Fund Accounting - Ivy Tech

SECTION A: Accounting

OVERVIEW - FUND ACCOUNTING

This chapter is intended to provide information on general College accounting practices. It is not

intended to serve as an authoritative source of accounting policy.

The College issues financial statements in accord with Generally Accepted Accounting

Principles (GAAP). Publications including the AICPA Audit Guide are routinely furnished to the

Regional Business Office by the Office of the Assistant Treasurer. These publications provide

the basis for College accounting policy. Questions on accounting for College financial activity

may be directed to the Office of the Assistant Treasurer.

Fund accounting is a manner of organizing and managing the accounting by which resources are

classified for financial accounting and reporting. This is in accordance with activities or

objectives as specified by donors, regulations, restrictions, or limitations approved by sources

outside the institution, or with directions issued by the State Board of Trustees.

A fund is a self-balancing group of accounts consisting of assets, liabilities, revenues,

expenditures, and fund balance. Each fund is separated in the financial records of the College

and is limited to a specific use. This separation ensures the integrity of the individual funds and

provides the necessary fiscal control over each fund group.

A fund group may be divided into two types of funds, Restricted and Unrestricted. Restricted

Funds are those funds that are provided by donors or external agencies for specific purposes,

programs or departments. Unrestricted funds are those funds that the College has the flexibility

to designate the use of, in its operation of the College.

Currently, Ivy Tech Community College of Indiana operates the following fund groups:

I. Current Funds

II. Loan Funds

III. Endowment and Similar Funds

IV. Plant Funds

V. Agency Funds

I. Current Funds

The current fund group accounts for those economic resources which are expendable for the

purpose of performing the primary mission of the College and which are not restricted by

external sources or designated by the State Board of Trustees for other than operating purposes.

This fund group contains three basic sub groups. They are Unrestricted, Restricted and Auxiliary.

A. Unrestricted Current Funds

1. Operations Fund

The operations fund accounts for the general operation of the College in fulfilling its mission.

The Operations Fund includes the following examples of assets, revenue, expenditures,

liabilities, and the fund balance.

ASSETS - includes object classes of cash, investments, and accounts receivable.

REVENUE - includes object classes of tuition and fees, state appropriations, overhead recoveries

and investment income.

EXPENDITURES - includes object classes of equipment, consumable supplies, salaries and

wages, utilities, leases and employee compensation.

LIABILITIES - includes object classes of accounts payable and accrued expenses.

FUND BALANCE - includes object classes that are allocated and unallocated.

B. Restricted Current Funds

Restricted Current Funds are those available for financing operations, but which are limited in

use by external agencies and other donors to specific purposes, programs, or functions.

1. Sponsored Program Funds (Reference: COPM 1.61 and FMM, Section L)

1) Federal

2) State

3) Local

4) Apprenticeship

5) Private Grants and Contracts

Sponsored Program Funds noted above relate to specific grants, contracts and agreements

between the College and external "Public" governmental entities, or "Private" organizations or

individuals funded for the particular restricted purpose specified. Each of these individual

programs is categorized by fund, according to the governmental entity or type of private

organization that has entered into the agreement with the College. Sponsored Program Funds

have the following assets, revenues, expenditures, liabilities and fund balances:

ASSETS - includes object classes of cash and accounts receivable.

REVENUES - includes restricted current funds to the extent that such funds were expended for

operating purposes.

EXPENDITURES - includes expenses incurred as determined by GAAP.

LIABILITIES - includes object classes of deferred credits accrued and/or assessed liabilities.

FUND BALANCE - Allocated

2. Financial Aid Funds (Reference: Section F)

Ivy Tech Community College of Indiana offers various federal, state, and local financial aid

assistance to its student body. These programs are designed to assist those students with a

financial need to attend Ivy Tech Commnity College of Indiana. While operating these programs,

the College accepts a fiduciary responsibility to the granting agency. The College is responsible

for administering these programs according to the granting agencies' regulations and sound

management policies.

The financial aid programs are accounted for in the following restricted current funds.

1) Financial Aid Federal

This fund will account for the following federal financial aid programs:

a) Campus based programs

(1) College Work-Study

(2) Supplemental Educational Opportunity Grant

b) Entitlement Programs

(1) Pell Grants

2) Financial Aid State

This fund will account for the following state financial aid programs:

a) Higher Education Award

b) Hoosier Scholarship

c) Stafford Loan

d) State Summer Work-Study Program

3) Financial Aid Other

This fund will account for any scholarship provided from a local agency or individual.

C. Auxiliary Enterprise Funds (Reference: Section K)

Auxiliary Enterprise Funds reflect financial data from activity conducted to provide a service

either directly or indirectly to students, faculty or staff. An objective of the Auxiliary Enterprise

Fund is to be self-supporting. After an auxiliary enterprise becomes self-supporting and excess

revenue is generated, this excess can be used (with appropriate approvals) to supplement the

regional operation of the College. Currently the Auxiliary Enterprise Fund group maintains the

following sub-groups:

1. Auxiliary Enterprise Bookstore

Accounts for the bookstore operation of the College.

2. Auxiliary Enterprise Parking Maintenance and Acquisition

II. LOAN FUNDS

Loan Funds account for those resources that are available for loans to students, faculty and staff.

Currently the only loan programs operated by the College are for the benefit of the students. As

an example, Ivy Tech Community College of Indiana operates a College-wide program which

has been provided by the Sears Foundation. Several Regional institutes operate other loan

programs provided from gifts by local organizations and student governments.

III. ENDOWMENT and SIMILAR FUNDS

There are three types of endowment funds:

1) True Endowment

2) Term Endowment

3) Quasi Endowment

True endowment funds are funds with respect to which donors have stipulated that the principal

of the gift is to remain intact and is to be invested for the purpose of generating current and

future income for a specified purpose. Term endowment funds are like endowment funds, except

that all or part of the principal may be utilized after a stated period of time or upon the

occurrence of a certain event.

The College operates a Quasi Endowment Fund. A Quasi Endowment Fund represents funds

established by the governing board to function like an Endowment Fund, but which can be

terminated by the board at any time. Both income and principal are expendable.

Use of the word "Endowment" relates to disposition of the corpus (original principal) of the

fund. Income earned from investment of the principal can be expended, and may be restricted or

unrestricted depending upon the declarations of the donor.

IV. PLANT FUNDS

The Plant Fund group accounts for new construction, repair and rehabilitation of existing

facilities, retirement of indebtedness, and the assets and liabilities of the College. The Plant

Funds are divided into the following sub-groups:

1. Unexpended Plant Fund

This fund is used to account for the construction of new facilities.

2. Renewals and Replacements

This fund is used to account for repair and rehabilitation of existing facilities.

3. Retirement of Indebtedness

This fund is used to record the payment of both short-term and long-term debt obligations

resulting from the financing for the construction of facilities or the acquisitions of major

equipment.

4. Investment In Plant

The Investment-In-Plant is a self-balancing group of accounts and not a fund. The Investment-In-

Plant group of accounts is used to record fixed assets and long-term liabilities of the College

V. AGENCY FUNDS

Agency Funds account for the resources held by the institution as custodian or fiscal agent for

students, faculty organization, or governmental agencies. An Agency Fund consists of only

assets and liabilities.

ASSETS - includes object classes of cash, receivables, and investments.

LIABILITIES - includes object classes of accounts payable.

Ivy Tech Community College of Indiana operates the following Agency Funds:

Sub Groups

1. Agency Fund Payroll

The payroll fund accounts for federal, state and county taxes, employee payroll deductions, and

College benefit contributions not yet forwarded to the appropriate agency.

2. Agency Fund Student Activity (Reference COPM 7.3-14)

This fund is to account for student activities funded from the student activity fee and/or student

government activities.

The College accounting system accepts the recording of revenue and expenditures within these

accounts. This is designed to provide information only on additions and deductions to assets and

liabilities. Business Directors should be cognizant that the activity will close to Fund Balance

and the Fund Balance will be reclassified to the appropriate liability account.

INTERFUND TRANSFERS/ INTERFUND BORROWING

I. INTERFUND TRANSFERS

Interfund transfers are payment movements of amounts between fund groups to be used for the

objectives of the fund group receiving the transfer. There are two types of transfers:

A. Mandatory Transfers

Mandatory transfers include transfers from Current Funds to other groups resulting from:

1. Binding legal agreements relating to the financing of the educational plant.

2. Grant agreements with agencies of the federal government and other governmental or private

organizations to match gifts and grants to loan and other funds. Mandatory transfers may be

required to be made from either unrestricted or restricted current funds.

B. Non-mandatory Transfers

Non-mandatory transfers include those transfers from the Current Fund group to other fund

groups made at the discretion of the governing board, and also may include the retransfer of

resources back to Current Funds. However, unrestricted amounts transferred from other fund

groups back to the Current Fund group are not considered revenues of Current Funds.

II. INTERFUND BORROWING

Interfund borrowing is the movement of monies between fund groups; is temporary in nature,

and there is a definite plan for repayment within a defined period of time. Borrowing of funds

should be recorded as assets of the fund groups making the advances, and as liabilities of the

fund groups receiving the advances.

III. FUND ADDITIONS and DEDUCTIONS

Fund addition and deduction transactions may be used to move dollars between funds within a

fund group. A more formal definition of additions is funds received or made available, while

deductions represent decreases in fund balance.

ACCRUAL ACCOUNTING

Ivy Tech Community College of Indiana reports its activities on an accrual basis of accounting.

Accrual accounting represents the effects of transactions on the assets and liabilities in the period

the event occurs, not when cash is received or paid. The accrual method is used to match

expenditures and revenues within the operating cycle of the College (July 1 to June 30). The

recording of accounts receivable and accrued liabilities using accrual accounting enables the

College to measure its financial position at a given date.

ASSETS

Assets of the College represent those items that are determined by generally accepted accounting

principles to be economic resources of the College. Assets are divided into two main categories:

I. Current Assets

II. Fixed Assets

I. CURRENT ASSETS

Current assets of the College represent those items that can be consumed or realized during the

current operating cycle. The following represents the current assets of the College:

A. Cash

Funds available to meet the operating expenditures of the College.

B. Accounts Receivable

Revenue earned by the College but not yet collected. A Contra asset account may accompany an

accounts receivable. The Contra asset account establishes an "Allowance for Uncollectible

Accounts Receivable." The establishment of this account allows the accounts receivable to be

reported on a more realistic basis.

C. Inventories

Current inventories represent those items that are used during the current operating cycle to

continue current operations. Presently the only items that are inventoried are those retail items

necessary to continue the Auxiliary Enterprises of the College.

D. Investments

Investing of excess short term cash for the purpose of generating additional revenue.

E. Prepaid Items

Expenditures for benefits not yet received

II. FIXED ASSETS

Fixed assets represent those items of the College that economic resources of the College were

used to acquire. Fixed assets may be real or personal property. They can be acquired by

purchase, (includes capital leases), gift, bequest, or produced by the College.

A. Real Property

1. Land

Represents the purchase price and additional cost such as legal fees, brokers' commissions, title

fees, razing, and other costs directly related to the cost of acquiring the property. If the land is

donated, then the fair market value at the time of donation represents its value to the College.

2. Land improvements

All improvements made to land such as paving, sidewalks, et al.

3. Buildings and Improvements

Represent the cost other than land and moveable equipment in the construction or purchasing of

an existing facility. If the building is being constructed and being financed from a debt

agreement, then the interest paid during the construction phase is capitalized with the building

cost. If the building is donated, the same rule applies as with land. Additional items added to the

cost of a building are:

a. Repair and Rehabilitation Projects

Represents those items that increase the value, efficiency, or usefulness of the facility and are

capitalized when the project has a cost of at least $10,000.

4. Leasehold Improvements

Represent the improvements made to leased facilities of the College in preparing or remodeling

for College use.

5. Mobile Units and Improvements

The cost of acquiring mobile units and/or remodeling of those units.

6. Construction-In-Progress

Includes all construction projects that are not completed by the fiscal year end.

B. Personal Property

Represents all equipment owned by the College either purchased, leased (capital), gift, bequest,

or produced by the institution. Please reference Section N, Fixed Assests, for the capitalization

policy. Equipment is subdivided into the following areas:

1. Instructional Equipment

All equipment used in the instruction of students, ranging from classroom furniture to lab

equipment.

2. Office Furniture and Equipment

Furniture and equipment used in the administration of the College (desks to calculators).

3. Machinery and Vehicles

Includes non-instructional equipment and vehicles ranging from hand tools to cars.

4. Computer Equipment

Represents computer equipment such as mainframes, terminals, mini computers and data

communications equipment.

5. Library

All books, tapes, periodicals costing over $10.

6. Construction in Progress - Movable Equipment

LIABILITIES

Liabilities represent obligations of the College arising from past events and are to be satisfied by

paying cash, transferring of assets, or providing future services. A liability has technically

occurred when it can be reasonably estimated and assured of happening. Liabilities are generally

divided into two categories:

I. Current Liabilities

II. Long-Term Liabilities

I. CURRENT LIABILITIES

Current Liabilities are designated obligations that are to be liquidated during the current

operating cycle and by using current assets. The College recognizes the following current

liabilities:

A. Accounts Payable

Materials and supplies acquired for the delivering of services to the students, faculty, or staff of

the College.

B. Salary, Wages, and Fringe Benefits

The accrual of salaries, wages and fringe benefits that have been earned in one period and paid in

the next.

C. Deferred Revenue

Revenue that has been received, but is not yet earned.

D. Other Liabilities

The current position of long term debt that is to be liquidated within the current period.

II. LONG-TERM LIABILITIES

Long-term liabilities represent those items that are planned to be paid back over a period in

excess of one year. Long-term liabilities of the College represent the principal amounts of Bond

Indentures and Lease/Purchase agreements. (NOTE: Capital lease agreements should also be

included under Long-Term Liabilities.)

REVENUE

Revenue represents the increase in assets provided from the delivering of services or other

earning activities delivered by the College. Current sources of revenue of the College are:

A. Tuition and Fees

All tuition and fees assessed against students for the delivery of instruction to them.

B. Governmental Appropriations

Includes all unrestricted and restricted appropriations for the current operation of the College.

C. Governmental Grants and Contracts

Grants and contracts awarded by a governmental agency.

D. Private Gifts, Grants and Contracts

Non-governmental source for the purpose of a particular instruction or a select group of

instruction.

E. Interest Income

Income earned from the short-term investments of the College.

F. Sales and Services

Goods and services provided to the students, faculty, or staff through the auxiliary enterprises of

the College.

G. Overhead Recovery

A partial recovery of operating expenditures of the College which is generally provided through

contractual agreements of the College.

H. Other Income

All other income that can not be classified into one of the above categories.

It must be remembered that generally any revenue earned by the College can and should be

classified into one of the above categories.

EXPENDITURES

Expenditures represent the cost of goods and services used or acquired by the College in

providing its services to the public. Current classifications of expenditures are:

A. Exempt (salaried)

Used to identify administrative salary staff.

B. Non-Exempt (hourly)

Identifies all hourly personnel.

C. Instructional Staff

Identifies instructors.

D. Staff Benefits

Identifies staff benefits provided by the College.

E. Supplies and Expenses

Identifies expenditures other than those listed here.

F. Utilities

Identifies utilities for owned or leased facilities operated by the College.

G. Leases

Identifies lease payments made by the College.

H. Travel

Identifies travel expenses of the College.

I. Cost of Goods Sold

Generally used in the bookstore to identify cost of items for resale.

J. Capital

Identifies all capital expenditures of the College.

K. Scholarships and Grants

Identifies financial aid passing through the College records.

When deciding on what major classification to use for a particular expenditure, the following

two items must be considered:

1. Excessive detail object classification should be avoided since it tends to complicate the

accounting procedure and is often of very little benefit in financial management.

2. The selection of the most appropriate classification should be based on an objective

assessment of what the item is commonly described as, not what its purpose for a particular

situation might be.

Expenditures may be defined as either a direct or indirect cost. Direct costs are those costs that

may be identified specifically with a particular sponsored project, an instructional activity, or any

other institutional activity; or that may be directly assigned to such activities relatively easily

with a high degree of accuracy, and without an inordinate amount of accounting. These costs

may include salaries, wages, benefits, services, materials, and equipment. It is not the nature of

the goods or services that determine direct cost classification; rather, it is the identification with

the sponsored work or final cost objective.

Indirect costs, in contrast with direct costs, are those that have been incurred for purposes

common to a number or all of the specific projects, programs, or activities of an institution, but

which cannot be identified and charged directly to such projects, programs, or activities

relatively easily with a reasonable degree of accuracy and without an inordinate amount of

accounting. Examples include such items as heating, lighting, air conditioning, and janitorial

services of buildings; and administrative services such as accounting, purchasing, personnel, and

library services.

Without indirect cost reimbursements, sponsored programs and auxiliary enterprise in colleges

and universities would require institutional support of indirect services, to the detriment of other

functions of the institutions.

FUND BALANCE

The fund balance of a particular fund represents the past accumulation of revenue minus

expenditures plus any additional adjustments. A fund balance can either be unallocated or

allocated. An unallocated fund balance represents those resources that are available without a

future restriction as to their use. While in turn, an allocated fund balance is either restricted to a

particular use by an external entity or designated as to a particular use by the governing board.

LEASES

Ivy Tech Community College of Indiana classifies its lease agreements in accordance with

generally accepted accounting principles:

I. Capital Leases

II. Operating Leases

I. CAPITAL LEASES

A capital lease is recorded as an asset and as an obligation at an amount equal to the present

value of the property being leased. Capital leases are determined by any one of the following

criteria:

A. The lease transfers ownership of the property to the lessee by the end of the lease term.

B. The lease contains a bargain purchase option.

C. The terms of agreement are equal to 75% or more of the estimated useful life. (NOTE: If the

lease falls within the remaining 25% of useful life, the above criteria is no longer valid.)

D. "The present value at the beginning of the lease term of the minimum lease payments,

excluding that portion of the payments representing executory cost such as insurance,

maintenance, and taxes to be paid by the Lessor, including any profit thereon, equals or exceeds

90% of the excess of the fair value of the leased property to the lessor at the inception of the

Lease." (AICPA Professional Standards Volume 3, Section 4053.007)

When applying the above criteria to land and buildings the following should be applied:

1. If the lease falls under items A or B, the land and buildings should be capitalized separately.

2. If the lease falls under C or D and the fair value of the land is less than 25% of the total, then

the land and building is considered as a single unit. If the value of the land is 25% or more, then

the land and buildings are considered separately.

II. OPERATING LEASES

An operating lease is any lease that does not fall into any of the four criteria under capital leases.

It is a lease agreement that the College has no intention of acquiring title to. The lease is not

capitalized, but is treated as a recurring expenditure over the term of the lease.

LIBRARY EXPENSES

The Library cost center has been identified as the area in which to record all expenses for the

operation of and services provided by the Library.

The following definitions are provided to properly classify, record, and report library expenses:

A. Library

Activities that support the collection, cataloging, storage, and distribution of published materials;

activities that directly support the operations of a catalogued collection or otherwise classified

collection. This includes activities providing audio visual services and other services that aid in

the transmission of information in support of the College's instruction and public service

programs.

The activities include the following:

1. Acquire materials

a. Determine acquisition policy.

b. Screen and evaluate available materials.

c. Obtain materials for the libraries.

2. Prepare materials

a. Prepare and maintain materials for general use and distribution.

b. Examples:

searching

cataloging

recording

shelving

binding

repair

3. Provide service to identify and access materials.

a. Provide services and aids to identify and locate documents or materials

b. Examples:

information desk

indexes

visual aids (posters, signs)

reference services

4. Distribute materials

a. The control and distribution of library materials

b. Examples:

circulation services

reserve services

loan and rental services

5. Participate in inter-institutional exchange and loan services.

a. The borrowing or lending materials to other libraries

b. Examples:

inter-library loan office

messenger services

6. Disseminate information/promote Library

a. Provide general information about the library and its activities to promote library use.

b. Examples:

publications

advertisements and exhibits

personal communication

The purchase of books by a department from its funds would not be classified in this category,

even though a departmental "library" is produced. The appropriate program categories may be

used in classifying activities when the library serves a single, specific, academic program or

department.

B. Branch Library

Auxiliary unit of a central library unit, which is administered from a central unit, and which has

all of the following:

a. separate quarters

b. a permanent basic collection of books

c. a permanent staff

d. a regular schedule for opening to the public

References: Higher Education Finance Manual (HEFM)

Program Classification Structure (PCS)

IPEDS Libraries Survey

AUTO REPAIR PROGRAMS

Automotive repair, as referred to in this section includes auto mechanics and body shop. This

section is provided due to tax related and classification and reporting issues.

Automotive programs frequently involve hands-on instruction in mechanics and body shop.

Students may elect to use their personal vehicles; however, the instruction may involve the use of

vehicles owned by individuals other than Ivy Tech students. In all cases, the preferred practice

for acquiring parts and supplies is for the vehicle owner to provide the required items. This is

generally accomplished based upon estimates of parts and supply needs.

The practice of the vehicle owner providing parts and supplies is preferred to minimize problems

with Indiana Gross Income Tax and Indiana Sales Tax. In addition, this practice provides for a

uniform method of dealing with the acquisition of automotive program parts and supplies and

does not require the Region to maintain an inventory of parts.

A second acceptable practice, which may be used if the preferred practice described above is

programmatically impractical, permits College funds to be used to acquire necessary parts. The

total expense including sales tax should be accounted for in a program specific accounts

receivable account in the operations fund. Vehicle owners are required to pay amounts due as a

condition of the return of their vehicle. If balances are in the Accounts Receivable account at

fiscal year end, a schedule must be forwarded to the Assistant Assistant Treasurer listing (a)

Vehicle Owner, (b) Date of Purchase of Parts, and (c) Total Amount Due. The total of this

schedule must agree with the balance in the accounts receivable account.

Regions who want to use alternative methods to the two practices detailed above for acquiring

and costing vehicle parts and supplies, must file a request annually with the College Vice

President for Finance/Treasurer. The request will be reviewed to determine the appropriateness

of the alternative method. The request will be filed for each fiscal year and, if approved, will be

retained by the Executive Director of Finance for review by internal and external auditors.

FINANCIAL STATEMENTS

The Ivy Tech Community College of Indiana prepares and distributes an annual financial report.

The report is prepared to meet internal needs, as well as to provide data for oversight bodies and

for public distribution.

The annual financial report includes three basic statements: (1) Balance Sheet, (2) Statement of

Changes in Fund Balance, and (3) Statement of Current Fund Revenues, Expenditures, and Other

Changes. The Notes to Financial Statements are considered to be an integral part of the

Statements. Additional schedules, statements, etc. are included in the report as supplemental

information to assist the reader/user of the report. The College has elected to use the columnar

report format for the basic statements.

For financial reporting purposes, funds with similar characteristics are combined into fund

groups. The College has summarized funds for reporting purposes as:

Current Funds

1. Unrestricted

a. Operations Fund

b. Auxiliary Enterprise Bookstore

c. Auxiliary Enterprise Parking Acquisition/Maintenance

2. Restricted

a. Sponsored Programs Federal

b. Sponsored Programs State

c. Sponsored Programs Local

d. Sponsored Programs Apprentice

e. Private Grants & Contracts

f. Student Aid Federal

g. Student Aid State

h. Student Aid Other

3. Student Loan Fund

4. Endowment and Similar Funds

5. Plant Funds

a. Plant Fund Unexpended

b. Plant Fund Renewal and Replacement

c. Plant Fund Retirement of Indebtedness

d. Plant Fund Investment-In-Plant

6. Agency Funds

a. Agency Fund Payroll

b. Agency Fund Student Activity

The Balance Sheet is a statement of financial position at the end of the College fiscal year-June

30. Account balances for Assets, Liabilities, and Fund Balance are combined for each fund group

as needed for fair presentation. Comparative data is presented for Prior Year.

The Statement of Changes in Fund Balance reports the change in the financial position for the

reporting period for each fund group. All fund groups containing a fund balance are reported.

The Statement of Current Fund Revenues, Expenditures and Other Changes reports revenue

detail by source, and expenditure detail by function for each fund group. Total Revenue and

Total Expenditure data should concur with data reported in Statement of Changes in Fund

Balance.

The Notes to Financial Statements should be considered to be an integral part of the financial

statements. A disclosure summary of significant accounting policies is contained. The summary

briefly describes the fund groups, together with a short narrative concerning activity within each

fund group. Additional notes are contained as required for fair presentation. This may include,

but is not limited to, investment valuation, valuation of Investment-in-Plant, basis of accrual

accounting, significant change in accounting procedure(s), significant changes in fixed assets

and/or long-term liabilities, as well as other material financial consideration. Correction of an

error and/or adjustment of a material amount in previously issued financial statements may be

disclosed in the financial statements or in the notes to the statements.

Supplemental schedules may include Statement of Allocated Fund Balance. The Statement

provides detail of allocated fund balance(s) by fund group. The allocated totals by fund group

should concur with reported allocated funds on the Balance Sheet.

Supplemental schedules on Auxiliary Enterprise Fund Bookstore are currently included. The

purpose is to provide greater detail on an area of concern to management. Greater detail on one

fund in a fund group may be included to provide additional focus on an activity currently

receiving additional management analysis. In addition, graphs and/or charts may be included to

provide alternative presentation of financial data.

Supporting schedules are included on debt service and lease purchase. The schedules may be

detailed by project/location and summarized to report College commitment.

SECTION B: Budgeting

Introduction

Budget development and monitoring at the College is a collaborative process comprised of

several different components, beginning with the biennial legislative budget request. Once the

biennial budget has been approved by the Indiana General Assembly and signed by the

Governor, the College’s annual internal budget development begins. The College’s total budget

is the sum of state funding obtained through the legislative request and revenues from tuition,

fees and other operating revenues. Throughout the year, budget adjustments and transfers may

be necessary. The following sections describe the policies regarding the College’s budget

development and monitoring process.

I. Legislative Budget Request

State operating support for Indiana’s public colleges and universities consists of two categories:

base funding and performance funding.

Base funding accounts for the majority funding the College receives. This is based on historical

changes in enrollment and is adjusted for inflation. A percentage of the base funding is allocated

through a performance formula that rewards outcome measures, including overall degree

completion, on-time graduation, at-risk overall and on time degree completion, STEM degree

completion and student persistence. Data related to the above metrics are measured over a six

year period, composed of three year rolling averages.

Based on this information from the CHE, the College prepares its legislative request for

operating and a separate legislative request for capital funds on a biennial basis. The biennial

budget document(s) is entitled "Legislative Request for Operating and Capital Funds."

The legislative request for capital funds describes new construction, land acquisition, facility

repair and rehabilitation, and major equipment acquisition. An introductory summary statement

provides information concerning each capital request, which is prioritized according to College-

wide goals and needs. Data by project is included with pertinent information concerning need,

relationship to long-range (ten-year) facility plans, other capital improvement projects, impact on

space usage, expected contribution to educational services, and cost computations. Information

regarding each capital request is presented and prioritized according to College-wide goals and

needs.

The legislative request for operating funds addresses the expenditure estimates by major object

and functional categories along with estimated sources of income supporting the educational

services of the College. Numerous schedules are prepared to provide expenditure and revenue

data by different functions and object categories. The cost information study, financial report and

current year budget are used to prepare the requested schedules.

The CHE will present its recommendations to the State Budget Committee. The Governor,

House, and Senate will review both the College’s original request and the recommendation of the

CHE in order to establish the as-passed legislative budget.

II. Annual Internal Budget

A. Internal Budget

The College’s internal budget is prepared on an annual basis. The internal budget is a

planning document used to ensure the optimum allocation of College resources for

instructional programs and support services. The process reflects the state appropriations

from the as-passed legislative budget and student fee increases and wage and salary

adjustments.

The College operating budget is divided into the following areas: campus, campus formula

funding, debt service, Office of Information Technology, Systems Office, college-wide

accounts, and new initiatives.

The first category, the campus budget, is determined by FTE enrollment, miscellaneous

revenues provided by campus, and historical data of the prior year, including adjustments.

Increases are provided for added cost arising from salaries and wages, employee benefits,

and utilities. Increases may be added provided for program improvement or special areas of

services, which are consistent with the overall College plan considering the established goals

and mission. Non-recurring expenditure budget adjustments (prior year reserves, College-

wide accounts, etc.) are excluded from the base year. State funds are allocated based on

certificate and degree completions in alignment with the State of Indiana’s performance

funding model. Of the state funds allocated to the campus, 90% of the base remains in the

campus and 10% is redistributed based on degree completions and equity index.

The second category is campus formula funding. Campus formula funding includes the

student activity fee, financial aid, and dual credit. The dual credit funding is awarded based

on the following: 1/3 based on dual credit full-time equivalent (FTE) enrollment, 1/3 based

on dual credit student being enrolled at least one term as non-dual credit student, and 1/3

based on earning a credential prior to high school graduation.

Campus leadership allocates the total from the campus base and campus formula funding

budget between departments, such as academic, student affairs, and others. The Executive

Director of Finance/Administration assigned to the campus allocates the total between

general expenditure categories, such as salaries and wages, fringe benefits, supplies,

contractual, travel, leases, and capital equipment.

Debt service, Office of Information Technology, Systems Office, and College-wide accounts

are developed and managed by Systems Office. Debt service is supported by the state fee

replacement appropriate from the legislature. The Office of Information Technology budget

is partially based upon the headcount enrollment technology fee and as a shared service,

supports staff salaries, fringe benefits, hardware and equipment, software, and computer

refresh. The Systems Office budget is allocated across several functional departments and

supports many statewide costs, including marketing fulfillment and legal fees.

College-wide accounts are established to serve all locations for benefits that cannot be

attributed to a specific location. Examples of College-wide accounts include unemployment

compensation, apprenticeship support, and insurance.

The budget provided by the campuses and Systems Office departments are reviewed by

Systems Office Budget Management Office to ensure compliance with established internal

goals and external legislative intent. The expenditure budget must not exceed the established

revenue budget, which incorporates revenue from student fees, state appropriations and

miscellaneous sources. The appropriations amount is the result of legislative action, while

forecasted fees are derived from prior year enrollment and the State Board of Trustees

approved fee schedules. After the annual budget document is reviewed by College

management, the campus budget is presented to the campus board for review and the

System-wide budget is presented to the State Board of Trustees for approval.

Once final approval is received from the State Board of Trustees, the budget detail by

location is accumulated by the campus business office and College Systems Office staff for

input to the College accounting records system. The budget detail for the new fiscal year is

balanced/reconciled to the approved total budget. The new budget detail is reflected in the

reports generated by the College accounting system for the month of July. Throughout the

year, campuses are responsible for monitoring the campus sections of the budget and

Systems Office Finance reviews the College’s budget in total on a monthly basis. Once per

semester, adjustments are made for enrollment, (with the exception of Summer when there

are two adjustments made due to the fiscal year change-over).

B. Operational Fund Expenditure Budget

1. Salaries and Wages

Position allocation/budgeting control provides the College the ability to know, at any

given time, the budgetary dollars committed to personnel services for filled and vacant

full-time positions. Every full-time position is defined, approved and budgetary dollars

allocated.

The three salary categories used are exempt (salaried), non-exempt (hourly), and

instructional. Within these three categories, an employee can either be full-time or

temporary/part-time.

For non-instructional areas, all exempt and non-exempt, full-time employees' July 1 salary

are line-item budgeted in the FOAP(s) that they are paid from. Exempt and non-exempt,

part-time temporary budgets may be entered as a line item or as a pooled relationship.

Instructional full-time budgets (including summer appointments) are line-item budgeted in

the FOAP(s) from which they are paid. Part-time/temporary instructional budgets may be

pooled in functional areas. Part-time salaries are projected by the campuses for both non-

instructional and instructional staff. The projections are used in the budget and a

percentage increase is applied if applicable. Adjustments may be made throughout the

year for increases or decreases in enrollment growth.

The salary budget is determined based on the following:

a. The Compensation Analysis, which lists individual position by function including

name, job class number, title and salary, is distributed by Systems Office Budget

Management. It is verified by the campus staff and utilized to determine all

approved, filled and vacant positions.

b.Vacant or unfilled positions are budgeted based on the mid-range hire-in rate of

the current salary range for the job classification.

c. Any nine-month instructional staff member who has a summer extended contract

is identified. The summer appointment amount is to be included in the full-time

salary budget base.

d. Any restricted or auxiliary dollars supporting the salary and wages of approved

positions should be deducted from the salary and wage base for the operations

fund.

The full-time position/budget control base should include only the approved positions

(filled and vacant) which are funded by the operations fund. This base should be the

actual full-time salary and wage commitment of the College operations fund.

Any position changes to the original established full-time salary and wage base must be

processed using a Position Request Form (PRF). When the PRF is approved, a budget

adjustment will be processed by the campus.

Any changes from the budget base must be explained and documented. Every position

included in the salary budget data distributed with the budget allocation will be reconciled.

The above procedure should provide the campus with more control over actual full-time

salary and wage commitments. The adjusted salary and wage budget base should always

approximate the actual salary and wage commitment.

2. Fringe Benefits

The fringe benefits base is determined based on actual filled positions and approved

vacant positions. The recommended budget should be the original budget unless there is

documentation indicating significant changes. If new positions are added or deleted during

the year, or if a position is reclassified resulting in additional or decreased fringe benefits,

a budget adjustment to the fringe benefits' category must be completed. This procedure is

done as part of the PRF process.

The budget allocation includes FICA, retirement, medical and dental benefits, life

insurance, long term disability, wellness program and the fee remission-staff benefit

allocation for employee, employee/spouse, and dependents taking courses at Ivy Tech.

3. General Supplies and Expenses

Several categories within the supplies and expense object category should be line-item

budgeted, including the distribution accounts, financial aid, Perkins MOE, in service

training and maintenance R & R.

All other categories may be pooled at the departmental level or line item budgeted; the

degree of budget detail is at the campus’ discretion.

4. Facilities Leases

Facility leases must be line item budgeted.

5. Utilities

Utility expenses may either be line item budgeted, or a budget pool may be used. The

amount requested and approved in the recommended budget buildup should be the

amount utilized in the original budget. The utility budget will be adjusted to match

expenditures at fiscal year-end.

III. Pooled Budget Accounts

Pooled accounts allow for budgetary funds to be established in one account from which many

expenditure accounts may then draw against this account. When an expenditure occurs, the

budgetary dollars will automatically draw down from the pooled account to cover the charge.

No expenditures should be processed against any pooled budget account. Contractual, travel,

capital and leases other than facilities may be budgeted via a pooled account. Supplies that are

not line item budgeted as specified above may also be budgeted via a pooled account.

IV. Budget Transfer Request

The Budget Transfer Request (BTR) is used in adjusting, correcting, or entering budgetary data

at the beginning and during the fiscal year.

A. Original Budget

Original budgets may be entered in Banner by the campus business office staff utilizing a

journal entry with the type of BD1 (BD01 for Systems Office) when the new year is

opened for use.

B. Transfers

Transfers may be processed by appropriate staff at all locations during the fiscal year for

specified accounts. Transfers may be completed utilizing a journal entry with the type

BD2 (BD02 for Systems Office) for recurring or BD4 (BD04 for Systems Office) for

one-time transfers.

Utility budgetary accounts cannot be changed unless approved by Systems Office Budget

Management Office.

Revenue budgets may only be entered by the Systems Office budgeting staff since it has the

effect of increasing the overall College budget.

V. Campus Reserves

The College has two primary focuses related to campus reserves: 1) a 3% year over year increase

in gross campus reserves and 2) 180 days of operating funds in reserves per campus. The 3%

year over year increase in gross campus reserve is the product of over/under production of

revenue budget, over/under spend of expenditure budget, and the change in student receivables.

It is calculated once per year after fiscal year end close.

Once a campus reaches the 180-day goal, the 3% metric may be discussed with the Senior Vice

President and Chief Financial Officer and the Operations team to determine a more appropriate

goal.

Any expenditure from campus reserves must be approved by the Senior Vice President and Chief

Financial Officer.

Revised January 10, 2019

SECTION C: Tax Manual

I. 1099-MISC

The Internal Revenue Service requires a 1099-MISC form be issued to independent contractors,

other individuals, LLCs, and unincorporated businesses that have received payments of $600 or

more during the calendar year. Systems Office Finance produces the 1099-MISC forms, and

mails one copy to the vendor. The second copy is submitted electronically to the Internal

Revenue Service by January 31st. The 1099-MISC forms are not required to be submitted to the

State of Indiana unless it includes state or local withholdings.

A 1099-MISC form is not required to be issued to 501(c)(3) non-profit organizations, state

agencies, S corporations, or C corporations unless the payment is for medical or legal

services. Payments for medical or legal services must be reported regardless of their federal tax

classification.

