Fiscal Operations Manual
Section 500: Financial Accounting and Analysis
WARNING: THESE ARE NOT CURRENT POLICIES!!
The 1xxxxx series of funds (Fund Type 2x) are used to account for self-supporting activities of auxiliary enterprises. An auxiliary enterprise exists to furnish goods or services to students, faculty, or staff as individuals and charges a fee directly related to the cost of the goods or services. Auxiliaries may also furnish services incidentally to the general public.
An auxiliary enterprise:
is responsible for its own equipment depreciation.
maintains a reserve for equipment replacement.
is responsible for its own buildings, including utilities and maintenance.
maintains a reserve for major building renovations.
Auxiliary funds are accounted for in the Other Funds Non-Limited category of the OSU legislative budget.
OSU auxiliaries include:
University Housing and Dining
Student Centers, including the Memorial Union & Dixon Recreation Center
Student Health Services
Hatfield Marine Science Center Bookstore
LaSells Stewart Center
Agriculture Experiment Station housing rentals
All costs related to the operation of the auxiliary enterprise activity should be recorded in the fund. This includes salaries & OPE (including unit administrative costs), supplies, minor equipment, travel, equipment depreciation, building utilities/operations & maintenance, and building depreciation.
Auxiliaries who purchase goods for resale must reconcile their inventories at least annually and make the necessary adjusting entries.
Capital equipment is recorded as an asset of the auxiliary, not an operating expense. Only the annual depreciation is recorded as an expense.
Auxiliary enterprises are subject to an institutional administrative overhead on all expenditures, exclusive of transfers and depreciation. The administrative overhead charge is posted as account code 28204 General Admin Overhead Charge. See OSU Assessments – FIS 504.
Fees should be developed to cover all costs of the auxiliary enterprise. There may be multiple services and fees associated with one fund. Fees to Internal customers may not include unallowable costs such as marketing or advertising.
Auxiliaries are the only units that may charge internally for ‘rental of buildings or land’.
The exception: Intercollegiate Athletics cannot charge academic or administrative units for use of their facilities because OSU E&G funds pay for a portion of the costs. See IMD 8.016(3) Proportionate Financing of Joint Use Facilities.
The fees must be published in either the OSU External Fee Book or Internal Fee Book, as appropriate, before they may be charged. See FIS 519 Recharge Activities for greater detail in calculating fees.
All cash deposited in Auxiliary funds is to carry an income Account Code (06XXX). Cash received as a gift is not to be deposited in these funds. See FIS 102-05: Gift, Grant, and Contract Income.
Use internal sales Account Code (09XXX) for non-cash activities. When both sides of the transaction are Auxiliary funds use 79XXX as the credit account code. These are completed by Journal Voucher. See FIS 1107 Journal Vouchers.
Any auxiliary enterprise with a current deficit must present an action plan for elimination of the deficit at fiscal year-end to the Director of Financial Accounting and Analysis (FA&A). The Director of FA&A will review the plan and forward it to the Vice President for Finance and Administration or his/her designee for approval.
Auxiliary Enterprises, as self-sustaining organizations, must also set aside funds for the replacement and repair of their equipment and buildings in accordance with FIS 703 Administration of Auxiliary Reserve Funds. Plans should set targets for funding levels and contributions to the reserve fund. These plans are submitted to the Director of FA&A in Business Affairs by April 30th of each fiscal year after completion of the unit budgeting process. Auxiliary reserve funds are interest-bearing funds and earnings should be considered when developing the funding and expenditure plans for the reserve.
For external (cash) transactions, documentation of fee, calculation, billing, and receipts should be maintained for three (3) years.
For internal (journal voucher) transactions, documentation of fee, calculation, and billing must be maintained for eight (8) years because these may involve charges to federal grants or contracts.