Overview
This article will describe when and how campus units will record Departmental Support Differential Income.
For Fiscal Year 2023-24, Differential Income will be recorded using Account 773002 - Department Tax
Critical Concepts
- Differential Income Rate is the overhead cost recovery rate applied to sales of goods or services to non-University individuals or entities only
- Use OFC Fund 12200 Ext Sales Diff Income to accumulate and separate the additional overhead rate for campus administration from Operating Funds
- Not all Recharge Operations will have a Differential Income Fund
- Track Differential Income via Tasks in Projects created for Recharge Operations, refer to KBA How to Set Up a Recharge Operation in PPM
- Refer to your Vice Chancellor for rate and requirements as the rate can vary per operation
- The department’s Financial Manager is responsible for submitting the Departmental Support Differential Income entries
- Exception is for departments in VCHS, where VCHS will centrally process the Departmental Differential Income and departments do not need to submit for their Recharge Operations
- The Differential Income must be posted in the same Fiscal Year that the Income is received
- For more information, refer to Blink Overhead Cost Recovery - Differential Income
- Effective Fiscal Year 2020/21, Campus will assess Sales and Service Activities (SSAs) Central Administration's portion of Differential Income
- Central Administration portion of Differential Income is currently only posting in General Ledger
- Departmental Support portion of Differential Income can post in PPM and then flow into the General Ledger
- Each Vice Chancellor area may also require a minimum Differential Income portion to be remitted, consult your Vice Chancellor’s office for more information
Application
- There are several SSAs that require recording of Differential Income
- Use the same process in the steps below for the following Funds, replacing the Recharge Operating Fund with the appropriate Fund that has Differential Income
- Examples of Funds that have Differential Income include:
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OFC Fund Number
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OFC Fund Name
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12100
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Recharge Operating Fund
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12304
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Misc Sale of Goods/Svcs Fund
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12316
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SOM-Housestaff/Resident Costs
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15006
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Lab Service Agreement
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Steps to Take
For Recharge Operations
The API that is being used to do ongoing recharge transactions will need to be used to transfer between the Recharge Operating Fund (OFC Fund 12100) to the Differential Income Fund, Ext Sales Diff Income (Fund 12200)
a. Use PPM Expenditure Type 774010 - Differential Income Transfer to Reserve (starting Fiscal Year 2023-24 Campus Departments will use PPM Expenditure Type 773002 - Department Tax) to transfer between Recharge Operating Fund (OFC Fund 12100) to the Differential Income Fund, Ext Sales Diff Income (Fund 12200)
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- Debit the Operating Fund (Fund 12100) on the Recharge Project
- Credit the Ext Sales Diff Income (Fund 12200)
Account 774010 - Differential Income Transfer to Reserve (starting Fiscal Year 2023-24 Campus Departments will use PPM Expenditure Type 773002 - Department Tax) needs to be used to process the Debit and the Credit of the transfer to have a net impact on the Account as zero
For Operations that are transacting on the RMP Recharge Application:
- Use the RMP Import Template for Differential Income - update Expenditure Type for Fiscal Year End 2023-24 to 773002 - Department Tax
- Follow the guidelines in How to Process Transactions in the RMP Recharge Application with attention to step 9 and 10
If your API can not be configured to process the above transaction, submit a request to get access to the RMP Recharge Application to process Differential Income.