The College is responsible for obtaining correct supplier information for 1099 reportable vendors

including the supplier name, social security number/employer identification number, and type of

organization. Failure to obtain correct supplier information may result in a penalty to the

College. This information is collected on a W-9 form, which must be completed for each vendor.

Systems Office Finance utilizes the Internal Revenue Service’s Taxpayer Identification Number

(TIN) matching service to verify the name and SSN/EIN match the IRS’s records for 1099

reportable vendors. If the federal tax classification indicates that an individual will be

performing services for the College, the Independent Contractor form must also be completed

and signed by the individual completing the form, the Human Resources department, and the

campus Finance Office. Completed forms should be returned with the W-9 to the Vendor Create

listserv. Please reference the Procurement section (Section J) of the Financial Management

Manual for further instructions regarding the addition of vendors. If the individual does not meet

the criteria stated on the Independent Contractor form, he/she should be considered an employee

of the College, and payroll taxes will be withheld as appropriate.

The following are examples of non-employee compensation that are reportable on the 1099-

MISC form:

Payments to non-employees for services rendered including payments for fees, honoraria,

and personal service contracts

Payments to recipients other than real estate agents for the rental of property and

equipment

Royalty payments of $10 or more per year

Medical and health service payments including payments to corporations

Payments to an attorney including payments to corporations

Scholarship and fellowship payments are not reported on Form 1099-MISC; these are reported

on the 1098-T form described in Section IV below.

In the fall, the IRS will send a CP2100A notice (B Notices) related to the Form 1099-MISC from

the College’s file submission to the Systems Office Finance department. This list includes errors

such as an incorrect social security number or employer identification number, missing social

security number or employer identification number, or the social security number/employer

identification number that does not match the name on file with the IRS. Systems Office

Finance will send the required B Notice letter to the vendor and request an updated W-9 form by

the date specified by the IRS. If the vendor fails to return an updated W-9 form by the date

specified on the B Notice, the vendor will be terminated in Banner. The vendor cannot be re-

established until an updated W-9 is received. In the event it is a second B Notice for the vendor,

the vendor is automatically terminated upon receipt of the CP2100A notice from the IRS and the

second B notice letter is mailed. The vendor cannot be re-established in Banner until the

appropriate documentation as required by the IRS is received.

Board of Trustees Per Diem

Members of the College’s state Board of Trustees attending board meetings are eligible for

mileage reimbursement and a daily per diem amount. The daily per diem amount is considered

taxable income and must be reported by the board members on their tax returns. The College

will issue a 1099-MISC form if the total per diem amount received by the board member exceeds

$600 for the year. If the total per diem amount does not exceed $600, board members will each

receive a letter from the College stating the amount of per diem received during the

year. Campus board members are eligible for travel reimbursement only.

II. Tax Implications for Nonresident Aliens

Independent Contractors

IRS Publication 515 and Federal Tax Forms 1042, 1042S, and 8233 discuss the federal income

tax implications of contracting with an individual who is a citizen of another country and who

has not been granted resident alien status by the U.S. Citizenship and Immigration Service.

The College will not enter into a contract for services with a nonresident alien without the prior

approval of the President or designee. If it is deemed in the best interest of the College to enter

into such a contract, the contract must be between the College and the party who is providing the

service. The College is responsible for paying the service provider and withholding and

remitting income taxes to the extent required by federal and state law. If the services to the

College are to be funded in whole or part from a grant to the Ivy Tech Foundation, the

Foundation will issue checks to the College to cover the appropriate amounts payable under the

grant.

Contracts entered into for personal services include payments for professional services, including

fees of an attorney, physician, or accountant made directly to the person performing the

service. In addition, it includes honoraria paid by the College to visiting lecturers and

researchers. Pay for certain personal services performed in the United States may be exempt

from U.S. income tax if the person is a resident of one of the treaty countries, if the person is in

the U.S. for a limited number of days, and if the person meets certain other criteria. For many

foreign independent contracts, the maximum number of days the person can reside in the U.S. is

183 days during the tax year. Residents of Canada and Mexico can only be in the U.S. for no

more than 183 days during the calendar year.

Unless the treaties specifically exempt the income earned while the foreign independent

contractor is in the United States, Ivy Tech must generally withhold tax at the 30% rate. This

rule applies regardless of the worker’s place of residence, the place where the contract for service

was made, or place of payment. Ivy Tech must withhold at the statutory rate of 30% on all

payments unless the nonresident alien enters into a withholding agreement or receives a final

payment exemption. The College is required to report the income paid to the independent

contractor and the related withholding on Forms 1042-S and 1042-T.

Scholarship and Grant Reporting

Principle designated school officials working as part of the International Student Hub are

responsible for collecting student information, such as the type of visa and program into which

the student is enrolled. Designated school officials at each campus may assist with collecting

this information.

Accounts of students receiving scholarships, grants or other third party payments must be

reviewed to determine if a 1042-S required. Once the student is determined to need a Form 1042-

S filed on their behalf, there are five procedures that the College follows to ensure proper

reporting and withholding.

1) Determine the amount of qualified and non-qualified scholarships, grants, and third party

payments. Withholding is required on all payments from U.S. sources to nonresident

alien students for non-qualified scholarships and grants. The payment of a qualified

scholarship to a nonresident alien is not reportable and not subject to nonresident alien

withholding. A qualified scholarship is defined as any amount paid to an individual as a

scholarship or fellowship grant to the extent that the amount is used for tuition and fees

required for enrollment at an educational institution and fees, books, supplies, and

equipment required for courses of instruction at the education organization.

2) Third party payments, scholarships, and grants are applied first towards qualified tuition

and fees required for enrollment at an educational institution and fees, books, supplies,

and equipment required for courses of instruction. Any amounts remaining are then

applied to other materials and living expenses, including international insurance.

Amounts that are not considered qualified scholarship expenses as outlined above are

subject to withholding and must be reported on Form 1042-S. If a student receives a

scholarships that covers living expenses as well as tuition and incidental expenses, the

amount for living expenses is taxable and subject to the appropriate withholding tax (14%

for F and J visa students or 30% for all others) unless the student completed IRS Form

W-8BEN to claim a treaty exemption. The amount included on Form 1042-S should not

include amounts reported on Form W-2 or Form 1099.

3) Forms 1042-S must be filed by March 15 of each year and are filed by Systems Office

Finance.

4) Systems Office Finance also files Form 1042, Annual Withholding Tax Return for U.S.

Source of Income of Foreign Persons, which is a summary of all Form 1042-S that have

been filed during the year. Form 1042-T, Annual Summary and Transmittal of Forms

1042-S, is also filed by Systems Office Finance. This form summarizes the number of

Forms 1042-S that are sent to the IRS and total amount of gross income and U.S. Federal

tax withheld on the forms. The forms are required to be submitted by March 15 unless

IRS Form 2758, Application for Extension of Time to File Certain Excise, Income,

Information, and Other Returns has been filed. IRS Form 2758 grants an extension of 30

days to file the forms with the Internal Revenue Service. Copies of the 1042-S forms are

mailed to the students by the March 15th deadline regardless of whether an extension was

granted.

5) Deposit requirements exist for tax liability amounts that are due to the IRS. The amount

of tax that is required to be withheld determines the frequency of deposits. If at the end

of the calendar year, the total amount of undeposited taxes is less than $200, the taxes can

be paid with Form 1042 or by depositing the entire amount by March 15 of the following

calendar year. If at the end of any month the total amount of undeposited taxes is more

than $200 but less than $2,000, the taxes must be deposited within 15 days after the end

of the month. If at the end of any quarter-monthly period, the total amount of

undeposited taxes is $2,000 or more, the taxes must be deposited within 3 business days

after the end of the quarter-monthly period. A quarter-monthly period ends on the 7th,

15th, 22nd, and last day of the month. All funds must be deposited using the Electronic

Federal Tax Payment System (EFTPS). Systems Office Finance handles the depositing of

withholdings.

Hiring Nonresident Alien Students for Employment

A student is defined as any individual who is temporarily in the U.S. on a F, J, M, or Q visa and

substantially complies with the requirements of that visa. Any person who meets these

conditions for five calendar years, will not meet the requirement after the fifth year unless the

person can establish to the satisfaction of the IRS that he/she does not intend to permanently

reside in the U.S. and has substantially complied with the requirements of his/her nonimmigrant

status. The student must be granted permission to work, and must have his/her Form I-94,

Arrival-Departure Record stamped. In order for the student to be in compliance with the visa

status, the student must not work more than 20 hours per week while school is in session (the

student may work full-time while on breaks), and on-campus employment must be performed on

the College’s premises or at an off-campus location which is educationally affiliated with the

school.

Any nonresident alien student who is enrolled and regularly attending classes may be exempt

from social security and Medicare taxes on pay for services performed for that school. If the

student is a resident alien classification, pay would be subject to social security and Medicare

taxes.

Prior to employment with the College, the student must file Form I-765, Application for

Employment Authorization, with Form I-20 A-B/I-20 ID, Certificate of Eligibility of

Nonimmigrant (F-1) Student Status. The student will also be required to complete the New Hire

Packet. If the student is from a treaty country, the student should file Form 8233, Exemption

from Withholding on Compensation for Independent (and Certain Dependent) Personal Services

of a Nonresident Alien Individual.

At the end of the year, Systems Office Finance will file Form W-2 and Form 1042-S as

appropriate for those receiving compensation from Ivy Tech. Form W-2 reports income earned

that is not covered by tax exemption. Form 1042-S is used to report wages in which there was

no tax withheld due to the claiming of a tax treaty or fellowship. Forms 1042-S are mailed to

student employees by March 15th. Copies of Form 1042-S and the transmittal form, 1042-T, are

also submitted to the IRS by March 15th. Form W-2, if applicable, will be sent no later than

January 31st.

Hiring Nonresident Employees (Non-Students)

Salaries, wages, or any other pay for personal services paid to nonresident alien employees are

subject to graduated withholding in the same way as for U.S. citizens and residents if the wages

are effectively connected with the conduct of a U.S. trade or business. Any wages paid to a

nonresident alien for services performed as an employee for an employer are generally exempt

from the 30% withholding if the wages are subjected to graduated withholding.

Pay of professors and teachers who are residents of treaty countries is generally exempt from the

U.S. income tax for two or three years if they temporarily visit the U.S. to teach or do

research. The exemption applies to pay earned by the visit professor or teacher during the

applicable period. For most of the treaty countries, the applicable period begins on the date of

arrival in the U.S. for the purpose of teaching or engaging in research.

Wages paid to teachers, professors, and researchers are given a separate income code number

because many tax treaties provide at least partial exemption from withholding and from U.S.

tax. Graduated withholding of income usually applies to all wages, salaries, and other pay for

teaching or research paid by Ivy Tech.

A nonresident alien temporarily in the U.S. on an F-1, J-1, M-1, or Q-1 visa is not subject to

social security and Medicare taxes on pay for services performed to carry out the purpose for

which the alien was admitted to the U.S. Social security and Medicare taxes should not be

withheld or paid on this amount. However, if an alien is considered a resident alien, that pay is

subject to social security and Medicare taxes even though the alien is still one of the

nonimmigrant statuses mentioned above. This also applies to FUTA (unemployment) taxes paid

by the employer. Alien teachers, researchers, and other alien employees temporarily present in

the U.S. on a H-1a, H-1b, L-1, O-1, O-2, P-1, P-2, P-2, TC, TN, refugee, or asylee immigration

status are fully liable for social security and Medicare taxes unless an exemption applies from

one of the tax treaties.

III. Payroll and Related Taxes

Payroll handles federal, state, and local tax withholding for the College as well as the annual W-

2 reporting. The amount of federal tax withheld is determined based on the federal withholdings

chart and the number of allowances the employee reports on their W-4, Employee’s

Withholdings Allowance Certificate. The amount of state and/or local tax withheld is based on

the state and local withholdings chart and allowances as reported on the employee’s Indiana

Form WH-4, Employee’s Withholding Exemption and County Status Certificate, Form MI-W4

for Michigan, Form K4 for Kentucky, or Form IT-4 for Ohio as appropriate.

W-2s are mailed to the employee’s address on file with the College no later than January 31st,

and are also available on MyIvy. Payroll submits the W-2 information to the Social Security

Administration, state and local tax agencies by the January 31st deadline.

Employees Assigned a College Car

Effective July 1, 2019, no additional College cars should be assigned to employees. Employees

with a College car assigned prior to this date may continue using their current vehicle until it is

no longer operational in accordance with the policy in Section H of the FMM.

In the event that employees are permanently assigned a College vehicle with the ability to use the

vehicle for personal use, the name of the person assigned the vehicle should be reported to

Systems Office Finance. Fuel and maintenance reimbursements for the car may be taxable to the

employee. Systems Office Finance will review all fuel reimbursements, maintenance, and gas

card charges for the assigned vehicle, and will provide this information to Payroll for inclusion

on the employee’s W-2 form as appropriate.

Moving Expenses

At the discretion of the President, an individual may receive reimbursement for expenses

incurred in moving to accept a position at the College. Alternatively, the College may pay a

third party for expenses related to an individual’s move to accept a position at Ivy Tech.

Reimbursement of moving expenses or payments to a third party for expenses related to a

prospective employee’s move are considered compensation and subject to taxation.

Systems Office Finance will identify moving expenses using the account codes in Banner, and

provide this information to Payroll for inclusion on the employee’s W-2 form.

Educational Support--Fee Remission, Tuition Assistance, and Tuition Reimbursement

Under current Federal laws all or some portion of fee remission, tuition assistance, and tuition

reimbursement benefits may be subject to taxation.

For an Ivy Tech employee applying for Ivy Tech fee remission for themselves at the

undergraduate level, remission benefits are not taxable. This is also true for the spouse or

dependent child of an Ivy Tech employee using the College’s fee remission benefits at the

undergraduate level.

The College’s tuition assistance program is available to full-time, benefits-eligible faculty and

staff pursuing a terminal degree or degree required as a condition of employment. Faculty and

staff in this program may be supported for up to twenty-four (24) hours per fiscal year, not to

exceed nine (9) credit hours per semester provided the coursework is taken at an institution

accredited by the federally recognized regional association.

Tuition reimbursement may also available to full-time, benefits-eligible faculty and staff who

wish to enroll in college and university classes outside of Ivy Tech on an elective

basis. Participants in the reimbursement program may be supported for up to twelve (12) credit

hours per fiscal year, provided budgetary funds are available and the course is taken at an

institution accredited by the federally recognized regional association. For a comprehensive list

of requirements for participation in the tuition assistance and tuition reimbursement programs,

please review the Educational Support section of the Full-Time Employee Handbook.

According to Section 127 of the IRS Code and IRS Publication 15-B, employee tuition

assistance and tuition reimbursement for undergraduate, graduate or professional level courses

may be taxable. If an employee receives more than $5,250 in tuition assistance or reimbursement

per calendar year, the value of the assistance or reimbursement above $5,250 should be included

as wages and reported in Box 1 of the employee’s W-2.

IV. 1098-T Forms

Ivy Tech is required to issue Form 1098-T, Tuition Statement, which reports payments received

for qualified tuition expenses during the calendar year. Qualified tuition is defined as tuition,

fees, and course materials required for a student to be enrolled at or attend an eligible education

institution. Amounts paid for any course or education involving sports, games, or hobbies,

unless related to the student’s degree program or charges for room, board, insurance, student

health fees, transportation and other living expenses are not considered qualified tuition.

Effective for tax year 2018, the College reports the payments received for qualified tuition and

related expenses.

The form also reports scholarships or grants applied to the student’s account during the calendar

year. The form is informational only and may assist students in determining their ability to

qualify for the education credit on their federal tax return. The 1098-T forms are generated by a

third party processor with the assistance of the Cash Management department and are

postmarked by January 31 to the student’s address on file with the College. The third party

processor submits the required file to the Internal Revenue Service. Students may also access

their 1098-T forms through MyIvy and the third party processor’s website.

Copies of 1098-Ts for the current year and two years prior may be requested from the Cash

Management department Systems Office—Finance. If a 1098-T needs to be corrected, the

campus Business Office should contact the Cash Management department.

1098-Ts are not generally issued to high school or apprenticeship students unless requested by

the student. 1098-Ts are also not issued to Indiana College Network students. The student must

have a social security number or taxpayer identification number provided to the College in

Banner in order to receive a 1098-T. The College requires social security numbers for all new

applications. In the event a student did not receive a 1098-T due to not having a social security

number on file with the College, the Cash Management Department at the College will issue a

1098-T for three prior years upon request of the student.

In the fall annually, the College may receive a list of students whose social security number is

either missing from the 1098-T form or whose name and social security number on the 1098-T

form did not match the records of the Internal Revenue Service (B Notice). The list is reviewed

by Systems Office—Finance and letters are sent to the students on the list to request an updated

social security number and corrections are made as appropriate.

V. Gifts, Prizes, and Awards

College departments and recognized student organizations may conduct drawings or other games

of chance to encourage attendance and participation in events. Prior to the drawing or game of

chance, the College’s General Counsel’s office should be contacted to ensure the event and prize

are in compliance with the regulations established by the Indiana Gaming Commission.

Indiana state law requires entities that conduct charity gaming and raffles to acquire a gaming

license. Indiana Code 7-32.2-2-26 defines a raffle as “the selling of tickets or chances to win a

prize awarded through a random drawing.” Raffles, bingo, poker, and other similar games are

prohibited by the College unless determined by the College’s General Counsel to be approved.

The value of the prize awarded through a drawing or contest is considered taxable income to the

recipient and may be reported to the federal and state revenue agencies as appropriate. Prizes or

gifts that include cash or cash equivalents, such as bookstore gift cards, or tangible items

determined to not meet the IRS’s definition of de minimis, may also be considered taxable

income to the recipient and reported to federal and state revenue agencies as

appropriate. Tangible items such as t-shirts or plaques are considered to be de minimis and not

required to be reported. Cash or cash equivalents, such as gift cards, no matter the value, are

never excludable as de minimis. Questions regarding whether an item meets the definition of de

minimis or reporting of specific items should be directed to the Chief Accounting Operations

Officer in Systems Office Finance. Campus and Systems Office staff providing gifts, awards, or

prizes should complete the Gifts, Prizes, and Awards Data Form and return to Systems Office

Finance within 10 days of distribution. Payments to non-employees totaling $600 or more in a

calendar year will be reported on Form 1099-MISC.

Prizes given by third parties directly to individuals are not reportable by the College.

Awards or gifts to employees, except for length of service, are taxable and must be reported to

Payroll for inclusion on the W-2 form. Awards to employees for length of service are not

taxable if received after a minimum of five years, during a presentation, not cash or cash

equivalent and no other awards were received in the most recent five years. In order to ensure

compliance with the IRS’s qualified plan award regulations, the average cost of all the length of

service awards given by the College during the tax year must be $400 or less. Cash and cash

equivalents, as stated above, are never considered de minimis and should not be purchased for

use as a gift, prize, or an award to an employee. Tangible gifts in excess of $100 for employees

and not meeting the above stated definition of a service award are taxable and should be reported

to Payroll for inclusion on the employee’s W-2. Note, this applies when the award or gift is

purchased by the College and does not include gifts paid by individuals personally without

reimbursement from the College.

Cash awards given to students should be reviewed to determine if it is a scholarship or prize. In

order to be considered a tax-free scholarship, the recipient must be a candidate for a degree at an

educational institution that maintains regular faculty and curriculum and normally has a regularly

enrolled body of students in attendance. The amounts are limited to the amount received to pay

for tuition and fees required for enrollment or attendance at the educational institution, or for

fees, books, supplies, and equipment required for courses at the institution. Scholarships should

be reported to Financial Aid for inclusion on the student’s record.

VI. Unrelated Business Income Tax

Ivy Tech is allowed an exemption from federal income taxes due to its classification as an

instrumentality of the State of Indiana. Income earned from engaging in activities that further

the College’s mission and purpose is exempt from federal income taxation as this is related to

College’s reason for the exemption. Ivy Tech is not exempt from federal income taxation on

activities that are regularly carried out and not substantially related to the exempt purpose of the

College regardless of whether the income is used to support or carry out the charitable,

educational, or other functions or operations that constitute the bases for the exempt status. The

following three criteria must be met in order to be considered an unrelated business:

(1) A trade or business (defined as activity conducted for the production of income from

selling goods or performing services).

(2) Regularly carried on (that is not infrequent or sporadic or conducted for a short period

or number of times during the year; not intermittent).

(3) Not substantially related to the organization’s exempt purpose.

Annually, the College must complete an Exempt Organization Business Income Tax Return

(Form 990-T). The Executive Director of Finance/Administration for each campus should

submit the Unrelated Business Income Tax form to the Chief Accounting Operations Officer

annually.

There are certain exclusions from the above general rule. Income from an activity that would

normally be deemed unrelated and therefore subject to tax, is nontaxable where:

(1) Volunteer workforce. Substantially all the work in carrying out the trade or business

activity is performed for the College without compensation. The College defines

substantially all as 85%.

(2) Convenience of members. The business is carried on primarily for the convenience of

the College’s students, employees or officers.

(3) Sales of donated merchandise. The selling of merchandise, substantially all of which

was received as gifts or contributions to the College.

(4) It results from passive rental activities.

Systems Office Finance ensures timely filing of College Federal, State, and Local income, excise

and sales tax returns and payments. Annually, Systems Office Finance files the Form 990-T, the

exempt organization Business Income Tax Return.

VII. 1098-C, Contributions of Motor Vehicles, Boats, and Airplanes

Form 1098-C must be completed for donations of a motor vehicle, boat or airplane with a value

of $500 or more. A separate form must be completed for each qualified vehicle. A qualified

vehicle is defined by the IRS as any motor vehicle manufactured primarily for use on public

streets, roads, and highways, a boat or an airplane.

The campus Finance Office is responsible for preparing copies of the Form 1098-C for items

donated directly to the College, including listing the donee’s name, address, and telephone

number, date of contribution, donee’s tax identification number (35-1180631), donor’s tax

identification number, donor’s name, and donor’s address. The odometer mileage, year, make,

model and vehicle or other identification number should be completed as available. Boxes 4-7

on Form 1098-C should be reviewed for applicability, and completed if necessary. Copies of the

forms should be sent to Systems Office Finance no later than January 15th of the year following

the donation. Form 1098-C should not be prepared for qualified vehicles that are donated to the

Ivy Tech Foundation. Systems Office Finance will complete the required submission to the

Internal Revenue Service by the March 15th deadline.

VIII. Sales & Use Tax

Sales Tax on College Purchases

As a non-profit organization, the College is entitled to purchase goods and services, including

meals and hotel rooms, exempt from tax if the goods, services, or meals are to further the non-

profit’s exempt cause or to be sold during a fundraiser to raise money for the College’s exempt

cause. Goods, services, or meals for fundraisers are limited to 30 days within a calendar year.

When purchasing goods or services, including meals and hotel rooms, for a valid exempt

function of the College, a completed sales tax exemption certificate, State of Indiana Form ST-

105, should be presented to the vendor. For vehicle or watercraft purchases, State of Indiana

Form ST-108E, should be presented. Sellers may refuse to accept the certificate if the following

criteria are not met:

• Purchase must be paid using College funds

• Must be billed directly to and paid by the College (not an employee of the College and

subsequently reimbursed)

• Purchase must be for a valid exempt function of the College.

Signed Indiana sales tax exemption certificates are available by contacting Systems Office

Finance.

Sales tax laws differ by state. Campus Finance Offices should confirm the process for obtaining

sales tax exemptions with the vendors, which they are conducting business. Requests to

complete sales tax exemption certifications for other states should be sent to the Chief

Accounting Operations Officer.

Sales Tax and Food and Beverage Tax on College Sales

Ivy Tech must collect and remit Indiana State Gross Retail Sales Tax from purchasers on sales of

goods and tangible personal property, including IncludED materials, unless an exemption exists,

or unless the purchaser presents a valid exemption certificate.

Additionally, the College is required to pay Food & Beverage tax at the rates specified by towns

and counties through the Indiana Department of Revenue.

The Cash Management department within Systems Office Finance calculates sales tax and food

and beverage tax on a monthly basis, and submits payment to the State of Indiana. Sales tax is

calculated at the Indiana state sales tax rate less a collection allowance of all accounts that

indicate “taxable” in their titles. Food and beverage tax is calculated according to the county

food and beverage tax rates published by the Indiana Department of Revenue. Therefore, all

taxable revenue should be recorded to an account that uses “tax” or “taxable” in its title.

Examples include the following account codes: 1071, 1602, 1605, 1606, 1610, 1710, 1720, 1721,

1726, 1736, 1807, 1831, and 1888. Additionally, all taxable revenue should have a

corresponding entry for sales tax collected posted to account code L008 or L009 for food &

beverage tax for the same fund in which the taxable revenue was posted.

IX. Excise Tax on Executive Compensation

In accordance with the Tax Cuts and Jobs Act, the College is subject to a 21% excise tax on

compensation in excess of $1 million paid to a covered employee and severance payments three

times or more of the individual’s annual salary. Systems Office Finance maintains the list of the

College’s five highest paid employees annually to ensure compensation does not exceed $ 1

million. Severance packages exceeding three times the employee’s average salary must be

reported to Systems Office Finance by the campus Finance department and/or the College’s

General Counsel.

X. Property Taxes

Properties owned by Ivy Tech are exempt from Indiana property tax. In accordance with

guidelines from the Indiana Department of Local Government Finance provided to the College

of January 19, 2010, each parcel of real estate owned by the College should be listed with the

610 (Exempt Property Owned by the State of Indiana) classification code.

Landlords who rent property to the College for its exempt purpose can qualify for an exemption

from property tax. The owner of the property must file two copies of Form 136 with the assessor

of the county in which the property is located. The application must be filed annually or before

April 1 of the assessment year and re-filed every even year.

Reviewed January 28, 2019

SECTION D: Record Retention

I. Rationale

A. Ivy Tech Community College of Indiana is subject to the statutes of the State of Indiana

concerning the preservation and destruction of all public financial records. The financial records

of the College will be preserved and/or destroyed as required by Federal and State Regulations.

B. The Vice President/Treasurer or designee is responsible for maintaining the filing and record

retention for the financial functions of the College. The Vice-President/Treasurer designates the

Executive Director of Finance (EDF) to be responsible for maintaining the filing and record

retention in each Region. The filing system will be so designed as to provide quick and adequate

retrieval for use by the financial staff, internal and external audit staffs, or other authorized

personnel. Retention schedules, disposal plans and relevant policies will be on file and available

for external and internal audit.

C. Financial records will be retained according to the recommended Commission on Public

Records retention schedule found in this section. Supporting documentation, including but not

limited to, invoices, requisitions, bids, quotes, receipts, etc., must be retained according to the

retention schedule specified with/for each financial document. Retain the documents in

appropriate storage either as an original paper document, or in one of the authorized formats

found in Chapter III, Definitions. In the event of conflicting retention requirements the longest

period of time will prevail.

D. Maintain the financial records for the current and prior fiscal year on-site. Files or documents

subject to retention may be kept off-site as long as adequate and reasonable security precautions

are taken. Retention of specialty reports, like the FBM070 series, other ad hoc reports or

spreadsheets, is at the discretion of the department receiving or creating the report. However, if

specialty reports are used to support financial reports, retention is the responsibility of the

individual filing the report and it must be maintained for audit purposes.

NOTE: If an audit has begun within the proposed retention period those records may not be

destroyed until the audit is complete. The Treasure's Office is responsible for issuing the

Notification of Audit Completion. Records will not be destroyed until receipt of this notification.

II. Applicable Regulations

State Commission of Public Records Guide for Preservation and Destruction of Public Records,

Revision 1973;

Indiana Code 5-15-5.1-1 as amended;

Burns Indiana Statutes, Section 57-401 et seq;

State Board of Accounts;

Office of Management and Budget Circular A-110, revised 11/19/93, as amended 9/30/99.

III. Definitions

A. Public Financial Records. "Public records or Records" include records that have been

recorded, copied, or reproduced by a photographic, photo static, miniature photographic, or

optical imaging process that correctly, accurately and permanently copies, reproduces or forms a

medium for copying or reproducing the original record on a film, compact disk (CD) or other

durable material. The copy must be treated as an original.

The following list includes, but is not limited to, documents that are considered part of the public

financial records of the College and are subject to the retention schedules:

1. Budget Transfer Requests (BTR).

2. Cash Receipt Vouchers.

3. Purchase Requisition/Check Requests.

4. Purchase Orders.

5. Invoice Vouchers.

6. Journal Entries (JE).

7. Statement of Accounts (FRS records).

8. Banking and Investments.

9. Payroll Records.

B. Electronic Records. Any record(s) created, maintained, altered or deleted in digitized format.

Just like paper records, the same retention requirements apply to these formats. Security

measures will be taken to protect these records from unauthorized alterations or deletion.

C. Computer Output Microfiche (COM). A process for copying and printing data onto

microfilm from an electronic media found on a personal computer, mini or mainframe computer.

The information is 'read' from a formatted magnetic media (tape) and transferred to microfiche

by laser. This medium requires a separate microfiche reader or reader/printer machine. This

medium prevents unauthorized alteration or deletions.

D. Compact Disk-Read Only Memory (CD-ROM). The process for transfer of information is

the same as paragraph c. The information is processed in a tape format and transferred to a "read-

only" computer disk. Information is retrieved using any appropriate CD system. This medium

prevents unauthorized alteration or deletions.

E. Imaging. An optical imaging process that correctly and accurately copies, reproduces, or

recreates the original record, document, paper or instrument. Indiana Code 5-15-1-1(a) as

amended by Public Law 79 1995 allows for the use of an imaging system in the creation and

storage of public records. Imaging systems will be designed to:

1. insure security of the information,

2. appropriate indexing for ease of retrieval and,

3. provides full documentation of the procedures for which documents will be imaged. The

procedures will identify who in each Region and/or Central Office location is responsible for

verifying the image is a true and accurate representation of the original document.

4. an imaged document must in a retrievable format that does not allow alteration or deletion.

IV. Disposal/Destruction

The preferred method of destruction for most records is recycling. However, Indiana Code 5-15-

5.1-13 states that confidential records must be destroyed in such a manner that they cannot be

"read, interpreted, or reconstructed". The preferred method of confidential record destruction is

shredding.

A confidential record is defined as:

A. Any record(s) that contain personal identifying information. (e.g., employee or student name,

address, or social security number); B. Document(s) of a legal nature; or C. Any internal

document(s) determined by the holder to be of a confidential nature. All other records can be

considered of an ordinary nature and may be appropriately recycled. No record will be destroyed

until a period of at least three (3) years has passed from the time the record was originally filed.

Federal or State program(s) retention requirements take precedence over the retention period

defined in the schedule, or by this section. NOTE: If a document or record will be

maintained/retained by an electronic, magnetic or photo imaging process, the duplicate paper

copy can be destroyed. However, the integrity of the record must be maintained and the

electronic media verified for accuracy, by a College representative, prior to the paper copy being

appropriately destroyed. The NOTE above is amended by memorandum from Crocker Price,

Vice President and General Counsel, dated April 26, 2001, sent to all College Officers,

Chancellors and Campus Deans. The memorandum states: "I have recently received various

questions and inquiries regarding the College's Document Imaging Project. One of the issues

discussed has been the disposal of hard copy documents one the information has been imaged. It

is the opinion of the General Counsel's Office that the original documents should not be

destroyed at this time. "As the College forges ahead in the utilization of technology, it is

important that all legal requirements be addressed. Once the imaging process has been properly

reviewed and the College has obtained relative assurances that we are complying with all

applicable laws and regulations, the imaged document will serve as the official record of the

College. Until such time, however, the original hard copy documents should still be considered

the official record of the College and should not be destroyed."

