FAQ: Cost Transfers, Recharges and Fund Balance Transfer
This article will provide answers to frequently asked questions intended to help distinguish between Cost Transfers, Recharges, Fund balance and Fund balance transfer.
- A Cost Transfer is a cost distribution where costs (expenses) that have already posted in the system need to be moved
- Project Portfolio Management (PPM) is a module in Oracle, primarily used for tracking and reporting expenses
- In IFIS there were two ledger references:
- General Ledger (Assets and Liabilities)
- Operating Ledger (Revenues and Expenses)
- In Oracle, the General Ledger (GL) encompasses both IFIS ledgers
- PPM is a subledger and pushes/feeds data into Oracle’s GL
- PPM is designed for tracking expenses and is not the same as IFIS Operating Ledger
- Recharges in the article refer to approved/true Recharges, these Recharges go through Costing Policy & Analysis (CP&A) and have approved rates applied to costs
Q: What is the difference between a Cost Transfer and a Recharge?
- A Recharge is when one department provides services/products for a fee to another department within UCSD
- The department providing the service/product will have recharge cost recovery, sometimes referred to as internal revenue or recharge income
- Overall for the campus, recharge transactions must have a zero impact on revenue/expenses as it will be a credit (cost recovery or a negative expense) for one department and debit (expense) for the purchasing department
- A Cost Transfer is when there is a need to change where expenses have already been posted, in either the same or different department, Project or Task
Q: How do you perform a Cost Transfer in Oracle?
Q: What form should I use for Recharges?
Q: Is a Fund Balance Transfer in PPM the same as a Cost Transfer?
- No, Expenditure Type in PPM derives from the Account segment value in the CoA
- Fund Balance Transfer is the title/name of an Account in CoA and Expenditure Type in PPM
- Cost Transfer is when there is a change in the distribution of an expense
Q: Are costs from IFIS converted in PPM by Expenditure Type?
- It depends on if the converted Project is a Sponsored Project or a General Project
- For Sponsored Projects, IFIS costs were converted by Expenditure Type
- For General Projects, only the ending balance was converted into Oracle, which is found in PPM under 774009 Fund Balance Transfer. As of May 2021, these transactions were removed from PPM and the balances remained in the GL.
Q: What does a Fund Balance Transfer in PPM mean?
As of May 2021, this is not in PPM, but is in this KBA as a reference for legacy transactions
- In PPM, 774009 Fund Balance Transfer was a reference to IFIS’s converted ending balance of Indexes to a General Project in PPM
- If an Index did not convert to a General Project or did not have a balance, it will not have a Fund Balance Transfer in PPM Expenditure Type 774009
- As a result of conversion, Expenditure Type 774009 was the starting balance in PPM because it is the ending balance in IFIS
Q: How do I move prior year's expense on a General Project?
- There are two key components in this question 1) General Project and 2) prior year's expense
- For this, a Fund Balance must be moved
- As of November 2020, the Fund Balance Transfer will only be done in GL
- This will also align with Budget Office allocation
- PPM 774009 will no longer be adjusted and it will be used as a conversion reference only, this is to avoid any further inconsistencies in PPM reporting
Q: How is account 300000 Fund Balance different from 774009 Fund Balance Transfer?
- Account 300000 is an Equity account that is a part of the GL
- At the end of the fiscal year, the net of revenues and expenses for a Fund per its chart string is debited/credited to the beginning of year Account 300000 Fund Balance
- Expenditure Type 774009 Fund Balance Transfer was in PPM and is a reflection of a beginning Balance in 300000 Fund Balance on July 1, 2020. As of May 2021, this no longer resides in PPM. 0
- The use of 774009 in PPM was a one-time entry for conversion purposes
- Account 300000 is an accumulated Fund Balance that will be updated at the end of the fiscal year
- Therefore, at the end of Fiscal Year 2020, account 300000 will be updated by taking the associated balance from 774009, subtracting expenses, and adding revenue to get to the ending Balance in 300000
- Account 774009 is the beginning Balance for 2020 because it is the converted amount from IFIS
- In future years, the net of revenues and expenses will be added to account 300000 at the end of the year
- Instructions on How to Check Starting Balance in PPM
Q: How can I do a Fund Balance Transfer for account 774009?
- Submit a Resource Transfer Request
- The Transfer tool can only be used within the same Fund for now
- If you have multiple Fund Balance Transfer requests, but the Transfer is within the same Fund and Financial Unit, you can submit one request and attach Transfer details in the case
- If the transfer involves multiple Funds and Financial Units, you will need to submit separate cases
Q: How will reappropriation of the Fund Balance occur in Oracle?
- Reappropriation will not occur in Oracle
- At conversion, ending Balances in IFIS converted to Fund Balance by Entity/Fund/Financial Unit
- In IFIS the 2019/2020 year end close out process was the same where net position closed out to Fund Balance and then reappropriation occurred
- This process will not happen in Oracle
- Instead, at year end account 300000 Fund Balance will be updated for net position, see question above regarding account 300000
Q: Where is the IFIS Index balance located?
A: Account 300000 Fund Balance, review the 3 questions above
Q: Can I transfer revenue, resources or funds from one department to another using Cost Transfer?
- No, because Cost Transfers are only for expenses
- It can be from different departments or within the same department, but must be a transfer of expenses, not revenues
Q: Can I move expenses from one Project/Task to a different Project/Task with a Cost Transfer?
A: Yes, this is a Cost Transfer and can be done in PPM
Q: Can I change the Expenditure Type in PPM with a Cost Transfer?
A: No, the Expenditure Type in a Cost Transfer must stay the same
Q: How can I change the Expenditure Type in PPM?
- This type of request is not a Cost Transfer
- A Cost Transfer keeps the costs within the same Expenditure Type as the expense is being allocated somewhere else
- If you need to change the Expenditure type,
- First request to reverse the existing charge in the current Expenditure Type
- Then request to post the expense in the correct POET with the correct Expenditure Type
Q: Are all Cost Transfers going through General Accounting?
No, the following Cost Transfers are not going through General Accounting:
- UCPath expenses
- Accounts Payable (AP) expenses
- ISIS transactions in the current academic year