UW-Madison Administrative Policy
Policy # 703
Cost Transfer Request (Non-Salary) Non-Grant–any fund except 133 and 144 Policy
Effective Date: October 13, 2009
Last Updated: May 2, 2011
Statement of Policy
- 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
- For purposes of this policy, non-salary costs are supplies, consultants, travel, equipment and other non-payroll expenditures.
- This policy applies to non-grant fund Cost Transfer Requests (Non-Salary) only. For grant fund transfers refer to http://www.rsp.wisc.edu/policies/costtransfer/index.html.
- 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).
- 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.
- 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 Journal Entry Tool (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 Request (Non-Salary) using the JET.
- 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.
- The roles and responsibilities of each individual are detailed below:
|wdt_ID||Responsibility||Preparer||First Approver||Second Approver|
|1||1) Generate form|
|4||Update form based on approver's feedback||X|
|6||This transfer is necessary||X|
|7||This transfer is reasonable||X|
|8||The expense is allocable to the funding source to which it will be charged||X|
|9||This transfer is consistent with standard university business practices||X|
|10||This transfer is permissible, given university policies||X|
Additional responsibilities for each role
|1||Preparer||Know and understand the UW cost transfer policy|
|2||Preparer||Generate the transfer request form|
|3||Preparer||Seek support in resolving difficulties with generating transfer requests|
|4||Preparer||Improve the accuracy of transfer request forms in response to feedback from approvers when requested to do so|
|5||First Approver||Know and understand the UW cost transfer policy|
|6||First Approver||Attend training in the non-salary cost transfer approval roles and responsibilities|
|7||First Approver||Determine whether explicit approvals are required from the "owners" of non-sponsored funding sources, and obtain the explicit approvals when necessary|
|8||First Approver||Route each transfer request form to the second approver|
|9||First Approver||Provide feedback to preparers when the accuracy of transfer forms does not meet an acceptable standard of quality|
|10||First Approver||Provide suggestions to preparers regarding strategies for improving the accuracy of transfer forms|
Cost Transfer Requests (Non-Salary) fall under the following record retention schedules. The retention period for Cost Transfer Request (Non-Salary) is the fiscal year of creation + (plus) an additional 6 years for the original record, and thereafter destroy. Duplicate documents should be destroyed when no longer needed. Do not retain duplicates longer than the original record.
Necessary: Transfer is necessary to have costs applied to proper funding; original cost is essential to meet a certain result.
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”?
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.
Permissible: Allowed under UW policies and state law.
See procedures for completing the Cost Transfer Request (Non-Salary).
Who should know this policy?
Deans, Directors, and Staff who prepare non-salary cost transfers
- Cost Transfer Workflow Tool
- Cost Transfer Request (Non-Salary) Non-Grant Form
- Delegation Authority to use JET for Cost Transfer (Non-Salary) Non-Grant
- JET Request for Access Form
- JET Excel File Layout (Excel)
- JET Import Excel Layout (pdf)
- JET Import Text File Layout Specs (PDF)
- Reference Manual for Non-Salary (non-grant) Cost Transfersand the use of JET