Appendices: Appendix A

The retention schedules for FRS, HRS, SIS and FFX records and reports are found in Appendix

B, C, D, E and F. Prior to the implementation of the FRS System the college computer

processing was EPIC. Any EPIC documentation, files, records, or microfiche, prior to January 1,

1990 may be appropriately destroyed and/or recycled. Historical records. Documentation of

historical value to the college should be retained, in their original state. If they are stored off site

all applicable records retention policies apply

Appendix B

FRS REPORT RETENTION SCHEDULE

LOCATION: CENTRAL OFFICE

Report Report Name Retention

DAILY REPORTS

FBD009 Daily Collector Report (FA) 2 months

FBD010 Daily Diagnostic Report 5 years

FBD011 Daily Bank Activity Report 2 months

FBD015 Daily Sort Merge 18 months

FBD016 Suspense Listing 2 months

FBD017 Daily Cash Receipts Listing 2 months

FBD018 Daily Cash Disbursements Listing 2 months

FBD019 Daily On-line Transcript 5 years

FBD043 Daily (GL) Summanry of Accounts Controls (Bank Account Balances) 1 week

FBI005 Table Load Report COA/GSE/ABR/FRS Table Maintenance 2 cycles

FBM097 Description Load Program 2 cycles

FBX008 Report Description File Update Diagnostic List 2 cycles

VBD009 Data Collector Report (AP) 2 months

VBD010 Daily File Maintenance Diagnostics 5 years

VBD020 FA Feed Report (Accounting Feed-Daily Cycle) 1 year

VBD029 Voucher Review Register (Daily Voucher Register/Voucher No. within batch) 2

months

VBD030 Daily Voucher Register 2 months

ZBA900-1 Data Collection Processing (FA) 2 months

ZBA900-2 Data Collection Processing (AP) 2 months

ZBA910 Automated D/C - Batch Delete 2 months

CHECK CYCLE REPORTS

VBC010 Check Cycle Extract 1 month

VBC025 Check Cycle Update 1 month

VBC030 Check Cycle Cash Disbursement Report 1 month

VBM092 Cash Requirements 3 days

WEEKLY REPORTS

FBM091 Report of Transactions 2 weeks

FBM100 OPT = Control 1 month

FBW022 Transactions Across Regions (listing of transactions posted to another Region's

Account) 1 month

VBM093 Cash Requirements (Selection = Credit) / Outstanding Vouchers 4 weeks

MONTHLY REPORTS

FBM003 Month End Turnover Initialization 1 year

FBM004 Transaction File Purge 1 year

FBM006 Prior Year Accumulator Load 1 year

FBM009 Open Commitment Status 2 months

FBM015 Year-to-Date Transaction History Merge 1 year

FBM019 Cash Report (Option = CM) - By Bank 2 months

FBM040-1 Chart of Accounts List - By Location, By Ledger, By Account 1 month

FBM040-2 Chart of Accounts List - By Account Number 1 month

FBM040-3 Chart of Accounts List - By Account Purpose 1 month

FBM050 Report of History File Merge 1 year

FBM061(F) Fund Group Summary GL & SL (by Fund) 1 year

FBM061(R) Fund Group Summary GL & SL (by Region) 1 year

FBM070-03 Fee Remission 2 months

FBM070-04 Federal Workstudy 2 months

FBM070-05 Trial Balance 1 year

FBM070-06 Federal Workstudy Summary 2 months

FBM070-09 Sponsored Programs 1 year

FBM070-9A Sponsored Programs 1 year

FBM070-9B Sponsored Programs 1 year

FBM070-9C Sponsored Programs 1 year

FBM070-11 Budget Reconciliation Report 1 year

FBM070-Y1 2-1-8-9 Subsidiary Ledger Report 1 year

FBM070-Y2 2-1-8-9 Subsidiary Ledger Report 1 year

FBM070-BA Major Object Report - By Region 1 year

FBM070-BB Base Budget Report 1 year

FBM070-BC Regional Divisional Report 1 year

FBM070-BE Revised Board Report - By Region 1 year

FBM070-BF Supplies & Expense Report - By Region 1 year

FBM070-BG New Year Budget Transition - By Region 1 year

FBM070-BJ Major Object Report - By Site 1 year

FBM070-BK Site Divisional Report 1 year

FBM070-BL Revised Board Report - By Site 1 year

FBM070-BM Supplies & Expense Report - By Site 1 year

FBM070-BN New Year Budget Transition - By Site 1 year

FBM070-B1 Board Report - By Object 1 year

FBM070-B2 Board Report - By Function 1 year

FBM070-B3 Board Report for Revenue 1 year

FBM070-CP Equipment Capitalization 1 year

FBM070-FF Federal Funds Revenue / Expenditure 2 months

FBM070-FF Federal Funds Revenue / Expenditure - By Region 2 months

FBM070-OF Other Funds Revenue / Expenditure 2 months

FBM070-OF Other Funds Revenue / Expenditure - By Region 2 months

FBM070-SF State Funds Revenue / Expenditure 2 months

FBM070-SF State Funds Revenue / Expenditure - By Region 2 months

FBM070-IG 1-8-2 General Ledger Report 1 year

FBM070-IS 1-8-2 Subsidiary Ledger Report 1 year

FBM092-2 Account Statement & Transaction GL/SL for

Ledger 4 & 8 1 year

FBM092-4 Account Statement & Transaction for

Ledger 4 & 8 1 year

FBM094-1 General Ledger - By Account Control 3 years

FBM095-1 Subsidiary Ledger Summary - By Fund 5 years

FBM095-4 Subsidiary Ledger Summary - By Location, By Fund 1 year

FBM100 Batch File (Option = Batch) 2 months

FBM100 Option = Control 2 months

VBD020 Account Feed Generator 2 months

VBM005 Vendor/Vouvher Purge Selection 1 year

VBM010 Month End Vendor/Voucher Purge 1 year

VBM020 Monthly Cash Disbursement (Check Sequence) 4 months

VBM020 Monthly Cash Disbursement (Name Sequence) 4 months

VBM093-1 Outstanding Vouchers (Select = All) 2 months

VBM093-3 Outstanding Vouchers (Select = All, Option = L) 2 months

VBM094 Outstanding Check Linsting Bank 32 1 month

VBM100 Batch File List 2 months

MONTHLY "FOCUS" REPORTS

FFM601 Budget Adjustments 1 year

FIM010 Subsidiary Ledger (End Date) 1 year

FIM015 General Ledger (End Date) 1 year

FIM020 Capital Equipment 1 year

FIM030 Reclass 1 year

FIM031 Totals 1 year

FINANCIAL REPORTS for "Fiscal Year-End Close"

(Reports dated June 30, 20XX)

VBM093 Outstanding Vouchers (Option L Credit Liability Account Number) 5 years

FBD016 Suspense Monitor (Regions) until cleared

FBD043 Account Control Summary 1 week

FBI005 Table Load Report COA/GSE/ABR 2 cycles

FBM003 New Month Initialization 2 months

FBM009 Open Commitment Status 2 months

FBM015 Year-to-Date Merge 1 year

FBM019 Cash Report by Bank (Option = CM) 2 months

FBM040-1 Chart of Accounts - By Location 3 years

FBM040-2 Chart of Accounts - By Account Number 3 years

FBM040-3 Chart of Accounts - By Purpose Code 1 month

FBM040-4 Chart of Accounts - By Fund 1 month

FBM050 Report History Merge 1 year

FBM061(F) Fund Group Summary (GL & SL) - By Ledger 18 months

FBM061(R) Fund Group Summary - By Region 18 months

FBM070-BA Regional Board Report 5 years

FBM070-BB Base Budget Report 5 years

FBM070-BC Regional Board Report 5 years

FBM070-BD Regional Board Report 5 years

FBM070-BE Regional Board Report 5 years

FBM070-BF Regional Board Report 5 years

FBM070-BJ Site Board Report 5 years

FBM070-BK Site Board Report 5 years

FBM070-BM Site Board Report 5 years

FBM070-BN Site Board Report 5 years

FBM070-B1 Board Report - By Object 5 years

FBM070-B2 Board Report - By Function 5 years

FBM070-B3 Board Report for Revenue 5 years

FBM070-CP Capital Equipment 5 years

FBM070-FF Federal Funds Revenue / Expenditure 5 years

FBM070-OF Other Funds Revenue / Expenditure 5 years

FBM070-LOF Other Funds Revenue / Expenditure - Location 5 years

FBM070-SF State Funds Revenue / Expenditure 5 years

FBM070-LSF State Funds Revenue / Expenditure - Location 5 years

FBM070 IA-IN IPEDS Report - Part A - F, L & N 5 years

FBM070-K3 Balance Sheet 5 years

FBM070-K4 Statement of Changes in Fund Balance 5 years

FBM070-K5 Statement of Current Fund Revenues, Expenditures and other Changes 5 years

FBM070-Y1 2-1-8-9 Subsidiary Ledger Report 5 years

FBM070-Y2 2-1-8-6 Subsidiary Ledger Report 5 years

FBM070-Y3 2-1-8-6 Subsidiary Ledger Report (Non-Current Funds) 5 years

FBM070-IG 1-8-2 General Ledger Report 5 years

FBM070-IS 1-8-2 General Subsidiary Report 5 years

FBM070-03 Fee Remission 5 years

FBM070-04 Federal Work-Study 5 years

FBM070-05 Trial Balance 5 years

FBM070-06 Federal Work-Study Summaru 5 years

FBM070-09 Sponsored Programs (Includes Options 9A, 9B, & (9C) 5 years from last year in

program

FBM070-11 Budget Reconciliation Report 5 years

FBM090 Account Statement in Whole Dollars Reclassification (D, H, E, V, A, T) 18 months

FBM092-2 Account Statement & Transaction Inter-Leave - By Fund 5 years

FBM092-3 Account Statement & Transaction Inter-Leave - (SL) Fund 01, Central Office 5

years

FBM092-4 Account Statement & Transaction Inter-Leave 5 years

FBM094 General Ledger (Use Element FBA Element Store FG & FA) By

Region/Fund/Account 5 years

FBM094-1 General Ledger - By Account Control 5 years

FBM095-1 Subsidiary Ledger Summary - By Fund 5 years

FBM095-3 Subsidiary Ledger Summary - By Region, By Fund 5 years

FBM095-4 Subsidiary Ledger Summary - By Location, By Fund 5 years

FBM097 Description Load Program 1 month

FBM100 Batch File List (Option - Batch) 2 months

FBR009 Open Commitment Status 2 cycles

FBX008 Report Description File List 5 years

FIA010 Expended Funds Account Range 441000-449999, By Purpose, By Sub-Code 5 years

FIA020 Expended Funds Account Range 100000-559999, By Purpose, By Sub-Code 5 years

FIA030 Current Funds Expended Account Range 100000-599999, By Purpose 5 years

FIA040 Current Funds Expended Account Range 100000-599999, By Fund 5 years

FIA045 Current Funds Expended (Selected Funds Only) By Purpose, By Fund 5 years

FIA050 Expended Funds Account Range 100000-599999, By Fund/Pur/Div/Dept/Subcode 5

years

FIA055 Expended Funds Account Range 100000-599999, By Fund/Pur/Dept/Subcode 5 years

FIA060 Expend Element Account Range 100000-599999 (Selected Departments) 5 years

- By Fund, Purpose, Division, Department, Subcode

FIA070 Expend Element Account Range 100000-599999 (Selected Departments) 5 years

- By Fund, Purpose, Department, Subcode

FIA075 Expend Element Account Range 100000-599999 (Selected Departments) 5 years

- By Fund, Purpose, Department, Subcode

FIM010 End Date 2 months

FIM015 End Date 2 months

FIM020 Capital Equipment 5 years

FIM030 Reclass 5 years

VBM005 Vendor/Voucher Purge Selection 1 year

VBM010 Month End Purge 1 year

VBM020 Monthly Cash Disbursement Register 3 months

VBM030 YTD Cash Disbursement Register (Alpha Order/Check Number Sequence) 6 years

VBM093-1 Outstanding Vouchers (Select = All) 2 months

VBM093-2 Outstanding Vouchers (Select = Credit) 2 months

VBM093-3 Outstanding Vouchers (Select = Liability) 2 years

VBM094 Outstanding Check Listing 6 years

VBR100 Batch File List 2 months

CALENDAR YEAR REPORTS

VBY100 1099 Exception Report 7 years

VBY110 1099 Form Create Report 7 years

Appendix C

HRS REPORT RETENTION SCHEDULE

LOCATION: CENTRAL OFFICE

Report Report Name Retention

EBA030 Job Class Master 2 Fiscal Years

EBA210 PASS 5 yrs after term

EBA216 PEF 5 yrs after term

EBA368 Check History Earnings 2 Fiscal Years

EBA520 Postion Control/Finance Acct Interface 1 Fiscal Year

EBC314 Dept Payroll Roster - All Others 5 years

EBC320 Analysis and Extract 5 years

EBC324 Payroll Calc Diagnostics 5 years

EBC326 Master File Update 5 years

EBC337 Check Number Update Diagnostics 5 years

EBC345 Payroll Register Summary 5 years

EBC362 Check History Update Void Report 10 years

EBC364 Void Check Update 10 years

EBC381 Check Reconciliation Audit Report 10 years

EBC410 Labor Distribution Extract 5 years

EBC422 Distribution Detail Audit 5 years

EBD160 File Maintenance History Register 5 years

EBD165 Batvh Balance & Edit Update 5 years

EBM280 TIAA/CREF Report Indefinite

EBM376 Check Reconciliation Tape Report 5 years

EBM574 Employees by Postion for Fiscal Year 1 Fiscal Year

EBM578 Postions by Account 1 Fiscal Year

EBQ380 FICA Master List for Quarter 5 years

EBQ382 Quarterly 941-A FICA Report 5 years

EBY392 W-2 Form, W-2 Forms Print Diagnostic 5 years

EBY394 W-2 Tape Report Extract 5 years

EBY399 Federal & State Audit 5 years

EFC520 Data on Direct Deposit Tape 10 years

LOCATION: REGION

Report Report Name Retention

EBA030 Job Class Master Reg Decision

EBA210 PASS 5 yrs after term

EBA216 PEF 5 yrs after term

EBA368 Check History Earnings 2 Fiscal Years

EBA520 Postion Control/Finance Acct Interface Reg Decision

EBC310 Gross Calc Audit 2 Fiscal Years

EBC314 Dept Payroll Roster - All Others Reg Decision

EBC314 Dept Payroll Roster - Assoc. Fac. 5 years

EBC320 Analysis and Extract 5 years

EBC324 Payroll Clac Diagnostics 5 years

EBC339 Check Distribution Register Reg Decision

EBC340 Payroll Register 2 Fiscal Years

EBC345 Payroll Register Summary 5 years

EBC352 ETDB Register 2 Fiscal Years

EBC358 Lost Time Register Reg Decision

EBC425 Labor Distribution Account Feed Audit Reg Decision

EBC440 Labor Distribution By Account Reg Decision

EBD160 File Maintenance History Register 5 years

EBM574 Employees by Postion for Fiscal Year Reg Decision

EBM578 Postions by Account Reg Decision

Appendix D

SIS REPORT RETENTION SCHEDULE

LOCATION: CENTRAL OFFICE

Report Report Name Retention

ABA110 Course Rate / Rate Table 1 month

BBA400 Automative Refunds 7 years

BBA400 Accounts Payable Manual Refunds 7 years

BBC220 Tuition Calculation Report 1 year

BBC320 Third Party Calculation Report 1 year

BBR330 Aged Receivable Report Year-end 5 years

BBR400 SIS/FRS Reconcilition Report 1 year

BBT380 Balance Forward / Purge Report Not Retained

BBT390 Cumulative History File Report Not Retained

SBA590 Student Award Distribution Detail 5 years

SIS "AP" FEED

VBD009 Data Collector Report (AP) 5 years

VBD010 Daily Diagnostic Report 5 years

VBD020 FA Feed Report (Account Feed-Daily Cycle) 5 years

VBD030 Daily Voucher Register 5 years

SIS "FA" FEED

FBD009 Data Collector Report 5 years

FBD010 Daily Diagnostic Report 5 years

FBD011 Indirect Updates to General Ledger 5 years

FBD015 Daily Sort/Merge 5 years

FBD016 Suspense Monitor 5 years

FBD017 Daily Cash Receipts Listing 5 years

FBD018 Daily Cash Disbursements Report 5 years

FBD019 Daily On-line Transcripts 5 years

FBD43 Daily Summary of Accounts Controls (GL) 7 years

FBM001 College Resource (P/R withholding P/R clearing account) 7 years

LOCATION: REGION

Report Report Name Retention

BBB290 Billing Summary Report 5 years

BBR330 Aged Receivables Report Year-end 5 years

RFA316 Prorata Refunds (after approval of FISAP) 5 years

Appendix E

FFX REPORT RETENTION SCHEDULE

LOCATION: CENTRAL OFFICE

Report Report Name Retention

DAILY REPORTS

TBD009 Transaction Builder (Applies to Masschange) 2 years

TBD065 Account Payable (AP) Asset Extract 2 years

TBD080 Asset Control Sheet 2 years

TBD090 Pending Asset Control List 2 years

ZBA900 Data Collector (Applies to Masschange) 2 months

WEEKLY REPORTS

TDB020 Accounting Feed 2 years

TBD025 Account Feed Reconciliation (Weekly Reconciliation by Account) 2 years

TBD030 Acquisition Report 2 years

TBD031 Acquisition Totals 2 years

TBD040 Disposal Report 1 cycle

TBD050 Transfer Activity List 1 cycle

TBD050T Transfer Activity List - Between Instructional Sites - To/From 1 cycle

TBD090 Pending Asset Control List 2 years

MONTHLY REPORTS

TBD035 Tag Number Report 1 cycle

TBM011 Asset Snapshot (Blank Location) 2 years

TBM020 General Ledger Reconciliation (Central Office) 2 years

TBM021 General Ledger Reconciliation (Region) 2 years

TBM022 Summary - General Ledger Reconciliation (Reconcile FFX with FRS) 2 years

TBM091 Pending Asset Control List (Created Prior to the Current Month) 2 years

TFM015 Assets by Class-Remaining Life/Useful Life 999 Error Report 2 years

YEAR-END REPORTS

FBM094 General Ledger Summary - By Account Control 2 years

TBD025 Accounting Feed 2 years

TBD030 Acquisition Report 2 years

TBD040 Disposals 1 cycle

TBD050 Transfer Activity 1 cycle

TBD050T Transfer Activity (To/From Only) 1 cycle

TBD090 Pending Asset Control List 1 cycle

TBM021 General Ledger Reconciliation 2 years

TBM200C Depreciation Calculation (Current Year) 2 years

TBM200P Depreciation Calculation (Prior Year) 2 years

TBM210 Recorded Depreciation 2 years

TBM400 Building Component Report 2 years

FFX FEED

FBD009-043 Profeed (Date Collector thru Bank Account Balances) 5 years

LOCATION: REGION

Report Report Name Retention

DAILY REPORTS

TBD009 Transaction Builder (Applies to Masschange) 2 years

TBD010 Daily Diagnostics 2 years

TBD065 Account Payable (AP) Asset Extract 2 years

TBD080 Asset Control Sheet 2 years

TBD090 Pending Asset Control List 2 years

ZBA900 Data Collector (Applies to Masschange) 2 months

WEEKLY REPORTS

TBD025 Account Feed Reconciliation (Weekly Reconciliation by Account) 2 years

TBD030 Acquisition Report 2 years

TBD031 Acquisition Totals 2 years

TBD040 Disposal Report 1 cycle

TBD050 Transfer Activity List 1 cycle

TBD050T Transfer Activity List - Between Instructional Sites - To/From 1 cycle

TBD090 Pending Asset Control List 2 years

MONTHLY REPORTS

TBM021 General Ledger Reconciliation (Region) 2 years

TBM022 Summary - General Ledger Reconciliation (Reconcile FFX with FRS) 2 years

TBM091 Pending Asset Control List (Created Prior to the Current Month) 2 years

TBM100 Batch Table List 1 cycle

YEAR-END REPORTS

FBM094 General Ledger Summary - By Account Control 2 years

TBD025 Accounting Feed 2 years

TBD030 Acquisition Report 2 years

TBD040 Disposals 1 cycle

TBD050 Transfer Activity 1 cycle

TBD050T Transfer Activity (To/From Only) 1 cycle

TBD090 Pending Asset Control List 1 cycle

TBM021 General Ledger Reconciliation 2 years

TBM200C Depreciation Calculation (Current Year) 2 years

TBM200P Depreciation Calculation (Prior Year) 2 years

TBM210 Recorded Depreciation 2 years

Appendix F

MICROFICHE RETENTION SCHEDULES

FRS/HRS/SIS/FFX MICROFICHE

LOCATION: CENTRAL OFFICE / REGION

Report Report Name Retention

FRS MONTHLY REPORTS

FBM019 Cash Report (Option - CM) - by Bank 5 years

FBM040-1 Chart of Accounts List - By Location, By Ledger, By Account 5 years

FBM040-2 Chart of Accounts List - By Account Number 5 years

FBM061(F) Fund Group Summary GL & SL (by Fund) 5 years

FBM061(F) Fund Group Summary GL & SL (by Region) 5 years

FBM092-1 Account Statement & Transaction GL/SL for Ledger 4 & 8 (by

Location/Account) 5 years

FBM092-2 Account Statement & Transaction GL/SL for Ledger 4 & 8 (by Fund/Account

Number) 5 years

FBM094-1 General Ledger - By Account Control 5 years

FBM095-1 Subsidiary Ledger Summary - By Fund 5 years

FBM095-3 Subsidiary Ledger Summary - By Region, By Fund 5 years

FBM095-4 Subsidiary Ledger Summary - By Location, By Fund 5 years

FBM070-BA Major Object Report - By Region 5 years

FBM070-BC Regional Divisional Report 5 years

FBM070-BE Revised Board Report - By Region 5 years

FBM070-BF Supplies & Expense Report - By Region 5 years

FBM070-BG New Year Budget Transition - By Region 5 years

FBM070-BJ Major Object Report - By Site 5 years

FBM070-BK Site Divisional Report 5 years

FBM070-BL Revised Board Report - By Site 5 years

FBM070-BM Supplies & Expense Report - By Site 5 years

FBM070-BN New Year Budget Transition - By Site 5 years

FBM070-B1 Board Report - By Object 5 years

FBM070-B2 Board Report - By Function 5 years

FBM070-B3 Board Report for Revenue 5 years

FBM070-FF Federal Funds Revenue / Expenditure 5 years

FBM070-FF Federal Funds Revenue / Expenditure - By Region 5 years

FBM070-OF Other Funds Revenue / Expenditure 5 years

FBM070-OF Other Funds Revenue / Expenditure - By Region 5 years

FBM070-SF State Funds Revenue / Expenditure 5 years

FBM070-SF State Funds Revenue / Expenditure - By Region 5 years

FBM070-1G 1-8-2 General Ledger Report 5 years

FBM070-1S 1-8-2 Subsidiary Ledger Report 5 years

FBM070-03 Fee Remission 5 years

FBM070-04 Federal Work-Study 5 years

FBM070-05 Trial Balance 5 years

FBM070-06 Federal Work-Study Summaru 5 years

FBM070-09 Sponsored Programs (Includes Options 9A, 9B, & (9C) 5 years

FBM070-9B Sponsored Programs (Includes Options 9A, 9B, & (9C) 5 years

FBM070-Y1 2-1-8-9 Subsidiary Ledger Report 5 years

FBM070-Y2 2-1-8-6 Subsidiary Ledger Report 5 years

FBM070-Y3 2-1-8-6 Subsidiary Ledger Report 5 years

end of FRS Monthly Reports Microfiche Retention Schedule

MICROFICHE RETENTION SCHEDULES

FRS/HRS/SIS/FFX MICROFICHE

LOCATION: CENTRAL OFFICE / REGION

Report Report Name Retention

FRS QUARTERLY REPORTS

FBM091 Accumulated Transaction Register YTD-By Region 5 years

VBM030 Cash Disbursement Register YTD 5 years

FINANCIAL REPORTS FOR FISCAL YEAR-END CLOSE,

AS OF JUNE 30, 20--

FBM019 Cash Report (Option - CM) - by Bank 5 years

FBM040-1 Chart of Accounts List - By Location, By Ledger, By Account 5 years

FBM040-2 Chart of Accounts List - By Account Number 5 years

FBM061(F) Fund Group Summary GL & SL (by Fund) 5 years

FBM061(F) Fund Group Summary GL & SL (by Region) 5 years

FBM070-BA Major Object Report - By Region 5 years

FBM070-BC Regional Divisional Report 5 years

FBM070-BD Regional Board Report 5 years

FBM070-BE Revised Board Report - By Region 5 years

FBM070-BF Supplies & Expense Report - By Region 5 years

FBM070-BJ Major Object Report - By Site 5 years

FBM070-BK Site Divisional Report 5 years

FBM070-BM Supplies & Expense Report - By Site 5 years

FBM070-BN New Year Budget Transition - By Site 5 years

FBM070-B1 Board Report - By Object 5 years

FBM070-B2 Board Report - By Function 5 years

FBM070-B3 Board Report for Revenue 5 years

FBM070-FF Federal Funds Revenue / Expenditure 5 years

FBM070-FF Federal Funds Revenue / Expenditure - By Region 5 years

FBM070-OF Other Funds Revenue / Expenditure 5 years

FBM070-OF Other Funds Revenue / Expenditure - By Region 5 years

FBM070-LOF Other Funds Revenue / Expenditure - Location 5 years

FBM070-SF State Funds Revenue / Expenditure 5 years

FBM070-SF State Funds Revenue / Expenditure - By Region 5 years

FBM070-LSF State Funds Revenue / Expenditure - Location 5 years

FBM070-Y1 2-1-8-9 Subsidiary Ledger Report 5 years

FBM070-Y2 2-1-8-6 Subsidiary Ledger Report 5 years

FBM070-Y3 2-1-8-6 Subsidiary Ledger Report 5 years

FBM070-1G 1-8-2 General Ledger Report 5 years

FBM070-1S 1-8-2 Subsidiary Ledger Report 5 years

FBM070-03 Fee Remission 5 years

FBM070-04 Federal Work-Study 5 years

FBM070-05 Trial Balance 5 years

FBM070-06 Federal Work-Study Summaru 5 years

FBM070-09 Sponsored Programs (Includes Options 9A, 9B, & (9C) 5 years

FBM091 Accumulated Transaction Register YTD-By Region 5 years

FBM091FG Accumulated Transaction Register YTD-By Region, By Account College-wide 5

years

end of FRS Quarterly Year-End Close Reports Microfiche Retention Schedule

MICROFICHE RETENTION SCHEDULES

FRS/HRS/SIS/FFX MICROFICHE

LOCATION: CENTRAL OFFICE / REGION

Report Report Name Retention:

FRS QUARTERLY REPORTS

FBM092-1 Account Statement & Transaction GL/SL for Ledger 4 & 8 (by

Location/Account) 5 years

FBM092-2 Account Statement & Transaction GL/SL for Ledger 4 & 8 (by Fund/Account

Number) 5 years

FBM094-1 General Ledger - By Account Control 5 years

FBM095-1 Subsidiary Ledger Summary - By Fund 5 years

FBM095-3 Subsidiary Ledger Summary - By Region, By Fund 5 years

FBM095-4 Subsidiary Ledger Summary - By Location, By Fund 5 years

FIA010 Expended Funds Account Range 441000-449999, By Purpose, By Sub-Code 5 years

FIA020 Expended Funds Account Range 100000-559999, By Purpose, By Sub-Code 5 years

FIA030 Current Funds Expended Account Range 100000-599999, By Purpose 5 years

FIA040 Current Funds Expended Account Range 100000-599999, By Fund 5 years

FIA045 Current Funds Expended (Selected Funds Only) By Purpose, By Fund 5 years

FIA050 Expended Funds Account Range 100000-599999, By Fund/Pur/Div/Dept/Subcode 5

years

FIA055 Expended Funds Account Range 100000-599999, By Fund/Pur/Dept/Subcode 5 years

FIA060 Expend Element Account Range 100000-599999 (Selected Departments) 5 years

- By Fund, Purpose, Division, Department, Subcode

FIA070 Expend Element Account Range 100000-599999 (Selected Departments) 5 years

- By Fund, Purpose, Department, Subcode

FIA075 Expend Element Account Range 100000-599999 (Selected Departments) 5 years

- By Fund, Purpose, Department, Subcode

FIM020 Capital Equipment 5 years

FIM030 Reclass 5 years

VBM030 YTD Cash Disbursement Register (Alpha Order/Check Number Sequence) 5 years

VBM093-1 Outstanding Vouchers (Select = All) 5 years

VBM093-2 Outstanding Vouchers (Select = Credit) 5 years

VBM093-3 Outstanding Vouchers (Select = Liability) 5 years

end of FRS Quarterly Reports Microfiche Retention Schedule

MICROFICHE RETENTION SCHEDULES

FRS/HRS/SIS/FFX MICROFICHE

LOCATION: CENTRAL OFFICE / REGION

Report Report Name Retention:

HRS MICROFICHE

EBC310 Gross Calc Audit 5 years

EBC312 Payroll Comparison Report 5 years

EBC339 Check Distribution Register 5 years

EBC340 Payroll Register 5 years

EBC352 ETDB Register 5 years

EBC358 Lost Time Register 5 years

EBC425 Labor Distribution Account Feed Audit 5 years

EBC440 Labor Distribution By Account 5 years

EBQ380 FICA Master List for Quarter 5 years

EBY391 W-2 Master List 5 years

EBY399 Federal & State Audit 5 years

end of HRS Microfiche Retention Schedule

MICROFICHE RETENTION SCHEDULES

FRS/HRS/SIS/FFX MICROFICHE

LOCATION: CENTRAL OFFICE / REGION

Report Report Name Retention:

SIS MICROFICHE - Central Office

BBD100 Accounting Summary Report 5 years

BBR330 Aged Receivable Report Year-end 5 years

BBT380 Balance Forward / Purge Report 5 years

BBT390 Cumulative History File Report 5 years

SBA590 Student Award Distribution Detail 5 years

SIS MICROFICHE - Region

BBD100 Accounting Summary Report 5 years

BBR330 Aged Receivable Report Year-end 10 years

BBT380 Balance Forward / Purge Report 5 years

end of SIS Microfiche Retention Schedule

MICROFICHE RETENTION SCHEDULES

FRS/HRS/SIS/FFX MICROFICHE

LOCATION: CENTRAL OFFICE / REGION

Report Report Name Retention:

FFX MICROFICHE

MONTHLY CYCLE - Central Office /Region

TBM021 General Ledger Reconciliation (Region) 5 years

TBM022 Summary - General Ledger Reconciliation (Reconcile FFX with FRS) 5 years

FFX YEAR-END - Central Office

FBM094 General Ledger Summary - By Account Control 5 years

TBD025 Accounting Feed 5 years

TBD030 Acquisition Report 5 years

TBD040 Disposals 5 years

TBD050 Transfer Activity 5 years

TBD050T Transfer Activity (To/From Only) 5 years

TBD090 Pending Asset Control List 5 years

TBM021 General Ledger Reconciliation 5 years

TBM200C Depreciation Calculation (Current Year) 5 years

TBM200P Depreciation Calculation (Prior Year) 5 years

TBM210 Recorded Depreciation 5 years

end of FFX Reports Microfiche Retention Schedule

SECTION E: BANK AUTHORIZATION

I. Introduction

The Region, with proper authorization, may establish various types of banking accounts for

accomplishing certain regional business office functions. Central Office Finance, with proper

authorization, also has the ability to establish banking accounts in order to complete necessary

functions, such as payroll and accounts payable processing, and investment of College funds.

These accounts, their set-up, and their usages are described in the body of this section. The

general purpose of these accounts is to aid the College in the safe, efficient and effective

handling of monies.

II. Types of Bank Accounts and Usage

A. Revolving Funds

1. Definition

Revolving funds are imprest funds established at an authorized amount to finance allowable

disbursements that, in turn, are reimbursed, thereby ensuring a continuous flow of cash.

Revolving funds may be established at each bank where the College has a depository account at

the authorized funding levels as determined by the designated custodians. Revolving funds

include any combination or all of the following - change fund and bank checking account. Each

custodian has the authority to establish change funds to satisfy regional requirements. The

custodian has the responsibility to supervise the operation of the revolving fund, to monitor

expenditures for use in financing authorized costs, and to maintain the integrity of the fund at all

times. Although the custodian may delegate actual day to day operation of the fund, the

custodian retains full responsibility for its administration and supervision.

2. Authorization

Revolving fund accounts have been authorized for each regional institute. The financial officers

authorized to approve payments from these accounts are the Chief Financial Officer, Chief

Accounting Operations Officer, and Chancellor. In addition, the Chancellor, with the approval of

the Chief Financial Officer, may authorize the Campus President and/or Executive Director of

Finance/Administration, and/or other designee, responsibility to sign expenditure checks for the

revolving fund account.

A change in the bank holding a College revolving account requires a resolution approved by the

Regional Board of Trustees.

3. Establishment

A regional institute’s revolving fund account is to be established in the name of:

Ivy Tech Community College of Indiana

Revolving Fund-Region XX

Address of Regional Institute

Bank statements, deposit tickets, and checks are under the control of the authorized revolving

fund custodian. Assistance in establishing a revolving fund account should be directed to the

Assistant Treasurer. The dollar amount needed to establish and to maintain the revolving fund

account must be approved by the Vice President for Finance/Treasurer.

4. Bank Signature Card

Evidence of signature approval will be made by the completion of a bank signature card with the

signature of:

a. Chief Financial Officer - Required

b. Chancellor - Required

c. Chief Accounting Operations Officer - Optional

d. Campus President - Optional

e. Executive Director of Finance/Administration- Optional

f. Other designee – Optional

5. Maintenance

The custodian is responsible for maintaining the fund in a businesslike manner on an imprest

system. The fund must be reconciled monthly to its authorized amount. A statement of Condition

of Revolving Fund, as of the end of each fiscal quarter, is required to be filed with the Cash

Management department in Central Office by the last working day of the month following the

end of each fiscal quarter. Shortages/Overages in the account should be promptly investigated,

with recommendations for corrective action included in the quarterly report.

6. Usage

There are various ways in which the revolving fund may be used: Change and local check

issuance - each of these is discussed in detail in the following paragraphs:

a. Change Funds:

Designation letters should be prepared establishing the amount of the respective change funds

and who is held responsible for maintaining them. These letters are to be signed by the revolving

fund custodian, and retained for inspection by Internal Audit. Each change fund is limited to

$250.00. Each regional business director, or designee, should periodically make an unannounced

count of each change fund.

This usage involves cash held for the sole purpose of making change during registration, or the

amount needed to start cash register operations each day. Since change may be in large amounts,

the custodian should take every precaution to ensure its safety, either by an adequate safe on the

premises or use of a night depository drop box, or both. When no longer needed, the change

should be deposited back to the revolving fund checking account and adequate documentation

must be maintained to ensure proper accounting of funds consigned to other employees.

b. Bank Checking Account:

The bank checking account provides for the handling of local and minor disbursements up to

$300. Disbursements are made from time to time as needed supported by proof of disbursement.

Receipts are to be obtained and detailed records are to be maintained by the custodian, so that

proper entries can be made in the College accounting system.

Restrictions

1) Sales tax should not be included on purchases made through the revolving fund. The College

is generally exempt from Indiana sales tax.

2) Personal funds or other non-College funds, including Ivy Tech Foundation funds, are NOT to

be intermingled with the revolving fund.

3) All revenues are to be receipted and deposited on a Cash Receipts form and are never to be

added to the revolving fund.

4) Disbursements cannot be made for:

i. Payments to individuals for wages or personal services performed.

ii. Cashing personal checks or third-party checks

iii. Reimbursement for employee tuition.

5) All change funds are to be kept in a locked cabinet or locked safe when not in use.

6) When possible one employee should not maintain more than one change fund.

7) Blank checks for the revolving fund should be adequately secured to prevent unauthorized

use.

8) Pre signing of checks is not allowed due to the possibility of unauthorized completion of the

checks.

7. Reimbursement

To replenish the revolving fund, the Region should submit a completed Revolving Fund

Reimbursement Voucher and enter an invoice in Banner. Once approvals have been obtained, the

funds are deposited into the region’s Revolving Fund through ACH. Funds shall be reimbursed

at least once per month, and more often as needed.

The authorized amount should be limited to that required for operation for a week, plus the time

needed for preparation, processing, and return of the reimbursement.

8. Non-Sufficient Fund Items and Miscellaneous Bank Debits and Credits

Regional revolving funds will be used for processing miscellaneous bank charges and non

sufficient fund (NSF) checks. A regional revolving fund will be established at each bank where

the College has a depository account.

Procedure

a. Debit and credit memos and miscellaneous items pertaining to the regional depository

account(s) are to be processed through the regional revolving fund. Charges invoiced by

regional depository bank for deposit ticket printing, when appropriate, should be processed to the

appropriate expenditure account as a routine function of the regional revolving fund.

b. The bank will be requested to automatically redeposit NSF checks when first returned. The

bank will be requested to charge NSF checks, which fail to clear a second time, against the

regional revolving fund.

c. The bank is to forward notices of NSF items (debit memo or returned item memo) together

with the NSF check to the regional business office.

d. Appropriate documentation for reimbursement will be the bank debit memo and a copy of the

student's account reflecting the entry to the Banner.

e. When monies are collected to honor an NSF item, such funds are to be recorded on Banner

and deposited with other daily receipts.

f. The uncollected NSF checks are to be included on the Banner Accounts Receivable System

and in the annual write-off request, if applicable. The criteria for write-off is comparable to any

account.

9. Revolving Fund Shortage

Items created by differences in deposits (i.e., checks totaled incorrectly on bank deposit slips,

etc.) should be charged to Over/Short. All cash overages or shortages must have the approval of

either the Chancellor, Campus President, or Executive Director of Finance/Administration

(EDF/EDA) before the reimbursement voucher is processed in the accounting system.

A copy of all cash over/shorts in excess of $25 must be sent to the Executive Director of the

Internal Audit Department.

Documentation of any cash over/short in excess of $250 must be reported to the Chief Financial

Officer or designee prior to processing the reimbursement request to charge the shortage against

the Cash Over/Short expenditure account.

10. Audit

Revolving fund moneys, bank statement, and other pertinent information are to be made

available, upon the request of the College Internal Audit Department, as necessary to make

periodic audits of such funds to aid the custodian and College in proper handling.

B. Depository Funds/Depository Accounts

1. Definition

Depository funds are moneys, currency, checks, and credit card drafts temporarily placed with a

banking institution as a general deposit subject to withdrawal in accordance with the terms of the

deposit arrangement.

2. Authorization

College depository account(s) have been authorized at each of the regional institutes. Only the

Chief Financial Officer and the Chief Accounting Operations Officer have signature authority for

expenditures/transfers and for credit card arrangements from these accounts. This authorization

is from resolution and motion of the State Board of Trustees appointing the College financial

officers.

3. Establishment, Control, and Responsibility

The establishment, control, and responsibility of a College depository account is under the

direction of Central Office Finance and is to be established in the name of:

Ivy Tech Commnity College of Indiana

Depository Funds - Region XXY

(Address of Regional Institute)

The XX characters represent the region number and the Y character represents the first letter of

the city (town) in which the depository account is located, other than the city of the main location

of the regional institute.

Bank statements and checks are under the control of the Chief Accounting Operations Officer,

with deposit tickets furnished by the region.

4. Bank Signature Card

Evidence of authorization will be made by the completion of a bank signature card with the

signature of the:

a. Chief Financial Officer

b. Chief Accounting Operations Officer

At the request of the Executive Director of Finance/Administration, the Chief Financial Officer

and/or Chief Accounting Operations Officer can provide a letter to the bank to authorize the

Executive Director of Finance/Administration or designee to complete limited functions

associated with the account such as establishing users or resetting passwords in the bank’s online

portal.

5. Usage

Depository accounts are a collection mechanism which provides concentration of the College

collected funds from fee payments and contractual arrangements negotiated by the regions. Such

arrangements provide for immediate safeguard of funds until such funds are transferred to the

College's primary bank account. By statute, the College is required to make deposits within one

business day of receipt.

6. Regional Depository Cash Transfers

Regional business office personnel are to initiate a cash transfer to the College's main account:

a. when the regional depository has more than $5,000 in deposits in the account; or

b. at a minimum of once per week on Thursday.

When possible, transfers should be aggregated into one daily transaction. A log is to be

maintained for all deposits and transfers, with a copy forwarded to the Cash Management

department at Central Office, at the end of each month. Transfers are to be made without regard

to whether the Cash Receipts form has been completed or input in Banner. The Cash Receipts

form should be prepared and input into the accounting system on a daily basis.

7. Returned Check Charge

A charge of $30 will be assessed for returned checks for each occurrence. Examples of returned

checks include stop payment, no account, account closed, or non-sufficient funds.

The regional business office reserves the right to insist on cash, postal money order, or certified

check for replacement of a returned check.

C. General Bank Account

1. Rationale

The College's general bank account serves as the primary account for all banking transactions.

All deposits either direct or transferred from depository accounts are placed into the College's

primary account. However, a single disbursement check can be charged to any number of

separate funds through the use of proper account coding.

2. Authorization

By resolution and motion of the State Board of Trustees appointing the College financial

officers, the Chief Financial Officer and Chief Accounting Operations Officer have signature

authority for receipt and disbursement of College funds from this account.

