series of definitely predicted events to persons other than current UW System employes, full-time state employes, or students attending UW System institutions.”

Part-time state employes are not covered by the exception under “Employment Procedures”. In making the determination whether the individual is considered a student attending a UW System institution for the purposes of this exception, a student who is eligible for student employment falls into this category. Contact Academic Personnel for current guidelines regarding eligibility for student employment.

The term “a series of definitely predicted events” is to be taken literally. The $500 payment limit applies to any series of definitely predicted events, regardless of time period or source of funding.

UW-Madison has requested and received approval to make one additional exception to the policy. If the individual performing the service is a non-U.S. resident and the work is performed outside the United States, the individual may be paid as an independent contractor, regardless of whether an employment relationship exists.

Academic Support Services Policies

Chapter 36 of the Wisconsin Statutes gives the Board of Regents the authority to enter into contracts in order to fulfill the instruction, research, and public service missions of the University. Contracts entered into under this authority do not need to follow the state purchasing statutes found in Chapter 16 of the Wisconsin Statutes. UW System Administrative Policy SYS 235: Personal Services Payment permits the use of Chapter 36 authority to obtain unique services directly in support of instruction, research, or public service (referred to as Academic Support Services), without obtaining bids or waiver of bid authority.

Before deciding if a service qualifies as an Academic Support Service, it is necessary to ascertain that the person performing the service should not be pay rolled. If it is not a payroll transaction, Purchasing Services will make the final determination as to whether a service may be considered an Academic Support Service.

The requisition process must be used for all academic support service requests. A PIR cannot be used for such transactions.

UW System Administrative Policy SYS 235: Personal Services Payment requires signed agreements for academic support services if the cost is $5,000 or more (excluding itemized travel). Agreements may be written at the department’s option for services costing less than $5,000. Purchasing Services will generate the agreement and send it to the vendor for signature. For more information on the format of such agreements, contact Purchasing Services.

Regardless of dollar amount, Academic Support Services Agreements must be signed by an authorized contracting officer for the institution. This generally is the Director of Purchasing Services. You do not have authority to sign such agreements.

Related Information

UW-Madison

UW System

Related Policy/Procedure

 

Who should know this policy?

Deans, Directors, and Staff who prepare payments.

Contacts

E-mail at uwtravel@bussvc.wisc.edu.

102 Exceptional Expenditures Using 133/144 Funds Policy

Posted on

Research and Sponsored Programs (RSP), in partnership with Accounting Services, have issued the following policy for all division/departments to follow when they have 133/144 funded grants that may include language that permits exceptional expenditures that are not covered by State/University policies or exceed costs allowed within State/University policies.

Policy: 102-Exceptional Expenditures Using 133/144 Funds
Date: 08/11/03 (Updated June 21, 2013)

Statement of Policy:

Research and Sponsored Programs (RSP), in partnership with Accounting Services, have issued the following policy for all division/departments to follow when they have 133/144 funded grants that may include language that permits exceptional expenditures that are not covered by State/University policies or exceed costs allowed within State/University policies.

If you have a grant that may permit costs that are not covered by State/University policy and you believe that the expenditure should be paid through the University, please contact the appropriate RSP Team Leader to discuss the particular circumstances of the transaction prior to making the commitment. RSP will review the terms and conditions of the grant and, if covered, will issue a prior approval memo or email that can be used to pay for the expenditure through normal UW processing. If you are seeking a blanket approval for a series of transactions, please note that in your request to the appropriate RSP team leader.

The approval memo or email should be attached to the requisition, invoice, travel expense report, employee reimbursement, payment to individual report or purchasing card log for each transaction.

This process takes the place of the former UW System cost waiver agreement form. The UW System cost waiver agreement form is no longer available because it’s not required when following the appropriate UW Madison Purchasing/Accounting policies.

Although these exceptions rarely occur, following this process should prevent delays in future transaction processing.

Related Procedure(s):

 

Who should know this policy?

Deans, Directors, and Staff dealing with expenditures using 133/144 funds

Related Documents:

Contacts:

E-mail uwtravel@bussvc.wisc.edu with questions.

103 Payments to Research Participants

Posted on

103 Payments to Research Participants

Date: July 1, 2013

PURPOSE

The purpose of this policy and the following procedures is to outline the payment mechanisms that can be used to make payments to human subjects participating in research studies and to determine when gathering of research participant tax information is required.

POLICY

The University of Wisconsin (UW) often conducts research projects that involve the use of research participants.  The propriety of any payment to a research participant in a human subject research protocol will be determined by the UW’s Institutional Review Boards (IRB’s), and the related protocol must be approved or determined to be exempt by the appropriate IRB before the study is conducted.  Payment methods may include checks or cash depending on specifics of individual studies and the dollar amounts to be paid.

UW-Madison staff members have been trained to handle protected health information confidentially in accordance with the 2003 Health Insurance Portability and Accountability Act (HIPAA).  Applicable regulations will be followed based on the facts and circumstance of each study.

Payments to research participants must be reported every calendar year in accordance with the Internal Revenue Code (IRC) to the individual in Box 3 of the Internal Revenue Service (IRS) form 1099-MISC (Miscellaneous Income).  Information required includes the research participant’s name, mailing address, and Taxpayer Identification Number (TIN) which can be their Social Security Number (SSN) or their Individual Taxpayer Identification Number (ITIN).  Annually, at the end of the calendar year in which a payment is made, Accounting Services will report payments received by research participants to the IRS as required by the IRC and a form 1099-MISC (Miscellaneous Income) will be sent to the research participant.

De minimis Research Participant Payments:

  • Effective July 1, 2013, individual payment amounts of under $250 ($249 or less) are considered by UW Madison to be de minimis in nature.
  • For de minimis payments of under $250, departments are encouraged; but not required, to obtain a Taxpayer Identification Number (TIN) from the research participant, to the extent that collection of this information is consistent with the confidentiality protections provided to the research participant accepted by the reviewing IRB.
  • If the research coordinator is aware that the research participant will be getting multiple de minimis payments of under $250 that will cause the recipient to exceed the IRS limit of $600, then it is the researcher’s responsibility to obtain the required taxpayer identification information and a W-9 from the recipient.
  • De minimis payments of under $250 only applies to research participant payments and does not apply to other payments made by the University. For payments other than research participant payments there is no de minimis payment of $250 limit and a TIN and W-9 are to be obtained from the recipient.
  • De minimis payments of under $250 do not apply to Nonresident Aliens (NRA) under any circumstances. See Eligible Research Participants section of this policy below.
  • A researcher may request an exception to this policy from the Assistant Vice Chancellor for Business Services, which if approved, would allow the researcher to pay a research participant an amount greater that the de minimis payment amount without collecting TIN’s for individual research studies. Exceptions will be granted, on a case-by-case basis, based on the facts and circumstances of the individual study.

