BURSAR’S DIVISION BURSAR’S OFFICE Summary …€™S DIVISION BURSAR’S OFFICE ... oversees credit card processing, ... (soon to be Wells Fargo) under a new contract.

BURSAR’S DIVISION BURSAR’S OFFICE

The Bursar’s Office administers the University’s cashiering operations, distributes revenue to the appropriate accounts, and receives and processes student account payments. The office processes student refunds, prepares student tuition statements, oversees credit card processing, maintains petty cash funds, and functions as the University’s liaison with commercial banks. The office also administers endowment funds and forecasts cash flow requirements and availability of funds for temporary investment. Summary of Major Accomplishments Student Account System The Bursar’s Office continued to realize efficiencies throughout Fiscal Year 2011 resulting from process and system changes implemented in previous years. Of the non-financial aid payments received on student account balances, 68.25% were received via Automated Clearing House (ACH), 11.22% by credit card, 20.34% by check/cash, and .19% by secure vault payment (SVP). The payments received by ACH reflected a 7.25% increase from ACH payments received in FY 2010. The number of credit card payments decreased an additional 1.78%, while cash payments decreased 5.41%. The Bursar’s Office had anticipated ACH payments increasing only slightly while credit card and cash payments would slightly decrease. The department had hoped SVP payments would increase; however, this seems unlikely to increase much more until some of the larger banks endorse this secure payment solution. Electronic banking continues to be greatly emphasized during freshman orientation. Several members of the Bursar’s Division staff spent a great deal of time working with Collegiate Project Services over the past fiscal year to evaluate the health of the University’s current financial systems and determine what direction would be best for replacement. The evaluation considered the option of writing a new system internally, using open source to create a new system or purchasing a software solution from a third-party source. The staff also participated in the evaluation to determine the institutional readiness to successfully implement a third-party solution on campus as well as a fit-gap analysis to determine the functionality of the third-party system. Electronic 1098-Ts The University reported tuition-related financial information to approximately 40,000 students in FY 2011 using IRS Form 1098-T. Prior to January 2007, the office staff expended a significant amount of effort and money printing and mailing these forms, the dissemination of which is required by the IRS. In this fourth year of collecting electronic consent, the office was able to provide 96% of the statements to students electronically. This represented a 1% increase over FY 2010 and saved approximately $16,611 in FY 2011 postage costs.

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Credit Card Processing The Bursar’s Office continues to monitor the University’s compliance in regard to credit card processing standards. As noted in the prior years of the Annual Management Report, UGA contracts with a third-party assessor to evaluate compliance with all credit card requirements. As part of this process, all UGA merchants complete an annual online questionnaire to determine compliance issues. Additionally, Ecommerce merchants initiate quarterly scans against their systems. Merchants who do business with UGA are learning that compliance is not a one-time task but is ever-evolving. Credit card compliance requires ongoing training and monitoring. The Payment Card Industry Data Security Standards Council (PCI DSS) released the PCI DSS version 2.0 and PA DSS version 2.0 in October 2010. As a result, the current credit card policy and procedures were revised to include the new requirement addressing any merchant’s workstations that are used to input credit/debit card information. The new policy states that personal use is prohibited on any computer or electronic device used for credit/debit card processing, and that reasonable measures shall be taken to limit personal use or any other unintended use of computers and devices that store, process or transmit credit/debit card data. This new policy was covered in training in February and will continue to be emphasized in FY 2012.