3. Bank Signature Card

Evidence of authorization will be made by the completion of a bank signature card with the

signature of the:

a. Chief Financial Officer

b. Chief Accounting Operations Officer

4. Usage

The primary function of the general bank account is to provide control on activities affecting the

cash flow of the College. Through the control of cash receipts and disbursements, management

has a greater potential for maximizing the pool of cash from which short-term investments are

made.

D. Payroll Account

1. Rationale

The College's payroll account is a zero balance type of checking account which is used for

disbursement control on employee payroll checks or ACH payments.

Each day as payroll checks are presented (cleared by bank) and ACH payments are made, a debit

balance is accumulated. At the close of each day, a credit is automatically generated by the bank

holding the payroll bank account equal to the day's debit, and applied to the payroll account

bringing the balance back to zero, and a corresponding debit is applied to the primary bank

account, the College's general account.

2. Authorization

By resolution and motion of the State Board of Trustees appointing the College financial

officers, the Chief Financial Officer and Chief Accounting Operations Officer have signature

authority for receipt and disbursement of College funds from this account.

3. Bank Signature Card

Evidence of authorization will be made by the completion of a bank signature card with the

signature of the:

a. Chief Financial Officer

b. Chief Accounting Operations Officer

4. Usage

Such a banking arrangement, where one bank account draws on a second bank account for funds

to cover only an amount needed for clearing items, allows:

a. The elimination of an excess balance,

b. Centralized cash in the primary bank account providing better management for short-term

investments,

c. Extends disbursement flow,

d. Eliminates overdrafts, as well as the need to fund those accounts.

E. Vendor Account

1. Rationale

Similar to the College’s payroll account, the vendor account is a zero balance checking account

which is used for disbursement control on accounts payable checks and ACH payments.

Each day as ACH payments are made and checks are presented (cleared by bank), a debit

balance is accumulated. At the close of each day, a credit is automatically generated by the bank

holding the vendor bank account equal to the day's debit, and applied to the vendor account

bringing the balance back to zero, and a corresponding debit is applied to the College’s general

bank account.

2. Authorization

By resolution and motion of the State Board of Trustees appointing the College financial

officers, the College’s Chief Financial Officer and Chief Accounting Operations Officer have

signature authority for receipt and disbursement of College funds from this account.

3. Bank Signature Card

Evidence of authorization will be made by the completion of a bank signature card with the

signature of the:

a. Chief Financial Officer

b. Chief Accounting Operations Officer

4. Usage

The vendor bank account provides control on activities affecting the cash flow of the College.

Through the control of cash disbursements and the once per day funding of the vendor account

from the general account, management has a greater potential for maximizing the pool of cash

from which short-term investments are made.

F. Tier 1 Account

1. Rationale

The purpose of the College’s Tier 1 bank account is to maximize interest earned while

maintaining the balance of cash needed to meet the College’s operating needs throughout the

year.

2. Authorization

By resolution and motion of the State Board of Trustees appointing the College financial

officers, the College’s Chief Financial Officer and Chief Accounting Operations Officer have

signature authority for receipt and disbursement of College funds from this account.

3. Bank Signature Card

Evidence of authorization will be made by the completion of a bank signature card with the

signature of the:

a. Chief Financial Officer

b. Chief Accounting Operations Officer

4. Usage

The Tier 1 account is used to wire funds to or from the College’s general bank account. This

allows the College to meet daily cash obligations while earning interest on the remaining funds

not yet needed for operations.

G. Custodian Investment Accounts

1. Rationale

The purpose of the custodian investment account is to support the College’s long-term

investment strategy.

2. Authorization

The College’s Investment Policy Statement as approved by the State Board of Trustees delegates

authority to manage the custodian investment account to the Chief Financial Officer.

3. Bank Signature Card

Evidence of authorization will be made by the completion of a bank signature card with the

signature of the:

a. Chief Financial Officer

b. Chief Accounting Operations Officer

4. Usage

The custodian investment account allows the College to allocate funds not immediately needed

for daily operations into longer term investments in an effort to maximize interest earned, and as

needed, funds from the custodian investment account may be used to satisfy an immediate cash

need of the College. The custodian investment account also provides investment-related

reporting, risk management, internal control, and compliance assistance to the College.

H. Accounts for Specific Functions

1. Rationale

Accounts may be opened for specific methods to collect or distribute payments, including but not

limited to ACH payments, payment plans, international transactions, printing, property

management and payments made to the College via credit card. Central Office Finance

determines the types of credit cards the College will accept.

2. Authorization

Accounts for specific accounts receivable and regional functions may be established at the

discretion of the Chief Financial Officer and Chief Accounting Operations Officer.

3. Bank Signature Card

Evidence of authorization will be made by the completion of a bank signature card with the

signature of the:

a. Chief Financial Officer

b. Chief Accounting Operations Officer

Specific accounts deemed necessary for regional purposes may have additional signatories

including but not limited to Chancellor or Executive Director of Finance/Administration as

deemed appropriate by the Chief Financial Officer and Chief Accounting Operations Officer.

4. Usage

Regarding accounts established for accounts receivable functions, students submit payments to

the College via ACH or credit card. The payments are received into the account based on type

(payment plan, ACH, credit card, printing), and the funds are transferred to the College’s general

bank account via account transfers.

At the discretion of Chief Financial Officer (or designee), accounts may be established for a

variety of purposes. Usage of these accounts is dependent on the nature of the account and the

specific purpose for which it was created.

I. Construction and Bond Custodian Accounts

1. Rationale

Accounts may be established for construction project funding, including bonds for such projects.

2. Authorization

Accounts may be established at the discretion of the Chief Financial Officer and Chief

Accounting Operations Officer.

3. Bank Signature Card

Evidence of authorization will be made by the completion of a bank signature card with the

signature of the:

a. Chief Financial Officer

b. Chief Accounting Operations Officer

4. Usage

Bond funding related to construction projects is maintained in the accounts. The College seeks

reimbursement from the account for construction expenses related to the bond funded projects.

III. Bank Service Charges

It is College practice to minimize bank service charges. These charges may be invoiced to the

College or, with the approval of the Executive Director of Finance/Administration, depository

and revolving fund fees may be charged to the Region's revolving fund. With the approval of the

Chief Accounting Operations Officer, fees for Central Office accounts may be charged directly

to the account.

IV. Unclaimed Property

A. Reporting of Unclaimed Property

1. Rationale

The College must report and remit unclaimed property to the appropriate state annually based on

the last known address for the student, business or organization. In accordance with Indiana

Code 32-34-1, all uncashed vendor and non-financial aid related student refund checks and credit

balances on all account types with a last known address in Indiana that have reached 3 years or

older as well as outstanding payroll checks over 1 year old by June 30th must be included with

the College’s annual report and payment to the State of Indiana. Regions with outstanding

checks and credit balances for students and entities in other states should contact the Cash

Management department within Central Office Finance to determine the appropriate dormancy

and reporting date for the property. The Return of Funds procedure should be followed for

financial aid-related refund checks and credit balances.

2. Procedure

a. Annually prior to June 30 the Cash Management department will send a template to the

regional Finance Office to complete. The completed spreadsheet should include the student or

entity’s name, check date that generated the unclaimed property, amount, type of payment (e.g.

check, credit card), C# or A#, and last known address. Credit balance reports regarding student

accounts will be provided by Central Office to the regional Business Office to assist with

completion of the template.

b. Revolving fund checks should also be reviewed by the region to determine if any checks older

than 3 years have not been cashed. Revolving fund checks meeting the dormancy period should

be included on the template provided by the Cash Management department. A non-reimbursable

check should be written from the revolving fund to Ivy Tech Community College and sent to

Central Office Finance for the total amount of the revolving fund checks that will be reported as

unclaimed property.

c. A letter meeting the due diligence requirements of the statute will be mailed by Central Office

Finance to the addresses included on the Unclaimed Property spreadsheet. Checks will be voided

and payments reissued for responses received before the stated due date. The item(s) will then be

removed from the unclaimed property report before it is submitted. All items for which a

response is not received will be reported and remitted to the appropriate state’s unclaimed

property division.

d. Persons holding checks, who inquire relative to cashing such items, issued prior to June 30,

2012, should be directed to Central Office Finance for assistance. Indiana vendors and students

with checks issued after June 30, 2012 and who did not respond to the letter regarding reissue of

payment by the deadline stated in the letter, must contact the Indiana Attorney General’s Office

through IndianaUnclaimed.gov to initiate the claim process. Out of state vendors and students

with checks issued after June 30, 2012, should be directed to the appropriate state’s unclaimed

property division for assistance.

B. Undeliverable Checks

If a check is returned to a regional address, it should be forwarded to Central Office Finance

within 7 days. For nondeliverable checks returned directly to Central Office, the Cash

Management staff will notify the regional business office. The regional business office should

then contact the student to obtain an updated mailing address.

If an updated mailing address is able to be obtained, the check will be sent by Central Office

Finance to the updated address.

In the event the business office is not able to obtain an updated address for a check consisting of

financial aid funds, the regional business office should work with financial aid staff to return the

funds to the sponsor. Checks issued for non-financial aid purposes will be stored in Central

Office Finance’s safe and reported in accordance with the unclaimed property dormancy

requirements.

SECTION F: FINANCIAL AID

I. Overview

The Financial Aid Disbursement section is intended to provide information on the financial aid

disbursement process responsibilities of the regional Business Offices.

In order for the Business Office personnel to perform their function effectively, it is necessary to

provide an overview of the financial aid programs available at IVTC. Continuous and effective

communication is vital between the regional Business Office and the Financial Aid Office staff

to ensure proper disbursement and accounting are maintained for each student receiving financial

aid.

II. Financial Aid Programs

The most common financial aid programs available at the College include:

Federal programs

1) Pell Grant Program

2) Supplemental Educational Opportunity Grant

3) Work-Study Program

4) Stafford Loan Program

5) Plus Loan Program

State programs

1) Higher Education Award

2) Nursing Scholarship

3) Hoosier Scholarship

Private monies include:

1) Lilly Endowment Educational Award

2) Foundation scholarships and loans

The College also provides assistance through the College Fee Remissions such as Statutory,

Employee, and Discretionary Fee Remissions.

A brief description of several of the programs follows. For a complete description of each

program's requirements, refer to your regional Financial Aid Office. Each area also provides

College policy pertaining to the Business Office responsibilities regarding each program.

A. Federal Pell Grant Program

The Federal Pell Grant Program is intended to provide a basic level of assistance to which other

forms of student aid can be added to enable needy students to pursue an education. This is the

major financial aid program administered at the College. The actual disbursement of the monies

for this program is made through the Student Information System (SIS) from the Financial Aid

Management component. This process is described in detail later in this section.

This program is generally accounted for financially on a reimbursement basis. The College

disburses the funds to students, then requests reimbursement from the federal Department of

Education (ED). Certain requirements must be met for the College to receive reimbursement for

each student. If those requirements are not met, the College does not receive reimbursement for

that particular student. The deadline is September 30 of each year. The College must have

satisfactorily submitted the information necessary to receive reimbursement by that deadline. If

the College does not successfully receive reimbursement by the deadline, then reimbursement

may not be made to the College. The funds paid that student may ultimately be charged to the

Operations Fund at the Region.

The regional Financial Aid Office has the major responsibility in obtaining the reimbursement.

Therefore, it is an advantage to monitor this reimbursement process especially as the deadline

approaches each year. Contact the regional Financial Aid Manager for additional information

regarding this process.

B. Federal Supplemental Educational Opportunity Grant (FSEOG)

The FSEOG program awards grants to students with financial need in order to help meet their

cost of education. The funding is received in one (1) allocation to the College, and the College

allocates these funds to participating regional campuses. The regional Financial Aid Office

personnel determine the award made to the individual student.

C. Federal Work-Study Program (FWS)

The purpose of the Federal Work-Study Program (formerly College Work-Study) is to stimulate

and promote the part-time employment of students who are enrolled as undergraduate students

and who are in need of earnings from employment to pursue courses of study. The federal

government and the College each provide a portion of the student's wage. The federal

government provides one (1) allocation to the College. The College combines the federal

allocation and the College portion and allocates the funds to the regional campuses. The regional

Financial Aid Office determines the award given to the student.

1. Disbursement

FWS students are paid on the College's non-exempt (hourly) payroll schedule. The Human

Resource System (HRS) is used to automatically charge the federal share and the College's share

to the appropriate accounts. When a payroll check is issued to a FWS student, it should be

disbursed to the student in the same manner as other payroll checks.

2. Off-Campus Work-Study Students

When the Financial Aid Office has made arrangements for a student to work for an off-campus

agency, a signed agreement must be in the student's file. The Business Office will need to bill the

off-campus agency for not less than the institutional share. The off-campus expenditures must be

identified separately and recorded in the Operations Fund and Student Aid Federal Fund. When

the off-campus billing is received, the funds should be deposited in the regional Overhead

Recovery account, and not applied against the expenditure account. A Budget Transfer should

then be prepared by the Region to cover that expenditure.

3. Overpayment

Any overpayment made to students must be returned to the Federal Work-Study Program. It is

the responsibility of the student to repay any overpayment. An overpayment consists of hours not

worked by the student, or an administrative error in the reporting of hours worked.

D. Federal Stafford Loan

The Federal Stafford Loan Program was authorized to make long-term, deferred payback,

educational loans available to all eligible students.

The College is not a lender in the program. The Financial Aid Office's responsibilities among

others are: (a) to furnish certain information to the lender, (b) default management, and (c)

student file maintenance. The Business Office responsibility, since the loan check is sent to the

College, is to release the disbursed funds to the student.

Stafford Loan checks are issued co-payable to the student and the College, and mailed to the

College.

The Business Office may process a student's check only after eligibility verification is received

from the Financial Aid Office.

Refer to the SIS Billing/Receivables Users Manual for specific details regarding processing

Stafford Loan checks using the SIS system.

Custody of Stafford Loan checks must be retained by the Business Office until either deposited

in the regional depository account to be credited to the student account or returned to the

financial institution which originally disbursed the check. A Stafford Loan check log is required

to be maintained to record the status of the check. When the check is initially received it is the

Business Office's responsibility to notify the Financial Aid Department of its receipt.

The check log must be maintained identifying:

1) Student

2) Lender

3) Date check issued

4) Date check received

5) Stafford loan check number

6) Stafford loan check amount

7) Date returned to lender, if appropriate

8) Date school endorsed student loan check

Stafford Loan checks are to be processed through the SIS. The check, once approved for

distribution, should be credited to the student's account. Any amount owed the College will

automatically be deducted from the check. Then a refund, if any, will be issued to the student

during the next refund cycle.

If a student requests that the College hold the funds, the College may do so. If this should

happen, the funds should be placed in a liability account in the Student Aid Other Fund. The

portion that the student uses for fees and other charges should be transferred each enrollment

period. Upon the student's request, the balance of remaining funds, or part thereof, must be

remitted to the student under the condition that the student is enrolled at a half-time status, or

greater, at the time of remittance.

E. Federal PLUS Loan Program

The purpose of the Federal PLUS Loan Program is to provide non-subsidized deferred payback

loan guarantees for parents of dependent students.

The policy on the processing of PLUS Loan checks is as follows:

1. When the Region receives a PLUS Loan check from the bank, the Business Office will retain

custody of the check. A check log will be maintained with the same information required for a

Stafford Loan check, as described previously within this section. In addition, the parent name

needs to be included as payee.

2. The Business Office should notify the Financial Aid Office to verify eligibility of the student.

If a student is not eligible, the check is to be returned to the lender. If the student is eligible, then

the parent is to be notified to come to the Site and endorse the check. The Site may mail the

check to the parent to be endorsed and returned to the Region, but only after the Financial Aid

Office has determined that the student is eligible.

3. If the student owes fees and there is no other financial aid which covers the fees, then the

parent should sign a statement allowing the Site to satisfy those fees owed by the student with

the PLUS loan. Any remaining amount would be remitted to the parent. If the parent will not

sign the statement, then the Site should hold the check and return it to the lender. The rationale

for this is that the student will have to be withdrawn from the classes because fees are

unsatisfied.

4. After the parent gives written permission to satisfy any fees owed the College by the student

and the parent endorses the check, the Site will deposit the check into the revolving fund and

write two checks; one to the College to satisfy the student charges not covered by other financial

aid, and one to the parent for any remaining excess funds to be given promptly to the parent. The

Region may mail the check to the parent.

F. Higher Education Award (HEA)

This program is designed to help provide an Indiana student with the means to meet his or her

cost of education, and is only available to full-time students. The State grants are determined and

adjusted by the State Student Assistance Commission of Indiana (SSACI).

The grants awarded under this program are for the fall and spring semesters; there are no summer

awards. The grant may be used only for the general fee and student activity fees. If the semester

grant is greater than the fees charged, that excess must not be remitted to the student. However,

that excess amount may be applied to a succeeding semester.

G. Hoosier Scholarships

This program is a merit scholarship awarded to various high school students. The award is one

(1) payment to the student in the fall term in the amount specified by SSACI.

H. Lilly Endowment Educational Award (LEEA)

This program is designed to help provide an Indiana student with the means to meet the cost of

education, and is only available to full-time students. The monies are donated by the Lilly

Foundation and are administered through SSACI.

The grants awarded under this program are for the fall and spring semesters. The grant may be

used for the general fee, student activity fees, and bookstore charges. The excess may be remitted

to the student.

I. Fee Remissions

Currently the College recognizes three (3) types of student fee remissions:

1) Statutory Fee Remission

2) Employee Fee Remission

3) Discretionary Fee Remission

The Statutory Fee Remission program may be used to pay for the College's general fee.

The Employee Fee Remission program may be used to pay for the College's general fee.

The Discretionary Fee Remission may be used to pay for the College's out-of-state tuition and

general fee.

These fee remission programs cover fees only, and any excess awarded may not be remitted to

the student, or used to satisfy uncollectible accounts receivable.

If the student is using the fee remission for payment of fees, the Financial Aid Office will

provide the Business Office with the award amount(s) by either inputting the amounts in the SIS

to feed to Screen 409 (most commonly used) or by use of the Financial Aid Notification form.

Any changes in the awards should be communicated using the same methods as noted above.

III. Financial Aid Feed to SIS Billing/Receivables Component

The student's award package is created using the Financial Aid Management component of SIS.

The student's financial aid package is fed to the B/R system via an automated feed (SBA590).

Before the actual feed is run, two non-update SBA590 reports are run on different dates and

routed to the regional Financial Aid Offices for their review. The non-update SBA590 report

simulates the financial aid feed. The regional Financial Aid Departments use this report to verify

the financial aid to be processed prior to the actual feed. After the actual feed is run, a SBA590

update report is run which generates the output for the feed. You should be aware each semester

term of the dates scheduled for the update SBA590 feeds.

The SBA590 feed generates a credit posting to each student's B/R account. Any amount

remaining in the student's account after all charges have been satisfied is paid by the regular

refund process (refer to FMM, Section G, Revenue Collections, for details).

All checks received by the Region from this refund process should be analyzed by the Business

Office personnel to determine what caused the refund. The refund could have been generated

based solely on financial aid, or based solely on a general credit (dropped class, student

payment...) or a combination of the two. If any financial aid has been credited to the student's

account, the Business Office should notify the Financial Aid Office that the check has been

received.

The Financial Aid Office is then responsible for determining if the financial aid credited was

appropriate. If the check is related to any other general credit to the student account, the Business

Office must determine the appropriateness of the check.

IV. Financial Aid Notification

The Financial Aid Notification form (Exhibit A) is used to communicate to the student the

financial aid offered for the award period by the College's Financial Aid Office. Once the student

accepts the aid offered, as evidenced by signing and returning the form to the Financial Aid

Office, the accepted financial aid amounts are communicated to the Business Office and

Bookstore via the Student Information System. The Business Office and Bookstore may then

defer the payment of the student's tuition and fees based upon the accepted financial aid

amounts.

In the event that a student's accepted award information changes, the Financial Aid Office must

inform the Business Office of the change.

This form is also used as a means for the student to certify that the student is financially

responsible if for any reason the financial aid award is revised. It also allows the College to

utilize the aid to pay for any tuition, fees, bookstore charges and other obligations. The form also

informs the student of his or her right to contact the Business Office if he or she wishes to make

other arrangements for bookstore charges and/or other obligations.

V. Other Policies

A. Overpayment(s)

All overpayments of financial aid must be identified by the Financial Aid Office and collected by

the Business Office. It is the responsibility and liability of the student to repay any overpayment.

An overpayment may be collected by reducing the student's next term award. In addition, the

College is also liable for an overpayment due to an administrative error. If an overpayment

cannot be collected from the student, the College must repay those funds to the appropriate

program. This amount will be charged to the Region's Operations Fund. If not at fault, the

College must assist the Department of Education in collection of federally awarded monies.

B. Returned Checks

According to Federal regulations, any financial aid check(s) not claimed within fifteen calendar

days after the end of the award year must be returned to the appropriate program. As a College

policy, the Business Office should return any unclaimed check within thirty (30) days after

receiving it from Central Office to the Central Office Financial Aid Accounting Department. A

list must be provided of any unclaimed financial aid check(s) noting student name, identification

number, and check amount before returning the check(s) to the Financial Aid Accounting

Department.

C. Student Refund Checks - Voids and Stop Payments

Any student refund checks that include financial aid funds that need to be voided must have a

financial aid void check form (Exhibit B) filled out. Send the completed form with the check

marked "Void" to the Central Office Financial Aid Accounting Department.

Any student refund check which needs to have a stop payment placed on it must be phoned in to

the Central Office Financial Aid Accounting Department. Please have the following information

on hand: Region Number, Check Number, Check Date, Student ID, Requested by, Check

Amount, Term/Subcode, and a reason for the Stop Payment.

A stop payment will not be placed on a check until five (5) days after issuance.

D. Prorata Refunds

As mandated by the federal government, prorata refunds will be provided to any student who is a

Title IV financial aid recipient and attending Ivy Tech Community College of Indiana for the

first time or a first-time transfer student. The student must have withdrawn completely from all

classes enrolled before the sixty percent point in the enrollment period.

Refer to Section G, Revenue Collections for more detailed information.

SECTION G: REVENUE COLLECTION

Overview

Recording revenue activity involves the collection of currency, checks, warrants, or bank wires.

Major sources of revenue for the College are state appropriations, federal and state grants, and

student fees and charges. The emphasis in this Section will be directed toward student fees and

charges. This Section is provided as an overview and to establish College-wide policy for

revenue activity.

I. Student Tuition and Fees

Tuition and fees are assessed to assist in the funding of a student's cost of education. The tuition

rate is established every two years by the State Board of Trustees. The miscellaneous and

consumable fee rates are established annually. Each College location should have a copy of the

most current State Board resolution. The type of fees assessed at the College include:

A. College-Wide Fees

1. General Fees

These fees are assessed to all students to assist in supporting the cost of providing a student's

education.

a. In-State General Fees - This general fee rate is assessed in accordance with the State Board

of Trustees resolution to all students who meet the College’s state residency requirements.

Distance education tuition revenue is received at the originating region. The Central Office

Finance Department produces a journal entry during the academic term which directs 20% of the

tuition revenue to the student’s home campus..

b. Out-of-State General Fees - This general fee rate is assessed in accordance with the State

Board of Trustees resolution to all students who do not meet the College’s requirements for state

residency or the reciprocity agreement.

c. Out-of-State Online Fees - This general fee rate is assessed in accordance with the State

Board of Trustees resolution to all students who are taking courses online and do not meet the

College’s requirements for state residency or the reciprocity agreement.

d. American Honors - American Honors is a competitive, two year honors program designed to

prepare students for transfer to a four year institution. This fee rate is determined by American

Honors and the College. It is assessed to students by the College and subsequently remitted to

American Honors.

e. Consumable Fees - Students enrolled in certain courses and programs may be charged a fee in

addition to their tuition for supplies and other consumables as determined by the Consumable

Fee Committee. In the case where the distance education student will use the materials/services

provided under the consumable fee, this fee should be charged to the student. However, if the

student will not use the materials/services provided under the consumable fee, the fee should not

be charged to the student. Regional course builders add consumable fees in accordance with the

approved list distributed by the Executive Director of Cash & Debt Management.

f. Technology Fees - Each student is assessed a per semester technology fee. The technology fee

is designed to offset the costs of the College's technical infrastructure such as Blackboard and

Campus Connect.

g. Online Course Fees - Students enrolled in online courses are assessed a per credit hour fee in

addition to the tuition rate for online courses. Allocation of the regional portion of the distance

education fee (60%) is to the student’s home campus. Allocation of the statewide support portion

(40%) of the distance education fee is directed to the Center for Instructional Technology for

statewide support and course development efforts.

h. IncludED - For IncludED courses, students receive access to the eText for the course and all

course-related materials. Depending on the type of course, students may also receive a lab kit or

other physical materials. Students are billed on a separate line for the IncludED materials.

i. Noncredit courses - Cost of noncredit courses are determined based on the Corporate College

pricing sheet. Fees vary dependent upon client customizations.

j. Miscellaneous Student Fees - Fees charged for specific services such as Returned Check Fee,

Course Test Out Fee, Transcript, IDs, etc. Refer to separate memo issued annually by Chief

Financial Officer.

B. Assessing Fees

It is the responsibility of regional management to ensure that adequate internal controls are in

effect over revenue activity.

Most tuition charges, and course and registration fees are calculated automatically when the

student registers for a class. Infrequently, however, the business office may need to manually

post entries to the system for charges, such as IncludED, books, adjustments, etc. As mentioned

above, consumable fee charges are added by regional course builders in accordance with the

approved consumable fee list.

C. Payment of Fees

Tuition and fees may be satisfied by cash, check, money order, bank credit/debit card, or third

party payment plan. Student tuition and fees are due prior to the first day of the term. Payment

for tuition using a credit or debit card should be made online, and a service fee will be assessed

for the online credit and debit card tuition transactions. Payments of tuition, fees, and tests not

paid online should be paid in the Business Office. Departments and individuals cannot accept

payments for tuition, fees or tests. Tuition and fees that are to be billed to a third party, must be

verified by a letter, contract, or other adequate documentation, and kept on file at the Region.

For corporate partners supporting their employees’ education through tuition reimbursement, the

College offers the option of deferring tuition payments for both credit and non-credit courses. In

order to participate in the Deferred Corporate Tuition Assistance program, the student and

employer’s Human Resource department must complete a Deferred Corporate Tuition Assistance

Request form each semester before the payment deadline. Payment for tuition is due 30 days

after the last day of the course. Deferred tuition arrangements cover tuition only. The student is

responsible for books, IncludED materials and consumable, technology and any additional fees,

and payment for the fees must be submitted by the posted payment deadline. In the event a

student does not submit payment to Ivy Tech, the Company is responsible for payment and will

be billed. Balances not paid after 30 days may be considered delinquent, and costs incurred in the

collection of a delinquent account, including collection and attorney fees, may be added to the

balance. Any exceptions to payment responsibility as related to the Deferred Corporate Tuition

Assistance program must be submitted to the Chief Accounting Operations Officer for approval

prior to the start of the course.

The College currently offers payment plans through an outside, third party vendor. The vendor

may assess a non-refundable fee for enrollment in a plan. Additional information regarding the

availability of payment plans is available on Campus Connect.

Generally, students who have a prior term balance will not be allowed to register until that

balance is satisfied. If a student who owes past financial obligations to the College enrolls in a

course but a contract or third party has agreed to pay tuition for the current semester regardless

of student completion, registering these students is appropriate. The Chancellor or their designee,

(the designee for this case must be a member of the business office staff), may allow a student to

register if the situation warrants. Exceptions are made on a case by case basis.

Students who register online through Campus Connect must acknowledge and agree to all

policies regarding the payment of fees. Entering their user id, password, and clicking “I accept”

is considered equivalent to the student's signature.

D. Cash Close Out and Reconciliation

Collections are to be reconciled daily by a cashier. In order to maintain the integrity of the audit

trail, when cashiers change and are sharing a computer terminal, the current cashier must sign off

the Banner system and the new cashier must sign on. The reconciling process involves balancing

the actual collections received against the transactions recorded in Banner. Indiana Code 5-13-6-

1 stipulates that daily deposits be made.

As an example of adequate backup documentation of a day's business collections, a typical batch

should contain (or must be easily obtainable) Cash Receipts Form (CRF), validated deposit

ticket, cashier's check-out screen print, manual receipts, cash register tape, and any other

documentation deemed necessary to support the collection activity. The Executive Director of

Finance/Administration is responsible for the appropriate separation of duties within this activity.

Collections (cash and checks) should be deposited in the Regional depository bank account

without regard to either the completion of the reconciling process, or the creation of the CRF.

Refer to Section E: Bank Authorization for more detailed information regarding depository

account cash transfers.

E. Cash Registers

Any cash register used should provide, at a minimum, the following documentation:

1. The clerk receiving the funds

2. The source of revenue collection

3. The date of the transaction

4. Voided transactions

5. No-sale transactions

6. Total receipt by source (currency, coin, check, charge and other), grand total collected for day,

and continuous grand total.

The Cash Management and Internal Audit Departments should be notified when a Region is

intending to purchase a cash register.

F. Reconcilement of B/R Cash Clearing Account

The Region is required to reconcile monthly the B/R Cash Clearing Account. A copy of the

reconcilement must be sent to the Cash & Debt Management Department at Central Office no

later than seven days after the end of each month.

G. Cash Transfer Log

A copy of the cash transfer log (CTL) for depository account must be sent to the Cash & Debt

Management Department at Central Office no later than seven days after the end of each month.:

H. Student Refunds

1. All tuition and fees assessed by the College, except for the Miscellaneous Student Fees

described previously, shall be refunded under the following condition:

a. The College will refund or cancel obligations that relate specifically to the cancellation of a

course by the College.

b. All refunds to students, except card transactions such as Visa, Mastercard or Discover, are to

be refunded via the College’s outside vendor based on the option selected by the student. The

card transactions should be refunded by issuing a credit to the student's Visa, Mastercard, or

Discover account via the same processor as paid through.

c. The effective date for calculating the amount of fees to be refunded is the date the official drop

is received. The refund amount is automatically calculated in the Banner system based on the

date.

d. Tuition and fees to be refunded for dropping from courses will automatically apply toward

assessment of additional courses in the same semester.

e. Students or parents, who feel that individual circumstances warrant an exception to the

standard refund policy, may appeal to the appropriate personnel based on Regional procedures.

2. Banner processes student refunds based on the percentages noted below. Refunds are

calculated on business days regardless of holidays. Technology fees, consumable fees, and

tuition are refunded at the same rate noted below. Regardless of the day of the week that a course

first meets, the refund period would begin on Monday of the first week of classes that a

particular course meets.

3. Refund Schedule

Term Length Refund Schedule Refund Amount

16 Week 1st - 10th Day 100%

12-15 Week 1st - 8th Day 100%

10-11 Week 1st - 6th Day 100%

8-9 Week 1st - 4th Day 100%

4-7 Week 1st - 2nd Day 100%

Less Than 4 Weeks 1st Day 100%

After the dates specified in the above refund schedule, students are not eligible for any refund.

4. General Procedure

For an automatic refund to occur, a student account must have a credit balance in the account.

On an exception basis, the Region will manually post a refund transaction to an account to

generate a refund regardless of the student account balance.

The Region must ensure that a refund is rightfully due a student. If the refund is not due to the

student, the business office must prevent the refund from processing or void the check in Banner

and initiate the process to reverse the transaction. If a student is inadvertently refunded money

not due, the student will be invoiced.

I. Tuition Waivers and Adjustments

There may be circumstances in which it is appropriate for the Region to waive tuition or other

charges. These situations, however, should be rare and this practice should not be utilized on a

regular basis. Examples of when a tuition waiver might be appropriate would include: student

has a valid complaint about a class and requests a refund; in lieu of a cash refund after the

normal refund period; and adjustments to tuition.

Tuition waivers must be approved in writing by the Chancellor. If deemed appropriate, the

Chancellor may delegate this approval to the Executive Director of Finance/Administration,

Director of Business Office or equivalent, or Campus President. In all cases the Region must

complete a Tuition Waiver/Adjustment form.

When processing a tuition waiver, the initial charge being waived must always be posted to the

student’s account. The tuition waiver is then to be posted utilizing the Regional tuition waiver

detail code. The same procedure would apply if the amount of the fee is being reduced; the

original fee should be posted to the account and the tuition waiver detail code utilized to reduce

the charge. All tuition waiver entries posted to a student’s account must be reviewed and verified

by an additional member of the Business Office staff.

Copies of the approved Tuition Waiver/Adjustment form must be filed with CRF associated with

the day’s transactions for which the waiver was posted.

J. Financial Aid

Returned/Unclaimed Financial Aid Student Refund Checks or Electronic Funds Transfer (EFT)

Refunds to students resulting from excess federal financial aid must follow specific federal

regulations when the check or EFT is returned or unclaimed. According to federal regulation, if a

check is returned to the institution or an EFT is rejected, the institution may make additional

attempts to disburse the funds, provided those attempts are made not later than 45 days after the

funds were returned or rejected. No later than 240 days, the College must cease any additional

disbursement attempts and return federal funds to the source. It should be noted that this policy

only applies to refunds generated from excess federal aid. This policy does not apply to refunds

from any other sources. The procedures related to this policy are outlined in the Standard

Operating Procedure for returning funds.

K. Accounts Receivable Write-offs

The College annually reviews accounts receivables to determine if, in the opinion of

management, it is reasonable to report these dollars as assets on the College Statement of Net

Assets. Receivables in excess of one year are to be written-off unless there is a reasonable

expectation of collection. The definition of a reasonable expectation of collection is that

payments are currently being made at amounts that will eliminate the debt in a reasonable period

of time.

Receivables in excess of one year old need not be scheduled as uncollectible if there a reasonable

expectation the amounts will be collected. However, no receivable more than two years old will

continue to be so classified without authorization from the Chief Financial Officer or designee.

The Region should submit a schedule of uncollectible accounts receivable for write-off to the

Regional Board of Trustees for approval. This approval should take place no later than October

of each year. The schedule should only include accounts outstanding longer than one year as of

June 30 of each year. The scheduled write-off report is available to run in NewT and includes the

name, type of obligation, date of obligation (semester), total due, and collection efforts, together

with totals by Fund.

After obtaining Regional Board of Trustee approval through a resolution, the schedule and

documentation of approval should be sent to the Chief Accounting Operations Officer by

October 31 of each year. Any additional data which may be useful in understanding the reasons

for bad debt write-offs should be included.

When the State Board of Trustees approves the write-offs, each Region will post the write-offs in

Banner at the direction of the Chief Accounting Operations Officer. A reconciliation of any

adjustments between the approved write-off and actual write-offs should be submitted to the

Chief Accounting Operations Officer upon completion of the write-off process.

L. Fee Collected by a Collection Agency

In general, student tuition and fees not collected in ninety (90) days are determined to be

delinquent and should be submitted to a collection agency, provided no alternative has been

established with the student, such as a regularly scheduled payment. Regions have authority to

make exceptions to this rule on a case-by-case basis.

Any account turned over to collection will be assessed a fee based upon the current contract with

the collection agency. In all cases, any collections received from the collection agency must be

posted to Banner in order to give proper credit to the student’s account.

M. Tax Intercept

Indiana Code 6-8.1-9.5 authorizes Ivy Tech to report debt to the Indiana Department of Revenue

for possible offset from a future Indiana income tax refund due to students. The Department of

Revenue garnishes State of Indiana income tax returns on behalf of Ivy Tech in order to pay the

outstanding balance.

Students who feel the debt is not valid have the right to submit an appeal. The written appeal

form and documentation must be received by the College within 30 days of the date of the

student’s notification letter.

N. Student Bankruptcy

U.S. Bankruptcy Code Sec. 523

If the College receives notice, as a creditor, that a student has filed for bankruptcy, then:

1. Note in student's record and financial aid file that a bankruptcy petition is pending. In the

interim, follow the procedures set forth in paragraph 2.

2. A general order of discharge does not discharge a student loan or a debt owed to the College

as a result of a student’s financial aid and or student loan refund to the U.S. Department of

Education, commonly referred to as R2T4. If the bankruptcy court specifically grants discharge

of the student debt, by making a specific finding of undue hardship, then the Region should

follow the steps described below (a.1) a.2) and b.), and forward a copy of each court order to the

College General Counsel.

a. Make an entry in the student's records and financial aid file of the date of bankruptcy decree,

and note that future efforts to collect the debt which violate federal law should not be made, such

as:

1. Withholding transcripts or other acts designed to compel the debtor to pay the discharged debt

(11 USC §524 a(2), and

2. The College is forbidden from discrimination against bankrupt persons solely on the basis of

bankruptcy (11 USC §525).

b. Include the student debt on the next accounts receivable write-off report.