Eligible Research Participants (Who does this Policy and Payment Procedure apply to?)

  • US. Persons (Citizens, Permanent Residents-Both Employees and Non-Employees) – This policy and payment procedure, applies to all U.S. Persons (Citizens, U.S. Resident Aliens).  UW employees are treated the same as non-UW employees when participating as research participants.  Per the IRS, research participant payments are not considered wages and therefore, payments to UW employees are not required to be processed through the Human Resource System (HRS) (Payroll).
  • Nonresident Alien (NRA) – This policy and payment procedure applies to NRA’s, but the payment method for NRA is restricted to only Payment to Individual Report (PIR) due to the immigration and taxation documentation associated with payments to NRA’s as imposed by Homeland Security and the Internal Revenue Service (IRS). Please see below for restrictions relating to NRA’s:
  1. All payments to NRA’s must be processed through a Payment to Individual Report (PIR) regardless of the dollar amount. Please follow the Payment to Individual Report (PIR) procedures, attaching all required documentation as outlined in the Non-Payroll Payments Flowchart.
  2. The de minimis payment of under $250 section of this policy does not apply to NRA’s.

PAYMENT PROCEDURES

Payments to research participants are to be processed using the methods listed below only.  Employees will not be reimbursed if research participant payments to study participants are paid using a Purchasing Card (P-Card), University Personal Liability Credit Card, Personal Credit Card, or personal funds.

Payment Mechanisms

  • Payments of under $250 ($249 or less) (de minimis payment amount)

Custodian Funds and Payment to Individual Report (PIR) may be used to make de minimis payments of under $250.  To the extent consistent with the confidentiality protections provided to the research participant in the approved protocol departments are encouraged; but not required, to obtain a TIN from the research participant when de minimis payments are made.  Obtaining TIN’s from the research participants must be consistent with approved confidentiality as per IRB approved study protocols.

  1. Custodian Funds

The Custodian (Principal Investigator) can make payments directly to research participant via check, cash, or gift cards.  Follow the Custodian Funds Policy for all payments from replenishable or temporary custodian funds.  The Custodian is personally responsible for determining the amount of the advance and complying with Taxation and Identification Requirements.

Research Participant Recipient Log must be completed for all payments.  A copy of the log must be attached to the Custodian Fund Accounting Form to account for the distribution of custodian funds.  The completed log must contain the following information for each participating recipient:

  • Amount Paid to Each Recipient
  • Name or Recipient Identifier
  • Date Received by Recipient
  • Check number or Gift Card Identifier
  • Signature or Initials of Each Recipient
  1. Payment to Individual Report (PIR)

Payments of any amount can be processed on a Payment to Individual Report (PIR).  A check is issued directly to the research participant.  Follow the Policy and Procedure: 101-Payments to Individuals and the Tax Compliance and Reporting for Research Participant Payments section below.

  • Payments of $250 or more

All payments of $250 or more must be processed on a Payment to Individual Report (PIR).  A check is issued directly to the research participant.  Follow the Policy and Procedure: 101-Payments to Individuals and the Tax Compliance and Reporting for Research Participant Payments section below.

 

Tax Compliance and Reporting for Research Participant Payments

Under the Internal Revenue Code (IRC), payments to research participants must be reported every calendar year to the individual in Box 3 of the Internal Revenue Service (IRS) form 1099-MISC (Miscellaneous Income).  The information required for research participant payments include the research participant’s name, mailing address, and Taxpayer Identification Number (TIN) which can be their Social Security Number (SSN) or their Individual Taxpayer Identification Number (ITIN).  Accounting Services will report payments received by research participants to the IRS as required by the IRC, and a form 1099-MISC (Miscellaneous Income) will be sent to the research participant at the end of each calendar year in which a payment is made.

Per the Internal Revenue Service regulations, information on participants in research studies must be obtained for tax reporting purposes.  Researchers and Dean/Director’s or their designees are responsible for monitoring the dollar amounts and frequency of research participant payments to ensure tax compliance.

Effective July 1, 2013, individual payment amounts of $249 or less are considered by UW Madison to be de minimis in nature.  For de minimis payments, departments are encouraged, but not required, to obtain a Taxpayer Identification Number (TIN) from the research participant.  De minimis only applies to research participant payments and does not apply to other payments made by the UW.  For payments other than research participant payments made by the University no de minimis amounts apply.

The informed consent and any applicable HIPAA documents required for use in a research study do not need to describe the collection of information from research participants when that information is solely used to process study payment.  Instead study teams are recommended to have research subjects complete a form, which should be maintained separately from research records, to obtain relevant information that also alerts the participant that the payment will be reported by the UW to the IRS.

EXCEPTION PROCESS

Exceptions to the de minimis section of this policy may be granted based on the facts and circumstances of the research participant study.  The Assistant Vice Chancellor for Business Services is responsible for granting exceptions subsequent to receiving the following information for the particular research participant study under consideration:

  • The researcher must demonstrate, in writing, that the collection of Taxpayer Identification Numbers (TIN)’s will jeopardize research by negatively impacting the research participant pool. This must include an explanation why disclosure of information will inhibit the project from obtaining representative samples of research participants.  Confirmable and verifiable data and evidence should be provided as part of the request for exception.
  • Provide written justification that there is a low probability that the participant will receive $600 or more in payments from the UW as a whole in a given calendar year.
  • Identify the steps the researcher will implement at the research project level in order to ensure compliance with #2 above. For example:
  • Develop a form where parties acknowledge that they are not receiving total payments from the UW in excess of the Internal Revenue Service (IRS) $600 reporting limit. The narrative would include “The research participant understands that receipt of total payments of $600 would require the UW to provide notification to the IRS.”  Total payments include, but are not limited to, payments from all UW Campuses for research participant payments, rents, services (including parts and materials), prizes and awards, and other income payments.