The Bursar’s Office continues to utilize TouchNet Marketplace to provide a “virtual” mall for UGA units. In FY 2011, 31,683 Marketplace transactions totaling $3,756,417 were processed, resulting in a 9% increase for total transactions and a 31% increase in total sales. Several factors contributed to the increase in both transactions and sales in MarketPlace. Units demonstrating high volume included the University’s required Commitment Deposits for incoming freshmen (2,330 transactions, $452,800 sales), Parking Services (2,790 transactions, $ 354,350 sales), Office of Admissions’ application fees (21,024 transactions, $1,235,330 sales), Botanical Garden rental fees (188 transactions, $172,718 sales), Athens Diagnostic Lab (1,007 transactions, $268,795 sales), and the Tifton Diagnostic Lab (284 transactions, $77,263). University-wide credit card sales totaled $53,910,877, which was an increase of 5% from sales in FY 2010. Banking Upon completion of the Request for Qualifications for banking services in FY 2010, a decision was made to continue the University’s existing relationship with Wachovia (soon to be Wells Fargo) under a new contract. The University is scheduled to be fully converted in February 2012. The usage of the secure vault option leveled off in the past fiscal year, but the Bursar’s Office would love to see it take off as it provides a more secure payment solution when paying from a bank account.

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Petty Cash During FY 2011 the Bursar’s Office played a more active role in the departmental level reconciling process of the Petty Cash accounts. Petty Cash custodians are required to submit detail-level reconciliations and bank statements to the Bursar’s Office at least twice during the fiscal year. This has allowed the Bursar’s Office to better assess the need for the funds and has resulted in several accounts being reduced or completely closed. The overall Petty Cash amount in FY 2010 totaled $5,926,764. That amount was reduced by 47% in FY 2011 for a total year-end balance of $3,130,140. The number of general Petty Cash accounts was decreased from 47 accounts ($428,448) to 40 accounts ($399,162). This reduction in regular accounts reflects a 6.84% drop in terms of dollars and approximately 1.5% drop in number of accounts. While the total number of study abroad accounts increased in FY 2011 (8%), the Bursar’s Office realized significant reductions/efficiencies in the amount of cash needed (50%). There were 108 accounts totaling $5,498,317 in FY 2010 and 117 accounts totaling $2,730,978 in FY 2011. A large portion of this reduction was due to more efficient processing of reimbursements by the Art School’s Cortona Study Abroad program. During FY 2011, the Cortona Study Abroad balance was reduced from $2,781,881 to $272,560 at year end. The Bursar’s Office will continue to evaluate how the Petty Cash need can be reduced and will look for better payment solutions for these programs. Cashiering During FY 2011 the Bursar’s Office partially implemented Phase II of the Core Business Solutions cashiering product purchased in FY 2008. This phase involves the departmental deposits module known as iPayment, which was released to Student Activities, the Ramsey Center, and Contracts and Grants. Additional customization was required in order to meet reporting requirements by the state and Board of Regents, as well as to capture detailed deposit data for Contracts and Grants. Cash receipts processed in FY 2011 totaled $1,175,720,155. Of this total, approximately 70% of the cash receipts were received by incoming wire transfer or ACH. The number of electronic funds transfers processed by the Bursar’s Office remained around the same level as last year. Summary of FY 2012 Goals Student Accounts The Bursar’s Office hopes to continue to realize a slight increase in ACH payments in FY 2012. While the department would also like to see SVP payments increase, the bursar does not foresee much growth in this payment option without one of the larger banks endorsing this payment solution. The Bursar’s Office continues to work with Application Development and Database Management to complete the necessary programming to finish the work on past due