3. If the debt is not specifically discharged by court order, and the student has only received a

general discharge order, and the debt to the College is the result of the student’s financial aid or

student loan being refunded to the U.S. Department of Education (R2T4), the College may

pursue collection of the debt against the student, including withholding grades, transcripts,

diplomas, admission, etc. Another entry, as a follow-up to 3.a. above, should be made, noting

that the debt is a valid one to be pursued. If a student is self-paying and the debt is discharged,

the College can no longer pursue collection.

II. Cash Receipts - Other Receipt Items

A. Property and Materials

When College property or materials are sold, the monies received should be deposited in

accordance with regular College policy. (See Section N, Fixed Assets, Chapter VI, Sale or

Disposal of College property or materials for necessary approvals to be obtained.)

B. Other Receipt Items

Monies received for reasons other than those stated previously, are to be deposited in accordance

with regular College policy.

Full identification of the source of the monies, including payer and check number, is to be

included with the Cash Receipts Form. Documentation must be adequate to assure a clear audit

trail is provided for classification and recording of miscellaneous revenue. This may be

accomplished by recording additional detail on the documentation when needed for clarification

and by review of the TZRMISC report not less frequently than monthly.

SECTION H: TRAVEL AUTHORIZATION

I. Introduction

This Section applies to all business travel conducted on behalf of Ivy Tech Community College

of Indiana, regardless of funding source, e.g. general funds, agency funds, student government

and student clubs, or other restricted funds. The College travel policies attempt to provide

reasonable reimbursement of expenses incurred by staff traveling on business, although in some

cases, 100% reimbursement may not be made. Travel expenses are reimbursed following this

policy for College employees, students, and board members. Unless otherwise specified in a

legally binding contract, College contracts that provide for reimbursement of travel expenses will

be consistent with the policies and regulations of the College. All persons seeking reimbursement

should incur the lowest reasonable travel expense and should exercise care to avoid impropriety

or the appearance of impropriety. Public funds should never be used for personal gain.

If a circumstance arises that is not specifically covered, either adopt the most conservative course

consistent with the policies of the College or consult with the Senior Vice President and Chief

Financial Officer or designee.

The CFO or Chancellor may develop campus procedures relating to travel by College employees

and others who might travel on College business. Such procedures must be consistent with those

outlined in this Section and the reimbursement rates may not be changed.

II. General Policy

A. Travel Approvals and Authorizations

The College utilizes Chrome River Expense to obtain required travel pre-approvals and request

reimbursements for travel. Chrome River automatically routes pre-approvals, expense reports,

and advance requests to the appropriate approvers.

All approvals should be obtained prior to the travel.

In-State travel: Includes travel to Cincinnati (OH), Chicago (IL), Louisville (KY), and Somerset

(KY) metropolitan areas. Requires prior approval of the employee’s supervisor. Submission of

a Pre-Approval in Chrome River is optional or subject to campus requirements.

Out-of-State Adjacent travel: Travel to adjacent states which is within a 60-mile radius from the

employee’s assigned post, and which is necessary to perform customary job responsibilities:

Requires written prior approval of the employee’s supervisor and the Chancellor or Senior Vice

President or equivalent. A blanket approval from the Chancellor or Senior Vice President or

equivalent is acceptable. The blanket approval should state the employee’s name or a

department name and position titles which are covered by the blanket approval. The blanket

approval should be kept on file in the campus Business Office for audit purposes. Submission of

a Pre- Approval in Chrome River is optional or subject to campus requirements.

Foreign travel: Includes any travel outside the US. Requires prior approval from the employee’s

supervisor, Chancellor (campus employees), respective Senior Vice President or equivalent

(Systems Office employees), Chief Financial Officer, and Chief Operating Officer. Approval for

foreign travel must be obtained via a pre-approval submitted in Chrome River.

Out-of-State travel <=$5,000 (Campus staff): Includes all other out of state travel not noted

above. Requires prior approval from the employee’s supervisor & Chancellor. Approval for

out-of-state travel must be obtained via a pre-approval submitted in Chrome River.

Out-of-State travel >$5,000 (Campus staff): Includes all other out of state travel not noted

above. Requires prior approval from the employee’s supervisor, Chancellor, Chief Financial

Officer, and Chief Operating Officer. Approval for out-of-state travel must be obtained via a pre-

approval submitted in Chrome River.

Out-of-State travel (Systems Office staff): Includes any out-of-state travel (excluding adjacent

travel covered with a blanket approval & travel to Somerset (KY), Chicago (IL), Louisville

(KY), or Cincinnati (OH) metropolitan area. Requires prior approval from the employee’s

supervisor, respective Senior Vice President or equivalent, Chief Financial Officer, & Chief

Operating Officer. Approval for out-of-state travel must be obtained via a pre-approval

submitted in Chrome River.

B. Travel Status

1. An individual is in travel status from the time he or she leaves the post to the time of

return. Occasionally an individual may take a trip that includes both personal time and

business travel. Generally travel status should begin and end as if the personal travel had

not occurred. The individual should exercise special care not to seek reimbursement for

expenses that could be construed to be personal.

2. When an employee combines personal and business travel, documentation must be

provided with the expense report to assure the College did not incur additional expenses.

Documentation must establish the cost of the trip without the inclusion of personal travel.

Reimbursement will be made at the lesser of the previously mentioned documentation or

actual expenses incurred.

There are special circumstances involved with non-exempt employees while traveling for the

College as it relates to payroll issues. Please contact the payroll office prior to approving

travel for non-exempt employees.

Generally when departing from or returning to your home, on a regular work day, reduce the

mileage claim by your normal commuting mileage. If your mileage to your destination is less

than your normal commuting mileage then you should not claim any mileage reimbursement.

An exception to this rule may apply when an individual departs or arrives home on an

unscheduled workday. In this case, the individual should claim the actual mileage to/from

home. This exception is not to be applied to travel to/from home and post. An example of the

correct usage of this exception would be as follows: The employee's normal work schedule is

Monday-Friday, 8:00 a.m. to 5:00 p.m. The employee departs Sunday at 10:00 a.m. the

mileage from home to the airport is 20 miles, and the employee's normal commute is 10

miles. In this case, the employee may claim the full mileage of 20 miles.

C. Travel Advances

Travel advances may be paid on an exception basis only upon approval from the Executive

Director of Finance/Administration for a campus employee and the Assistant Vice President of

Budget Management approval for a Systems Office employee. Travel advances will be paid by

Direct Deposit only. The following stipulations apply:

1. A travel advance should be requested after the travel pre-approval is approved in

Chrome River. Chrome River will systematically apply the Fund and Account to be used

on the advance. If the advance is approved, it will be paid through the Banner Accounts

Payable module.

2. The request should be submitted within 10 days prior to the expected travel date.

3. The advance must be at least $100 and may not exceed 50% of the reimbursable

estimated mileage, lodging, airfare, and Per Diem.

4. When completing the expense report in Chrome River, 100% of the travel expense should

be reported. No adjustment should be made for the advance. The amount of the advance

will be systematically recovered. If no expenses are incurred or the allowable actual

expenses are less than the advance, advance repayment must be made to the campus

bursar or business office. If necessary repayment may be realized through a payroll

deduction(s).

5. Once the advance is paid, Chrome River will automatically apply any outstanding

advance balance to any expense reports created subsequent to the payment until the

balance is reduced to $0.

III. Reimbursements

A. Requests for Reimbursement

Expense Report

a. Reimbursement for travel expenses must be submitted in Chrome River via an

Expense Report.

b. Each expense report must be submitted for reimbursement within sixty (60) days

after the completion of each trip. The College reserves the right to deny

reimbursement if not received within this sixty (60) day period.

c. Each person requesting reimbursement for travel expenses must submit an expense

report covering only his or her own expenses. The traveler may authorize a delegate

in Chrome River to submit an expense report on their behalf. No reimbursement

should be received by a person for the expenses paid by another person unless

specifically authorized elsewhere within this travel section. Exceptions may be made

by the EDF/Chancellor or designee for campus staff and the Chief Accounting

Operations Officer for the Systems Office.

d. All amounts reported must be converted to United States currency. Chrome River will

provide foreign exchange rates upon entry of the expense report. Differences between

the system supplied rate and the requested rate which vary by more than 2%, must be

explained. Proof of conversion rate(s) must be submitted for expenses paid in any

other currency.

B. Travel Status

1. Per Diem

A person in travel status is entitled to a daily Per Diem allowance based on the meals

only rate published by the U.S. General Services Administration (GSA).

The GSA rate tables are integrated with Chrome River and the system will calculate the

rate based on the destination and date entered in the report.

The first and last day travel per diem will be paid in accordance with the Federal tables,

which approximates the following for overnight travel.

Over-Night travel (12 - 24 Hours)* Meal Breakouts

Departure before 9:01AM (100%) 100% of Rate

Departure between 9:01AM and 2:00PM (75%) 75% of Rate

Departure between 2:01PM and 7:00PM (50%) 50% of Rate

Departure 7:01PM or later None

Return between 12:01AM and 4:59AM None

Return between 5:00AM and 11:00AM (25%) 25% of Rate

Return between 11:01AM and 4:59PM (50%) 50% of Rate

Return between 5:00PM and 11:59PM (100%) 100% of Rate

*Documentation of overnight travel accommodations is required to pay Per Diem at the

over-night travel rate.

If a person is in multiple locations on the same day while in travel status outside of

Indiana, the per diem rate for the location employee slept or rested should be claimed.

The same meal may not be claimed more than once.

Federal Travel Regulations 41 C.F.R.300-304 and IRS Notice 2018-77 currently allow

$5.00 per day as incidental expenses, fees and tips given to porters, baggage carriers,

bellhops, hotel maids, stewards or stewardesses and others on ships, and hotel servants in

foreign countries. Employees receiving Per Diem for domestic travel may request up to

$5.00 per day as incidental expenses, if incurred, without providing a receipt.

Except as provided below, a person is not entitled to Per Diem allowance or lodging

expense for overnight travel if travel takes the person fifty (50) miles or less from the

post or the person's home, whichever is the lesser distance. A Senior Vice President (or

equivalent) or Chancellor may authorize payment of Per Diem allowance and lodging by

making a determination that it may be dangerous or undesirable for a person to travel

because of any one of the following:

• unsafe highway/weather conditions

• unusual work assignment

• the employee's physical condition

One-Day Travel (more than a 50-mile radius from home or post)

If a person is in travel status a minimum of twelve consecutive hours all in one-day he or

she may claim ½ of the Indiana daily per diem rate. All other travel policies apply. No

exclusions for meals furnished need to be made because the traveler will receive a flat

rate of half the Per Diem rate. Per IRS regulations (1.32.1.7.1), Per Diem paid for one-

day travel is considered taxable income to the recipient.

One-Day travel is defined as travel that is:

a. at least 12 consecutive hours in travel status

b. occurs within the same calendar day

c. more than 50 miles from home or post

The request for reimbursement will be entered in Chrome River. Upon approval, payment

will be made through the accounts payable system. Chrome River Analytics will be used

to provide the necessary information to the payroll department regarding the taxable

payment. The tax will be withheld from the employee’s paycheck.

2. Meals Furnished

a. If a person in travel status receives a meal without charge*, or as part of a

registration fee paid by the College, State of Indiana, the Ivy Tech Foundation, or

provided by a vendor or potential vendor, the Per Diem allowance must be reduced

as calculated by Chrome River, which will approximate the following table,

regardless of the actual cost of the meal: (An exception to this is One-Day Travel

as noted above.)

Breakfast 25% of Daily allowable rate

Brunch 25% of Daily allowable rate

Lunch 25% of Daily allowable rate

Dinner 50% of Daily allowable rate

b. If all meals are provided, make no claim for Per Diem. The College must not pay

for a person's meal more than once.

*Meals furnished without charge does not apply to continental breakfast. A continental

breakfast usually consists of cereal, juice, fruits, and pastries.

3. Lodging Furnished

If lodging is provided to a person in travel status at no cost to the person, a statement by

the employee explaining that the person was in travel status, may be substituted as

documentation to justify claiming the Per Diem allowance.

4. Board Members

All campus and State board members are entitled to reimbursement of allowable travel

expenses at the same rate as employees. Additionally, a State Board member is entitled to

a $50.00 stipend each day while attending an official board meeting. The stipend must be

processed through Chrome River and is subject to 1099-MISC IRS reporting rules as

detailed in Section C of the FMM. State Trustees: IC 21-38-2-3

5. Non-Working Days or Extended Travel To Save Costs

The additional expenses associated with travel that is extended to save costs, such as a

Saturday night stay, may be reimbursed when the cost of airfare would be less than the

cost of airfare if the traveler had not extended the trip, and provided that those expenses

were incurred in compliance with all other travel regulations. Such expenses, which

include lodging, car rental, meals and incidental expenses, shall not exceed the amount

the College would have paid if the traveler had not extended the trip. An employee must

document the airfare as if the trip had not been extended, and turn this documentation in

with the expense report.

C. Reimbursement of Lodging

1. An employee in travel status may claim lodging expenses not to exceed the single

room occupancy charge including taxes.

2. If two (2) or more employees in travel status share a room, one person may pay the

entire cost of the lodging and request reimbursement. The employees must note this

fact on each employee's expense report. If one employee pays for a deposit, that

employee may list the full amount of the deposit on the expense report.

3. An employee may not request reimbursement for lodging when the lodging was

provided by a person who is not in the business of providing lodging. Examples

include stays with friends and/or family members.

4. Whenever possible, employees should stay in hotels that offer government

rates. Employees who prefer luxury accommodations should not request full

reimbursement. Travelers and College management should pay special attention to

the policies and procedures when selecting anything other than modest

accommodations.

5. Generally, employees should pay for their lodging, and then request reimbursement.

However, there are circumstances when it is in the best interest of the College to

allow direct billings or prepayment of hotel charges for a group of employees. Any

and all amenities which would result in additional charges are strictly prohibited.

Further, prior to payment, the hotel must have been informed and in agreement that

charges for amenities may not be billed to the College but instead will become the

responsibility of the employee. In these cases, prior approval by the Assistant Vice

President of Budget Management (Systems Office staff), or Chancellor or Executive

Director of Finance / Administration (campus employees) is required.

6. It is the employee’s responsibility to pay for the hotel stay. Hotel receipts without a

zero balance will be allowed in order for employees to be reimbursed for their hotel

expense. The majority of hotels allow a quick checkout, charging the employee's

credit card and later emailing a receipt.

D. Conference Expenses and Hotel Deposits

An employee in travel status may be reimbursed for the cost of registration fees associated

with attendance at conferences. Only the employee's portion of the registration fee may be

paid. Paragraph B-2 (Meals Furnished) applies when the registration fee covers the cost of

meals. In some cases, conference hotels require a deposit in advance, instead of allowing the

employee to hold the room with a credit card only. In these cases, the employee may be

reimbursed for the total deposit. The Expense Report for reimbursement of the deposit may

be requested in Chrome River prior to the completion of the travel if desired. The Expense

Report for the remaining expenses may be submitted upon completion of the trip.

E. Reimbursement of Transportation

1. Personal Automobile

a. The employee is free to choose any site for driving directions; however the mileage

reimbursement will be based on Google Maps which is integrated with Chrome

River.

For all full-time employees and all part-time non-instructional staff, a primary post or

station must be designated by their supervisor in consultation with human

resources. This designation must be based on where the employee normally spends

the majority of their work time. Generally when departing from or returning to the

employee’s home, on a regularly scheduled workday, reduce the mileage claim by the

employee’s normal commuting mileage to/from the primary post or station. If the

mileage to the destination is less than the normal commuting mileage, the employee

should not claim any mileage reimbursement.

Examples: Employee’s post is the Indianapolis campus (downtown), they live in

Franklin, IN (south of Indy), and their work schedule is Monday through Friday.

Mileage Table for Examples:

Description Mileage

Home to Post 25

Home to Chicago 204

Home to Madison 77

Post to Chicago 179

Post to Madison 102

Example 1. Departs from home to post, then to Chicago on a Monday, returns on a

Tuesday and stops at post prior to returning home

Home to Post 25 miles

Post to Chicago 179 miles

Chicago to Post 179 miles

Post to Home 25 miles

Total 408 miles

Less: Round trip commuting mileage 50 miles

Total to be claimed 358 miles

Example 2. Departs from home on a Sunday to Chicago, returns to home on a Tuesday

Home to Chicago 204 miles

Chicago to Home 204 miles

Total 408 miles

Less 1 day of commuting mileage as departure was on a Sunday 25 miles

Total claimed 383 miles

Example 3. Departs from home on a Thursday to Madison, returns to home on the same

day

Home to Madison 77 miles

Madison to Home 77 miles

Total 154 miles

Less round trip commuting mileage 50 miles

Total claimed 104 miles

Example 4. Departs from home to post, then to Madison, returns directly to home all on a

Friday

Home to post 25 miles

Post to Madison 102 miles

Madison to home 77 miles

Total 204 miles

Less round trip commuting mileage 50 miles

Total claimed 154 miles

If the miles traveled exceed the miles shown on Google Maps and the employee can

show just cause for taking that route (i.e. road closed due to detour), the employee

should be reimbursed for that extra mileage, provided documentation is included with

the Expense Report.

b. If reported miles differ from the integrated Google Maps miles, an explanation

must be entered on the expense report in Chrome River.

c. Additional official automobile travel within a city or town shall be listed separately

from travel between cities or towns, and shall be itemized sufficiently to show the

address (es) visited.

Example:

Visited 4100 East 38th Street

(8 miles NE Indianapolis).

Additional official travel outside a city or town shall be listed separately from

travel between cities or towns, and shall be itemized sufficiently to show the

address visited.

d. Personal automobile mileage will be based on the approved IRS rates. This rate

will change with the same frequency that the IRS mileage rate changes. Revised

IRS rates are normally issued annually, usually by January 1 of each year.

e. The mileage reimbursement shall not exceed airfare available thirty days (30)

before the departure date. Documentation supporting the costs of the airfare must

be attached to the employee’s expense report. The College will not pay Per Diem

for extra days taken to drive as opposed to flying. In essence, the total costs of

driving cannot exceed the total costs that would have been incurred had the

individual used a commercial air carrier. This same approach is to be applied for

travel by rail, bus or other means. Exceptions to this policy may be approved by

the employee's respective Senior Vice President (or equivalent), Chancellor, or

EDF/EDA when economical and practical, and should be noted on the Pre-

approval for out-of-state travel. When the employee traveling is a Senior Vice

President (or equivalent) or a Chancellor and traveling outside the continental

United States, the President or designee must approve exceptions to this policy.

2. Travel by Commercial Air Carrier

The coach or tourist class cost of travel by commercial air carrier will be reimbursed.

Airfares carrying cancellation penalties should be used with extreme caution. The

penalty fee up to 50% may be reimbursable only if legitimate College business or a

personal emergency prohibits the employee from traveling. Change fees must be pre-

approved by the Chief Financial Officer and the Chief Operating Officer.

3. Travel by Non-commercial Carrier

The cost of travel by a non-commercial carrier is reimbursable only if the Senior Vice

President and Chief Financial Officer or designee has approved the use of such a

carrier before the reservation is made.

4. Travel by Railroad or Bus

The cost of travel by railroad or bus may be reimbursed. No employee may be

reimbursed for the cost of train or bus fare in excess of airfare available thirty (30)

days before the departure date. Pullman accommodations in excess of the cost of a

roomette are not allowed. The travel time maximum of two full driving days per trip

applies to train and bus travel.

5. Public Transportation

The cost of taxi and other public transportation between an employee's post or home

and a terminal may be reimbursed. The cost of transportation between the terminal,

the place of lodging and other places of College business while in travel status may

be reimbursed. The employee must submit the detail of such trips with the expense

report. The cost for transportation to and from restaurants or other forms of

entertainment are considered to be personal expenses and will not be reimbursed.

The cost of parking at a terminal may be reimbursed at long-term rates. If the long-

term parking lots are full, the College will pay for other parking arrangements such as

parking lots away from the airport, which require shuttle services. This should only

occur rarely, and the employee must attest to the lot being full. An employee in travel

status may use a personal vehicle for transportation to a terminal instead of using

public transportation, and may be reimbursed the cost of round-trip mileage between

the post and the terminal. If traveling from home you must deduct your normal

commuting mileage, unless it is on a non-scheduled work day The employee in travel

status may receive reimbursement for a second round trip in lieu of receiving

reimbursement for parking at the terminal. However, reimbursement for a second

round trip may not exceed the cost of long-term parking fees for the travel status time

period.

6. Car Rental

Any employee who may be expected to drive a College-owned vehicle or drive a

rental vehicle for business purposes related to College must complete a Driver

Authorization Form at least 10 days prior to driving. Details for completing this form

are provided in Section I, IV, c, 2. Driver Authorization. This form and instructions

can be obtained in the forms section of College’s Infonet under "Driver

Authorization".

The College may not rent a vehicle designed to seat 15 persons or more, including the

driver.

Students wishing to drive College-owned, rented, or leased vehicles must comply

with the guidelines set forth in the student domestic travel policy, which may be

found at: https://www.ivytech.edu/files/4.29-Student-Domestic-Travel.pdf All

student participants choosing to ride in a private automobile do so voluntarily and at

their own risk. The College shall not insure or accept liability for any damage, loss or

injury resulting from the use of a private vehicle. The College does not provide

comprehensive or collision (physical damage) insurance for private vehicles driven

on College business.

Students are allowed to drive designated driver's education vehicles when enrolled in

the College's driver education course or drive time, only when accompanied by a

certified driver education instructor.

Automobile rental expense is reimbursable for out-of-state travel when it is efficient

and cost effective, and when approved by the employee's respective Senior Vice

President (or equivalent) or Chancellor or Executive Director of Finance /

Administration. Approval from the President or designee is not required when a

Senior Vice President (or equivalent) or Chancellor is the employee renting the

automobile.

When an automobile is rented for a combination business/personal trip, extra care

should be taken to ensure the College does not pay for rental costs outside of the

business portion of the trip. There may be circumstances when a weekly rental rate is

cheaper than the daily rate for the conference dates. When this occurs, the College

will pay the weekly rate. This must be documented on the rental agreement and

submitted at the time of reimbursement.

The employee may have the cost of the rental billed directly to the College if

approved by the Assistant Vice President of Budget Management (Systems Office

staff) or the Chancellor or Executive Director of Finance / Administration (campus

employees). If the employee incurs the costs of rental, copies of the receipts for the

car rental and fuel should be attached to the request for travel reimbursement. The

employee will be reimbursed for the lesser of the car rental and fuel or the mileage

calculated per section E-2 (Personal Automobile). The least expensive practical

vehicle should be rented.

7. Long Distance Travel by Driving

Employees who choose to drive rather than fly long distances cannot be in travel

status for more than a maximum of two full driving days per trip. The mileage

reimbursement shall not exceed airfare available thirty (30) days before the departure

date. Exceptions to this policy may be approved by the employee's respective Senior

Vice President (or equivalent) or Chancellor or Executive Director of Finance /

Administration when economical and practical, and should be noted on the Chrome

River pre-approval. When the employee traveling is a Senior Vice President (or

equivalent) or a Chancellor, the President or designee must approve exceptions to this

policy.

F. Travel Outside the Continental U.S.

In addition to the Per Diem allowance, an individual in travel status outside of the continental

United States may be reimbursed for the reasonable expenses associated with the travel. Such

expenses include the cost of:

• visas, passports and other travel documents

• photographs for travel documents

• inoculations

• currency exchange

• airport taxes

G. Requirement for Receipts

1. Except as provided below, a person requesting reimbursement of the actual cost for

any item of expenditure must include a scanned receipt in the Chrome River module

which is attached to the Expense Report. If a receipt for any item of expense has been

lost or cannot be obtained, the following may be substituted and scanned and attached

to the Expense Report in Chrome River:

a. Lodging - statement from provider or FAX or scanned copy of detailed receipt.

b. Airfare - documentation from the airline or travel agent.

c. Other - A Certificate of Missing Documentation form. The form is available in

the business office or on the forms page of the College's Infonet. The certificate

must be approved by the individual's supervisor.

H. Sales Tax

Exemption from sales tax is offered on the purchase of tangible personal property by non-

profit organizations if:

1. The purchased item is used or consumed by the organization.

2. The item is used for the same purpose for which the organization is exempted from

Indiana Income Tax.

3. Meals and lodging, furnished by an educational organization for the use of

individuals, are not used or consumed by the organization itself and are not used for

educational purposes, regardless of the fact that the individual may use them while

employed by or is a guest of the educational organization; and therefore, are not

exempt from sales tax.

4. Exception: If the College pays a hotel within Indiana, it is billed directly, and it is for

College business, the sales tax should be waived. If the employee pays the bill and

seeks reimbursement, sales tax is appropriate.

I. Parking Charges/Other Miscellaneous Charges

1. An employee in travel status may be reimbursed for the cost of parking, rideshare

services, and cab fare (including cab fare tip) within the guidelines of Section E,

Reimbursement of Transportation, of this travel policy. Receipts satisfying the

requirement of Paragraph G, Requirements for Receipts, must be included with the

request for reimbursement.

2. Reimbursement for parking at parking meters may be requested on an expense report

to the extent of $8.00 per trip. Detail must be provided.

3. Reimbursement for public transportation for which a receipt is normally not given,

i.e., city buses, subway or metro service , as well as tolls may be requested on the

expense report to the extent of $15.00 per day without providing a receipt or

Certificate of Missing Documentation.

4. For those employees that do not claim Per Diem, an exception would allow that

employee to claim tips up to the amount they would have been allowed for Per Diem.

Such examples would be tips for maids and hotel or airport porters.

5. Certain Airline fees in addition to the cost of the ticket may be reimbursed when

required for airline travel (i.e. baggage fees). Other fees which are normally

considered more personal convenience in nature (i.e. seat assignment fees, Wi-Fi) are

not to be reimbursed. Exceptions may be approved by the Chancellor or Executive

Director of Finance/Administration for a campus employee or Assistant Vice

President of Budget Management for a Systems Office employee.

J. Instructional Travel (Applicable to Full-time Faculty, Adjuncts, & Administrative

Staff)

One of the key elements in the decision of how to reimburse an instructor's travel expense is

the establishment of the individuals designated station. In the majority of cases, the

individual's station is the location at which the individual is contracted to teach. For example,

the station of an adjunct faculty member, who is contracted to teach a course at a local high

school, is the high school, not the campus’s main location. For adjunct faculty this principle

applies on a class-by-class basis regardless of the number of individual contracts. To expand

upon the above example, assume that the individual was not only teaching a course at the

local high school, but he/she was also teaching a course at the main campus. This individual

would have two stations, each one based upon where the individual was contracted to work,

and therefore would not receive travel reimbursement.

In making a determination to pay mileage reimbursement to adjunct faculty, the individual's

assignments should be the basis, not the contract. It does not matter if the individual has two

independent adjunct teaching assignments on one contract or on two separate contracts.

There may be instances however, where the College might reimburse a full-time instructor to

drive to a location. If for example, an individual's overall employment with the College is

based upon the individual traveling from their station to another location, then travel

reimbursement may be appropriate. For example, if a full- time instructor, who is contracted

to teach at the main campus, is given the assignment to also cover a course at a local high

school as a part of their full-time contract, then travel reimbursement to the second location is

appropriate.

In the case of administrative employees who are also teaching classes, the same principle

would apply. If teaching the class is a part of the individual's administrative assignment, then

the reimbursement of mileage is appropriate. However, if instructing the class is not a part of

the individual's administrative assignment, travel expenses would not be reimbursed.

In cases where the college would not pay travel reimbursement, it would also be

inappropriate to allow the individual to utilize a college-owned vehicle.

IV. College Sponsored Meetings

The College sponsors on campus and off campus meetings/activities for various reasons. The

following paragraphs address food and drink and other allowable expenses for guests, advisory

committees, employees, and students. This paragraph is not applicable to meal costs incurred

during Workforce Alignment courses, such as lunch fees included in the cost of the course.

These costs are considered a factored component of the total cost of the course. For additional

information on this topic, see Travel Policies, Section H. III. B. 2. Meals Furnished.

Provision of food and drink at meetings/activities requires prior approval of a Senior Vice

President (or equivalent), Chancellor, or President. Approval delegation may be made to the

Executive Director of Finance / Administration. This delegation must be in writing and available

for review. As a reminder, employees are prohibited from approving their own purchases.

Due to numerous statewide meetings that are sponsored by the Systems Office, meal approvals

within those areas may be delegated to specific staff members. Approval authority may be

delegated to one Vice President/Assistant Vice President level or higher staff person in each

operational area (Human Resources, Finance, Financial Aid, Student Services, Facilities,

Distance Education, IT, Institutional Research, Marketing).

A complete list of all individuals provided food and drink must be submitted with an itemized

receipt of the expenditure for all payment requests. Signatures from attendees are not required; a

list is appropriate. The list must be verified by an employee with knowledge of who attended the

meeting. In all cases food purchases from College funds should be closely scrutinized and must

be directly related to professional development initiatives or College meetings/activities where it

is in the College's best interest to provide food and drink, as determined by the Vice President,

Assistant Vice President, Chancellor, or Executive Director of Finance / Administration. Given

the nature of some meetings/activities it may not be appropriate or feasible to obtain a complete

list of individuals. Some examples include an open house or a centralized college-wide

demonstration. In circumstances where it is not feasible to provide a list of attendees,

documentation explaining this rationale should be submitted with the receipts.

Note: Alcohol/liquor may only be purchased for instructional use when required by the

curriculum, whether credit or non-credit courses. Otherwise, College funds may not be used for

alcoholic purchases.

Food and drink expenses per person may not exceed the current daily Per Diem amount for the

meal provided. Total food and drink expenses per person per day may not exceed the

current daily Per Diem amount. Tax, gratuities, and delivery/set up charges are not included in

the above limits. State Board Meetings and campus Board meetings are excluded from these

limits for food and drink expenses. Exceptions must be approved by the Chief Financial Officer.

1. Guests

The College may pay expenses of guests when in the best interest of the College to do so.

All payments are to be for food and/or lodging only and must comply with College

policy. (Note: Refer to Section VI, Moving Expenses, for approval and reimbursement of

interview expenses)

2. Open Houses, Building Dedications, etc.

Breakfast 33% of Daily allowable rate

Lunch 50% of Daily allowable rate

Dinner 50% of Daily allowable rate

These types of events may be conducted to provide opportunities for the community to

become more knowledgeable about Ivy Tech. Expenses for such events may be paid by

the College with advance approval of the Senior Vice President (or equivalent),

Chancellor, or the President. A copy of the statement of approval, a statement of the

purpose of the function, and a list of itemized expenses with receipts must be attached to

employee reimbursement payments.

3. Advisory Committees

Expenses for Advisory committee meetings may be reimbursed in accordance with rates

in effect for mileage, lodging, and Per Diem. Employee and non-employee committee

members will be reimbursed similarly under the provisions applicable to employees.

V. Campus and State Board of Trustees

Arrangements for lodging, rental of meeting places and meals for dinner meetings may be made

for the Trustees. Billings to the College for such charges must include a list of the names of

Board members who attended the meeting. Payments for group arrangements for lodging,

meeting places, and meals in conjunction with these meetings should be made through a

Purchase Requisition through the College's purchasing system. Requests for Per Diem or meal

allowance must be reduced for the meal(s) provided by the College. The amount of the reduction

should be in accordance with the Per Diem rate schedule.

Regarding all other travel for conferences or for visitation and consultation purposes, a member

of the State Board or campus Board of Trustees, in the performance of duties will be entitled to

reimbursement for transportation, lodging, and Per Diem in accordance with employee travel

policies.

VI. Moving Expenses

All pre-approvals and reimbursements for moving/relocation must be processed through the

Chrome River module. The Chrome River pre-approval should be used to receive approval by

the Systems Office. The Chrome River Expense Report should be used for reimbursement of

moving expenses after the pre-approval is approved. The Expense Report should be submitted

within 60 days of when the expense was incurred. The Chrome River module will facilitate

proper approvals for both the pre-approval and the expense report, and allow tracking for IRS

reporting purposes. Relocation, as used in this section, applies to change of official post of

current employees as well as new hires.

A. New Employees

Employment of new personnel may necessitate the relocation of households either from

within or outside of the State of Indiana. An incentive for the attraction of competent

personnel may, in part, rest on the ability of the College to offer to pay a portion of the

moving expenses for such personnel. However, payment of moving expenses is entirely

discretionary and must be approved in advance by the President. The appropriate Senior

Vice President (or equivalent) or Chancellor or their delegate will enter the pre-approval

with estimated expenses into the Chrome River module. The estimated moving expenses

must be justified as being in the best interest of the College, and not exclusively for the

convenience of the individual employee. Upon approval of the pre-approval by the

President, a new employee may be reimbursed for moving expenses at a rate of up to the

lesser of ten percent (10%) of the starting salary or five thousand dollars ($5,000).

B. Change of Official Post

1. An employee required by his or her department to be reassigned from his or her

present official post to a new official post, which necessitates the employee to move

his or her home, will be allowed mileage for a one-way trip from the old official post

to the new official post. If the distance between posts is more than 50 miles, a

moving allowance may be allowed. With the prior approval of the President, the

employee may be reimbursed up to the lesser of ten percent (10%) of the starting

salary or five thousand dollars ($5,000).

2. When the moving allowance is claimed, a lodging receipt or similar proof of travel to

the new official post will be required. It shall be the duty of the employee's immediate

supervisor or department head to secure sufficient information to be able to certify via

a comment on the expense report or an attachment thereto which of the above-

mentioned provisions apply. The department head or subordinate shall certify that the

change of post was a necessary transfer. (This may be an exception to the 50-mile

limit.)

C. Relocation Reimbursement

Relocation, as used in this section, applies to change of official post of current employees

as well as new hires.

D. Interview Expenses

1. Requires approval from the employee's respective Senior Vice President (or

equivalent) or Chancellor prior to incurring obligation.

The President or designee must grant the approval for any Senior Vice

President (or equivalent) or Chancellor open position.

The approval should be obtained outside of Chrome River and scanned and

attached to the expense report in Chrome River when reimbursement is

submitted.

2. May be paid only to individuals seeking employment with the College.

3. The required qualifications for the position must be submitted with the

request.

4. The allowable reimbursement is subject to the travel rules and policies of the

College as applicable to employees in travel status, subject to the overall

limitation of 1% of the maximum hire-in rate authorized for the position.

Exceptions to the 1% limitation may be authorized by the President.

5. The Expense Report for reimbursement should be submitted within 60 days of

the interview.

VII. Ivy Tech-Owned and Leased Vehicles

An accurate record of all travel, mileage, and expenses must be recorded daily for each vehicle,

in accordance with procedures approved by the State Board of Accounts. All use of Ivy Tech

owned or leased vehicles in the campuses must be authorized by the Chief Financial Officer’s

office and are then assigned to the custodian. The custodian is the campus Chancellor or

Executive Director of Finance / Administration. The use of a vehicle must be strictly confined

to travel necessary to conduct business of the College. (This does not include commuting.)

A. Permanent Assigned Vehicles

Any employee who may be expected to drive a College-owned vehicle or drive a

rental vehicle for business purposes related to Ivy Tech Community College of

Indiana must complete a Driver Authorization Form at least 10 days prior to driving.

Details for completing this form are provided in Section I, IV, c, 2. Driver

Authorization. This form can be obtained in the forms section of College’s Infonet

under “Driver Authorization”.

Effective July 1, 2019, Chancellors and others designated by the President may

receive an automobile stipend. If an individual drives his or her own vehicle

throughout the year, an automobile allowance would be provided to the individual in

an amount equal to the leased value of the mid-sized sedan or smaller SUV (vehicles

on the state QPA list or comparable) plus an estimated amount for gas purchases.

Under this option, the individual would be responsible for gasoline purchases and

other vehicle costs. In addition, the College would not provide mileage

reimbursement.

Employees who were permanently assigned a College vehicle prior to July 1, 2019

under the former policy, may continue using the permanently assigned vehicle until it

is no longer operable at which time they may transition to a stipend. These

employees must continue to maintain a record of business and personal travel and the

value of commuting and personal travel are included as taxable income on the

employee’s W-2.

Any exceptions to this policy must be approved by the Senior Vice President and

Chief Financial Officer.

B. Temporary Assigned Vehicles

Each campus should have an established procedure for requisition of use of Ivy Tech

vehicles for temporary assignment. The documentation should at least include the

following information for approval.