Exception Request Submission:

  • Upon presentation of written request for exception to the Assistant Vice Chancellor for Business Services, a review will be conducted by the Division of Business Services based on the facts and circumstances, and a written acceptance or denial of the exception request for will be issued. The Assistant Vice Chancellor for Business Services will provide the final approval or denial for exceptions to this policy.
  • Exceptions will be granted for only the specific study submitted. Future studies, no matter how related or similar in nature, will require separate request for an exception to be approved by the Assistant Vice Chancellor for Business Services.

For more information contact our Tax Manager Jose Crus Jr.

104 Transfer of Funds (money) Between UW-Madison Departments/Funding Sources Policy

Posted on

Funds may be transferred between departments and funding sources within the UW-Madison.


Date: 08/17/05 (Last updated: January 24, 2018 )

Cost Transfer Tool

Statement of Policy:

Funds may be transferred between departments and funding sources within the UW-Madison.

Related Procedure(s):

104-Transfer of Funds (money) Between UW-Madison Departments/Funding Sources

Who should know this policy?

Deans, Directors, and Staff dealing with transfers of funds

Contacts:

Susie Maloney

106 Check Distribution Policy

Posted on

Accounting Services will only release checks to the payee or a certified check custodian. Any person requesting a check must present a valid photo ID at the time of pick up. To request a check for pick up by a custodian, a signed Check Custody Agreement must be submitted with the payment request.

Date: May 1, 2018

Check Pick Up: As of 5/1/2018, Accounting Services will only release checks to the payee or a certified check custodian. Any person requesting a check must present a valid photo ID at the time of pick up. To request a check for pick up by a custodian, a signed Check Custody Agreement must be submitted with the payment request.

Check Custodians and the Check Custody Agreement: Staff may become a check custodian for a check or set of checks by submitting a signed Check Custody Agreement. An agreement or copy of the agreement must be submitted with each payment request (DP, PIR, Invoice, and Payment Upload). This handling exception requires written justification explaining the business reason(s) for doing so in addition to the authorizing signature of the Divisional CFO. Check custodians are personally responsible for check security and safekeeping until the check is distributed to the payee. A check custodian alternate may also be named.

Check Distribution Log: Each custodian is provided with a Check Distribution Log with their checks. The checks are counted to confirm all checks were received at the department and signed off on the log. As checks are distributed, the payee should sign the log and the custodian or alternate should write their name and the date distributed. Checks that are mailed should have “mailed” written in the payee signature field. Check Distribution Logs must be returned to Accounting Services within 30 days of the check date.

Check Intermediary Form: In the event a check custodian must hand off a check to an intermediary custodian for delivery to a payee, a Check Intermediary Form must be completed by the check custodian, intermediary custodian, and signed by the payee for each check. Check Intermediary Forms are returned to Accounting Services with the Check Distribution Log.

Check Custodian Audit: There will be an annual audit of check custodians to review proper timeframe from check pick up date to cashed, authorized chain of custody of the check, proper secure storage, documentation of checks given out, internal controls and violation of agreement and fraud. A sample of 5 checks will be reviewed as well as department check handling procedures.

Contacts:

For tax questions contact Accounting Services.

110 Capital Equipment Policy

Posted on

UW-Madison defines capital equipment assets as any individual item which has a per-unit acquisition or fabrication cost of $5,000 or more, is movable (not permanently affixed to a building), and has a useful life of at least one year. It does not include real property (land), most software, animals or library holdings. In fulfillment of its mission and compliance responsibilities, UW-Madison must maintain an accurate inventory system and procedures that safeguard assets, and assure financial accountability, reporting accuracy, adequate insurance, efficient utilization and appropriate disposition of all capital equipment.

UW-Madison Administrative Policy
Policy # 110
Capital Equipment Policy

Effective Date: January 1, 2017
Last Updated: June 18, 2018
Last Reviewed: June 18, 2018
Next Review: TBD

Download 110 Capital Equipment Policy (pdf)

Functional Owner: Director of Financial Information Management
Executive Sponsor: Asst. Vice Chancellor for Business Services
Policy Contact: Supervisor Property Management, 608-265-7830 or Property Control Mailbox Property@bussvc.wisc.edu

Policy Summary

UW-Madison defines capital equipment assets as any individual item which has a per-unit acquisition or fabrication cost of $5,000 or more, is movable (not permanently affixed to a building), and has a useful life of at least one year. It does not include real property (land), most software, animals or library holdings. In fulfillment of its mission and compliance responsibilities, UW-Madison must maintain an accurate inventory system and procedures that safeguard assets, and assure financial accountability, reporting accuracy, adequate insurance, efficient utilization and appropriate disposition of all capital equipment.

Policy Application

This policy applies to all UW-Madison divisions, departments and individuals involved in the acquisition, utilization and/or disposition of capital equipment in their operations, and the Property Control Office within the Division of Business Services, which is responsible for recording, monitoring and tracking capital equipment assets.

Rationale

UW-Madison has a fiduciary responsibility to manage the capital assets for which it has been entrusted. This includes strict adherence to both State and Federal policies in an effort to assure safeguarding and accounting for all capital assets.

Policy Detail

UW-Madison defines capital equipment assets as any individual item which has a per-unit acquisition or fabrication cost of $5,000 or more, is movable (not permanently affixed to a building), and has a useful life of at least one year. It does not include real property (land), most software, animals or library holdings. In fulfillment of its mission and compliance responsibilities, UW-Madison must maintain an accurate inventory system and procedures that safeguard assets, and assure financial accountability, reporting accuracy, adequate insurance, efficient utilization and appropriate disposition of all capital equipment. Policy details are organized into capital equipment asset life-cycle stages: (I) acquisition of assets, (II) tagging and physical inventory tracking and (III) final dispositions. In addition, this policy includes detail on the Department Property Administrator role (section IV).

I. Acquisition of Assets

A. All capital equipment asset purchases must be placed on institutional inventory records regardless of their funding source(s) or ownership title (Federal or University).

B. Gifts in Kind (GIK) are non-monetary gifts, which if they meet the definition of capital equipment assets, must be added to institutional records. Book value must be based on a written estimated fair value of the GIK.