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balances, collections and write-offs. Unfortunately, this project has been delayed due to other regulations and needs that take precedence. The Bursar’s Office and Student Accounts will continue to work with Collegiate Project Services as the Student and Financial Aid System replacement project moves into the next phase. A decision was made to purchase the licensing for SunGard Banner, and the transition is anticipated to be a three to five year project. It is possible that additional staff members will have to be added in order to respond to these changes and that staff will have to be retrained and seek new skills in order to complete their job duties going forward. Representatives of the Bursar’s Office plan to visit other schools in the coming year to assist with planning, testing and implementation. The Bursar’s Office is engaged in reviewing how and where social security numbers are stored and protected. The removal of social security numbers will be an ongoing issue. In the meantime, efforts to eliminate the use of these numbers continue; however, the Bursar’s Office does still rely on these numbers in some instances due to reporting requirements and the accuracy of data currently available. Staff are trained regularly and reminded of the importance of protecting this information on their workstations and in their offices. The high level of risk is expected to decrease significantly upon implementation of a new student system. Credit Card Processing With the Durbin amendment going into effect in July 2011, some expenses related to the processing of credit cards should decrease. For example, the debit expense has declined from $.36 to $.13 per transaction for two units that accept a high percentage of debit cards. Merchants are encouraged to accept debit cards as a form of payment. Guidelines and requirements for accepting credit cards continue to be modified to meet the challenges of technology advancements as well as address the security issues that accompany these new solutions. Additional requirements added to UGA’s policy and procedures in FY 2011 will have to be emphasized in FY 2012. The Bursar’s Office will continue to work with Internal Audit and Information Security to address the concerns that come with this change. These offices also will work together to conduct the annual mandatory training session for all merchants on campus; this training covers any upcoming changes and requirements as well as reviews policies and procedures. TouchNet, one of the University’s vendors utilized for credit card payments, will be upgrading its software in FY 2012. This new software will allow enhancements to the current student billing system as well as to Marketplace. One of the most exciting enhancements includes the ability to offer a mobile solution to students for bill payment on their student accounts as well as to Marketplace consumers.

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Banking The Bursar’s Office continues to work with the Procurement Office to complete the contract for armored car service. The current contract has been extended to September 30, 2011 so that this crucial service is maintained. Once the contract is in place, the Bursar’s Office would like to readdress the possibility of adding a safe product on the campus for processing cash in high volume areas such as the parking decks. Some benefits of this product are better security for employees and customers, deposits guaranteed from loss or fire, counterfeit detection, enhanced balancing/reconciliations, better management of change fund needs and detailed management reports. Cashiering The Bursar’s Office will proceed with implementation of Phase II of the Core cashiering product. Addition of the file import capability will allow departments with deposits that contain many individual items to submit these deposits in an Excel or CSV file. Contracts and Grants will be offered this ability first, with Food Services next in the queue and then the Georgia Center. Once these implementations occur, other departments will be brought on board. The Bursar’s Office foresees the need to implement a new cashiering system as the University plans for the transition to SunGuard Banner in the coming years; however, this would not occur in FY 2012. Time spent importing files will prove beneficial as the experience will allow staff members to have an understanding of what will be needed in the future so that this option can continue to be provided even after the conversion to a cashiering system that is more compatible with Banner. Testing for the Imaged Cash Letter to Desktop Deposit conversion of the electronic file containing check information has been completed. The switch in production to finalize the transition from Wachovia to Wells Fargo will take place in February 2012.

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Statistical Information The following charts illustrate the number of charge and payment transactions processed through the student account system from July 1, 2010 to June 30, 2011.

Charges # of

TransactionsDollar Amount

Admission Orientation Fee 8,246 680,460.00 Bulldog Bucks 67,662 2,489,188.30 Bookstore Charges 271 62,601.56 Return Items/Late Fees/Reinstatements 20,805 2,096,568.87 Course and Lab Fees 72,765 583,453.49 Financial Aid Repayments 3,362 1,831,533.81 Food Services 16,953 23,722,607.82 Graduate School Penalty Fee 14 26,775.00 Housing 37,506 18,773,790.10 Family Housing 11,867 3,600,408.11 Non-Resident Alien Tax 64 6,073.82 Health Insurance 3,592 440,982.00 International Student Compliance Fee 3,268 135,600.00 Freshman College 299 365,104.34 Field Study Program Fee 6,665 12,038,779.84 Parking 39,681 4,885,272.00 Direct Billing 2,898 4,314,319.29 Deferred 1,218 1,878,824.73 Payroll Deduct 8,725 1,269,579.30 Tuition and Fees 1,656,292 186,696,004.17 Tifton 602 21,423.00 Write-Off Charges 277 4,794.67 Charges Sent to Collections 548 159,593.58 Total 1,963,580 266,083,737.80