1. Name of Driver

2. Destination of Trip. If more than one location is involved, so in

dicate.

3. The date and period of time the applicant wishes to use the state or Ivy Tech

vehicle.

4. Purpose of trip. Must be official College business.

5. Authorized signatures.

VIII. Overpayments from Travel Reimbursements

The College may recover any expense or allowance paid to any person or entity which was 1)

erroneously paid for any reason or 2) paid because of illegality or fraud on the part of any person

or entity or 3) paid under the mistaken belief, at the time payment was made, that such payment

was in accordance with this policy or 4) paid in excess of Per Diem expenses per federal

guidelines.

Revised January 15, 2019

SECTION I: INSURANCE

I. INTRODUCTION

The College manages its risks in four general ways: 1) by avoiding a possibly

hazardous task or condition, 2) by modifying the risk to an acceptable level, 3) by

transferring the risk to another party by means of a contract and/or insurance

purchase, and 4) by retaining the risk after other treatment techniques have been

considered.

This section of the Financial Management Manual explains the types of insurance

policies the College purchases to address its Property and Liability exposures, the

basic coverage each provides, and the proper manner to file a claim. Please read the

below section carefully; this information can help you become more aware of the

potential risks at your operating location and how they are managed. This summary

is intended to provide a high-level overview. Individual claims are subject to the

specific terms, conditions and exclusions contained in the appropriate insuring

document(s).

Questions concerning potential or actual claims should be referred immediately to

Systems Office Risk Management at [email protected].

II. POLICIES AND COVERAGE

A. GENERAL LIABILITY

1. Named Insured

The policy contains a complete definition. Please consult with Systems Office

Risk Management where clarification is needed.The following is a brief

excerpt:

Ivy Tech Community College of Indiana, Ivy Tech Foundation, Community

Enterprises Incorporated, Community Enterprises Properties LLC, Ivy Tech

Properties, and any past, present or future trustees, governing board of

directors or officers while acting within the scope of their duties on behalf of

the aforementioned entities.

Faculty, uncompensated volunteer workers, and students while serving in a

supervised internship or while acting at the direction of, complying with the

policies and procedures governing conduct at, or performing services

primarily for or on behalf of, Ivy Tech, but only while acting within the scope

of their duties or obligations in their respective capacities to Ivy Tech may

also be considered Insureds.

2. Limits of Liability

$1,000,000 Each Occurrence

$3,000,000 Annual Aggregate

$1,000,000 Fire Legal Liability

$5,000 Medical Payment Expense, Per Person

See the Excess Liability policy for additional limits of insurance.

3. Deductible

The campus from which a claim arises is responsible for 10% of the

deductible any general liability claim.

4. Insuring Agreement

We will pay on behalf of the Insureds all Damages up to the Limit of Liability

resulting from an Occurrence anywhere to which this insurance applies. In

addition, we will pay certain supplemental amounts as Medical Payments

Expense. The Policy is subject to a Deductible, if applicable.

For a full definition of terms included in the insuring agreement, consult the

policy. For one, an Occurrence means: a. an accident during the Policy Period

or the continuous, intermittent or repeated exposure to conditions that

commence during the Policy Period that causes Bodily Injury or Property

Damage neither expected nor intended by the Insured; or b. an event that

first occurs during the Policy Period that causes Personal Injury or Advertising

Injury. Sexual Molestation and Athletic Traumatic Brain Injury are considered

under the definition of occurrence. Breach of contract is not an occurrence.

5. Coverage

The following is a brief description of the General Liability coverage:

BODILY INJURY Physical injury, sickness, disease,

death or emotional distress

sustained by a person and includes

mental injury and shock.

PERSONAL INJURY Injury resulting from: a. false arrest,

detention or imprisonment; b.

malicious prosecution; c. wrongful

entry into, or eviction of a person

from, a room, dwelling or premises a

person occupies; d. oral, written,

video, or electronic publication of

material that slanders or libels a

person or organization or disparages

a person’s or organization’s goods,

products or services, or violates a

person’s right of privacy (other than

in any advertisement, publicity

article, broadcast, telecast, or

electronic or video publication that

arises out of an Included Entity’s

advertising of its goods, products or

services); e. sexual harassment; or

f. Clerical or Administrative Error.

PROPERTY DAMAGE Physical injury to or destruction of

tangible property of others including

loss of use if the loss of use results

from the physical injury or

destruction of the property, loss of

use of tangible property of others

that has not been physically injured

or destroyed, and consequential

damage or evacuation loss resulting

from any actual or threatened

physical injury or destruction of

tangible property.

ADVERTISING INJURY Injury resulting from a: oral or

written publication of material that

slanders or libels a person or

organization or disparages a person’s

or organization’s goods, products or

services; b. oral or written

publication of material that violates a

person’s right of privacy; c.

misappropriation of advertising ideas

or style of doing business; or d.

infringement of trademark, title,

copyright or slogan, in any

advertisement, publicity article,

broadcast, telecast, or electronic or

video publication that arises out of

an Included Entity’s advertising of its

goods, products or services.

6. Exclusions

The policy contains a number of exclusions and exceptions to those

exclusions. The more important exclusions under the College’s General

Liability policy are described below.

The policy does not apply to:

1. Any obligation or liability of the College as an employer, including that

under worker’s compensation, unemployment compensation, disability

benefits law or any similar law. This risk is better covered under the

Worker’s Compensation policy.

2. Wrongful Employment Practices. This risk is better covered under the

Educator’s Legal Liability policy.

3. Any liability arising out of the administration of any employee benefit plan

or any violation of the responsibilities, obligations or duties imposed by

the ERISA or similar statute, except for clerical or administrative error

with respect to a Covered Benefit Plan that occurs, and for a claim which

is made, within certain named dates of the policy. This risk is better

covered under the Fiduciary Liability policy.

4. Any liability arising out of the ownership, repair, maintenance, use or

entrustment to others of any Automobile, except liability arising out of the

repair or maintenance of automobiles by students or employees of the

College as part of any curriculum-related instruction. The former liability

risk is better covered under the Auto Liability policy.

5. Any liability arising out of rendering or failure to render any Professional

Services. There are two narrow and notable exceptions specific to: 1) paid

and supervised student interns; and 2) employed or contracted health

personnel other than a physician or dentist, but only for services provided

at facilities maintained by the College and principally for use by the

College’s employees or students, or while at incidental locations that are

not medical facilities in the event of a medical emergency. The College

carries insurance specific to the activities of students and faculty in

Human Services, Mortuary Science or Health Division programs. Please

see details of the Licensed Professional Liability policy below.

6. Any property damage to property owned, occupied or rented by, or within

the care, custody or control of any Insured. This is better covered under

the Property policy.

7. Any liability related to or arising out of 1) Sexual Molestation when known

to a Reporting Officer who failed to report it to proper authorities when

under a legal duty to do so; or 2) any person who engaged in Sexual

Molestation, sexual or physical assault, abuse or corporal punishment or

who knew about any of these acts, and to have failed to report it to proper

authorities when under a legal duty to do so. Indiana is a mandatory

reporting state. Any person who has reason to believe a child is

being abused or neglected shall make a report IMMEDIATELY. Call

the Indiana Child Abuse & Neglect Hotline, available 24/7, at 800-

800-5556.

8. Any liability arising out of, related to, or in any way involving asbestos or

lead in any form.

9. Any liability arising out of the actual, alleged or threatened discharge,

dispersal, release, seepage, migration, growth or escape of Pollutants. The

exclusion does not apply under certain conditions.

10. Any emotional distress, mental injury or shock arising from the theft of a

natural person’s identity information for which the College has a legal

obligation to maintain confidentiality.

B. Educator’s Legal Liability

The College maintains insurance to cover Wrongful Acts specific to its actions as an

institution of higher education. The following are Wrongful Acts that may be covered

by the policy:

Unlawful discrimination or violation of civil rights; sexual harassment;

wrongful termination of employment;

Failure to hire or promote, denial or removal of tenure; constructive

discharge; breach of an individual employment contract;

Failure to properly manage charitable trust services;

Breach of fiduciary duty arising out of the management of an endowment;

Peer review not arising out of the performance of medical services

Unlawful discrimination in the terms and conditions of employment;

Failure to grant due process; education malpractice or failure to educate,

negligent instruction, failure to supervise, inadequate or negligent academic

guidance or counseling, improper or inappropriate academic placement or

discipline;

Invasion of privacy or humiliation;

Infringement of copyright, trademark or patent;

Plagiarism or idea misappropriation; or

Oral or written publication of material that slanders or libels a person or

organization or disparages a person’s or organization’s goods, products or

services, including any such publication to the Internet, in a book, newspaper

or other publication of the College, or broadcast over, a radio, cable or

television station owned or operation by the College.

C. Internships & Professional Services Liability Insurance

The College maintains insurance for Wrongful Acts in the performance of or failure to

perform an Internship Program or the rendering or failure to render a Professional

Service anywhere in the world.

Internship Programs may be an internship or externship that is part of an academic

program, or a program sponsored by the College that offers practical experience for

students of the College. The internship or externship could be on campus or hosted

by a third party.

Professional Services, such as healthcare services, are services provided by the

Educational Organization to the campus community or general public. Student

clinical experiences related to Health Sciences program curriculums are considered to

be performing professional services. Professional Services may also include

engineering, legal, and social work, to name a few.

Students participating in an internship program or providing Professional Services

while under the supervision, direction or control of faculty or other professionals who

instruct or supervise students in an Internship Program are covered. Faculty or other

professionals who instruct or supervise students in an Internship Program are also

covered, but only with respect to a Wrongful Act for which the instructor or

supervisor is liable. Employees and uncompensated volunteers of the College are

also covered while providing Professional Services, but only with respect to Wrongful

Acts committed or allegedly committed within the scope of their duties or

obligations.

The limits of liability are $1,000,000 for each claim and $3,000,000 in the annual

aggregate.

D. Medical Professional Liability Insurance

The College maintains specific Medical Professional Liability Insurance in order to

qualify eligible medical professionals, students and faculty with the Indiana Patient

Compensation Fund (INPCF). This policy is designed to cover Wrongful Acts resulting

from conduct of the following individuals performing professional services in the

State of Indiana in a clinical setting: employed Dentists, Dental Hygiene and Dental

Assisting students and faculty, Paramedic Science students and faculty EMTs,

Nursing students pursuing and/or faculty having RN and LPN licensure. Health

programs students and faculty not covered under this policy are covered under the

Internships & Professional Services Liability policy.

Limits of liability are $400,000 per claim and $1,200,000 in the annual aggregate as

prescribed by the Indiana Medical Malpractice Act. The College’s qualification with the

INPCF provides protection in the form of a cap on damages resulting from medical

malpractice claims as per the IN Medical Malpractice Act.

E. Automobile Insurance

The College maintains liability coverage for property damage and bodily injury as

well as uninsured and underinsured motorist’s coverage on all of its owned, leased,

or rented vehicles when the driver is an approved driver on College business. The

College carries physical damage coverage on all autos which are leased or rented,

except for those leased or rented from an employee. Of owned vehicles, physical

damage coverage applies only to those from the last five model years. Physical

damage means collision with another object, including overturn, or any cause of loss

other than collision, such as fire, theft, vandalism, hail, or flood. A physical damage

deductible of $1,000 must first be met for coverage to apply. The campus from

which the claim arises is responsible for the deductible.

This policy does not cover:

1. Any obligation for which Ivy Tech may be held liable under any worker’s

compensation law, disability benefits or unemployment compensation law or any

similar law (better covered elsewhere); or

2. Employees’ personal vehicles. Primary coverage falls under the employee’s

personal auto insurance policy. The College’s auto liability coverage may apply on

an excess basis.

Rented Autos

Because rented autos are covered under the College’s policy, the rental car’s

insurance option may be waived. Blanket, non-vehicle specific insurance ID cards are

available in the campus business office and serve as proof of insurance for

employees renting an auto. Employees should obtain an insurance ID card prior to

obtaining their rental vehicle. This does not apply to rentals outside of the U.S. In

such cases, the local insurance option should always be elected. The College’s policy

would then be excess to any local auto policy.

Driver Authorization

1. Any employee who may be expected to drive a College-owned or leased vehicle

or drive a rental vehicle for business purposes related to Ivy Tech Community

College of Indiana must complete a Driver Authorization Form at least 30 days

prior to driving. This form and instructions can be obtained in the forms section

of Infonet under “Driver Authorization.” A list of approved drivers is kept on file

by the campus and is updated on a continuous basis since it is used for

underwriting purposes. Driver information is checked at the initial request for

approval as well as randomly on an as needed basis or as requested by the auto

liability insurance carrier. Please contact your campus Human Resources

department for information on driver approvals.

2. The College should not transport students unless it is absolutely necessary.

Whenever it is necessary to transport students, students should only be

transported by an authorized driver for the purpose of attending school activities

in a College-owned, rented, or leased vehicle. The College may not rent a vehicle

designed to seat 15 persons or more, including the driver. Faculty and staff

should NEVER transport students in their personal vehicle because any accident

that may happen does not fall under the College’s auto policy.

3. Students are generally not allowed to drive College-owned, rented, or leased

vehicles unless they are authorized by the campus AND are an approved driver.

Students should not transport other students on behalf of the College in a

personally-owned vehicle. A College-owned, rented, or leased vehicle must be

used. Individual carpool arrangements can be made among students. Any

accident that may occur when a student transports other students to a College-

sponsored event in his/her own vehicle are generally not covered under the

College’s insurance. Liability would fall under the student’s automobile policy.

F. Worker's Compensation

Worker’s Compensation protects employees in the event of injury, illness, or death

caused by a work-related accident while on the job. Injured workers are entitled to

medical and wage loss benefits under Indiana’s Worker's Compensation Act.

The College supports returning employees to work as soon as possible through

Temporary Modified Duty (TMD).

A full explanation of Worker’s Compensation and TMD is located in the employee

handbook.

G. International Liability

The College maintains insurance to protect its liability arising from its participation in

activities outside of the United States, its territories and possessions. The policy

includes coverage for General Liability, Excess Automobile Liability and Foreign

Voluntary Workers Compensation and Employers Liability. The College also

purchases Group Travel Accident and Sickness coverage for all international travelers

which is explained below.

H. Excess Liability Insurance

The College maintains insurance which provides coverage in excess of any underlying

insurance. Underlying insurance means formal or informal risk instruments or

transfer mechanisms; or risk transfer mechanisms that name the College as

“additional insured.” Underlying coverage to which this policy applies includes:

General Liability, Educators Legal Liability, Licensed Professional Liability, Automobile

Liability, Worker’s Compensation/Employer’s Liability and International Liability.

The excess liability coverage limit is $25,000,000, and the underlying limit retention

of $1,000,000 for each occurrence must be satisfied for this coverage to apply.

I. Property Insurance

The College maintains insurance against losses to the buildings and personal

property it either owns or for which it is legally responsible. Many causes of loss are

covered, including loss or damage resulting from burglary or theft. While a blanket

limit of insurance applies to most buildings and business personal property, there are

varying sub-limits for certain types of property and for certain causes of loss (e.g.

flood and earthquake). A loss is generally valued at replacement cost, however, in

some cases it may be at stated or actual cash value.

Property for which the College has an insurable interest is covered as follows:

1. Buildings, including completed additions, fixtures, machinery and equipment

permanently attached to the building, personal property owned by the College

that is used to maintain or service the buildings, structures or grounds; and

2. Business Personal Property located in or on the buildings on College premises,

including furniture and fixtures, machinery and equipment, stock, all other

personal property owned by the College and used in its operations, use interest

as a tenant in improvements and betterments which are made a part of the

buildings or structures occupied or leased, and acquired or made at the College’s

expense but for which the College is not permitted to remove; and

3. Personal Property of Others that is in the care, custody, or control of the College

or for which the College has agreed in writing to insure prior to any loss or

damage. This coverage is limited to $1,000,000 per occurrence. Coverage is not

in place for personal items that are damaged or stolen from an employee or

student while working or attending the College; and

4. The loss of Business Income and/or Rental Value sustained due to covered cause

of loss; and

5. Boiler and Machinery from a sudden and accidental breakdown of a covered

object, which includes boilers; fired or unfired pressure vessels subject to

vacuum or internal pressure other than the static pressure of their contents;

metal piping and its accessory equipment; refrigeration or air conditioning

systems; other mechanical or electrical machines or apparatus used for the

generation, transmission or utilization of mechanical or electrical power; and fiber

optic cable.

6. Property in Transit up to a limit of $500,000 per occurrence

The campus from which loss or damage arises is responsible for 10% of the

deductible for any insurable Property claim. An insurable claim is not established

unless loss or damage exceeds the deductible.

You should notify Systems Office Risk Management immediately of planned

renovation, new construction, or acquisition of buildings or other property in order to

receive full benefits of the coverage.

J. Fine Arts Insurance

This insurance will pay for accidental, physical loss or damage (“loss”) to property

consisting of objects of art or rarity or historic merit of every nature and description

and their frames, crates, display cases, signage, other exhibitry and packing

materials which are:

a. Owned by the College.

b. Property of others for the College has agreed prior to "loss" to insure.

c. Property of others offered as gifts to the College or for sale to College and while

waiting formal acceptance by the Trustees or other authorized representatives.

d. The College’s interest in jointly owned property, but only to the extent of the

College’s interest at the time of "loss".

e. The College’s reference library and other reference material belonging to the

College which are not for sale nor listed in the College’s collection inventory.

This policy also covers the College’s liability as "Bailee" of all loaned property for

which it has been instructed not to insure excluding, however, any property for which

the College has obtained a signed release of liability from the owner.

Certain coverage conditions apply related to packing, protective safeguards, and

record-keeping.

Notable exclusions include damage due to wear and tear, gradual deterioration,

insects, vermin; damage resulting from any repair, restoration, or retouching; and

damage due to any earth movement.

Limits of $250,000 and $1,000,000 apply to Unnamed and Named Locations,

respectively. Coverage for Bailee Legal Liability is limited to $1,000,000. Coverage

for Fine Arts in Transit is limited to $250,000.

The deductible for "loss" or damage separately occurring is $1,000 for fine arts

owned by the College. Valuation is at current market value.

K. Builder’s Risk Insurance

It is necessary to obtain Builder’s Risk Insurance for new construction or a large

remodeling project typically over $1M The property policy is not well suited to

address the risks inherent in construction projects. Since coverage varies with the

project, please contact Systems Office Risk Management.

L. Student Accident Insurance

For students registered in credit courses, the College provides no-fault accident

insurance in a designated amount of $3,000 for injuries sustained while participating

in a College course, a College-sponsored activity, on College premises or any

premises designated by the College (i.e. clinical site). Club, intramural and

recreational sports activities are excluded from coverage. This accident insurance is

excess insurance, meaning all other valid and collectible medical insurance must be

utilized prior to the consideration of this insurance. It is intended to fill in the gaps

(pay for deductibles, co-pays or other eligible expenses) up to the accident policy

limit. In the absence of other insurance, this insurance becomes primary. Coverage

is provided at no cost to the student.

It is not intended to replace insurance coverage students may already have.

Students should review their own coverage. The master insurance policy issued to

Ivy Tech is on file at the Systems Office. The description of the hazards insured,

benefits and exclusions is controlled by the master policy.

This policy covers usual, reasonable and customary medical expenses provided

treatment begins within one hundred eighty (180) days from the date of the injury.

Benefits are payable for one (1) year from the date of an injury, and care must be

medically necessary. Once the maximum of $3,000 has been reached, the College’s

general liability policy may consider additional expenses if there is negligence on the

College’s part.

It is the student’s responsibility to report injuries promptly to the instructor and/or

the office designated to handle student accidents. A student should complete the

Student Accident Report, an online form accessible via MyIvy. The form will be

routed to the campus student accident gatekeeper, security, and Systems Office Risk

Management. Completion of an accident report will trigger an automatic response

with a link to information about the College’s Student Accident Insurance policy. Any

questions should be designated to the office designated to handle student accidents.

Students participating in a sports activity should sign a waiver available on Infonet

(“Recreation and Wellness Waiver”) acknowledging they are aware that their

participation is voluntary and not covered by Ivy Tech.

M. International Student Health Insurance

All full-time international students on a F-1, M-1 or J-1 visa, eligible dependents and

OPT (Optional Practical Training) students are automatically enrolled in the College’s

mandatory Student Health Insurance Plan for international students. Full-time status

is defined as 12 credit hours per semester. Students attending on a less than full-

time basis may be eligible if a reduced class load is approved by the International

Student Advisor. Students not attending classes at Ivy Tech in a given semester and

not approved for a reduced class load are NOT eligible for coverage under any

circumstances.

Students with pre-arranged health insurance may request a waiver from the

mandatory health insurance plan if they provide proof of comparable coverage and it

meets certain minimum requirements. A student may apply for a waiver or obtain

details about coverage, limitations and resources at

www.gallagherstudent.com/ivytech. Questions should be directed to the Designated

School Official (DSO) at the campus or Systems Office Risk Management.

The College does not offer a student health plan for domestic students. Those in

need of coverage should be directed to the Health Insurance Marketplace, which can

help students find health insurance coverage specific to their needs and budget

through either the state or the U.S. Department of Health and Human Services for

Medicaid or Medicare programs. Visit HealthCare.gov for more information, including

an online application for health insurance coverage and contact information for local

health plan assisters.

N. Travel Accident & Sickness

Every student, faculty or staff traveler registered through the International Travel

Registry will be insured under the College's Travel Accident & Sickness Plan. The plan

provides coverage for:

- Accidents and Sickness

- Medical Evacuation

- Repatriation of Remains

- Accidental Death & Dismemberment

- Political & Natural Disaster Evacuation

- Trip Cancellation/Interruption

Coverage will start on the actual start of the trip. It does not matter whether the Trip

starts at the Covered Person’s home, place of work, or other place. It will end on the

first of the following dates to occur: 1. the date the Covered Person returns to his or

her Home Country; 2. the scheduled Trip return date; or 3. the date the Covered

Person makes a Personal Deviation (unless otherwise provided by the Policy).

The cost to a student traveler for a trip less than 30 days is $25. More than 30 days,

it will be determined by trip length. The cost to a guest traveler is $50 for a trip less

than 30 days.

Once registered, Systems Office will notify the campus business office to assess the

fee.

O. Fiduciary Liability Insurance

The College maintains coverage for Fiduciary Liability to cover those Insureds (the

College, trustees, management committee members, Employee Benefit Plan

committee members, and College employees) while acting in their capacity as a

fiduciary of an Employee Benefit Plan or as a person performing administration of

employee benefits.

P. Crime Insurance

The College maintains crime insurance to cover instances of Employee Theft, ERISA

Fidelity, Forgery or Alteration, Counterfeit Money, Computer Fraud, or Funds

Transfer Fraud.

Q. Real Estate Bonds

Certain real estate licensing courses require approval from the Indiana Real Estate

Commission. In turn, the Commission requires real estate bonds as a part of the

application and renewal process. Examples of courses requiring approval are the

Real Estate Broker Pre-Licensing course and the Real Estate Sales Pre-Licensing

course. Copies of the renewal bonds or new bonds can be obtained by contacting

Systems Office Risk Management.

R. Cyber Liability

The College maintains Cyber Liability insurance to cover damages, claims, expenses

and fines related to a breach of electronic data or computer network. An array of

benefits and breach response services are included in the coverage.

S. Aviation

The College maintains Aircraft and Aviation Liability insurance to cover claims or

suits that arise out of the ownership, maintenance, or use of aircraft, including injury

to passengers inflight. The policy also provides physical damage coverage for College

owned aircraft scheduled on the policy. Systems Office Risk Management should be

informed immediately upon any College department or program acquiring an aircraft.

T. Unemployment Compensation Insurance

The College pays unemployment compensation benefits for those employees who

were covered by the Employment Security Act IC 22-4-1-1. Benefits awarded are on

a reimbursable charge basis to the College in accordance with State requirements.

Questions should be referred to the Assistant Vice President, Human Resources.

III. Certificates of Insurance

Affiliate sites and certain third parties doing business with the College require proof

of financial responsibility in case of an accident. Whenever third parties request

“evidence of insurance” or “proof of insurance,” they are requesting a Certificate of

Insurance. Examples are car rental agencies, affiliate sites, and off-site locations

that the College may be using for a conference or special event.

When verification of insurance coverage is required of the College, a Certificate of

Insurance can be obtained by completing a “Certificate of Insurance Request” form,

a link to which can be found in Infonet. Certificates of Insurance are produced by

Ivy Tech’s insurance broker, therefore, it is important that the request is sent to both

the broker and to Systems Office as instructed on the form.

Under certain circumstances, the College should be asking for proof of insurance

from outside vendors/businesses. Please refer the College’s Minimum Insurance

Requirements for Contracts for more information.

Third party users of Ivy Tech facilities are required to carry at least $1,000,000 in

general liability insurance. If a third party user does not carry insurance, or if the

limits they carry do not meet the College’s minimum requirements, they may be

eligible for coverage through the Tenant’s and Users’ Liability Insurance Policy

(TULIP).

TULIP is designed to provide a general liability insurance option to third party users

of Ivy Tech facilities. It protects both the Facility User (the third party) and the

College against claims by third parties who may be injured or experience damage as

a result of participating in an event. Events may range from seminars, receptions, or

weddings to festivals and concerts. Note that some events may not be eligible for

coverage.

TULIP may be purchased ONLY when the event takes place in an Ivy Tech owned or

leased facility or property. For more information, please see the Facility User Guide

provided by URMIA.

To purchase TULIP or obtain a quote, please visit https://tulip.ajgrms.com/.

Facility users may need to obtain coverage from another insurer if their event does

not qualify for the TULIP program. Facility users are also welcome to use other

insurers to purchase general liability insurance.

IV. Special Events Assessment and Reporting

The College strives to modify risks to an acceptable level and maintain proper

insurance for liability that arises in the normal scope of our business. Because the

College is active in the community and may desire to participate in ways not

common to its ordinary operations, there are instances where special insurance may

be necessary to cover liability of specific events. Therefore, we ask that the program

organizer complete an Activity Risk Assessment and notify Systems Office Risk

Management of events that fall outside of the College’s normal business operations

in advance of the event date.

V. Notice of an Occurrence or Claim

Becoming familiar with the following information will assist you when an accident or

incident occurs at your campus. It is very important to handle claims resulting from

accidents or injuries in a professional and timely manner. Delay in filing a claim will

result in delayed payment and may increase costs to the College. Further, insurance

policies have time limits on reporting claims, and untimely filing could lead to a

denial of benefits.

A. General Claims Reporting Information

Notice of an accident, or an incident that may give rise to a claim, should be

made IMMEDIATELY to Systems Office Risk Management by completing an

accident reporting form at ivytech.edu/accident, or where not available, in writing

to [email protected]. The campus is responsible for directing the College

employee, student or visitor involved to the accident report form.

If there are questions regarding handling a claim, or if you suspect an incident may

give rise to a claim, you should contact Systems Office Risk Management

immediately.

B. Property Damage or Theft Claims

Incidents involving damage or theft of College property should be immediately

reported to Systems Office Risk Management by completing the “Property Damage or

Theft Report” form or other readily available means.

The types of incidents to report include, but are not limited to:

Building or property damage to due to accidents, fire, broken

pipes, vandalism, or weather

Missing or damaged property due to theft

If the loss is due to theft, break in, vandalism, these incidents are criminal and

should be reported to law enforcement immediately upon discovery. If it occurred on

College property, notify campus security.

When a loss occurs, Risk Management needs the following information as soon as possible

(within 24 hours) following the loss causing event:

Responsible campus/department official contact information and

affected building/property location

A narrative of the incident, including the date and time of loss,

immediate actions taken, witnesses names and statements, and

necessary action taken to remedy loss

Brief Description of damaged property

Use this checklist to know what to do in the event of a loss.

The following information is needed within 7 business days following the loss causing event:

Detailed inventory of damaged or lost property

Copies of all correspondence, documentation, or other information

related to the incident

Use this spreadsheet to document lost or damaged property.

a. For damage to or theft of College property, if a loss is insurable, recovery is

subject to the applicable deductible.

b. Where replacement or repair is necessary, the expenditure should come from

the appropriate campus account. Insurance payments are generally based on

replacement cost at the time of loss or damage. If the cost of

replacement/repair will exceed the deductible, attach an estimate to

replace/repair the property to the claim form. For claims under the

deductible, replacement/repair expenses will come out of the campus budget

and estimates do not need to be submitted.

c. After a claim has been properly filed, a claims adjuster will work directly with

the campus contact listed on the claim form. If the claim exceeds the

deductible, a check for the amount above the deductible will be sent directly

to the campus where the College contact directs payment. Reimbursement

should be deposited in the account that the expenditure was made.

d. If the campus decides not to replace or repair the covered property, payment

will be based on the actual cash value at the time of the loss.

A. Employee Accidents & Work-Related Illness

Any work-related injury should be immediately reported to the employee’s

supervisor. The employee should complete the “Employee Accident Report” which is

routed to the campus Human Resources Administrator and Systems Office Risk

Management.

The College is self-insured for the first $500,000 of each accident.

B. Student or Guest Accidents

When a student or guest is injured, the following is important to know:

1. The College is not automatically responsible for persons injured on our premises.

Do not acknowledge fault on the part of the College or promise payment, and do

not direct medical care. It is a student or guest’s decision and responsibility to

seek and pay for any medical treatment received.

2. Conduct a thorough investigation with assistance from your PSEP staff to collect

and preserve relevant information. A report of injury allows Systems Office Risk

Management to examine accidents and make a determination as to if and when

to involve the College’s General Liability insurance company.

3. Accidents should be reported immediately to the student’s instructor or to the

appropriate campus official.

4. The individual involved must complete the “Student and Guest Accident Report”

which is routed to the campus gatekeeper and to Systems Office Risk

Management.

5. If a clear hazard may have contributed to the loss, notify the appropriate

personnel to ensure that a correction is made and future accidents are prevented.

C. Automobile Claims

Whenever a College-owned, leased, or rented vehicle is involved in an accident,

follow these steps:

1. Stop immediately but do not obstruct traffic.

2. Assist the injured, if anyone is injured.

3. Contact the local or state police immediately to file a police report so that the

accident is documented. Even if the accident seems minor, injuries may not

become apparent for a few days or weeks. If the police do not come to the scene,

in some jurisdictions, you may go to the police department to file a report or

make a report online.

4. Secure the names, phone numbers, and addresses of drivers, witnesses, or

injured persons.

5. Obtain complete vehicle (color, year, make, model, license plate number) and

insurance information (including the insurance company policy number and

phone number) for all autos involved.

6. Take photographs of damage.

7. Don’t accept liability or claim settlements.

8. Complete an “Automobile Accident Report,” which is routed to the designated

campus official and to Systems Office Risk Management.

A copy of the College’s accident procedures should be kept in all College-owned vehicles.

1

SECTION J: PROCUREMENT

I. Introduction

The purchasing of products or services must be executed in accordance with all applicable state and federal statutes, including the Uniform Guidance, in an efficient and business-like manner. The following College policies are to be followed by all College personnel participating in purchasing activities, regardless of funding source. For all policies outlined in this section, the term “must” is a requirement and the term “should” references a best practice, suggestion or recommendation. Violation of procurement policies, may result in disciplinary actions pursuant to the Employee Handbooks.

II. Procurement Standards

A. Codes of Conduct

No employee, officer, or agent shall participate in the selection, award, or administration of a contract if a real or apparent conflict of interest would be involved. Such a conflict would arise when the employee, officer, or agent, any member of his or her immediate family, his or her partner, or an organization which employs or is about to employ any of the parties indicated herein, has a financial or other interest in the firm selected for an award. The officers, employees, and agents of the College shall neither solicit nor accept gratuities, favors, or anything of monetary value from contractors, or parties to subagreements. The College may take appropriate disciplinary actions for violations of such standards by officers, employees, or agents of the recipient. See College’s Conflict of Interest Policy in Human Resources Employee Handbooks for further information.

B. Competition

All procurement transactions must be conducted in a manner that provides open and free competition. This means situations must be avoided that may prevent competition, such as placing unreasonable requirements on firms to qualify, noncompetitive pricing practices between firms, or affiliated companies or specifying only a “brand name.” To ensure objective contractor performance and eliminate unfair competitive advantage, contractors that develop or draft specifications, requirements, statements of work, or invitations for bid or requests for proposal must be excluded from competing for such procurements.

Additionally, other situations considered to be restrictive of competition include but are not limited to: placing unreasonable qualifying requirements on firms; requiring

2

unnecessary experience and excessive bonding requirements; noncompetitive pricing practices between firms or affiliated companies; noncompetitive contracts to consultants that are on retainer; and any arbitrary action in the procurement process.

The College must conduct procurements in a manner that prohibits the use of statutorily or administratively imposed state, local, or tribal geographical preferences in the evaluation of bids or proposals, except in those cases where applicable Federal statutes expressly mandate or encourage geographic preference. Nothing in this section preempts state licensing laws. When contracting for architectural and engineering (A/E) services, geographic location may be a selection criterion provided its application leaves an appropriate number of qualified firms, given the nature and size of the project, to compete for the contract.

III. The Purchasing Process

A. Identify Need

Faculty or staff may identify a need for products or services necessary for effective operation of instructional programs or support services. Procurement or Business Office staff may be consulted during the assessment of the need and the evaluation of alternative types of items which may meet the requirements; products such as equipment, supplies, etc., or services such as rental of facilities, printing, advertising, etc.

Unnecessary or duplicative items should not be purchased. Consideration should be given to consolidating or breaking out procurements to obtain a more economical purchase. Where appropriate, an analysis must be made of lease versus purchase alternatives as well as any other appropriate analysis to determine the most economical approach.

Purchasers are encouraged to use Federal excess and surplus property in lieu of purchasing new equipment and property whenever such use is feasible and reduces project costs. State and local intergovernmental agreements should be used whenever appropriate. Use value engineering clauses in contracts for construction projects of sufficient size to offer reasonable opportunities for cost reductions.

B. Develop Product Specification/Request for Proposal

Requests for proposals should be solicited from service providers for any services for which a pricing agreement may be financially beneficial to the College. These services may be bid for a period up to three years. Requests to bid contracts for periods in excess of three years must be approved by the Senior VP/CFO.

3

All procurement transactions must be conducted in a manner providing full and open competition. The preparation of proper product technical specifications or service specifications is a critical component of the purchasing process. Specifications should describe what is required or desired and provide a common basis for securing bids.

• Incorporate a clear and accurate description of the technical requirements for the material, product, or service to be procured.

• The description may include a statement of the qualitative nature of the material, product or service to be procured and, when necessary, must set forth those minimum essential characteristics and standards to which it must conform if it is to satisfy its intended use.

• Identify all requirements which the offerors must fulfill and all other factors to be used in evaluating bids or proposals.

• Specifications must clearly and accurately describe the kind and quantity of the materials, product, or service needed, avoiding restrictive specifications that might unduly limit competition.

• When it is impractical or not economical to make a clear and accurate description of the technical requirements, a “brand name or equivalent” description may be used as a means to define the performance or other salient requirements of procurement

• If brand specifications are used, the specifications must include a statement that competitive bids of equivalent and quality level will be acceptable and that no restrictions or limitations are intended by use of a specific brand name.

The College must comply with section 6002 of the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act. The requirements of Section 6002 include procuring only items designated in guidelines of the Environmental Protection Agency (EPA) at 40 CFR part 247 that contain the highest percentage of recovered materials practical, consistent with maintaining a satisfactory level of competition, where the purchase price of the item exceeds $10,000 or the value of the quantity acquired during the preceding fiscal year exceeded $10,000; procuring solid waste management services in a manner that maximizes energy and resource recovery; and establishing an affirmative procurement program for procurement of recovered materials identified in the EPA guidelines.

For Federally funded construction or facility improvement contracts or subcontracts exceeding the Simplified Acquisition ($150,000) threshold, the Federal awarding agency or pass-through entity may accept the bonding policy and requirements of the College

4

provided that the Federal awarding agency or College has made a determination that the Federal interest is adequately protected. If such a determination has not been made, the minimum requirements must be as follows:

(a) A bid guarantee from each bidder equivalent to five percent of the bid price. The ‘‘bid guarantee’’ must consist of a firm commitment such as a bid bond, certified check, or other negotiable instrument accompanying a bid as assurance that the bidder will, upon acceptance of the bid, execute such contractual documents as may be required within the time specified.

(b) A performance bond on the part of the contractor for 100 percent of the contract price. A ‘‘performance bond’’ is one executed in connection with a contract to secure fulfillment of all the contractor’s obligations under such contract.