C. With prior approval from their Division’s business office, departments hiring new research-related employees can execute a Transfer-In of existing capital equipment assets without purchase from the new hire’s former institution. Departments of new hires who negotiate a transfer-in of capital equipment asset(s) must notify their DPA and Property Control of the incoming item(s).

D. With prior approval from their Division’s business office, departments hiring new research-related employees can purchase existing capital equipment from a new hire’s prior institution. Departments must requisition such purchases through Purchasing Services within the Division of Business Services.

E. Fabricated capital equipment expected to cost $5,000 or more must be declared in advance to Property Control through a fabrication request so that a Fabrication ID number is established and referenced for all future qualified expenditures. Upon putting the fabrication into service, the asset’s responsible person must notify their designated DPA and Property Control so that the asset can be tagged and the accumulated value moved from a Fabrication in Progress account into a Capital Equipment account and begin depreciation.

F. Upgrades (purchased or fabricated) costing $5,000 or more to existing capital equipment assets can be capitalized only if the upgrade results in one or more of the following:

a. A substantial increase in the functionality of equipment which allows it to function or perform tasks that it was previously incapable of performing.

b. A substantial increase in the efficiency of the equipment, that is, an increase in the level of service provided by the equipment. The record of the qualified upgrade must be linked to the original asset and its corresponding asset tag, but the upgrade will depreciate under its own separate schedule.

II. Tagging and Physical Inventory Tracking

A. All capital equipment must be tagged with the appropriate asset ID tag (Federal or University-owned), and records completed in the central asset management system when the asset, whether purchased or fabricated, is put into service.

B. Asset tags must be placed on a routinely visible location of the asset. Capital equipment that is designated as “untaggable” must still have inventory records completed in the central asset management system.

C. Physical inventories facilitated by Property Control will be scheduled on an annual basis prior to the start of the fiscal year. The selection criteria for the physical inventories will follow UW System Administrative Policy 334.C. It is recommended that departments verify that all capital equipment for which it is responsible, can be located and is in use on an annual basis. Inventory records should be updated accordingly.

D. Departments have up to 15 business days from the last physical inventory or audit to locate items if they were not found in their last documented location.

E. An asset should be reported as lost only after a concerted effort has been made to find it. Property Control will remove items from active records as lost with a written request from the Department Chair/Dean or Director.

F. In between physical inventories, the DPA must update asset records upon knowledge of any known capital equipment relocations or a permanent change of custody to another UW-Madison department.

G. An asset loan agreement must be obtained through Property Control for any capital equipment asset placed at a non-UW-Madison location for 30 days or more.

III. Final Dispositions

A. Departments must receive written approval from Property Control prior to disposition of capital equipment. Allowable retirement reasons and specific guidance for the dispositioning of capital equipment assets are outlined in a set of procedures.

Disposition includes:

  • Surplus
  • Transfer to departing employee’s new institution with ongoing sponsored project
  • Sell/move to departing employee’s new institution
  • Cannibalize
  • Trade-in
  • Return to vendor
  • Deliver per contract
  • Lost
  • Stolen
  • Destroyed
  • Record-keeping error
  • Unallowable dispositions

IV. Department Property Administrator

A. Every campus unit (school, college, administrative unit) must designate at least one Department Property Administrator (DPA). Property Control will formalize this designation through an agreement with the DPA and unit senior financial officer.

B. The DPA must manage capital equipment for his or her individual unit(s) for the equipment’s entire lifecycle, from arrival on campus through final disposition. Personnel designated as DPAs must undergo training and certification, administered by Property Control.

Consequences for Non-Compliance

Failure of any employee to comply with this policy may result in disciplinary action up to and including dismissal based on the severity of the action or non-action of the employee(s). Incidents related to fraud may be referred to the police for further investigation and action.

For DPA’s, consequences may also include revocation of their DPA agreement and reassignments of property administration duties.

Researchers should be mindful that failure to follow federal guidelines could result in loss of future research funding.

Supporting Tools

Wis. Stat. s.36.11

UW System FPPP 33 – Accountability for Capital Equipment

White House OMB Uniform Grant Guidance § 200.313 (d) – Equipment

Definitions

    1. Asset Loan – A UW-Madison capital equipment asset that will temporarily reside for 30 days or more at a location not directly part of UW-Madison.
    2. Asset Tag – A bar-coded tag that is affixed to an asset signifying that the item is a capital equipment asset and whether it is titled to UW-Madison or a Federal Government agency.
    3. Asset Trade-In – An active asset is relinquished to a vendor in exchange for the reduction in price towards the purchase of new similar asset.
    4. Cannibalization – An asset is removed from active service (retired), but remains on campus for the purpose of supplying spare parts for another (same or similar) piece of equipment that’s still in service.
    5. Capital Equipment Asset – An acquisition qualifies as capital equipment if it meets these four criteria:
      1. Item has a per-unit acquisition cost of $5,000 or more before any applicable trade-in allowance or qualifies as a fabrication with a cost of $5,000 or more.
      2. The acquired item has a useful life expectancy of one year or more.
      3. The item is moveable; that is, it is not permanently affixed to a building or another object in such a way as to lose its unique identity.
      4. The item is an inanimate object, typically used to perform tasks (e.g. research, grounds-keeping, farming, transportation, etc.). Items like artwork, animals and most software are not considered capital equipment assets.
    6. Chief Financial Officer (CFO) – the senior leader within the Division who’s primarily responsible for oversight and management of the Division’s financial activities.
    7. Fabrication – Purchases of component parts and direct labor that are custom joined to create an asset not commercially available, and is capitalized together as one asset. To meet this definition, component parts must work together to perform one function. Each component part must be necessary for the asset to function, i.e. removal of any part would result in the asset not operating at capacity or for its intended purpose. Software can be considered a fabrication component only if the software is integral to the control and operation of the fabricated asset, i.e. without the software the fabricated asset will not function for its intended use.
    8. Gift in Kind – A non-monetary gift received by the University to be used in operations.
    9. Move – For purposes of this policy, a move is defined as a zero-dollar sale to a new institution that results in a transfer of title, possession and accountability for the equipment from UW-Madison to a new academic institution. At UW-Madison, moves can only be done in cases where a researcher is departing for the new academic institution. In any other situation, equipment must be declared as surplus.
    10. Sale – For purposes of this policy, a sale is defined as a transaction in which title to equipment, possession, and accountability is relinquished in exchange for a sale price. At UW-Madison, sales can only done in cases when a researcher is departing for a new academic institution. In any other situation, equipment must be declared as surplus.
    11. Surplus – Any item that:
    12. does not function anymore;
    13. b. is obsolete;
    14. is not useful; or
    15. is not needed in the foreseeable future.
    16. Transfer-In – For purposes of this policy, “transfers-in” is capital equipment received from an incoming employee’s prior institution (usually from another university). This used equipment may transfer-in without purchase to UW-Madison, or could have an exchange of funds under limited circumstances.
    17. Transfer-Out – For purposes of this policy, transfer-out is defined as a transfer of title and accountability for equipment to a new institution. At UW-Madison, transfers can only be done in cases when a researcher is departing for a new institution with an ongoing sponsored project that will be moved there, and the sponsored project paid for the capital equipment asset.
    18. Upgrade – For purposes of this policy, an upgrade refers to substantial improvements costing $5,000.00 or more. Upgrades may be fabricated or purchased complete. To be considered a capital equipment upgrade, the upgrade must result in one or more of the following:
      1. A substantial increase in the functionality of equipment which allows it to function or perform tasks that it was previously incapable of performing.
      2. A substantial increase in the efficiency of the equipment, that is, an increase in the level of service provided by the equipment without the ability to perform additional tasks.
    19. Untaggable Asset – A capital equipment asset that is not compatible with being tagged due to special circumstances (e.g. asset too small for the tag, would adversely impact asset performance, etc.).

