Indicate, Charge, and Record
The service centers must distinguish between internal and external customers based on the origin of funds utilized for transactions. Internal customers typically utilize the university system payment method of a C-FOP. External customers commonly use cash, credit cards, or checks for their transactions. This differentiation ensures efficient processing and appropriate handling of payments within the service center's operations as well as correct rate charging.
External customers are charged the fully costed rate plus the applicable Facilities and Administrative (F&A) rate. This practice guarantees that internal customers, such as grant projects and other sponsored funds, are not subsidizing the overhead costs that should rightfully be covered by external customers. (F&A is later assessed on service rates charged to sponsored projects). By ensuring accurate cost recovery, the service center maintains fairness and transparency in its financial operations, safeguarding the integrity of internal funding allocations.
Once the factors distinguishing internal from external customers are determined and charges are applied accordingly, it is imperative to record any excess revenue generated from these transactions accurately. This involves assigning the appropriate account code to ensure transparency and accountability in financial reporting. This can be successfully completed by using 307921: Revenue from Incremental Upcharges to External Customers for Overhead Expenses.
Determine (Indicate): |
Internal | External |
C-FOP | Cash, Check, Credit Card |
Rates (Charge): |
An assessed internal rate | An assessed fully costed rate plus the applicable F&A rate added on |
Revenue (Record): |
307920: Service and Storeroom Activities Revenue | 307920: Service and Storeroom Activities Revenue (internal portion only) |
| 307921: Revenue from Incremental Upcharges to External Customers for Overhead Expenses |