(c) A payment bond on the part of the contractor for 100 percent of the contract price. A ‘‘payment bond’’ is one executed in connection with a contract to assure payment as required by law of all persons supplying labor and material in the execution of the work provided for in the contract.

For non-federally funded construction projects that fits the definition below, refer to Section X Capital Projects.

Capital Projects involve the construction, alteration or repair and rehabilitation to real property owned or leased by Ivy Tech Community College of Indiana. "Repair and rehabilitation project" means any project to repair, rehabilitate, remodel, renovate, reconstruct, or finish existing facilities or buildings; to improve, replace, or add utilities or fixed equipment; and to perform site improvement work, whereby the exterior dimensions of any existing facilities or buildings remain substantially unchanged. C. Identify Potential Suppliers Once an assessment has been completed, specifications developed, and a decision made about the best product or service that will meet the need, then initiate the process of identifying potential suppliers, vendors or service providers.

The College must award contracts only to responsible contractors as defined by the following criteria.

• Contractors must possess the ability to perform successfully under the terms and conditions of a proposed procurement.

5

• Consideration will be given to such matters as contractor integrity, compliance with public policy, record of past performance, and financial and technical resources.

• Suspension and debarment checks for contracts over $25,000 should be made on the EPLS site – (www.sam.gov) and documented, or added in a clause in the procurement contract.

• Vendors must complete an ACH payment form, W-9 form, Supplier Diversity Information form and Non-Collusive Certificate form. (exceptions to ACH payment form may be granted by Systems Office Finance.) College Finance staff must submit the new supplier request, W-9 form and ACH authorization form via email to [email protected]. The forms should be password protected.

Good business practices must be used and ethical standards followed when soliciting quotes, bids, and proposals from potential suppliers. Special attention should be given to situations where the available vendors providing the product or services are limited, in order not to limit the competitive process.

The College must take all affirmative steps to assure that minority-owned businesses, women-owned businesses, veteran-owned businesses, and labor surplus area firms are used whenever possible. These steps include;

1. Identify and include in solicitations multiple qualified small, Minority Business Enterprises (MBEs), Women’s Business Enterprises (WBEs) and Veteran’s Business Enterprises (VBEs).

2. Assure that small and Minority Business Enterprises (MBEs), Women’s Business Enterprises (WBEs) and Veteran’s Business Enterprises (VBEs) are solicited whenever they are potential sources.

3. Dividing total requirements, when economically feasible, into smaller tasks or quantities to permit maximum participation by small and Minority Business Enterprises (MBEs), Women’s Business Enterprises (WBEs) and Veteran’s Business Enterprises (VBEs).

4. Establish delivery schedules, where the requirement permits, which encourage participation by small and Minority Business Enterprises (MBEs), Women’s Business Enterprises (WBEs) and Veteran’s Business Enterprises (VBEs).

5. Where there is involvement of a prime (or general) contractor, if subcontracts are to be let, require the contractor to take these same affirmative steps

6

6. Use the following resources to help ensure the solicitation respondent list is representative of the diversity in the communities that the College serves;

• Indiana Department of Administration Department Minority and Women's Business Enterprises Division website (http://www.in.gov/idoa/2352.htm)

• City of Indianapolis Department of Minority and Women Business Development http://www.indy.gov/eGov/City/DMWBD/MBE-WBE-VBE/Pages/OMWBD-Vendor-Listing.aspx

• Mid-States Minority Supplier Development Council: https://midstatesmsdc.org/bid-opportunities

• Conexus Indiana: https://conexusindiana.com/supplier-database/

The College must ensure that all prequalified lists of persons, firms, or products which are used in acquiring goods and services are current and include enough qualified sources to ensure maximum open and free competition. Also, the College must not preclude potential bidders from qualifying during the solicitation period. D. Conduct Cost/Price Analysis

The College must perform a cost or price analysis in connection with every procurement action in excess of $149,999 including contract modifications. Buyers are encouraged to conduct a price analysis for purchases over $9,999. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the College must make independent estimates before receiving bids or proposals.

There are various ways to conduct a price analysis. These include comparing offered prices including discounts with those listed in commercial catalogs, or with those recently submitted for similar services. It can be done, for example, by comparing the price quotes submitted by vendors, or by telephoning other vendors to obtain their market price, or simply by comparing published market prices (such as from a classroom supply catalog, for example).

Cost analysis involves an examination of all the elements used in calculating a contract’s total estimated cost. Every cost element listed in the vendor’s offer must be examined. Additional cost analysis should be done if there are contract modifications that introduce new conditions or more current information is needed.

7

• The College must negotiate profit as a separate element of the price for each contract in which there is no price competition and in all cases where it meets or exceeds the simplified acquisition threshold (greater than $149,999).

• The cost plus a percentage of cost and percentage of construction cost methods of contracting must not be used.

Cost Analysis documentation including quotes or bids received must be attached to the College’s e-procurement system requisition and include vendor name, amount, and date received.

After the bids have been submitted, the College must contract with the lowest and best bidder using terms and conditions that will accomplish the work at the lowest possible cost to the College.

When the best quote or bid is not the lowest, documentation justifying the best quote or bid must be attached to the College’s e-procurement system requisition

E. Post Procurement Award Policies

The College must maintain oversight to ensure that contractors perform in accordance with the terms, conditions and specifications detailed in contracts and purchase orders.

All contracts made by the College must include the subsections of contractual clauses as outlined in http://www.ivytech.edu/about/po-terms-conditions.html

The College may use a time and materials type contract only after a determination that no other contract is suitable and if the contract includes a ceiling price that the contractor exceeds at its own risk. Time and materials type contract means a contract whose cost to the College is the sum of:

(i) The actual cost of materials; and

(ii) Direct labor hours charged at fixed hourly rates that reflect wages, general and administrative expenses, and profit.

Since this formula generates an open-ended contract price, a time-and-materials contract provides no positive profit incentive to the contractor for cost control or labor efficiency. Therefore, each contract must set a ceiling price that the contractor exceeds at its own risk. Further, the College must assert a high degree of oversight in order to obtain reasonable assurance that the contractor is using efficient methods and effective cost controls.

8

The College must be responsible, in accordance with good administrative practice and sound business judgment, for the settlement of all contractual and administrative issues arising out of procurements. These issues include, but are not limited to, source evaluation, protests, disputes, and claims. These standards do not relieve College of any contractual responsibilities under its contracts. Violations of law will be referred to the local, state or Federal authority having proper jurisdiction.

F. Procurement Methods – Non-Construction For Non-construction activities, the following methods must be used depending on the dollar value of the procurement.

1. Micro purchase: Purchases of $9,999 or less • Acquisition that, in the aggregate, does not exceed the micro-purchase

threshold. The College utilizes the threshold defined in Section 806 of the National Defense Authorization Act.

• To the extent practical, purchases in this category shall be distributed equitably among qualified suppliers. For example, when purchasing supplies, the campus might consider rotating purchases between vendors that offer similar rates.

• Purchases may be awarded without soliciting competitive quotations; price just must be reasonable.

• Recommend price or rate quotations from more than one qualified source. o Can be informal – phone call and document or web search

2. Small purchase: Purchases of $10,000 up to $149,999 • Acquisition that, in the aggregate, does not exceed the small purchase

threshold. • No requirement for formal RFP solicitations. Quote (RFQ) procedures may be

simple and informal. • Include detailed business requirements with RFQ as necessary to obtain the

best fit supplies, equipment or services for the College’s needs. • Price or rate quotations must be obtained from two or more qualified

sources. • When applicable, quotes may be obtained from a variety of simple

sources, e.g., internet search, vendor price listing, etc. Supporting documentation for the competitive quote must be provided prior to the creation of a purchase order.

3. Methods of Procurement for Purchases over $149,999 up to $499,999

9

Procurement by competitive proposals. The technique of competitive proposals is normally conducted with more than one source submitting an offer, and either a fixed price or cost-reimbursement type contract is awarded. It is generally used when conditions are not appropriate for the use of sealed bids. In order for sealed bidding to be feasible, the following conditions should be present:

• a complete, adequate and realistic specification or purchase description is available

• two or more responsible bidders are willing and able to compete effectively for the business

• the procurement lends itself to a firm fixed price contract and the selection of the successful bidder can be made principally on the basis of price

If this method is used, the following requirements apply: • Requests for proposals must be publicized and identify all evaluation factors

and their relative importance. Any response to publicized requests for proposals must be considered to the maximum extent practical;

• Proposals must be solicited from an adequate number of qualified sources; and

• The College must have a written method for conducting technical evaluations of the proposals received and for selecting recipients;

• Contracts must be awarded to the responsible firm whose proposal is most advantageous to the program, with price and other factors considered; and

• The College may use competitive proposal procedures for qualifications-based procurement of architectural/engineering (A/E) professional services whereby competitors' qualifications are evaluated and the most qualified competitor is selected, subject to negotiation of fair and reasonable compensation. The method, where price is not used as a selection factor, can only be used in procurement of A/E professional services. It cannot be used to purchase other types of services though A/E firms are a potential source to perform the proposed effort.

• Quote, bid or proposal solicitations additional requirements: • Solicitations must be publicized and all necessary affirmative steps to assure

that minority businesses, women’s business enterprises, veteran’s businesses and labor surplus area firms must be used when possible. (See Section C.)

4. Methods of Procurement for Purchases over $499,999

Must follow all of the steps for purchases greater than $149,999 and must obtain State Board of Trustees approval in the form of a resolution.

10

5. Procurement by non-competitive proposals (sole source) is allowable when one of the following circumstances apply:

• 1. Federally Funded Sole Source Justifications

• The product or service is available from only one source; or

• The public exigency or emergency for the requirement will not permit a delay resulting from competitive solicitation; or

• The Federal awarding agency or pass-through entity expressly authorizes noncompetitive proposals in response to a written request from the College; or

• After solicitation of a number of sources, competition is determined inadequate.

• 2. Non-Federally Funded Sole Source Justifications

• The product or service is available from only one source; or

• The public exigency or emergency for the requirement will not permit a delay resulting from competitive solicitation; or

• After solicitation of a number of sources, competition is determined to inadequate; or

• Intellectual property of a vendor is necessary to properly use existing equipment or software; or

• The good/service is mandated by an association in which the College is a member or an individual or entity with whom the College has a contract; or

• Legal services, expert witnesses, or other services associated with litigation or regulatory proceedings; or

• There is a significant need for the contractor’s expertise linked to the current project.

Sole source bid exception requests must be submitted to the Senior VP/CFO or designee for approval to proceed with purchase/contract.

11

G. Procurement Methods – For Federally Funded Construction For Federally Funded construction activities defined as micropurchases and small purchases, The College follows the threshold defined in the Davis Bacon Act. The following methods must be used depending on the dollar value of the procurement.

1. Micro purchase: Purchases of $1,999 or less • Acquisition that, in the aggregate, does not exceed the micro-purchase

threshold. • To the extent practical, purchases in this category shall be distributed

equitably among qualified suppliers. For example, when purchasing supplies, the campus might consider rotating purchases between vendors that offer similar rates.

• Purchases may be awarded without soliciting competitive quotations. • No quotations necessary, price just must be reasonable.

Recommend Price or rate quotations must be obtained from an adequate number of qualified sources (interpreted as at least 2 sources)

o Can be informal – phone call and document or web search

2. Construction Purchases of $2,000 and over

The sealed bid method is the preferred method for procuring construction purchases exceeding $2,000, if the following conditions apply:

a. The value of a single item or the total value of multiple items is $2,000 and greater; and

b. The item for which quotes, bids or proposals being solicited is categorized as *professional and expert service or construction, alteration, or repair of facilities (regardless of dollar value); and

c. A complete, adequate, and realistic specification or purchase description is available; and

d. Two or more responsible bidders are willing and able to compete effectively for the business; and

e. The procurement lends itself to a firm fixed price contract and the selection of the successful bidder can be made principally on the basis of price.

• Procurement by sealed bids (formal advertising). Bids are publicly solicited and a firm fixed price contract (lump sum or unit price) is awarded to the responsible bidder whose bid, conforming with all the material terms and conditions of the invitation for bids, is the lowest in price. The sealed bid is the preferred method for procuring construction. In order for sealed bidding to be feasible, the following conditions should be present:

12

o Bids must be solicited from an adequate number of known suppliers,

providing them sufficient response time prior to the date set for opening the bids, for local, and tribal governments, the invitation for bids must be publically advertised; and

o The invitation for bids, which will include any specifications and pertinent attachments, must define the items or services in order for the bidder to properly respond; and

o All bids will be opened at the time and place prescribed in the invitation for bids, and for local and tribal governments, the bids must be opened publicly; and

o A firm fixed price contract award will be made in writing to the lowest responsive and responsible bidder. Where specified in bidding documents, factors such as discounts, transportation cost, and life cycle costs must be considered in determining which bid is lowest. Payment discounts will only be used to determine the low bid when prior experience indicates that such discounts are usually taken advantage of; and

o Any or all bids may be rejected if there is a sound documented reason.

3. Construction Purchases of $500,000 and over for Federally Funded Construction

Must follow all of the steps for purchases $2,000 and above must obtain State Board of Trustees approval in the form of a resolution.

H. Maintain Procurement Records

The College must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to the following: rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. For ALL procurements the following information must be maintained.

1. Detail history of the procurement [different for each procurement method] 2. Rationale for method of procurement 3. Selection of contract type 4. Contractor selection or rejection 5. Basis for contract price

I. Information Released to Vendors.

1. Guiding Principles

13

o Ivy Tech is a public entity and is subject to the state’s Access to Public Records Act at IC 5-14-3.

o The public has a right to know that the College conducts public business properly, and the College needs to reinforce the perception that business is conducted properly.

2. Before the bidding process is complete. Vendors do not have the right to information such as competing vendors' names, items, prices, terms or copies of bids prior to the completion of the bidding process.

3. After the bidding process is complete. Any request for information by vendors not selected should be treated as a public records request under state law and should be immediately referred to the Office of the General Counsel for advice in how to respond.

J. Prepayments for Products and Services General prepayment for goods and/or services is strongly discouraged by the College. However, prepayments may be made in advance, without seeking approval for the following items: catalog orders, subscriptions, membership dues, conference fees, maintenance contracts, deposits less than $3,000 and insurance premiums. Prepayments are not allowed for personal services including personal services by contract. Approval for any prepayment reason not listed above shall be governed by the following:

a. Prepayments below $3,000

All prepayments for products and services below $3,000 must have prior approval of the Executive Director of Finance

b. Prepayments $3,000 and above

All prepayments for products and services above $3,000 must have prior approval of the Senior VP/CFO or designee.

K. Memberships

The College will not pay for personal memberships in professional organizations; however, the College will pay for organizational memberships. Exceptions to this policy may be made in the following circumstances and at the discretion of the

14

College. All exceptions must be approved in writing by the Executive Director of Finance or the Senior VP/CFO, and available for review.

a. If a professional organization does not provide for an organizational membership, the college may pay for the individual membership. Documentation must be on file to support that College membership was not available.

b. If an individual membership is less expensive than an organizational membership, the College may pay for the individual membership. This exception would apply in a unique situation where only one person needs the membership, and it is cheaper than an organizational membership.

Given that the College pays for many organizational-wide memberships, the campus and offices at the Central location are encouraged to determine if the College already holds a valid membership prior to incurring additional membership expenses.

L. Authorization of Contracts Review by the Office of the General Counsel is required for all expenditure and revenue contracts of $25,000 and greater.

Contracts for expenditures may be authorized by the Chancellor or Vice President within the prescribed authorization levels. The President's signature is required if the contract is an expenditure level of $100,000 or greater and not previously delegated by the President. All contracts to be approved by the President or designee must be approved and signed by the respective Chancellor or Vice President prior to submission for signature.

Options to renew leases originally identified in a prior approved agreement may be signed by the respective Chancellor, provided the annual rent is within the Chancellor’s signature authorization level. A copy of the signed lease renewal document must be forwarded to the System’s Office Facilities Planning Department.

In accordance with 2 CFR 200.323, "Cost plus" or “percentage of construction cost” contracts are prohibited for Federally Funded Contracts. Examples of such prohibited contracts include: a) a contract for equipment at supplier cost plus a stated mark-up percentage, and b) a contract for course development at a fixed labor rate and unfixed labor hours. In certain instances there may arise a need for ongoing consulting or other services where the amount of related labor is unknown. In such cases, contracts should clearly define scope of work, labor rate and a contract ‘not to exceed’ (NTE) value that relates to defined scope of work, with contractor responsible for any costs in excess of

15

such NTE value. A high degree of oversight must be given to contractor performance against such NTE contracts to obtain reasonable assurance that the contractor is using efficient methods and effective cost controls.

The following contracts, regardless of dollar value, must be forwarded to the appropriate System’s Office department for approval:

1. Operating and capital lease for land and/or buildings obligating the College for a period greater than two (2) years. This lease will be forwarded to the State Board of Trustees for approval. Any initial lease greater than $150,000 per year needs State Board of Trustees approval before being forwarded for recommendation by the Commission for Higher Education and then approval by the State Budget Committee and Governor.

2. Leases for land and/or buildings that involve a request for additional College level funding in addition to the campus’ normal annual facilities budget.

3. Purchase or lease-purchase agreements and other contracts for land and/or buildings. These agreements will be forwarded to the State Board of Trustees for approval.

4. Vehicle lease or purchase excluding non-recurring leases of less than thirty (30) days.

5. All governmental contracts including government pass-through funds.

6. All contracts for new capital plant improvements such as additions, alterations, repairs and rehabilitation to College-owned property, and all change orders increasing the amount of such contracts by ten percent (10%) or more. Change orders of less than 10% for capital projects may be approved by campus administration within their authorization limit of payment documents, following verbal notification to the System’s Office Facilities Planning Department. A copy of the signed change order should be forwarded to the System’s Office Facilities Planning Department.

Capital leases are contracts which effectively transfer ownership to the College at the end of the lease. If there is doubt as to whether a lease qualifies as a capital lease versus an operating lease (where ownership does not transfer), inquiries may be made to the office of the Senior VP/CFO.

Land and Buildings - Capital leases for land and buildings must be approved by the State Board of Trustees. A request for a capital lease of land and buildings should be

16

forwarded to System’s Office Facilities Planning Department. Requests for authorization should be submitted on a Lease and Building Acquisition Request form.

Technology – Purchases for end-user technology equipment and infrastructure technology equipment will be made through the Office of Information Technology. Software licenses, maintenance and support purchases (new and renewal) will be made through the Office of Information Technology. Subscriptions will not be purchased through the Office of Information Technology.

Equipment - Capital leases must be initially routed through the office of the Senior VP/CFO so proper notification can be made to include the equipment as a capital asset in the College Fixed Assets system and to assure compliance with IRS reporting requirements.

All documents requiring an authorizing signature for commitment of College funds must be signed in accordance with authority delegated by the State Board of Trustees or an officer of the College. The table below outlines the requirements for signature at certain specific levels.

Approval Level Authorization Amount State Board of Trustees Certain contracts only * Campus Board of Trustees Refer to campus by-laws President or designee up to $500,000 all contracts not delegated **Chancellor or Vice President up to $99,999 Executive Director of Finance up to $29,999

* The following contracts must be approved by the State Board of Trustees:

1. Lease for land and buildings obligating the College for longer than two (2) years.

2. All lease-purchase agreements and other contracts for land and buildings not delegated to the President.

3. All contracts in excess of $500,000 unless previously approved through the allocation of funds by the Board.

**The Chancellor may delegate this authority to any of their direct report employees at an employment level E-3 or above at their campus. However, under no circumstances may a sole individual approve. Two separate individuals must approve at all times (for instance the EDF cannot be the requester and approver). This delegation must be in writing and available for review.

M. Authorization of Expenditures

17

All expenditures must be within approved budget allocations except for those specifically authorized by the State Board of Trustees.

Purchases must not be split in such a way as to place the dollar value of the expenditures into a lower authorization level so that they can be approved without review by a higher authorization level. Likewise, increases in encumbrances must be approved at the appropriate level based on the total commitment.

All documents requiring an authorizing signature for commitment of College funds must be approved in accordance with authority delegated by the State Board of Trustees or an officer of the College. The table below outlines the requirements for approval at certain expenditure levels.

Approval Level Authorization Amount State Board of Trustees in excess of $500,000 Senior VP/CFO up to $500,000

all contracts not delegated **Chancellor or Vice President up to $ 99,999 all contracts not delegated Executive Director of Finance up to $ 29,999 As delegated by Campus Management up to $ 9,999

**The Chancellor may delegate this authority to any of their direct report employees at an employment level E-3 or above at their campus. However under no circumstances may a sole individual approve. Two separate individuals must approve at all times (for instance the EDF cannot be the requester and approver). This delegation must be in writing and available for review.

Delegation to Business Office staff to approve campus expenditures up to $9,999 must be approved by the Vice President, Chancellor, and Executive Director of Finance. See Refer to FMM, Section M, Financial Documents (Approval Authority Delegation) for further details.

All the approval level guidelines and requirements are built into the routing criteria for purchase requisitions and purchase orders in the College’s e-procurement system.

IV. Purchasing Card Policies and Procedures A. Introduction The intent of this section is to provide clear, concise, and workable College Purchasing Card procedures for the conduct of College business. If a circumstance arises that is not specifically covered, either adopt the most conservative course consistent with the policies and procedures of the College or consult with the office of the Senior VP/CFO or

18

designee. The Chancellor or Vice President may develop additional procedures relating to the use of the College purchasing card. Such procedures must be consistent with those outlined in this section.

It is important that all purchasing activity be documented in a manner that will satisfy the requirements of established College policies and procedures. Also, purchases of products and services for use in the operation of the College must clearly indicate the details involved in the purchasing transaction. This is necessary for the proper handling of College funds and subsequent review by internal and external auditors. Use of the purchasing card does not replace any policies or procedures that apply to activities that are restricted by College policy. The issuance of the card to the cardholder constitutes authorization to use the card without obtaining prior approval required by other purchasing methods. Prior approval for food purchases is required as outlined in the FMM, Section H, Travel Policies and Procedures (College Sponsored Meetings). The conduct of College business by employees who are authorized to make purchases representing the College is required to be in accordance with established procedures and ethical behavior including the conflict of interest policy. All purchases with the card must comply with the applicable procedures in the FMM, Employee Handbook, and any other published College sources related to the use of College assets and ethical conduct by College employees. B. General Overview

Ivy Tech's Purchasing Card Program is designed to allow for the purchase of small dollar (items less than $3,000), non-capital items for use in the College operations. Non-capital refers to all items, such as supplies, minor equipment, books not part of library collections, etc., that are excluded from the dollar threshold at which items are capitalized as an asset in the accounting records of the College for inventory control and other purposes.

Purchases that exceed the $3,000 single transaction limit are to be processed through the requisition based process in the College’s e-procurement system.

Purchases must be made in the College’s e-procurement system whenever practical to take advantage of the contract and consortium pricing that is built into the system. Purchasing through the College’s e-procurement system is also preferred because the system is set up with appropriate internal controls (i.e. pre-approval requirements, etc.) and more accurate accounting.

The Ivy Tech Community College of Indiana Purchasing Card is a MasterCard. It is accepted by any merchant who currently accepts MasterCard.

19

The card is the property of Ivy Tech Community College of Indiana, is issued on the credit limit allowed the College, and is only to be used for College business. Purchasing cards are issued bearing the name of the College, the name of the cardholder, and the sales tax exempt number on the front of the card. The card is to be used only by the individual to whom the card is issued.

Employees of the College must be approved to be issued a card for use and will be required to sign a Purchasing Cardholder Agreement, which is the form that contains the general terms and conditions for use of the College Purchasing Card.

New cards should only be created with the written approval of the College Purchasing Card Administrator within the office of the Senior VP/CFO. Purchasing cards should only be assigned to full-time employees. Vice Presidents and Chancellors are not eligible to be cardholders.

All designated cardholders and reviewers must attend a training session (on the purchasing card procedures) to be instructed to view transactions and obtain reports of card transactions. This training is conducted by staff in the office of the Executive Director of Finance (EDF) at the campus, or staff in the office of the Senior VP/CFO in the System’s Office (Finance). The resources used for training are located on the bank website.

Violation of purchasing card procedures, such as unauthorized purchases, may result in termination of the cardholder privileges or other disciplinary actions as outlined in the Employee Handbook. The cardholder may be financially responsible for sales tax and unauthorized purchases. Please refer to the College’s tax manual, FMM Section C, for information regarding the College’s sales tax exemption. C. Structure for Purchasing Card Program The office of the Senior VP/CFO has approved a structure for the functioning of the College Purchasing Card program. The College Purchasing Card Administrator is an employee in the Finance Department at the System’s Office. The Executive Directors of Finance serve as the campus Purchasing Card Administrators at each campus.

The EDF must be supported by one back up administrator from the campus’ Business Office staff. Neither the EDF nor the backup administrator can be cardholders. The designation of all College staff persons functioning in these roles must be in writing, and will be kept on file in the System’s Office in the Finance Department.

In accordance with the bank's requirement to have designated authorized signers on file to provide approvals when changes are needed for the College's program, there are three System’s Office Finance staff persons with this assigned responsibility. This includes the College Purchasing Card Administrator and two other Finance staff persons

20

who serve as administrative support for the program, In addition, in the absence of the College Purchasing Card Administrator, these individuals handle daily inquiries from the bank regarding cards.

D. Card Controls The card has several controls and safeguards. There is a specific single purchase limit and a 30-day monthly dollar limit for the card.

Another control is the Merchant Category Code (MCC). All businesses that accept the MasterCard for purchases are assigned a MCC that designates their line of business. Each card is created with a specific MCC group designation that restricts the use of the card for certain businesses. Certain MCC groups have been excluded from access by all College cardholders. An attempt to obtain card authorization approval for a non-approved MCC will result in the card being declined. E. Operation of Purchasing Card Program

1. Issue of Purchasing Cards

The following steps must be completed to obtain a purchasing card:

Step 1 At a minimum, the EDF and the individual's supervisor determine which employees will be issued the purchasing card to purchase items for the College operations. For System’s Office, the College Purchasing Card Administrator in the office of the Senior VP/CFO in the Finance Department and the individual's supervisor must approve. These approvals must be in writing, and on file. Requests for a new card must be submitted to the Senior VP/CFO for written approval by his designee, the College Purchasing Card Administrator in the Finance Department, along with a signed Purchasing Cardholder Agreement, which is the form that contains the general terms and conditions for use of the College Purchasing Card.

Step 2 After approvals are confirmed, the new card information will be entered on the purchasing card bank's website by Finance Department staff. Step 3 The bank will mail new cards to the campus Card Administrator at the campus or System’s Office. Generally, the processing time is 7 to 10 days from the approval. The campus Purchasing Card Administrator at the campus or System’s Office will review the card, confirm with information on the bank’s website and notify the

21

Executive Director of Finance or the appropriate System’s Office department supervisor regarding the card distribution. Step 4 The EDF or the College Purchasing Card Administrator will arrange for training in the use of the card and reports on card transactions using the bank’s website as a resource for training. The cardholder must receive the purchasing card in person from the EDF or at the System’s Office, the College Purchasing Card Administrator. The card must be signed on the back immediately when received. Step 5 It is the responsibility of the employee to activate the card by calling the bank customer service number prior to use. The number is located on the back of the card.

2. Purchasing Card Use

The card may be used in person, by phone, fax, or Internet. The cardholder should be careful in giving out the purchasing card number. Many scams that are conducted by phone, mail, or Internet, require staff to be careful in exercising these options. If using the Internet, only a secured site should be used. As a general guideline, an order should never be placed when the company initiates the contact, such as telephone or Internet solicitation or advertisement.

Generally, the card limit for a single transaction is $1,000. However, depending on the size of the campus, , the Vice President for Finance Senior VP/CFO or designee may authorize a limited number of cardholders to have single transaction cards limits of up to $2,999. Cards used for the Concur travel program may have limits up to $5,000 if approved by the Senior VP/CFO or designee. Further, there are limited exceptions for the use of the card for Student Life travel. See IV. E. 4 g. below.

The single transaction limit is based on the total purchase price which includes shipping and handling charges. Cardholders are prohibited from splitting purchases into multiple transactions in order to avoid single transaction dollar limits.

A monthly limit is established based on the department budget availability. Reviewing card transactions on a regular basis is critical for budget control. Purchasing card transactions are not encumbered against departmental budgets. Due to the dollar transaction limit and frequency of feeds to Banner Finance, departments should have adequate tracking procedures to insure transactions do not exceed the budget. A purchase transaction for an amount greater than the standard single purchase transaction or the 30-day monthly limit will be declined at the point of sale.

Allowable Use includes, but is not limited to, the following items:

22

• Instructional materials and supplies • Lab supplies • Office supplies • Registration Fees (If it is for out of state travel, the travel request must have

prior approval ) • Subscriptions • Equipment repair

The card is NOT TO BE USED for the following:

• Personal use • Computers and other high theft items that must be inventoried • Foundation purchases or charitable contributions • Restricted Merchant Category Codes (MCC):

o Financial (all type of transactions including cash advances) o Airlines * o Auto Rental * o Hotels and Motels * o Food and Beverage ** o Entertainment o Transportation *

• Individual professional memberships (reference Employee Handbook) • Payment of Personal Services (refer to FMM, Section E, Authorized Bank

Accounts section in the FMM) • Prescription drugs and controlled substances • Radioactive materials • Purchases requiring a contract • Third party credit card processors, e.g. PAYPAL ***

* Exception: Unless specifically authorized by Chief Financial Officer

** Exception: The MCC (Merchant Category Codes) for Grocery Stores & Supermarkets and Caterers is available for assignment to specific cardholder cards to be used only for approved College sponsored activities and not for personal activities/meals.

*** Exception: Certain vendors may require use of their third-party credit card processor (e.g. PayPal) for payment. These purchases may be made using the Purchasing Card, but must be made as a one-time customer to vendor payment transaction. These transactions are only allowed when the third party acts as a payment processor and when the purchaser is not required to setup or log in to an account with the third-party credit card processor.

23

3. Resolving Disputes and Errors

Disputed transactions can occur due to the following:

• Failure to receive item charged • Altered charges • Defective items • Incorrect amounts • Credits not processed • Duplicate charges • Fraudulent charges not made by the cardholder • Fraud or misuse • Sales tax charged

The cardholder should contact the vendor to resolve any questionable charges. If the matter cannot be resolved, notify the supervisor, EDF, or College Purchasing Card Administrator in the office of the Senior VP/CFO System’s Office, Finance Department.

The matter must be reported by phone to the bank's customer service number. The bank will immediately credit the account for the disputed amount while it completes its investigation of the matter. The cardholder will be notified of the resolution.

In the case of fraudulent charges or misuse, notify the office of the campus Card Administrator or the College Purchasing Card Administrator at Systems Office. In addition, if needed, other appropriate College procedures that fit the situation should be followed. This may involve reporting the matter to the campus Security staff, Human Resources at the location, and the Office of the General Counsel which handles legal matters for the College.

4. Cardholder and Supervisor Responsibilities

It is the cardholder's responsibility to keep the purchasing card safe and secured; to obtain and retain appropriate documentation for purchases; to review card transactions regularly, and obtain supervisor's signature on the printed Statement of Account report signed by the cardholder and the immediate supervisor/card reviewer each month.

All campuses and the Systems Office should follow a similar procedure for the preparation, collection, and review of Statements of Account. At a minimum, Statements of Account should be reviewed at least monthly but may be reviewed more frequently at the discretion of the campus Executive Director of Finance/Administration. All cardholders must submit the signed and completed Statement of Account and associated documentation by the tenth of the following month to the appropriate office, either the office of the Senior VP/CFO or System’s Office, Finance Department or the Executive Director of Finance.

24

A complete packet consists of the monthly Statement of Account signed and dated by the cardholder and card reviewer/supervisor, and all supporting receipts, billing statements, packing slips, etc. Once collected these staff should review the monthly statement to assure that proper receipts and other back-up information and signatures are present.

The supervisor/card reviewer assigned to review and approve a Statement of Account must be an exempt level employee. It is the supervisor's responsibility to familiarize themselves with the purchasing policies of the College and to insure compliance with all purchasing card purchases.

All purchasing card documentation will be collected and maintained in the campus business offices and at the Systems Office, Finance Department. Refer to FMM, Section D, Retention of Records.

a. Reviewing and Reallocating Purchasing Card Transactions

All transactions are available for viewing daily on the purchasing card bank’s website. Most transactions are posted to the bank’s website within 24 to 72 hours after date of purchase. Card transactions are posted to Banner Finance on a regular basis.

Using Banner form FAAINVT, card administrators can reallocate a card transaction to different accounts within Banner, the College’s accounting system. Transactions may be reallocated by specifying either the dollar amount or percentage. Transactions that have already been posted to Banner Finance cannot be reallocated using the bank’s website.

b. Record Keeping

The cardholder is responsible for obtaining the Statement of Account, card receipts, cash register receipts, packing slips, etc. Once the monthly review is completed and signed off by the supervisor, the location where these records will be retained is determined by the campus or the office of the Senior VP/CFO Systems Office, Finance Department. In the rare instance where a receipt is lost, the Certificate of Missing Documentation may be substituted for that receipt. Abuse of this form may result in the revocation of the purchasing card.

These transactions may be subject to internal or external audit. Receipts and proper documentation must substantiate each purchase. In addition, the cardholder and supervisor may be called upon to provide further clarification.

c. Receiving

• Shipment must be directed to an Ivy Tech address or official station

25

• Cardholders should request their name to be listed on the package, along with the College name and address, to insure prompt handling

• Advance notice to the receiving department of expected deliveries may also be helpful.

The cardholder will be responsible for coordinating the return of damaged or unwanted items directly with the vendor.

d. Returns

The purchaser should always request returned items to be credited to the College card. If the vendor refuses to credit the card, the campus cardholder should contact the Executive Director of Finance. System’s Office cardholders should contact the College Purchasing Card Administrator or designated Finance Department staff. Another alternative is to report this matter to the bank's customer service number requesting the card account be credited for the disputed amount.

e. Purchases within the College

Expenses resulting from transfers between campuses should continue to be processed by journal entry. The purchasing card will not be used for purchases between College departments or campuses, or other auxiliary services operated by the College.

f. Student Travel (Effective March 1, 2014)

Under certain circumstances, the use of a purchasing card may be authorized for student travel. Student Life Directors or designee may be issued a purchasing card that on occasion may be utilized for travel expenses when traveling with students on a College authorized student life trip. Each campus may issue a purchasing card to their Student Life Director or designee. If needed, the campus may reassign an existing purchasing card to the Student Life Director or designee or may issue a new card within the campus’ specified allotment. If the campus has already used their allotment a request for an additional card may be made to the Senior Vice President/Chief Financial Officer (CFO) and General Counsel. These purchasing cards must follow all of the current guidelines for all purchasing cards with the following additional requirements. The purchasing card should be used only when other arrangements are unsuccessful, e.g., the hotel will not directly bill the campus. Airfare would generally not be charged on the purchasing card as the campus has other alternatives for payment in advance.

• Approval of the student life trip must be secured prior to requesting the use of the purchasing card for travel related expenses.

26

• Once the trip has been approved, the campus must complete the Request for Major Student Travel form. The form authorizes increasing the purchasing limits of the card up to the Executive Director of Finance’s expenditure authority.

• Any requests over that amount must be approved by the Senior Vice President/CFO and General Counsel or designee.

• The increased purchasing limits will be returned to the normal levels after the completion of the travel. The completed form must be submitted at least one week prior to the date of the travel.

It is the responsibility of the cardholder to obtain all necessary purchasing card transaction paperwork (receipts, confirmations, etc.) to substantiate the expenditures from the above mentioned travel. The Business Office will review the card transactions in accordance with the FMM policies, appropriate paperwork is provided and to assure there are no duplicate expenditures. Personal expenses are not to be charged to the card. If personal expenses are charged to the purchasing card, they are required to be repaid by the cardholder. Further, the cardholder may lose access to the card if used inappropriately.

6. Changes in Card Status

If any card information needs to be revised after the original card is issued, written authorization must be forwarded to the Executive Director of Finance or the College Purchasing Card Administrator in the office of Senior VP/CFO in the System’s Office, Finance Department. Revisions may include changes in the card’s 30 day cycle limit with the bank or changes in the cardholder's personal information.

a. Lost or Stolen Cards

Report all lost or stolen card information immediately to the financial institution at the number listed on the bank’s website on the Internet. As soon as possible during working hours, notify the office of the Executive Director of Finance or the College Purchasing Card Administrator at the office of Senior VP/CFO in the System’s Office. If you are certain that the card has been stolen at work, you should also notify the campus Security staff and/or Human Resources department. The College is responsible for all purchases regardless of dollar value until the card is reported to the financial institution.

b. Closing a Card

The purchasing card should be closed for the following reasons:

• The cardholder accepts a position at another College location, terminates employment with the College, is deceased, or the card is revoked by the

27

supervisor, office of the campus Card Administrator, or office of the Senior VP/CFO.