General Responsibilities

Department Property Administrator (DPA) – Serves as the liaison between their department/division and the Property Control Office for matters regarding capital equipment.

Division Chief Financial Officer (CFO) – Coordinates the designation of DPA(s) for their division and provides oversight and support to the DPAs in execution of their responsibilities.

Office of Research and Sponsored Programs (RSP) – Reviews project proposals on behalf of the Board of Regents, transmits proposals to providers of extramural support, and monitors fund expenditures by PIs. RSP provides Property Control with contract information specifically related to property (capital equipment) title, funding source(s), the dollar amount, and equipment relevant terms and conditions of the sponsored research.

Property Control Office – Responsible for the overall management of capital equipment acquired by and assigned to the University of Wisconsin – Madison in accordance with current state and federal policies. Management duties include establishing and maintaining necessary records to ensure accurate accounting and reporting of all capital equipment in the possession of the University.

Principal Investigator (PI) – Responsible for initiating and conducting extramurally funded research, training, or public service projects. PI is responsible to generally ensure that all federally titled property is exclusively utilized to support research on the contract/grant under which it was acquired. PIs must also support the DPA in performance of their capital equipment asset management duties.

Surplus with a Purpose (SWAP) – Through DOA designated authority, is responsible for disposing of UW-Madison’s surplus property. Prior to sending capital assets to SWAP, DPAs must work with Property Control to ensure proper handling of the equipment, especially federally funded/federally titled property, hazardous materials, and other special cases.

Links to Related Policies

UW System Administrative Policy 334 – Accountability for Capital Equipment

UW System Administrative Policy 332 – Financial Reporting of Library Holdings

White House OMB Uniform Grant Guidance § 200.313 (d) – Equipment

110.1 Recording and Tagging Capital Equipment Procedure

Posted on

110.1 Recording and Tagging Capital Equipment Procedure

Recording and Tagging Capital Equipment Procedure
Procedure # 110.1
Rev.: 0
Effective Date: January 1, 2017

Download 110.1 Recording and Tagging Capital Equipment Procedure (pdf)

Related Policy: Capital Equipment Policy
Functional Owner: Property Control, Business Services
Contact: Property Control Manager: (608) 890-3131, Property Control Mailbox: property@bussvc.wisc.edu

Contents

I. Procedure Statement
II. Who is Affected by this Procedure
III. Procedure
IV. Contact Roles and Responsibilities
V. Definitions
VI. Related References
VII. Revisions

I. Procedure Statement

UW-Madison departments must code capital purchases to 46XX accounts in the UW System Chart of Accounts. All capital purchases are routinely reviewed by Property Control upon payment as the trigger to identify new capital equipment items that have been acquired by campus. To later aid in physically identifying capital equipment, Property Control will assign a unique asset barcode tag to be affixed to each item. Asset barcode tags are color-coded based on whether the University owns the asset (blue – “Property of University of Wisconsin”) or a sponsor owns the asset (red – Property of Federal Government”). Assets that belong in whole or in part to a sponsor must be tagged with the red Federal ownership tag. Property Control will mail asset barcode tags along with a Capital Equipment Confirmation Form to the Department Property Administrator (DPA) with instructions for completing the recording of new capital equipment items in the University’s asset management system. Fabricated capital equipment assets (refer to Procedure 110.4 Fabricated Capital Equipment) are tagged once the item is placed into initial service. Qualified capital equipment upgrades are generally not issued an additional asset barcode tag (refer to Procedure 110.5 Upgrades to Existing Capital Equipment). If Property Control has not mailed an asset barcode tag for a newly acquired item within a reasonable amount of time, the DPA should contact Property Control with the purchase order number or other referenced information. Property Control will verify if payment has been made or that the correct account code was assigned to the purchase.

II. Who is affected by this Procedure

This procedure applies to all UW-Madison departments. It should be understood by department managers, DPAs, Principal Investigators (PI’s), lab managers, department chairs, directors, deans, and all employees responsible for capital equipment.

