Agency Funds                                                                      UPPS No. 03.01.15

                                                                                                Issue No. 1

                                                                                                Effective Date: 11/30/2011

                                                                                                Review: April 1 E5Y

 

 

01.       POLICY STATEMENTS

 

01.01  This UPPS establishes guidelines regarding agency funds held by Texas State University-San Marcos (Texas State). This policy applies to the establishment, maintenance, and use of agency funds by Texas State.

 

01.02  From time to time, Texas State may, if determined to be in its best interest, choose to accept fiduciary responsibility for funds belonging to an external party. When Texas State chooses to accept these funds, Texas State acts solely as a custodian and does not own these funds.

 

01.03  Approval to establish an agency fund is only granted when the funds will be used by the external party for activities consistent with, or in support of, the mission of Texas State. Refer to Section 03. for procedures regarding obtaining approval for establishing an agency fund.

 

01.04  The financial activities of the agency fund may not be complex or voluminous. The associate vice president for Financial Services will work in conjunction with the vice president for Finance and Support Services to determine when an activity is too complex or voluminous to justify acceptance of the agency funds. Refer to Section 04. for limitations on the financial activities of agency funds.

 

01.05  Texas State will file any required IRS Forms 1099 associated with payments made by Texas State as a third party processor on behalf of the external party. The external party is otherwise entirely responsible for any tax and regulatory compliance and filings.

 

01.06  Texas State will not issue gift receipts for donations to agency funds. For additional guidance, consult with Donor Services in the University Advancement division.

 

01.07  Texas State will report the cash held for the external party and a related liability on Texas State’s general ledger and financial statements. Any additional financial reporting or audit requirements of the independent organization are entirely the responsibility of the independent organization.

 

01.08  Agency funds will not act as nor hold their external party out as a component of or an agent of Texas State. All assets and liabilities related to the operations of the independent organization belong to and are the responsibility of the external party.

 

01.09  Agency funds may not utilize Texas State’s federal tax identification number, other than as outlined in Section 01.05.

 

02.       DEFINITIONS

 

02.01  Agency Funds: Resources held by Texas State as a custodian or fiscal agent for others, such as student organizations, professional associations, faculty or staff organizations, or individual faculty or staff members. Agency funds have only assets and liabilities and do not generate fund balances. Although these funds are spent consistent with or in support of the mission of Texas State, they are not available to support Texas State’s programs.

 

02.02  Agency Fund Transactions: Charges or credits to the individual asset and liability accounts that are not included in the revenues and expenses of Texas State.

 

02.03  External Party: An entity that is legally separate from Texas State, acts on its own behalf, is not controlled by Texas State, and is funded from sources other than Texas State. The entity may or may not have a taxpayer identification number.

 

03.       PROCEDURES FOR ESTABLISHING AN AGENCY FUND

 

03.01  Requests for a new agency fund are initiated by completing the appropriate form maintained on the FI Master Data Center’s Web site. Contact the FI Master Data Center for assistance with determining the correct form to utilize.

 

03.02  The completed form and supporting documentation must be approved by one of the following: the requestor’s divisional cabinet officer, an academic dean, or the dean of Students. Additionally, the General Accounting Office (director of Accounting), the associate vice president for Financial Services, and the vice president for Finance and Support Services must approve the request.

 

03.03  In no case should the funds of an external party be co-mingled with funds in another Texas State account.

 

03.04  An account manager will be assigned to each agency account. The account manager must be a faculty or staff employee of Texas State. The account manager must approve each request for payment made from the agency account and will be responsible for ensuring that all expenditures are made in accordance with the policies or guidelines established by the external party.

 

04.       FINANCIAL ACTIVITIES OF AGENCY FUNDS

 

04.01  The financial activities of agency funds should be limited to occasional deposits and occasional disbursements.

 

04.02  Agency funds may only process reimbursements of expenditures made on behalf of the external party or payments to a vendor on behalf of the external party. Disbursements are requested on Form AP-10.

 

04.03  Agency funds are not authorized to utilize Texas State’s purchasing systems. No SAP requisitions, BOBCATalog orders, TravelTracks authorizations or reimbursements, purchasing card transactions, or these systems’ successors will be processed for an agency fund.

 

04.04  Agency funds may not obtain a purchasing card (P-card) from Texas State.

 

04.05  Agency funds may not make payment of salaries or benefits.

 

04.06  Transfers between Texas State accounts and agency funds, other than internal transfers (IDTs) to record payment for goods or services and internal transfers to record donations from the agency fund to a university account, are prohibited. Donations from agency funds become university funds and are subject to university policy and procedure regarding the expenditure of the funds.

 

05.       REVIEWERS OF THIS UPPS

 

05.01  Reviewers of this UPPS include the following:

 

Position                                                         Date

 

Associate Vice President for Financial    April 1 E5Y

Services

 

Director, Accounting                                   April 1 E5Y

 

Director, Payroll and Tax Compliance     April 1 E5Y

 

Director, Purchasing                                   April 1 E5Y

 

Director, Student Business Services       April 1 E5Y

 

06.       CERTIFICATION STATEMENT

 

This UPPS has been approved by the following individuals in their official capacities and represents Texas State policy and procedure from the date of this document until superseded.

 

Associate Vice President for Financial Services; senior reviewer of this UPPS

 

Vice President for Finance and Support Services

 

President