Payments # of

TransactionsDollar Amount

ACH 129,505 108,457,172.40 Bill to Sponsor 2,483 4,314,319.29 Cash/Check 18,398 31,538,422.34 Charge to Account 4,441 9,278,058.95 Commit/Law/Vet Deposits 3,177 617,260.00 Credit Card 24,354 17,785,766.67 Deferments 739 1,878,824.73 Financial Aid 106,394 171,111,382.51 Payments from Collection Agency 186 12,074.50 Payroll Deduct 2,206 1,269,838.80 Secure Vault Payment 380 299,087.67 Total 292,263 346,562,207.86

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STUDENT RECEIVABLES AGING SUMMARY As of June 30, 2011

Sending Unit TOTAL CURRENT > 30 DAYS > 60 DAYS > 90 DAYS > 120 DAYS

> 180 DAYS > 1 TO 3 > 3 TO 5 > 5 TO 10

Admissions 166,983.00 44,100.00 121,223.00 0.00 0.00 40.00 520.00 1,100.00 0.00 0.00

Bursar’s Office 60,895.82 21,044.49 5,135.46 1,110.00 200.00 19,904.85 1,855.00 1,621.02 0.00 10,025.00

Course and Lab 1,712.50 1,647.50 (15.00) 0.00 0.00 80.00 0.00 0.00 0.00 0.00 Financial Aid 1,355,169.56 238,189.50 16,677.00 47,620.00 224,184.77 26,564.00 200,277.25 482,365.00 51,073.00 68,219.04 Graduate 9,900.00 9,900.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Health Ins (633.00) (586.00) 0.00 0.00 0.00 (704.00) 0.00 657.00 0.00 0.00 SEVIS 1,761.17 1,661.17 0.00 0.00 0.00 50.00 50.00 0.00 0.00 0.00 Freshman College 23,050.00 23,050.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Program Fees 1,025,170.11 700,103.69 228,761.00 56,997.00 6,582.42 29,400.00 535.00 2,791.00 0.00 0.00 Sponsors 499,347.35 493,339.35 0.00 4,626.00 0.00 30.00 1,352.00 0.00 0.00 0.00 Deferments 93,189.02 92,493.02 0.00 0.00 0.00 0.00 696.00 0.00 0.00 0.00 Tuition 2,288,817.62 2,267,045.51 14,897.00 (4,283.00) (45.00) 2,137.75 5,832.86 3,232.50 0.00 0.00 Tifton 1,810.00 1,720.00 0.00 0.00 0.00 90.00 0.00 0.00 0.00 0.00 Collections 297,546.62 0.00 157,410.59 0.00 3,544.40 0.00 118,744.58 4,421.57 13,425.48 0.00 Unapplied (40,630.57) (40,630.57) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

TOTAL 5,784,089.20 3,853,077.66 544,089.05 106,070.00 234,466.59 77,592.60 329,862.69 496,188.09 64,498.48 78,244.04

Bulldog Bucks 15,082.87 13,744.40 441.47 356.00 225.00 41.00 230.00 45.00 0.00 0.00 Food Services 284,171.90 280,422.08 25.00 0.00 522.90 397.16 1,994.00 810.76 0.00 0.00 Housing Prepay 2,200.00 (2,730.00) 2,045.00 885.00 1,900.00 100.00 0.00 0.00 0.00 0.00 Housing Fines 26,993.83 23,522.86 1,942.49 422.50 260.00 25.80 664.32 155.86 0.00 0.00