III. Procedure

The following steps represent the overall process of inventorying new asset purchases:

  1. Department financial staff must code capital purchases to the 46XX accounts in the UW System Chart of Accounts. No additional reporting of purchases is necessary.
  2. Property Control reviews capital purchases at the end of each month in WISDM and establishes partial inventory records for each item purchased, obtaining information from:
    1. Purchase Orders: Purchasing System, Image Now
    2. P-Card: Purchasing Card Capital Equipment Documentation Form
    3. Direct payments/payments to individual: Image Now
    4. MDS Orders: Shop@UW Shopper Lookup Website
    5. Inter-departmental billings: Journal Entry Tool comments
    6. Cost transfers: Cost Transfer Tool Research and Sponsored Programs Cost Transfer Policy.
  3. If an item does not meet the capital purchase definition, Property Control will not establish an inventory record. Instead, Property Control will contact department financial staff to gather additional information. If confirmed as a non-qualified capital equipment purchase, Property Control will complete a journal entry to reassign the purchase to an appropriate account. If confirmed as a capital equipment purchase, the capital equipment processes will continue.
  4. Property Control will issue a unique asset barcode tag and generate a Capital Equipment Confirmation Form for each item. Property Control will mail asset barcode tags and Capital Equipment Confirmation Forms to DPAs, in batches, weekly.
  5. DPA affixes asset barcode tag. For best adherence, DPAs should affix asset barcode tags onto a clean, dry surface when temperatures are above freezing. Asset barcode tags should be placed onto the equipment in a location that will be readily visible on an on-going basis. This will also make scanning the asset barcode tag during subsequent physical inventories much easier. If an asset barcode tag cannot be affixed to the item, then it should be affixed in an alternate location/method within the department that the DPA maintains. Qualifiers for assets that asset barcode tags cannot be affixed to include:
    1. Item is too delicate to tag (e.g. laser optics)
    2. Tag would de-face or de-value the asset (e.g. antique piano)
    3. Tag would make the asset un-usable (e.g. centrifuge rotor would be unbalanced by tag)
    4. Asset is not accessible (e.g. satellite dish on tower, roof-mounted asset without stair access)
    5. Asset shape or size prohibits tagging (e.g. asset smaller than the tag)
    6. Asset does not have compatible surface/environmental conditions (e.g. environment too hot/cold/wet)
    7. Asset is subsequently impractical to scan (e.g. asset will be in space, buried underground)
  6. DPAs are responsible for affixing asset barcode tags or explaining on the Capital Equipment Confirmation Form if tag cannot be affixed, changing/confirming the accuracy of the information prelisted on the form (e.g. building and room location,equipment’s responsible employee) and recording balance of the asset information unavailable to Property Control (e.g. serial #). DPA should return the Capital Equipment Confirmation Form to Property Control via mail or email within two (2) weeks. DPAs are responsible for completing these tasks, but may engage the assistance of others (including the responsible employee).
  7. Upon return of the Capital Equipment Confirmation Form, Property Control will update the equipment record in the asset management system. If Property Control does not get confirmation that the asset barcode tag has been affixed after two (2) weeks, a follow up email will be sent to the DPA.
  8. If the DPA has not received an asset barcode tag from Property Control for a newly acquired item within a reasonable time period, the DPA should contact Property Control with the purchase order number or other referenced information. Property Control will verify if payment has been made or that the correct account code was assigned to the purchase.

IV. Contact Roles and Responsibilities

wdt_ID Inventorying Asset Purchases Dept Fin Staff Responsible Employee DPA Property Control
1 1) Code all capital purchases to 46XX accounts. X
2 2) Review 46XX account activity and establish inventory records for each item. X
3 3) If necessary, investigate with Dept. Financial Staff and complete journal entry to reassign non-capital purchases to appropriate account. X
4 4) Create Capital Equipment Confirmation Form and send it, along with appropriate asset barcode tag (red or blue), to the DPA for each new asset entered into the system. X
5 5) Affix asset barcode tag to capital equipment item. If tag cannot be affixed to the item, affix tag to the alternate method/location that the DPA manages. (if DPA engages help) X
6 6) Complete capital equipment information fields and change/confirm pre-printed asset information on the Capital Equipment Confirmation Form. Return Form to Property Control within two (2) weeks. (if DPA engages help) X
7 7) Complete/update the asset record in the asset management system. X
8 8) Contact Property Control if an asset tag was expected but has not been received. X

V. Definitions

VI. Related References

VII. Revisions

Procedure Number

110.1
Date Approved

January 1, 2017

Revision Dates

110.10 Asset Loan Agreement Procedure

Posted on

110.10 Asset Loan Agreement Procedure

Asset Loan Agreement Procedure
Procedure # 110.10
Rev.: 0
Effective Date: January 1, 2017

Download 110.10 Asset Loan Agreement Procedure (pdf)

Related Policy: Capital Equipment Policy
Functional Owner: Property Control, Business Services
Contact: Property Control Manager: (608) 890-3131, Property Control Mailbox: property@bussvc.wisc.edu

Contents

I. Procedure Statement
II. Who is Affected by this Procedure
III. Procedure
IV. Contact Roles and Responsibilities
V. Definitions
VI. Related References
VII. Revisions

I. Procedure Statement

To maintain control and assign responsibility for capital equipment removed from University premises, Property Control must authorize the loan of, and track assets. Completion of Form 110.10F Asset Loan Request Form is required when equipment is to be borrowed for more than 30 days and will reside at a location not directly associated with the University. Property Control must authorize loans before equipment is removed from campus. Risk Management should also be notified for executing appropriate insurance and risk management activities.

  • Equipment may be loaned for a specified period (maximum five years), and the borrower must sign an Agreement for Loan of University Property within 30 days prior to the loan.
  • Property Control will monitor loaned equipment aging and will work with the DPA 30 days prior to the end of the agreement term to determine and formalize if the loan will be renewed or ended. Property Control will require a new agreement to extend beyond one year.

II. Who is affected by this Procedure

  • Departmental staff members, Responsible Employee
  • DPA
  • Property Control
  • Borrowing institution or entity
  • Risk Management

III. Procedure

The following steps represent the overall process:

