UC Davis Finance Glossary
| Term | Definition |
|---|---|
| Accountability | An obligation or willingness to accept responsibility or to furnish a justifying analysis or explanation for ones actions. |
| Accounting | A system for collecting, summarizing, analyzing and reporting, in monetary terms, information about an organization primarily for management purposes. Some requirements are established by law or directives of state and federal agencies. |
| Accounts Payable (AP) | A system which integrates department and vendor information with purchasing, general ledger, capital asset management and departmental systems with the purpose of making payments to suppliers on behalf of the university. |
| Accruals | The fiscal recording of items pertaining to a current period which would not have appeared on the General Ledger until a future period in the normal course of payment or receipt of the items. |
| Ad Hoc |
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| Add-on | Tangible items which are not complete in themselves, and are attached to a capitalized equipment item (item with an original acquisition value of $5000 or higher). Add-on parts must have a value of $5000 or more, and increase the value or useful life of a UC-owned equipment item. |
| Agreement | A contract duly executed and legally binding as affected by applicable rules of law. The university engages in commodity agreements and price schedule agreements. |
| Appropriation |
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| Approval Authority | The authority, either by virtue of a person's appointment as department head or by re-delegation to departmental representatives, to formally give permission to process a transaction. Chart string approvers and PPM managers may or may not be the ultimate approval authority for a transaction. In cases where they are not the ultimate approval authority, formal authorization for a transaction must be documented. See PPM 330-10 for details. |
| Asset Custodial Code | The four-digit number assigned to a specific department for asset-tracking purposes. Many departments have 2 custodial codes: one for assets used for teaching, and one for assets used for research. Some departments set up additional custodial codes to track assets by Principal Investigator (PI). |
| Asset Representative | The asset representative is the UC Davis employee assigned to and responsible for the physical inventory of the assets for an asset custodial code. |
| Audit | The examination of documents or records to determine the propriety, legality and accuracy of transactions recorded, or to be recorded, in accounts. |
| Auxiliary Enterprise | Self-supporting activities which provide non-instructional support in the form of goods and services to students, faculty, and staff upon payment of a specific user charge or fee for the goods and services provided (e.g. Student Housing, Transportation Services). The general public may be served only incidentally. |
| Award | An award is an agreement between a sponsor and the university for support of research, scholarly or professional training, or public service programs related to research or to scholarly or professional training. |
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| Term | Definition |
|---|---|
| Bank Draft | This is a check drawn on a bank in a foreign country in a foreign currency and mailed from Accounts Payable. |
| Base Budget | A base budget (permanent budget) is established for those functions that require a long-term financial commitment or have a long-term impact on the fiscal operations of the university (e.g., general funds, student fees, self-supporting funds). Funds in the base budget are automatically reallocated at the start of each fiscal year. The base budget rolls forward every year and is the starting point for that year's current operating budget. |
| Blanket Order | A Blanket Order is an "open" Purchase Order where a department contracts with a vendor to provide item(s), and/or service(s), on an "as required" and frequent basis. In general, a Blanket Order is for a total amount of $10K or higher, and for a time period of a year or longer. Such agreements have a limit on the period of time for which they are valid, and the amount of money that can be spent in that time. Blanket Order requests are established on a Requisition document in Aggie Enterprise. |
| Budget | A financial plan that estimates the costs of conducting future activities. The budget is intended to express the program objectives and how they will be carried out in terms of resources required. |
| Budget Adjustment | The act of amending the budget by moving funds from one category or line item to another |
| Budget Period | The intervals of time into which a multi-year project period is divided for budgetary/funding purposes. |
| Budget Review | Periodic review for each major unit headed by a Dean or Vice Chancellor, where the campus leadership and a Dean or Vice Chancellor discuss funding issues, program priorities and faculty recruitment needs. |
| Budgetary Savings | Annual budget reductions required to balance the university's budget. Since these are not permanent reductions, the targets can sometimes be achieved by current year salary savings or by reducing purchases. |
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| Term | Definition |
|---|---|
| Campus Assessment | An indirect cost surcharge to income derived from sales of goods and services to non-university customers. Campus assessment and the Non-University Differential (NUD) are not charged against the same income. |
| Campus Investment Fund | A fund managed by the Office of Resource Management and Planning that is directed to campus priorities. |