Housing Rent 290,162.15 263,708.52 16,308.94 0.00 0.00 3,079.70 3,587.82 3,477.17 0.00 0.00 Housing Buyout 10,848.61 694.24 6,651.62 0.00 0.00 725.00 2,777.75 0.00 0.00 0.00 Family Housing Fines 1,969.54 1,388.54 95.00 126.00 0.00 0.00 85.00 275.00 0.00 0.00

Family Housing Rent 224,983.96 197,422.18 5,415.43 2,423.00 1,928.11 3,517.20 8,181.24 6,096.80 0.00 0.00

Fam Housing Electricity 10,339.92 8,190.81 298.40 95.24 261.77 663.74 403.63 426.33 0.00 0.00

Parking Citations 49,597.81 22,035.81 14,360.00 5,770.00 4,127.00 930.00 1,010.00 1,325.00 0.00 40.00

Parking Permits 51,760.81 45,124.81 590.00 600.00 1,430.00 2,120.00 1,351.00 545.00 0.00 0.00

Parking Misc Fines 1,216.00 624.00 295.00 168.00 92.00 26.00 0.00 11.00 0.00 0.00

TOTAL 969,327.40 854,148.25 48,468.35 10,845.74 10,746.78 11,625.60 20,284.76 13,167.92 0.00 40.00

GRAND TOTAL 6,753,416.60 4,707,225.91 592,557.40 116,915.74 245,213.37 89,218.20 350,147.45 509,356.01 64,498.48 78,284.04

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Short-term Investment Income Interest rates continued to fall in FY 2011, causing earnings on short-term investments to decrease over FY 2010. The University earned interest from the operating account with Wachovia, the investments in the Georgia Fund and the Board of Regents Short-Term Fund. As the banking industry is changing and UGA’s reserves in the operating account are growing, the short-term plan is to move towards putting more in the Georgia Fund and Board of Regents Fund from the Operating Account and investigating more short-term options for the Short-Term funds. The following schedule reflects the net earnings and distribution of earnings for the current and past three years on short-term investments. Fund FY2011 FY 2010 FY 2009 FY 2008 FY 2007 Plant Funds $1,748,279.35 $2,441,346.84 $4,870,907.29 $8,599,983.39 $9,952,137.47 Auxiliary Enterprises $546,001.49 $676,179.71 $1,629,631.37 $2,529,979.61 $2,963,257.80 Agency Funds $5,946.19 $8,102.23 $25,833.85 $45,056.12 $58,012.78 Student Activity Funds $170,461.58 $887,068.57 $48,863.88 $188,442.69 $272,302.30 Loan Funds $5,337.23 $5,671.42 $59,877.57 $260,788.85 $166,440.83 Endowment Funds $5,131.54 $6,872.23 $261,293.87 $463,806.26 $933,414.82 Total $2,481,157.38 $4,025,241.00 $6,896,407.83 $12,088,056.92 $14,345,566.00

Endowment Funds The Bursar’s Office administers 206 University endowment funds which provide general support for the University, student scholarships and loans, salary supplements and other funding as provided for in the individual trust agreements. One new endowment fund was established in FY 2011. The largest portion of these funds is invested with RidgeWorth Capital (formerly Trusco Capital Management) under a plan approved by the Board of Regents. Beginning in August 2011, the Bursar’s Office will be investing the University’s endowments in the Board of Regents Diversified Fund through SunTrust Investments to obtain a more diversified portfolio. In FY 2011, endowment funds experienced unrealized market appreciation due to a slight rebound in markets in the United States and abroad.