  1. The employee responsible for the equipment notifies the DPA for guidance on the capital equipment loan procedures, as well as contacts Risk Management to inquire about insurance guidelines.
  2. The DPA works with the Responsible Employee to gather the terms of the loan (i.e. the duration of the loan) and contact information for the borrowing institution or entity to which the capital equipment will be loaned.
  3. The DPA completes the Form 110.10F Asset Loan Request Form and obtains signatures of approval from Department Chair/Dean/Director. The form is submitted to Property Control.
  4. Property Control reviews the request and the funding sources of the equipment. If funding sources include sponsored funding, Property Control will verify with RSP to confirm if equipment can be loaned to another institution or entity. Equipment that is owned by a sponsor (e.g. title vests with Federal agency) cannot be loaned to another institution or entity without written consent from the sponsor.
  5. Property Control authorizes the equipment loan and notifies the DPA, the Responsible Employee, and Department Chair/Dean/Director.
  6. Property Control prepares an Agreement for Loan of University Property, which is to be signed by the borrowing institution. The agreement should be signed by the borrowing institution or entity at least 30 days prior to the loan.
    1. Property Control will work with the DPA, Responsible Employee and Department Administrators to coordinate and obtain sign-off from the borrowing institution. The responsible party for obtaining approval is the individual negotiating the loan of equipment to the borrowing institution. This is most often the Principal Investigator, but may be other parties. Property Control intends to team with the DPA to ensure appropriate personnel approve the loan prior to allowing the equipment to be borrowed.
  7. Upon receipt of signed Agreement for Loan of University Property, Property Control provides a signature and sends a copy of the fully executed loan agreement to the DPA and borrowing institution or entity.
  8. Property Control notifies the DPA and Responsible Employee that loan agreement is signed and the equipment can be shipped to the borrowing institution or entity.
  9. Property Control updates the asset management system to indicate that the equipment has been loaned to another institution or entity.
  10. The DPA, Building Manager and/or Responsible Employee coordinate shipment of capital equipment to the borrowing institution or entity.
  11. When the loan agreement approaches its end date, Property Control will contact the DPA to initiate conversations to determine whether an extension of the loan agreement is necessary.

IV. Contact Roles and Responsibilities

wdt_ID Asset Loan Agreement Responsible Employee DPA Dept Chair/ Dept Admin Property Control Bldg Mgr
1 1) Notify DPA and Risk Management of loan request. X
2 2) Gather terms of loan and contact information for borrowing institution. X X
3 3) Complete Form 110.10F Asset Loan Request Form, obtain signatures and submit to Property Control. X X (signs request form)
4 4) Loan request is reviewed for approval. X
5 5) Once approved, notification is sent to DPA, Responsible Employee and Department Chair/Dean/Director/Designee. X (Prop Cont may need assistance) X (Prop Cont may need assistance) X
6 6) Agreement for Loan of University Property is prepared and sent to borrowing institution or entity. X
7 7) A copy of the fully executed loan agreement is sent to DPA and the borrowing institution. X
8 8) Notice to proceed with shipment of equipment is sent to DPA and Responsible Employee. X
9 9) Update asset management system. X
10 10) Coordinate shipment of the equipment to the borrowing institution or entity. X X X X

V. Definitions

VI. Related References

VII. Revisions

Procedure Number

110.10

Date Approved

January 1, 2017

Revision Dates

  09/12/18 – Updated Form 110.10F

110.11 Departing Employee Request to take Capital Equipment to a New Institution Procedure

Posted on

110.11 Departing Employee Request to take Capital Equipment to a New Institution Procedure

Departing Employee Request to take Capital Equipment to a New Institution Procedure
Procedure # 110.11
Rev.: 0
Effective Date: January 1, 2017

Download 110.11 Departing Employee Request to take Capital Equipment Procedure (pdf)

Related Policy: Capital Equipment Policy
Functional Owner: Property Control, Business Services
Contact: Property Control Manager: (608) 890-3131, Property Control Mailbox: property@bussvc.wisc.edu

Contents

I. Procedure Statement
II. Who is Affected by this Procedure
III. Procedure
IV. Contact Roles and Responsibilities
V. Definitions
VI. Related References
VII. Revisions

I. Procedure Statement

This document covers procedures to be followed when a departing employee requests to take capital equipment with them to a new institution. In all cases, Form 110.11F Request for Authorization to Transfer/Sell University Property to a Departing Employee’s New Institution and an Agreement for Transfer/Sale of University Property must be completed and signed prior to equipment being shipped to the new institution. Please note, Departments and Divisions may require additional review, approval, and discussion with the Deans Office when a departing employee requests to take capital equipment with them to a new institution.

Criteria for Determining Authorization of Transfer/Sale of Capital Equipment

Department Chair/Deans Office/Director/Designee and Property Control may authorize departing employees to take University equipment if all of the criteria are met:

  • The departure of equipment does not adversely affect instructional needs, graduate students or other research remaining at UW-Madison.
  • Formal resignation has been submitted by the departing employee and received by the Department Chair/Supervisor.
  • The departing employee was a permanent, University employee, including Faculty and Academic Staff roles. Student employees and zero-dollar appointees are excluded from this definition.
  • The departing employee’s role was directly related to at least one element of the University’s core mission (instruction, research, or public service). This excludes administrative roles.
  • The capital equipment will be used for the same purpose at the new institution.
  • The new institution is another institution of higher education or academic research. Equipment cannot be transferred to a for profit or start-up business.
  • Equipment does not contain any UW-Licenses, UW-Proprietary Software, nor any sensitive data.

If all of the above criteria are met and the Department Chair, Dean/Director/Designee approves the transfer/sale of equipment, departments must complete Form 110.11F Request for Authorization to Transfer/Sell University Property to a Departing Employee’s New Institution.

Criteria for Determining if a Transfer of Equipment is Acceptable

Equipment may be transferred to the departing employee’s new institution under the following circumstances. The transfer of equipment is also referred to as a zero-dollar, cost transaction.

  • The capital equipment item was solely funded by an active/on-going, sponsored research project AND the research project is moving with the departing employee to their new institution. Expenses for all packing, shipping and insurance costs are covered by the new institution.
    • Note: An active or on-going project is defined as a contract/grant/agreement having the same sponsor, that is currently in progress having not ended, and is being continued at the new institution.

Criteria for Determining if a Sale of Equipment is Acceptable

Equipment may be sold to the departing employee’s new institution under the following circumstances.

  • The sale is a negotiated exchange as part of the departing employee’s recruitment between the UW department and the departing employee’s new institution.
    • Departments may be allowed to sell equipment in situations involving departing employees and their new institutions. Sales involving departing employees may be granted, because such sales are customary exchanges in academia and are commonly negotiated as part of a larger recruitment/employment package offered to the departing employee. This circumstance does not meet the state’s definition of surplus and therefore is an allowable sale. In situations where this is not the case, departments must coordinate sale through Surplus with a Purpose (SWAP). Please refer to Procedure 110.7 Equipment Dispositions.
  • Equipment was funded by a sponsored project, but the project is closed AND there are no sponsor restrictions on the award.

