FAQ: Cost Transfers, Recharges and Fund Balance Transfer
This article provides answers to Frequently Asked Questions intended to help distinguish between Cost Transfers, Recharges, Fund balance and Fund balance transfer.
- In Oracle, the General Ledger (GL) encompasses all transactions, including those from subledgers.
- Project Portfolio Management (PPM) is a subledger in Oracle, primarily used for tracking and reporting expenses.
- PPM is a subledger and pushes/feeds data into Oracle’s GL.
- A Cost Transfer is a cost distribution where costs (expenses) that have already posted in the system need to be moved.
- Recharges in the article refer to approved Recharges with proposals, 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 UCSD, 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?
- Refer to KB0033457: How to Perform a Full or Split Cost Transfer Transaction in Oracle
- Costs Transfers are done through PPM and require justification for the Cost Transfer.
- Approval is required and this will happen through Oracle workflow.
Q: What form should I use for Recharges?
- None. You should process through your recharge facility application or through the RMP Application.
- For additional information, please refer to KB0033521: How to Process Transactions in the RMP Recharge Application
Q: Is a Fund Balance Transfer in PPM the same as a Cost Transfer?
- No, Fund Balance Transfer is the title/name of an Account in CoA.
- Expenditure Type in PPM derives from the Account segment value in the CoA and Fund Balance Transfer is no longer an Expenditure Type in PPM.
- Fund Balance Transfer refers to a transfer of resources (not costs/expenses).
- 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 was 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?
A: 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 legacy expense on a General Project?
- There are two key components in this question 1) General Project and 2) legacy 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
- In PPM, Account 774009 Fund Balance Transfer 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 Fund Balance is an accumulated Equity account that is a part of GL and is only updated at Fiscal Year End close.
- No manual entries or transactions occur on Account 300000 throughout the year.
- At the end of the Fiscal Year, the net of Revenues and Expenses for a chart string is debited/credited to the beginning of the 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.
- The use of 774009 in PPM was a one-time entry for conversion purposes.
- Account 774009 was the beginning Balance for 2020 because it was the converted amount from IFIS, but now it shows as Account 300000 because that is the Fund Balance that was converted.
- Instructions on KB0032308: How to Check Starting Balance in PPM.
Q: How can I do a Fund Balance Transfer for account 774009?
- Submit a Journal Entry which will post in the GL only.
- The Fund Balance transfer must be within the same Fund or same Fund Level D.
- Fund Level D is in reference a Funds that share the same CoA Fund Hierarchy L4 (same parent of the Fund that ends in D).
- Instructions on KB0032759: How to Process a Journal Entry
Q: Where is the IFIS Index balance located?
A: Account 300000 Fund Balance, review the 2 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 a cost transfer 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?
- Yes, this is a Cost Transfer and can be done in PPM.
- Reference KB0033457: How to Initiate a Full or Partial Cost Transfer in Oracle 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.
- In the KB0033191: Cost Transfer Guide, refer to the section Generally Unallowable Transfers - Same Project but Changing Expenditure Type or Expenditure Item Date.
Q: Are all Cost Transfers going through Internal Controls and Accounting (previously known a General Accounting)?
A: No, refer to Essential Information section in the KB0033191: Cost Transfer Guide. The following are not going through ICA:
- Sponsored Projects
- Accounts Payable (AP) expenses
- Gift Fund transactions
- Medical Center, PG, PHSO
- ISIS transactions in the current academic year