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Exhibits summarizing statistical data are presented on the following pages: Exhibit 1 - Endowment Fund Balances Exhibit 2 - UGA Income, Cash Receipts vs. Credit Card Receipts Exhibit 3 - Percent of Cash Receipts Received via Wires/ACH Exhibit 4 - UGA Credit Card Merchants’ Processes Exhibit 5 - Student Accounts Charges, Resident Instruction vs. Auxiliary Exhibit 6 - Student Account Resident Instruction-Related Charges Exhibit 7 - Student Account Auxiliary-Related Charges Exhibit 8 - Student Account Payments Exhibit 9 - Student Account Non-Student Financial Aid Payments Exhibit 10 - Student Account Financial Aid Payments Organization Chart

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EXHIBIT 1

EXHIBIT 2

EXHIBIT 3

$43.53

$50.14 $47.33

$52.61

$59.86

0

10

20

30

40

50

60

70

2007 2008 2009 2010 2011

Endowment Fund Balances

0.00 200,000,000.00 400,000,000.00 600,000,000.00 800,000,000.00

1,000,000,000.00 1,200,000,000.00 1,400,000,000.00

2009 2010 2011

Fiscal Year

UGA Income

Cash Receipts

Credit Card Receipts

0.00

200,000,000.00 400,000,000.00 600,000,000.00 800,000,000.00

1,000,000,000.00

1,200,000,000.00

1,400,000,000.00

2009 2010 2011

Fiscal Year

% of Cash Receipts Received via Wires/ACH

Wires/ACH

Total Cash Receipts

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EXHIBIT 4

EXHIBIT 5

EXHIBIT 6

Exhibit 7

0%5%

7%

44%

35%

9%

Student Account Auxiliary Related Charges

Bookstore ChargesFamily HousingFood ServicesHousingParkingBulldog Bucks

POS Only66%

EcommerceOnly20%

Both14%

UGA Credit Card Merchants' Processes

Resident Instruction

79%

Auxiliary21%

Student Account Charges

1%

0%6%

1%

0% 0% 0%

0%0%1%

0%

91%

Student Account Resident Instruction-Related Charges

Admissions Orientation Fee

Course and Lab Fees Field Study Program Fee

Financial Aid Repayments

Freshman College Graduate School Penalty Fee

Health Insurance ISCF Fee

Non-Resident Alien Tax

Return Checks/LateFees/Reinstatements Tifton Fee Package Tuition and Fees

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EXHIBIT 7

EXHIBIT 8

EXHIBIT 9

Fin Aid Payments

54%

Non Student Financial Aid

Payments46%

Student Account Payments

68%

20%

0% 11%

0% 1% 0%

Student AccountNon-Student Financial Aid Payments

ACH

Cash/Check (CS)

Commit/Law/Vet Deposits

Credit Card (CF)

Payments from Collection Agency

Payroll Deduct (06)

Secure Vault Payment (VP)

0%5%

7%

44%

35%

9%

Student Account Auxiliary Related Charges

Bookstore ChargesFamily HousingFood ServicesHousingParkingBulldog Bucks

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EXHIBIT 10

52%37%

4% 2%

5%

Student Account Financial Aid Payments

GRANTS

LOANS

SCHOLARSHIPS

DIRECT BILLING

CHARGE TO ACCOUNT

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BursarLisa McCleary

BURSAR’S DIVISIONORGANIZATION CHART

Bursar’s OfficeLisa McCleary

Accounts ReceivableTherese Hodges

Student AccountsShannon Lay

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Sr. Financial AcctSusan McCullough

Admin Assoc IISuzanne Brown

Systems Admin SpecJill Jerome

BursarLisa McCleary

BURSAR’S DIVISIONBURSAR’S OFFICE

ORGANIZATION CHART

Assistant BursarTherese Hodges

Senior Financial Accountant

Elizabeth Quillian

Accounts ReceivableDepartment

Assistant ManagerAmy Brown

Assistant ManagerSusan Caldwell

Sr. Operations Supervisor

Marianne Christian

Senior AccountantNicole Moon

Senior Operations Specialist

Amber Redfern

Sr. Accounting TechLeah King

Sr. Accounting TechBrandi Aycock

Customer Service Rep

Melissa Mullins

IT Professional Specialist

Jennifer Lazo

Senior Accounting Tech

Karen Pitts Loan Collections Officer II

Lena Anglin

Sr Accounting TechAnn Smith

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