Criteria for Determining a Sale Price of Equipment

  • Property Control provides a listing of the capital equipment and information including initial acquisition cost of equipment, acquisition date, and net book value (NBV) for which equipment is recorded in the University’s financial sub ledger.
  • Property Control does not require departments to sell at the NBV, but does ask for a brief explanation if there is a difference between NBV and sale price.
  • An employee’s Department Chair and/or Dean/Director/Designee has the final authority to set the sale price of the equipment, as they are most closely involved in situations when prices must be negotiated with a new institution.
  • At their option, Department Chairs and Deans/Director/Designee may seek the advice of the Division of Business Services, Purchasing Services for a suggested sales price.

II. Who is affected by this Procedure

This procedure applies to all UW-Madison departments. It should be understood by Department Managers, DPAs, Department Chairs, Directors, Deans, Chief Financial Officers, Principal Investigators, and other employees responsible for equipment.

III. Procedure

The following steps represent the overall process:

  1. Departing employee notifies their Department Chair and DPA of their pending departure, and that they are requesting permission to take capital equipment to a new institution.
  2. The DPA contacts Property Control to request a list of capital equipment items associated with the departing employee.
  3. Property Control provides a list of equipment to the DPA. The equipment list will include the asset tag number, description, acquisition date, acquisition cost, funding sources and percentages, net book value (NBV), etc.
  4. The DPA provides the equipment list to the Departing Employee, Department Chair, Dean/Director/Designee for review.
  5. The Department Chair, and/or Dean/Director/Designee determines that all eligibility criteria are met:
    1. The departure of equipment does not adversely affect instruction needs, graduate students or other research remaining at UW-Madison.
    2. Formal resignation has been submitted by the departing employee and received by the Department Chair/Supervisor.
    3. The departing employee was a permanent University employee, including faculty and academic staff roles. Student employees and zero-dollar appointees are excluded from this definition.
    4. The departing employee’s role was related to at least one element of the University’s mission (instruction, research, or public service). This excludes administrative roles.
    5. The capital equipment will be used for the same purpose at the new institution
    6. The new institution is another institution of higher education or academic research. Equipment cannot be transferred to a for-profit businesses or start-up business.
    7. Equipment does not contain any UW-Licenses, UW-Proprietary Software, nor any sensitive data.
  6. The Department Chair and/or Dean/Director/Designee approves one or more items on the equipment list to be either transferred and/or sold to the new institution. The criteria listed for a transfer and a sale of equipment must be used to determine the treatment of each piece of equipment.
    1. If the equipment meets the criteria to sell equipment, the departing employee’s Department Chair and/or Dean/Director/Designee has the final authority to negotiate and determine the sale price of the equipment with new institution.
  7. Along with the DPA, the Department Chair, and Dean/Director/Designee, completes Form 110.11F Request for Authorization to Transfer/Sell University Property to a Departing Employee’s New Institution.
    1. Signatures from the Departing Employee, Department Chair, and Dean/Director/Designee represent an agreement to release the equipment to the departing employee’s new institution and attests that the equipment does not contain sensitive data, UW Licenses, or UWProprietary Software. (Examples of sensitive data: UW-Madison Knowledgebase-Protecting University Data.)
  8. After Form 110.11F Request for Authorization to Transfer/Sell University Property to a Departing Employee’s New Institution is completed, the DPA sends the form to Property Control along with the approved list of equipment to be transferred and/or sold to the new institution.
    1. Note: In cases when equipment is to be sold and the selling price exceeds the NBV, please include a justification along with the request form.
  9. Property Control and Research and Sponsored Programs (RSP) reviews the terms and conditions of the grant or contract for restrictions that would prevent the departing employee from taking the equipment.
  10. If restrictions do not exist, Property Control will prepare an Agreement for Transfer/Sale of University Property and will send it, along with a copy of the approved equipment list, to the authorized official at the new institution for signature. Property Control will notify the Departing Employee, Department Chair, DPA and/or Dean/Division/Designee of the action.
    1. If equipment is being sold to the new institution, the sale price will be included in the agreement.
  11. The authorized official of the new institution accepts the terms of the agreement, signs the Agreement for Transfer/Sale of University Property and returns it to Property Control.
    1. Note that the new institution accepts responsibility for all packing, shipping, and insurance costs for the equipment.
  12. Upon receiving the signed Agreement for Transfer/Sale of University Property, Property Control will authorize the departing employee to take or ship the equipment. Property Control will update the asset management system to show retirement of the asset. Property Control will also provide the Departing Employee, DPA, Department Chair and Dean/Director/Designee a copy of the fully-signed agreement.
  13. The DPA or designee must remove and discard the asset barcode tag(s) prior to shipping the equipment.
  14. If equipment was sold to the new institution, the Departing Employee’s UW department financial staff should prepare and send an invoice, along with a copy of the Agreement for Transfer/Sale of University Property, to collect on the sale price of the equipment. The invoice should reference the capital equipment description, amount billed, UW department financial contact, along with an appropriate funding string to which the sales amount should be credited. If necessary, check with your Deans Office for guidance on the appropriate funding string to use. The UW System Chart of Accounts revenue code specifically approved for this type of transaction is account code 9939.

IV. Contact Roles and Responsibilities

wdt_ID Departing Employee Request Departing Employee DPA Dept Chair/ Dept Admin RSP Property Control New Institution Dept Fin Staff
1 1) Notifies Department Chair and DPA of departure and request to take capital equipment to a new institution. X
2 2) Request equipment list from Property Control. X
3 3) Provide list of equipment with NBV to DPA. X
4 4) Provide list of equipment to Department Chair, Dean/Director/Designee and Departing Employee. X
5 5) Confirm all eligibility criteria are met X
6 6) Determine and approve equipment based on criteria related to transferring and/or selling equipment. Sale price determined when applicable. X (provides input) X
7 7) Complete Form 110.11F Request for Authorization to Transfer/Sell University Property to a Departing Employee’s New Institution. X (provides input) X X (provides input)
8 8) Form 110.11F Request for Authorization to Transfer/Sell University Property to a Departing Employee’s New Institution sent to Property Control with list of capital equipment approved for transfer/sale. X X (provides input)
9 9) Funding sources and terms reviewed. X X
10 10) Prepare Agreement for Transfer/Sale of University Property and send to departing employee’s new institution. X

V. Definitions

VI. Related References

VII. Revisions

Procedure Number

110.11

Date Approved

January, 1, 2017

Revision Dates