| Capital Asset | A capital asset, also known as university equipment, is defined by the university in Policy & Procedure Manual (PPM) 350-50 as:
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| Capital Asset Management (CAMS) | The module in the university financial system used for the financial accounting and physical tracking of university equipment. |
| Capital Budget | Budget for capital assets and infrastructure such as facilities, renovation, and certain equipment |
| Categorical Funding | Allocations that are required to be spent in a particular way or for a designated program (e.g., K-12 Outreach, Tobacco Research). |
| Certifier | In the General Ledger Review process, the person who certifies that charges and credits are valid. |
| Chart of Accounts (COA) | A code which represents the rules, policies and regulations under which organizations function. |
| Contract | An agreement between two or more entities which creates an obligation to do (or not do) a particular thing one is otherwise entitled to do (or not do). To be legally enforceable, a contract must have subject, consideration, and competent parties. |
| Core Funds | Funds which represent the basic core of financial resources required by the University to accomplish its assigned missions and generally includes State general funds, University general funds, permanently budgeted indirect cost funds, and registration fee funds. |
| Credit | An increase in income or a decrease in expense. For balance sheet accounts, an increase in fund balances or liabilities, or a decrease in asset accounts. |
| Current Budget | A unit's budget for the current fiscal year. Year-end balances (surplus or deficit) in the current budget are re-appropriated to the next fiscal year. Carry-forward re-appropriations are combined with the base budget (if applicable) to provide the beginning current year budget at the start of each fiscal year. |
| Current Funds | Funds expended for current operating purposes as contrasted to Retirement Funds, Loan Funds, Endowment Funds or Plan Funds. |
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| Term | Definition |
|---|---|
| Effort | Effort is the portion of time spent on a particular activity expressed as a percentage of the individual's total activity for the institution. Effort reporting certifications are processed in the Effort Reporting System. |
| Encumbrance | A firm commitment or obligation placed against funds of a department, in the form of purchase orders or agreements, to cover a later expenditure required when goods are delivered or services are rendered. |
| Endowment Funds | Funds for which a donor has stipulated, as a condition of a gift, that the principal is to remain intact and only the income from investment of the funds may be expended. |
| Equipment | Capital Asset |
| Expenditures (Expense) | The cost of goods delivered, or services rendered, which are recorded as charges to the accounts of an activity or department. |
| Extramural Funds | Funds (not regularly budgeted) received under grants, donations, or contracts from sources (private, state, federal, etc. ) outside the university. |
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| Term | Definition |
|---|---|
| General Assistance (GA) | Usually used to budget and disburse student, overtime, and some casual employee's salaries. |
| General Funds | Funds provided by the State of California through the annual State Budget act. |
| General Ledger Engine (GLE) | A system computer that processes and permanently maintains the university's financial data. |
| Generally Accepted Accounting Principles (GAAP) | Uniform minimum standards of and guidelines to financial accounting and reporting. Currently, the Financial Accounting Standards Board (FASB), the Governmental Accounting Standards Board (GASB) and the Federal Accounting Standards Advisory are authorized to establish these principles. The UC system complies with GASB. |
| Gift | Gifts are funds donated irrevocably for unrestricted or designated purposes by extramural individuals or organizations. Unlike sales and services activities, gifts do not involve contractual consideration - such as tangible property, intellectual property rights, or specified services---provided to the donors by the university. |
| Grant | Federal assistance award authorized by federal law to support programs which the government wishes to encourage and accomplishes a public purpose. |
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| Term | Definition |
|---|---|
| Income | The payment for goods or services from a university client who does not have a UC expenditure account or from a non-university client. |
| Incremental Budgeting | An approach to budgeting that adjusts funding incrementally based on the prior year's budget. Example: range and merit allocations are provided as an increment of the prior year's base budget for staff salaries. |
| Independent Consultant | An independent consultant is an individual or organization outside the university with proven professional and technical competence who provides primarily technical or professional advice to the university in an independent contractor relationship. The end product is usually a written or oral report, study, design, or set of recommendations. Consultants are vendors who provide professional services over which the University has neither the right to control the manner of performance nor the results of the service. |
| Independent Contractor | An independent contractor relationship is a relationship in which the university controls only the results of the service, not the manner of its performance. |
