As explained in Topic Overview: Fund Types, the university receives funding from a variety of sources, including donor gifts, government and non-government sponsored research, and tuition.
Because these sources typically have different terms and restrictions, each unique source must be tracked in a separate fund.
Fund transfers are used to move funding from one of these sources to a destination PTA on which expenses are being charged that are appropriate to be covered by the source PTA.
Fund transfers move money from one account (project-task-award or PTA) to another PTA. Fund transfers should be used when expenses (or charges) will be recorded on one award and the money to pay for the expense (or charge) comes from a different award. This approach aligns the expenses and funding and is effective when:
- The funding provided will be spent at the discretion of another unit.
- Responsibility for the expense transactions will be borne by a different unit.
- Comprehensive reporting of an activity is desired without spreading the expenses across multiple funding awards.
Expense transfers move expenses from one account or PTA to another PTA after they are posted on a fund statement. Expense transfers are generally used to transfer expenses that were charged to the wrong PTA. Expenses should be charged to the activity (or PTA) that they support. Refer to System: iJournals for more information.
Any time money is moved between funds, it is critical to be aware of the restrictions on the respective funds to avoid commingling funds with different purposes or restrictions. Refer to Topic Overview: Fund Types and Policy: Proper Use of Funds for more information.
To comply with certain fund restrictions, the university has embedded business rules in its financial system to enable only allowable fund transfers to occur. See Allowable Transfers and ISC section below.
In all transfers, the journal justification field should contain the WHO, WHAT, WHERE, WHY, WHEN information, just like entering a business purpose in other transactions. This field should contain sufficient information so that the reader can understand the purpose and appropriateness of the transaction and know where to find additional information (the full journal entry and/or fund authorizations).
- WHO - requested the transfer
- WHAT - will the transfer support
- WHERE - did the transfer go
- WHY - was the transfer needed
- WHEN - was the transfer done
Including a robust description on the journal transfer helps those reviewing the transactions have an understanding of the complete activity.
Transfers are only allowed between specific fund types and they may incur infrastructure charges (ISC) depending on the combination of from and to awards. The full amount of the transfer request is moved and the ISC is charged as an additional amount on the from award. Refer to the table below for general application of these relationships. Refer to Burdening for more specific information about application of ISC.
| To: Operating Budget | To: Designated | To: Endowment | To: Expendable Gift | To: Univ Research Cost Sharing | |
|---|---|---|---|---|---|
| From: Operating Budget | Allowed No ISC | Allowed No ISC | Not Allowed | Not Allowed | Allowed No ISC |
| From: Designated | Allowed No ISC | Allowed No ISC | Not Allowed | Not Allowed | Allowed No ISC |
| From: Endowment | Allowed ISC Charged | Not Allowed No ISC* | Not Allowed | Allowed No ISC | Allowed ISC Charged |
| From: Expendable Gift | Allowed ISC Charged | Not Allowed | Not Allowed | Allowed No ISC | Allowed ISC Charged |
*Designated revenue can be used to purchase Fund Functioning as Endowment (FFE)
Many schools and departments centralize the management of fund transfers. To comply with certain fund restrictions, the university has embedded business rules in its financial system to enable only allowable fund transfers to occur. See Allowable Transfers and ISC section above.
- Fund transfers can be initiated internally or can be performed by Fund Accounting. See How To: Request a Fund Transfer.
- Select schools and units with authority can initiate a bulk fund transfer. See How To: Upload a Bulk Fund Transfer in iJournals.
For questions about non-sponsored fund transfers, refer to Contacts for Non-Sponsored Funding by School/Department.
