Administrative Service Charge Regulation 319

I. Purpose

This regulation applies to administrative service, otherwise known as overhead charges on receipts from items such as sales of supplies, services and rental fees from self-sustained, i.e. institutional trust fund (ITF) budgets. Operating costs have two categories: direct or indirect.

II. Scope

This regulation applies to the academic and administrative functions of the UNCSA campus, except where noted otherwise in this regulation.

III. Definition

Direct Costs are those charged to the benefiting function or organization.

Indirect Costs, also referred to as overhead, are those costs generally applicable to a function, but are not charged directly to that area. Typically, these are costs which benefit more than one self-supporting entity and for which there is no convenient unit of measure to allocate the cost to the benefiting functions.

ITF receipts refer to money that comes in to the university trust funds in the form of cash, check, credit card, electronic funds transfer, etc.

IV. Regulation

The University intends to recover the following types of overhead costs:

A. Institutional Support

This category includes the following:

• Executive management
• Fiscal management and accounting services
• Support services such as data processing, risk management and compliance, payroll, and human resources
• Logistical services such as purchasing and equipment and inventory control
• Support services such as facilities planning, energy management, environmental health and security services

B. Method of Recovering Overhead Costs

• The standard method of recovering overhead costs is by charging a campus-wide rate to the unit's revenue for the services in arrears (i.e. based on the previous year's June 30th receipts).
• Overhead is not charged for the following:
  • Internal billing transactions between campus units
  • During the first year a fund is established
  • Temporary funds
  • Course fees associated with specific courses or departmental special fees
  • Support service functions that are for the benefit of the University's students, faculty, and staff (a list of these can be found on the Budget Office webpage)
• In special cases, and alternative method may be considered by determining a fixed amount of overhead to charge or by direct charging for specific overhead services.

C. Overhead Rates

• Overhead rates are calculated by the Budget Office based on the proportion that the costs to be recovered bear to total University costs
• The calculation produces a University-wide rate which will apply to revenue received by all campus unites unless specific exemptions are provided
• Special rates will be calculated for those units which provide their own overhead services or reimburse the University for those Services

V. Revision History

A. June 13, 2018 - Approved by the Chancellor and Cabinet