| Indirect Costs | The costs of conducting business that are incurred for common or joint objectives and therefore cannot be identified readily and specifically with particular projects (such as individual grants or contracts) or with a specific activity (such as instruction, research, public service). For purposes of charging federal grants, UC Davis negotiates Facilities and Administrative (F&A) cost rates with the Department of Health and Human Services. There are two negotiated rates:
For a recharge activity, indirect costs are collected from non-university clients, through assessing the non-university differential (NUD). |
| Intercampus | A transaction taking place between UC campuses, such as an intercampus transfer of equipment from the English Department at UC Davis to the English Department at UC Berkeley. |
| Intracampus | A transaction taking place between units at the same campus, such as an intracampus loan of equipment from the UCD English Department to the UCD Mathematics Department. |
| Inventorial Equipment | Asset |
| Invoice (Vendor) | A request for payment (bill) from a vendor for specific materials or supplies furnished or services rendered to the University. |
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| Term | Definition |
|---|---|
| Journal Entry | A means to record in the accounting records equal debit and credit entries between sub-budgets or account/funds. |
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| Term | Definition |
|---|---|
| Ledger | The basic and official accounting record of all financial transactions recorded under each revenue, expenditure and balance sheet account. |
| Legacy System | The previous accounting system. Often used to refer to older systems. |
| Lien | Encumbrance |
| Log | To record progress or activity. |
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| Term | Definition |
|---|---|
| Maintenance Documents | Computer screens used for the setup and maintenance of data stored in the system reference tables (e. g. account, organization, etc. ). |
| Mark-up | For a recharge activity, a charge that is in addition to the direct and indirect costs of providing the good or service. A mark-up is only allowed for a sale to a non-university client. |
| Moving Expenses | Reasonable costs of moving household goods and personal effects to a new residence. Such expenses also include the cost of travel to the university location for the individual and his/her immediate family. These expenses are incurred by a new appointee or by a current employee who transfers to a new university location. |
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| Term | Definition |
|---|---|
| OMB Circular A-21 | Defines direct and indirect costs for purposes of accounting for federal funds. |
| Operating Budget | Budget for current and on-going operations, as well as one-time costs that result in the day-to-day business of a University department. |
| Overdraft | A circumstance where expenditures and/or encumbrance exceed the amount of funds appropriated in a particular account/fund/sub-budget. |
| Overhead | Indirect Costs |
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| Term | Definition |
|---|---|
| Rate Group | A standing committee, titled Professional Staff Rate and Service Activity Group, that reviews and recommends approval or disapproval of specified recharge activity rate proposals to the Assistant Vice Chancellor, Budget Resource Management. The committee membership includes representatives from Finance and Business and various campus academic and administrative units. |
| Reasonable Costs | Costs that are reasonable under the circumstances of a particular move. Specifically, a move from the old to the new residence is made via a conventional mode of transportation using the shortest and most direct route available and in the shortest period of time normally required to travel such a distance. |
| Rebudget | The act of amending the budget by moving funds from one category or line item to another. |
| Receipts | Cash received. |
| Recharge | The assessment and collection by one university department of a charge to recover the direct costs of providing goods or services to another university department. |
| Recharge Activity | An activity that provides a specific, ongoing and repetitive good or service to a number of campus units or projects and recovers the cost of providing the good or service from the unit served on a fee basis. |
| Recharge Rate | For a recharge activity, the unit price for a good or service, based on an approved, established, standard pricing method. |
| Refund | To return money in restitution, repayment, or balancing of accounts. |
| Reimbursement | A repayment, commonly for out-of-pocket expenses incurred by an employee, such as for travel. Also refers to payment by agencies to the University for costs incurred under contracts. |
| Relocation Allowance | These payments are intended to offset higher living costs in a new location; they are not intended to reimburse or offset the actual or presumed costs of moving from one location to another. The total value of such payments may not exceed 25% of an appointee's annualized base salary. Payment is generally made monthly over a four-year period. Eligibility is limited to individuals who, at the time of recruitment, are not employed by The University of California and who reside outside the State of California. |
| Removal Expense | Moving expenses incurred, usually by an academic appointee, in accepting employment at the University. |
| Report (Financial) | A formal accounting to a granting agency, donor or higher authority of how funds were spent. |
| Reserve for Equipment | In support of a recharge activity, the type of reserve used to accumulate funds, contributed to the fund via a depreciation schedule, for purposes of purchasing replacement equipment (for equipment included in the official depreciation schedule). |
| Reserve for Improvement (RFI) | In support of a recharge activity, accumulation of contributions for approved purposes that exceed the purposes of the Reserve for Equipment (Reserve for Renewal and Replacement). This is an unallowable cost for federal clients. |
| Reserve for Renewal and Replacement | Reserve for Equipment |
| Restricted Funds | Funds, the use of which must be made in accordance with restrictions, directions, or instructions placed on them by donors or outside agencies. |
| Revenue | Inflow of funds from sales, services, fees, gifts, or other sources. Two types of revenue are recorded in the university financial system: recharge and income. |
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| Term | Definition |
|---|---|
| S&E | An abbreviation for supplies and expense. |
| Sales and Services of Educational Activity | A recharge activity operated by an academic department, that provides on a regular and continuing basis, at approved rates, goods or services to clients in connection with the training of students or support of research activities. |
| Sales Tax | A tax levied by the State on sales of tangible personal property which is not for resale. UCD pays sales tax on taxable purchases directly to California vendors or out-of-state vendors registered with the State Board of Equalization. |
| Scholarship | An award based on academic excellence, exceptional promise or financial need. Usually awarded to undergraduate students. |
| Separation of Duties | A practice in that no one person has complete control over any financial transaction. Each person's work should routinely serve as a complementary check on another's work. |
| Service Department | A University department which supplies goods or services to other departments, such as Bulk Mail, Storehouse, Reprographic Services, etc. Costs incurred for these goods or services are recharged to the departments using them. |
| Short Term Investment Pool (STIP) | A cash investment pool available to all UC fund groups. STIP allows fund participants to maximize the returns on their short-term cash balances by taking advantage of the economies of scale of investing in a larger pool. STIP consists primarily of current funds slated for payroll and operating/construction expenses for all UC campuses and medical centers. In addition, funds awaiting permanent investment in one of the long-term pools are invested in STIP to earn maximum daily interest until transferred. The term STIP also refers to the interest income generated by the Short-Term Investment Pool. |
| Sign-on Bonus | Additional payment sometimes made to new employees with unique, critical skills or for critical occupations where there is a documented shortage in the labor market and recruitment or retention difficulty exists. Sign-on bonuses are generally considered for the highest level staff positions and MSP positions and are only considered in rare circumstances. The non-base building bonus can be any amount up to no more than 20% of the annual salary for the position. The bonus will generally be made in two payments. The first payment will be made when the employee reports to work. The subsequent payment will be made at the discretion of the hiring manager, as long as the employee is performing satisfactorily or above at the time of payout and is still employed in the same position. A sign-on bonus agreement with a specific payback provision clause must be prepared and signed by all parties. |
| Sponsor | The organization or entity that funds a research project. |
| Sponsored Projects | Projects which are funded by outside sources as the result of a proposal and award. The term commonly refers to projects funded by the various federal agencies. |
| Staffing List | A listing by department of all academic and staff positions and provisions (all funding); used by departments to align their base budgets with their actual staff & faculty salary commitments. |
| Stipend | For career staff, a regular or fixed payment made to an individual in recognition of added responsibility. For graduate students, a non-compensatory payment for the student to use in payment of living expenses and other costs of attendance unrelated to tuition and fee payment. |
| Strategic Planning | An approach to long-term planning that aligns the unit's mission with its specific courses of action and results measurements. |
| Supply | Generally, a supply item is classified as being expendable, with an acquisition value under the inventorial equipment threshold of $5000.00, and a normal life expectancy of under a year. |
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| Term | Definition |
|---|---|
| UCOP Tag Number | The number assigned to an asset.
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| Unallocated Funds | Funds held temporarily in suspense (not available for use) pending final allocation. |
| University Client | For purposes of purchasing a good or service provided by a campus recharge activity, a university client is:
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| Unrestricted Funds | Funds, the use of which is directed by the Regents or the Chancellor. |
| Use Tax | UCD pays use tax on taxable purchases directly to the California State Board of Equalization, rather than to the vendor. Use tax generally applies to out-of-state vendors who are not registered with the California State Board of Equalization. |
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