• After entering the card closing information on the bank’s website, the Executive Director of Finance or the College Purchasing Card Administrator in the office of Senior VP/CFO in the System’s Office, Finance Department will destroy the card.

c. Reissued Cards

Cards are valid for a two year period. Reissued College cards will be mailed automatically by the bank to the College Purchasing Card Administrator in the office of Senior VP/CFO in the System’s Office, Finance Department prior to the expiration date of cards currently in use. The cards to be distributed will be confirmed and mailed to the Executive Director of Finance for distribution and/or arrangement made for pickup of cards by System’s Office staff. Reissued cards must be personally picked up by the cardholder. Employees receiving reissued cards are required to sign for the cards on a listing of all reissued cards for that location or complete a new Purchasing Cardholder Agreement form. Before the cardholder can be issued the new card, they must surrender the expired card. The Executive Director of Finance or the College Purchasing Card Administrator in the office of Senior VP/CFO in the System’s Office, Finance Department will destroy the expired card.

7. Changes in Employment Status

a. Transferring to another Department

The purchasing card is linked to the department's account (FOAP). A change in the employee status to another department must be reported to the Office of the Executive Director of Finance or the College Purchasing Card Administrator in the System’s Office, Finance Department.

b. Termination of Employment

All cards are to be turned in to the College prior to the point of termination. The card may be turned into the Human Resources Department at the time of the exit interview, the supervisor, the Executive Director of Finance, or the College Purchasing Card Administrator in the office of Senior VP/CFO in the System’s Office, Finance Department.

28

V. Other Financial Considerations A. Technology Stipend 1. Basis for Stipend

The use of cellular phone and other electronic access devices for business purposes can be expensive and the decision to incur such business expenses must be evaluated from a cost/benefit perspective. Departments must consider other viable options such as landline phones, prepaid phones, or other less expensive devices and or access tools.

Electronic access devices could include cellular devices with cellular access plans for connection, such as cell phones and smartphones.

A College business purpose for having an electronic access device is one where:

• The employee is responsible in emergency matters where they must be available 100% of the identified business period or,

•The use of other less expensive communication devices does not serve as a viable alternative to the business purpose or,

•The employee’s job effectiveness will show a significant increase through the use of a cell phone or electronic access/device. For example, the employee is required to travel extensively as a part of their job responsibilities.

•The identified business period is the time that the employee must be accessible by the institution.

College employees required to use electronic access and electronic devices for business purposes will obtain personal access plans and will be compensated by the College via a stipend. This must be for business purposes that cannot be accommodated with other less expensive communication devices and/or access. The technology stipend is not a supplement to an employee’s salary.

Exclusions from this policy include college owned electronic access devices which are shared among employees only while on campus or their designated station, and while on duty. The shared devices do not leave the campus or the station. An example would be a cell phone shared by security personnel while on duty. These devices would be

29

purchased by and remain the property of the College. The plan would also be paid for by the College.

Stipends can be issued for the following purposes:

Establishment and/or on-going monthly expenses of the personal plan with a vendor including the purchase of the electronic access device(s), purchase of any accessories for the device (headsets, cases, protectors), and any additional expenses which may be incurred to have the electronic device.

Because the primary purpose of having electronic communications and access is to maintain accessibility, by accepting a technology stipend, the individual agrees to maintain the electronic access device in their possession and in an “on” status during business periods or during times when the individual is in an “on call” status. It is recognized there are times when it is inappropriate for a cellular device to be on (during business meetings). Individuals should consult with their direct supervisors regarding this issue.

As these devices are the property of the individual, devices lost or damaged are the responsibility of the employee to replace. These personal electronic devices and plans will be available for personal, as well as, the business purposes outlined in this policy. Therefore, the College reimbursement is not intended to cover the entire cost of these plans.

The amount of the technology stipend is $41.54 per pay and it is paid each bi-weekly pay period.

During the annual reviews of the technology stipend, a review of the continuation of the technology stipend is to occur with the employee’s supervisor.

Individuals who do not obtain a technology stipend for electronic communications (because their usage is intermittent) may continue to be reimbursed for business cellular usage on a per-call basis as outlined in the Travel section of the FMM, (III. Reimbursements, section I. Parking Charges/Other Miscellaneous Charges). Individuals with technology stipends are prohibited from also receiving per-call reimbursements.

2. Reviews, Approvals and Documentation

30

Initial technology stipends must be approved on the Technology Stipend Form (TSF) and must be approved by the Executive Director of Finance (EDF) and Chancellor or Vice President of the area. Justification should be noted on the TSF. Approval should occur after a review of the business purpose.

Technology stipends are a W-2 taxable benefit to the employee. The TSF will require a signature of the employee acknowledging the W-2 taxability of the benefit. Base salaries will not be adjusted to accommodate stipend disbursement. Extra pay is the only process that can be used for this purpose. The extra pay is not benefits eligible. This form should be on file in the Human Resources department. A copy must be maintained in the campus payroll office.

Signatures by the offices of campus Human Resources and/or the Payroll Office on the Technology Stipend Form are an acknowledgement of W-2 taxability only and not intended to imply approval of the stipend. Full accountability for the appropriateness and reasonableness in amount of the stipend for the devices and services covered in this policy are the responsibility of the approving department head, the EDF/EDA and ultimately the Chancellor or Vice President of the area.

Equipment

No additional reimbursement above the technology stipend is permitted for equipment and accessories. As outlined above, the technology stipend is designed to provide funding for a portion of the costs of an individual to maintain a functioning electronic access service to meet workplace demands when away from their primary post or workstations.

Employees are expected to purchase the requisite accessories to support the safe and legal operation of their technology devices. Further, employees are required to be aware of and compliant with any federal, state or local rules/laws regarding the safe usage of cellular devices.

Annual Service Review

An annual review by the employee’s supervisor to ensure that a business purpose continues to exist and that the amount is still appropriate in order to accomplish the job must be performed. This may be done via email rather than completing another TSF.

Verification of services obtained is the responsibility of the supervisor.

31

Termination of the additional pay is required if the business purpose no longer exists. This should be done via a TSF. Documentation must be retained in the payroll office. Individuals are not required to submit billing statements from their electronic access provider.

3. Contracts and Grants Accounts

On grant funds for the additional pay to be considered an allocable expense the use of the cell phone or electronic access/device should be fully devoted to the project, necessary for the project, and included in the approved budget. In cases where it is not in the approved budget, not fully devoted to the project or not necessary for the successful implementation of the project, the expense will not be allowable unless approved by Systems Office Sponsored Program Accounting, which will typically require sponsor prior approval.

B. Charitable Contributions

Expenditures to support not-for-profit or charitable organizations are only allowed as long as there is documentation attached to the payment request showing the benefit to the College. As an example, the College may benefit from purchasing tickets/tables at a charitable event because of the opportunity to interact with community leaders, as well as receiving marketing benefits. This documentation should be written in such a way as to clearly explain the business benefit of the College’s participation. Donations to a not-for-profit or charitable organization are prohibited.

Student government associations and College clubs may use funds derived from student fees to make donations to the College's institutionally related foundation (Ivy Tech Foundation) if the donations are for student financial aid or the purchase of equipment or technology as part of an approved capital campaign to benefit a particular campus or administrative campus of the College. Consistent with the Foundation's longstanding policy, the Foundation will not levy any administrative fees or overhead charges against these donations. Additionally, the Foundation will report on the usage of these particular donations at the request of the College.

32

PURCHASING PROCEDURAL GUIDANCE

State of Indiana Quantity Purchase Agreements (QPAs) and Group Purchasing Organization (GPO) competitively bid contracts should be considered where appropriate for procurements or use of common or shared goods and services.

I. Purchasing Process A. Prepare Purchase Requisition for Approval in the College’s E-procurement System The College’s preferred method for purchase order generation is the College’s e-procurement system, and all purchase order documents are linked to their accompanying purchase requisition. Documentation of approvals is recorded in the system and is available for review at any time. The College’s e-procurement system purchase requisition should be prepared by the requisitioner.

The purchase requisition is required to be completed to obtain approval for all purchases before a purchase is made, and before a purchase order is issued. Orders should not be placed with the suppliers until the purchase requisition is completely approved in the College’s e-procurement system. http://www.ivytech.edu/fmm/section-m/m-v.html Documentation supporting the purchase should be attached to the College’s e-procurement system requisition.

f. System Access

Requisitioners need to have access to the College’s e-procurement system and the appropriate access to their accounting codes (FOAPs) in Banner. A Banner Finance/College’s e-procurement system access request form must be completed and submitted to the Office of Information Technology - Information Security.

g. Electronic Approvals

Purchase requisitions should be originated in the College’s e-procurement system. In some instances, the paper Purchase Requisition/Check Voucher form may need to be used. The paper form may be used in situations such as (the following is not to be an exclusive list): 1. The College’s e-procurement system is unavailable, 2. The supplier in question cannot be added to the College’s e-procurement system, 3. In situations where the paper form is used for the sole purpose of obtaining an approval signature that is

33

unavailable in the College’s e-procurement system, the paper form should be submitted as backup documentation to the College’s e-procurement system requisition.

Approval of purchase requisitions in the College’s e-procurement system is done online. By approving a document in the system, the approver assumes the same responsibility for the transaction as they would by signing their name. Approval as required in the expenditure and contract authorization tables (will be documented in the College’s e-procurement system history).

Approval queues are maintained in the system according to the signing authorities outlined in FMM, Section J, Purchasing (Authorization of Expenditures. FMM J.I.C. The College’s e-procurement system is designed so that each initiating department must approve a requisition before it is routed to the Finance Department for review/approval. For any given transaction, the requisitioner and the final departmental approver cannot be the same person. The departmental approvers were established by the EDF or by the supervisor in the System’s Office. Changes to the departmental queues can be requested via email to the E-Procurement System Administrator or Finance System Administrator, and requests must be from the EDF or Business Office Director or by the supervisor in the System’s Office

Purchase requisitions are approved through the College’s e-procurement system. All approvals are completed at the requisition level. In cases where the dollar amount is $100,000 or greater, an additional “High Dollar” approval of the purchase is required by the Senior VP/CFO or designee. If the dollar amount is $500,000 or greater, the State Board of Trustees approval must be documented before the system approval is performed by the Senior VP/CFO or designee.

II. Issue Purchase Order Rationale

A purchase order is a document authorizing a vendor to deliver described merchandise, materials, or services at a specified price. Upon acceptance by a vendor, a purchase order becomes a contract. A purchase order is used to encumber (set aside) necessary funds to cover an anticipated expenditure. All lease purchases, service and rental agreements, construction contracts, professional services, and other financial commitments (excluding faculty agreements) should be attached to and encumbered by a purchase order.

The College, as an instrumentality of the State of Indiana, is exempt from sales tax on the purchase of tangible personal property or services meeting certain criteria. Information regarding sales tax and the College’s exemption may be found in Section C of the FMM.1.Terms and Conditions

34

Terms and conditions applicable to governmental contracts with federal funds of $2,500 or more and terms and conditions explaining the College's status as an Equal Opportunity Affirmative Action Institution for purchase orders of $2,500 or more, are located at: http://www.ivytech.edu/about/po-terms-conditions.html

The College’s e-procurement system purchase order documents provide the above link at the bottom of the last page.

2. Revolving Fund Purchases (Banking Section)

http://www.ivytech.edu/fmm/section-m/m-v-b.htmlA revolving fund check may be issued for minor purchases up to $300. Exceptions up to $300 for unusual circumstances may be made only upon approval by the Executive Director of Finance.

III. Purchase Order Documentation The College’s preferred method for purchase order generation is the College’s e-procurement system and all purchase order documents are linked to their accompanying purchase requisition. Documentation of approvals is recorded in the system and is available for review at any time.

1. Follow-up on Purchase Orders

1. Oversight must be maintained to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders.

2. A follow-up system should be in place to check on open purchase orders on a monthly basis using FPIOPOF (Open Purchase Orders by FOAPAL) in Banner or the Discoverer Open Encumbrance report.

3. If an item has been on back order for 60 days or longer, it may be to the College's advantage to cancel the purchase of backordered items and make payment on those items the College has received. Vendors should be informed of cancellation and that reordering may take place on a later date.

2. Checklist for Properly Receiving Merchandise

1. Unpack goods no later than forty-eight (48) hours after receipt. When possible, unpack goods in the presence of the carrier. Save the packing materials if there is damage.

35

2. If merchandise is to be returned, wait for a return authorization from the vendor.

3. Have driver note discernible damage on both your copy and the driver's copy of the delivery ticket.

4. Report concealed damage to the carrier within fifteen (15) days of delivery date.

5. Request carrier to send their inspector to report on concealed damage, and obtain a copy of the damage report.

6. Send one copy of the inspection report to the vendor.

7. File a claim for either discernible or concealed damage within fifteen (15) days of delivery date.

8. When wrong merchandise is received, contact the vendor and wait for the vendor's return authorization.

9. All shipments received should be counted, and overages and shortages noted on all copies of the delivery ticket. Contact the carrier and the vendor within fifteen (15) days of delivery.

3. Cancellation of Purchase Order

Cancellation of an executed purchase order must be made by the College location initiating the purchase order.

The cancellation of the purchase order in The College’s e-procurement system can be performed by the campus Compliance approver or the E-Procurement System Administrator. The purchase order will also need to be cancelled in Banner on FPAPDEL (Purchase/Blanket Order Cancel). The cancellation in Banner will liquidate the encumbrance (Refer to FMM, Section M, Financial Documents for further details)

IV. Standing Purchase Orders Rationale

Standing purchase orders are issued for repetitive type purchases such as utilities expense, leases, service contracts, and operating supplies. The advantages are the estimated total expenditure is encumbered and additional purchase order approvals are not required.

36

Procedure

1. All normal bidding procedures apply, or an explanation of vendor selection must be attached to the Purchase Order form.

2. Terms are negotiated, a dollar amount limit is established, and an order is issued for a definite period - usually one fiscal year.

3. Standing orders issued for utility costs, service agreements and maintenance agreements should be processed on a regular basis according to the terms of the agreement (usually monthly). Requisitions are not required for each payment period. Original authorization in accordance with the Authorization Tables

4. Standing orders issued for operating supplies require additional documentation. When supplies are needed immediately from standing orders, authorization should be obtained from, at minimum, a department approver. Departments needing materials covered under a standing purchase order must authorize the pick-up and confirm delivery. Please note that certain vendors may require written authorization before releasing goods to College employees. Authorization should come from the department approver stating dollar limits for that particular order and/or the standing Purchase Order number.

5. Standing purchase orders should be generated using the Standard order type in the College’s e-procurement system and noting Standing Order in the external notes or product description of the requisition.

6. It must be understood by all parties that all materials received are to be billed to the Business Office. This should be the “bill to” address listed on the College’s e-procurement system purchase order.

7. Partial payments pertaining to standing orders will be processed in Banner according to the normal invoice processing procedures. The balance of the unexpended original purchase order must be monitored to ensure the expenditures do not exceed the original encumbrance.

V. Capital Equipment Purchases, Sales, Trade-ins and Disposals of Fixed Assets

See FMM, Section N, Fixed Assets, for further details.

VI. Vehicle Purchases

37

1. Ivy Tech-Owned Vehicles Procurement of all College-owned vehicles requires advance approval of the Senior VP/CFO in the President's Office. This applies both to vehicles to be purchased and to be leased. Refer to FMM, Section H, Travel Policies and Procedures (Ivy Tech Owned and Leased Vehicles). Reference: Travel Authorization, Section H: State-Owned/Ivy Tech Vehicles.

The owner of a vehicle is defined as:

"A person who holds legal title of a motor vehicle, or any person renting or leasing a vehicle, and having exclusive use for a period longer than thirty (30) days."

The Bureau of Motor Vehicles permits leased vehicles to be registered by the Lessor or the Lessee. All vehicles owned or leased for periods longer than thirty (30) days will be registered by Ivy Tech. The registering of the vehicle in the name of the College permits the College, as the owner or lessee, to properly claim an exemption from State sales tax and excise tax. Refer to Section C of the FMM for further information regarding tax exemptions.

All Ivy Tech owned and leased vehicles will have Ivy Tech specialty plates that are available for passenger cars, trucks up to 11,000 pounds, motorcycles, and recreational vehicles. These plates are available through the Indianapolis Bureau of Motor Vehicles location and must be renewed each year. All other vehicles will require the state owned license plate. For required documents and contact information, see the BMV to obtain municipal (state owned) plates. The registration and plating is coordinated by the campus Executive Director of Finance. Once the plates are obtained, a request for reimbursement of $25 per plate should be sent to the Executive Director of Administration and Operations of the Ivy Tech Foundation. The EDF should submit a copy of the registration receipts to the foundation with the Foundation’s Request for Payment form, referencing account number 00 01 30 1300.

Request for insurance on the vehicle should be submitted to Assistant Director of Benefits and Risk Management in email format. The request should include the following information:

• Vehicle Make, Model, and Year • VIN • Copy of registration form • Effective date of insurance coverage • Purchase price of vehicle

38

• If the vehicle is leased, also include the name and address of the leasing company and amount of monthly leasing payments.

Insurance card should be retained in the glove box of the vehicle the card specifies. Please refer to FMM, Section I, Insurance (Policies and Coverage-Vehicle Insurance).

Procurement of vehicles must be done using the Vehicle order type in the College’s e-procurement system and adhere to purchasing procedures and authorization approval levels.

2. Use of Vehicles All use of Ivy Tech-owned or leased vehicles must be authorized in accordance with FMM, Section H, Travel Policies and Procedures ( Ivy Tech Owned and Leased Vehicles. Any employee who may be expected to drive Ivy Tech owned or leased vehicles must be an authorized driver under the College’s insurance. Approval may be obtained by completing the Driver Authorization Form at least 30 days prior to driving.

3. Vehicle Expenses for State or College-Owned Vehicles

The College/Campus is responsible for payment of gasoline, oil, repair and maintenance in the operation of its vehicles. The College does have college-wide gas card which allows for gasoline, oil, etc. purchases. For more information on gas credit card purchases, contact the Chief Accounting Operations Officer. Arrangements for tax exempt credit accounts should be made with appropriate oil companies by each campus.

4. Exceptions

Special exceptions may be granted by the President or the Senior VP/CFO.

VII. Vendor Payments

1. Invoices An original invoice should be submitted in all cases. However, if necessary fax copies, scanned copies and photocopies are permissible. As a last resort the Certificate of Missing Documentation may be used. Reference FMM, Section M, Financial Documents.

39

2. Credit Memos Credit memos are issued by a vendor to Ivy Tech for returned merchandise or adjustments on merchandise delivered as damaged or short. Credit memos are processed in order to decrease the amount owed the vendor.

Special attention should be given to credit memos that are "open" in Banner and have a date more than one year old. The Business Office should communicate, at least on a quarterly basis, with companies to resolve aged credit memos. There is a concern that the College's accounting records may be unfavorably impacted if these items remain "open" and continue to age. If it is determined that a refund cannot be obtained, the placing of an order may be considered in order to use the credit. This may be preferable to losing the credit. (Refer to FMM, Section M, Financial Documents for further details)

3. Material Variance between Invoice and Purchase Order Amount

A material variance occurs when the invoice amount exceeds the purchase order amount by a material amount. A material amount is defined as the lesser of 20% of the original purchase order amount, or $1,000.

The purchase order must be approved at the appropriate authorization level corresponding to the total invoiced amount for the order. If a material variance occurs, the invoice will require a tolerance override by the EDF in order to process the invoice.

A change order should be generated in the College’s e-procurement system to document the approval of the increased amount. The College’s e-procurement system change order type should be used for the total amount (original PO amount + any increase), and the original PO number should be documented in the notes of the requisition. Change orders are only required when the material variance is due to the invoiced amount exceeding the purchase order amount.

Revised July 2019

SECTION K: AUXILIARY ENTERPRISE

I. AUXILIARY ACTIVITIES - GENERAL

Auxiliary activities provide facilities or services directly or indirectly to students, faculty, or

staff. Proper management of the auxiliary activities is important to assure the activities are

providing the desired support service and the financial impact falls within acceptable guidelines,

as determined by College management.

It is the policy of the College that separate accounting be kept for all fees or charges collected

from bookstore operations, parking, or other activity which derives its financial support primarily

from the users; and that expenditures of such funds shall be made solely to support activities or

operations which directly benefit such users. Such accounting is essential for internal use to

ascertain the degree of self-support attained and to provide the basis for exercise of controls. The

monthly accounting detail provided through the segregation of these activities is the basis for

financial analysis of the auxiliary activities.

II. Bookstore

Rationale

The bookstore, an auxiliary enterprise of the College, furnishes a service directly to students.

This service is an essential element in support of the College mission, and conceptually, should

be regarded as self-supporting. The major portion of a bookstore's activity is devoted to making

available books, materials, and supplies which students are required to purchase in connection

with their course work. Each regional institute will make provisions to have available for

purchase, by its students, the necessary texts, workbooks, and supplies in sufficient quantity so

that the student's ability to progress in class is not impaired through lack of such materials.

A. Administration

The Director/Regional Business Affairs is responsible for the management of the College

bookstore and is accountable to the Vice President of Finance and Treasurer for the bookstore's

fiscal operations. Cost accounting methods are to be used to evaluate and analyze income and

expense elements of the operations.

The bookstore operations are to be supported by schedules of revenue and expenditure. Such

schedules are essential for internal use to ascertain the degree of self-support attained and to

provide the basis for exercise of controls. Financial statements are to be based on the accrual

method of accounting. The basic instruments of financial reporting for the College bookstores

will be College and regional balance sheets and College and regional statements of income. The

Central Office staff will issue semiannual and fiscal year-end statements pertaining to the

College bookstores.

The bookstores are expected to pay their share of general overhead expenses, as well as all direct

operating expenses, and are expected to provide adequate working capital to be self-supporting.

The College will not complete the fiscal year end closing process until all College owned

bookstores have been charged adequate overhead expenses. This overhead charge will be

calculated using the annual survey published by the National Association of College Stores. This

calculation and the resulting journal entry charging the bookstores and crediting the operations

fund will be prepared and processed by central office staff. This does not apply in cases where

the bookstore is not located on campus and pays all expenses directly.

B. Cash Deficits

Regional institutes having a cash deficit at any fiscal year end, as listed on the June 30 College

accounting system FBM092 Report for the Bookstore Fund, will have such deficit applied

toward their Operations Fund fiscal year operating reserve.

The cash balance may be monitored daily by using the College accounting system on-line Screen

18, referencing Claim on Cash, `YTD', and monthly by using report FBM092.

C. Operating Surplus

Regional institutes having cash balances in excess of funding requirements for inventories and

receivables may use such reserve to supplement the regional operations with the approval of the

Vice President of Finance and Treasurer.

D. Funding of Accounts Receivable and Inventory

It is expected that the bookstores will provide adequate cash to finance trade accounts receivable

and inventories, in addition to covering all direct operations expenses and their share of indirect

costs.

Operating expenses include personnel salaries, wages, employee benefits, and payroll taxes.

Only management and staff having involvement should be charged to operating expenses.

Supplies consumed and equipment and furniture assigned to the bookstores are to be included as

direct operating expense. Overhead expenses include lease or space rental, utility charges for

heat, light, telephone, etc., and the cost of occupancy-related services such as janitorial,

maintenance, and repair services furnished by the College. Overhead expense attributes should

be made on the basis of square feet occupied by the bookstore operation, and should be charged

quarterly.

E. Budgets

Budgets should be developed that set financial goals for the bookstore operations. Prior year's

level of activity, adjusted by an enrollment growth or decline factor and profit margin, would be

a good foundation for current year budgeted activities. Budgets are to be entered into the College

accounting system by the regional business office by August 31 of the current fiscal year.

Budgets will be reviewed by the Central Office staff during the preparation of semiannual

statements of income and net worth. However, bookstore operations should be monitored by the

Region.

F. Ordering/Purchasing

The involvement and cooperation of the faculty, Director of Instruction, and Director of Student

Services in monitoring textbook orders are essential for having required course materials on hand

by the start of classes.

The instructional divisions must monitor and approve changes in textbooks used (including

requested changes in editions) and requests for new texts not previously ordered. All texts of a

current edition should be sold or returned to its publisher when ordering texts of a newer edition.

The instructional divisions must be responsible for having faculty submitting orders a minimum

of five (5) weeks prior to the start of classes. Review of requests should be in conjunction with

Student Services so that adequate quantities are ordered based upon enrollment projections.

Purchase order quantities should be calculated based upon orders submitted less quantity on

hand. In addition, it is recommended records be maintained which detail the number of textbooks

ordered, the number of textbooks used and returned, by division, in order to have a basis for

informed decisions concerning the future purchase of textbooks.

All textbook orders are to be documented by a purchase order for confirmation of goods ordered,

inventory control, encumbrance of funds, and expediting payment.

Although vendors may allow telephone orders and may request no written confirmation of

telephone orders due to possibility of duplicate shipments, a purchase order is required to

encumber funds and expedite payment. Under such circumstances where vendor requests no

written confirmation, the vendor (white) copy of the purchase order should be retained by the

bookstore with notation on the document copy that the order was placed by phone with no

confirmation requested. Procedures for payment of bills, purchase order document, receiving

report, check request document, and revolving fund should be followed for processing of

documents.

Purchases under $250 may be made through the use of a Check Voucher in accordance with

normal College operating procedures.

Used Book Purchase/Sales Operation

A regional institute may utilize a used book purchase/sales operation whenever feasible. It is

encouraged to work with used book wholesalers in purchasing texts from students for resale and

in purchasing used books for the student at a reduced cost to the College and students.

G. Pricing/Markup

Selling prices and operating costs must be monitored carefully to ensure that the bookstore meets

its budgetary objectives. The income realized by a bookstore is predominantly from the sale of

books, supplemented by the sale of supplies and other goods.

The College recognizes that variations occur from Region to Region on bookstore expenses: mix

of books, supplies, and other items; and markup and gross margin. However, in order to assure

that the College is providing the students textbooks at the least possible cost, a maximum markup

percentage of 40 percent has been established for new textbooks. Any exceptions to this must be

approved annually by the Vice President of Finance and Treasurer. Freight may be included as

an add-on cost to determine the final selling price of the textbooks.

In order to generate a valuation system that is consistent throughout the College, the following

pricing method should be utilized.

If the maximum markup (for new textbooks) of 40 percent is desired, the product cost is

multiplied by 1.40.

EXAMPLE:

If the markup desired is 35 percent, then 1.35 would be the multiplier; if 30 percent is desired,

then 1.30 would be the multiplier, and etc.

It is at this point, after the multiplier is used, that unit freight cost is added. Including freight

prior to using the multiplier results in freight costs being marked up, as well as the book. Unit

freight cost is derived by dividing freight costs for a shipment by the number of books received

from that shipment.

EXAMPLE:

Freight Costs $10.00

Number of books received 100

Selling Price $0.10

In order to generate an inventory valuation system, the following pricing method may be

utilized. This method should provide adequate revenue which will generate working capital to

finance inventories and accounts receivables, and which will cover operating and overhead

expenses. Calculations should be based on prior fiscal year data:

Textbook Cost $10.00

Markup Multipler $1.40

Selling Price $14.00

Operating Costs:

Salaries and Wages

Employee Benefits

Payroll Taxes

Overhead Costs:

Space Cost

Utilities

Other

Profit Margin (Percent of Sales)

Cost Plus Markup Method

Example of 40 percent markup: Markup is the amount added to an established price for the

purpose of determining a new and higher selling price; the percentage of markup is based on the

previously established price.

Product Cost $10.00

40% Markup $4.00

Selling Price $14.00

H. Inventory

Approximately three weeks after the start of a semester, an inventory count of textbooks on hand

should be taken to assist the ordering process for the following semester. A semiannual financial

inventory must be provided to the Central Office staff on dates specified by the Central Office

staff. It is recommended that at least one week prior to the semiannual financial inventory, the

bookstore personnel arrange the inventory in a logical manner in order to facilitate the

semiannual count. In addition, it is recommended the attached inventory count form be used to

facilitate this count. Also, it is recommended the bookstore close during the time of the

semiannual inventory in order to have a more accurate count. The actual procedures of

performing the count is a regional decision; however, it is suggested that one or more people

perform the count and another person verify the count on a test basis. The inventories should be

classified into the following categories:

1. Books

2. Supplies

3. Other

The illustration (on page K-7) may be used for the inventory. Please note the form has a column

headed "Obsolete". This is to be marked "Yes" or "No" for all items listed in the inventory.

Obsolete for textbooks is defined to mean the publisher will not accept returns and the books are

not usable for current or planned courses. Obsolete for supplies and other goods is defined as

items which are not returnable and are not considered to be salable at a price equivalent to cost or

above.

I. Inventory Valuation

The following method is to be used by the regional bookstores to value their inventories for

financial statement purposes.

The latest price paid for the item is to be applied to all items on hand. This should approximate

the first in, first out (FIFO) method of inventory valuation. This is being done to provide for a

consistent inventory valuation method for the College's financial statements.

According to the Generally Accepted Accounting Principles, freight costs should also be

allocated to the ending inventory. The Region may use actual freight cost or develop an average

freight cost per book and apply the average cost to the entire ending inventory. This average

must be reviewed and updated at least annually to reflect increased costs.

EXAMPLE

INVOICE DATE DESCRIPTION AMOUNT PAID

03/01/89 Accounting Principles I $20/ Book

06/01/89 Accounting Principles $22/ Book

Regional Average Freight Cost $ 0.35/Book

Inventory Count as of 06/30/89:

100 Accounting PrinciplesI Books

100 * $ 22 = $2,200

100 * $0.35= $ 35

Total Cost $ 2,235

Returns/Credit (Publishers)

The inventory of textbooks, taken approximately three weeks after the start of a semester, should

reflect publisher, title, and quantity on hand. The Director/Regional Business Affairs should

review this list in identifying texts that will not be used for the following semester. All in?stock

books not to be used within the succeeding two semesters are to be returned to the vendor for

credit. When returning unsold textbooks, publisher guidelines for returns and due dates must be

adhered to closely.

The bookstore must project if a credit memo may be applied within the following semester. If

applicable, the credit memo should be entered in the College accounting system and utilized

against future purchases. Where additional purchases applicable toward a credit memo are not

anticipated within four months and the publisher is infrequently contacted, the bookstore should

return the credit memo with a request for a check refund.

A report (VBM093CRED) is generated on a weekly basis. This report should be reviewed when

vendors inquire about payment of invoices. Vendors who are in credit status College-wide

should be informed that credit memos are applied College-wide, and that checks are written

when amounts owed exceed allowable credits.

The regional business director may process vouchers to exclude College-wide credits on an

exception basis. This should occur only after communication with the vendor has failed to

resolve the issue and the vendor's services/products are necessary.

Bookstore Inventory Tag

IVY TECH STATE COLLEGE

BOOKSTORE INVENTORY TAG

Region_______________ TAG #________

Location _____________

Total Count ___________

TYPE

Book _______________ Normal__________

Supplies _____________ Obsolete _________

Other _______________

COUNTED BY:_________________________

VERIFIED BY:_________________________

COMMENTS ________________________________________________

________________________________________________________

________________________________________________________

________________________________________________________

J. Refunds

Book refunds may be made from available cash on hand or revolving fund. Book refunds may be

granted in compliance with these established conditions.

1. Books may be returned for a refund within the first two weeks from the beginning of the

semester.

2. Original cash register receipt or bookstore receipt must accompany returned books.

3. Books being returned cannot be written on, or in, unless the regional institutes have a used

book purchase/sales operation. Usually, books returned are either resold as new books or

returned to the publisher as unused copies.

4. All cash refunds must be documented with a bookstore receipt, signed by the student

indicating receipt of cash, and signed by the employee making the refund. Books refunded are to

be identified on the receipt.

5. Sales of supplies are final. No refunds are to be granted on consumable items.

6. Full refunds will be issued where class(es) have been canceled by administrative action.

7. The bookstore's refund policy should be posted in a location easily available to students.

K. Accounts Receivable

It is the responsibility of each regional institute's business office to manage bookstore accounts

receivable to the best interest of the College. Bookstore receivables are to be collected or written

off in the same manner as Operations Fund receivables.

L. Sales

Sales for the bookstore involve the exchange of merchandise for money. The bookstore manager

should be concerned with two types of sales:

1. Nontaxable Sales

Sales made to a tax exempt federal or state agency, institution, or charitable organization are

nontaxable sales. This type of sale must be billed directly to that agency, and that agency must

provide the appropriate tax exemption number. The Region must keep this number on file. A few

examples of tax exempt agencies are:

a. Vocational Rehabilitation

b. Job Training Partnership Act

2. Taxable Sales

Taxable sales are all other sales not covered under Item 1, regardless if they are to students,

faculty, or staff.

3. Institutional Sales

Sales to administrative and instructional departments are classified as nontaxable revenue and

expenditures. Such transactions are considered revenue to the bookstore and should be

journalized. An example journal entry follows:

REGION DESCRIPTION DEBIT CREDIT

xx Operations Fund - S & E - Books $xx.xx

xx Aux. Ent. Bkstr. - Nontax. Rev. - Books $xx.xx

Total $xx.xx $xx.xx

III. PARKING ACQUISITION and MAINTENANCE

Rationale

To the extent possible, each regional institute will maintain off-street parking for students and

staff. Parking and parking regulations should conform to all applicable municipal codes and

ordinances, or the Region shall obtain any necessary variances required by the local situation.

The parking acquisition and maintenance fund is an auxiliary enterprise of the College. This fund

furnishes an indirect service to the faculty, staff, and students, in that it is to be used for the

acquisition, expansion, improvement, and maintenance of College parking facilities.

A. Administration

Funding is to be primarily received from a designated portion of the Building Facilities Fee.

College-wide monies will be provided and allocated to projects according to a priority listing

established by the property management area. Individual accounts for approved projects will be

established by the Central Office staff. All applicable State Statutes and College policies and

procedures are in effect for the administration of this fund. Classification of expenditures are:

1. Capital - Purchases of land, land improvements, and capital equipment ($l0,000 and more)

2. Supply and Expense - Maintenance expenditures of under $10,000 (i.e. sealing).

L. SPONSORED PROGRAMS

I. Overview

Authority to execute or to delegate authority to execute contracts and written agreements is held

by the President of Ivy Tech Community College, with the exception of those contracts which

require Board of Trustee or other outlined approval. Grants and contracts for restricted purposes

usually involve a formal written agreement and unless so designated require the signature of the

President or a designee in accordance with FMM Section J.III.L for signature delegation for

contracts.

The types of grants, contracts, and agreements include those for which organizations external to

the College have resources that can be made available to support the instructional, research, or

public service function of the College. These programs are established in restricted College

accounts and are designated as "Sponsored Programs."

These funds are expendable for operating purposes, but restricted by donors or other outside

agencies as to the specific purpose for which they may be expended. The distinction between the

balances of externally restricted and internally designated, but otherwise unrestricted funds, must

be maintained in the accounts and disclosed in the financial reports. The circumstances and

evidence relative to restrictions may not be clear and may require the advice from General

Counsel, management and independent auditor judgment, insight, and discretion. Technical and

administrative responsibilities assumed by the College in relation to sponsored programs are

complex. Acceptance of funds for these programs is accompanied by a requirement of strict

accountability. In addition to the agency/sponsor requirements, College staff working with

grants must be cognizant of the many areas of the College in which a grant will interact.

Relevant departments and offices should be kept apprised and consulted with as grant proposals

are developed and sponsored programs implemented.

Sponsored programs will be established via signed contracts, grants, cooperative agreements, or

memorandums of understanding. These projects may be sponsored by governmental (federal,

state, or local government entities) or non-governmental entities (foundations, corporations, and

other agencies).

Sponsored program funds relate to the specific grants, contracts and agreements between the

College and external "Public" governmental entities, or "Private" organizations or individuals

funded for the particular restricted purpose specified. Each of these individual programs

is categorized by fund, according to the governmental entity or type of private organization that

has entered into the agreement with the College.

It is important to note the primary differences between a grant and a gift. A gift represents a

‘contribution’ which is voluntary and non-reciprocal. A gift generally contains no reporting

requirements, and is for an unspecified period of time. Grants or Contracts or Agreements are

defined as a signed contract or agreement which provides for the expenditure of funds for a

stated purpose with a period of performance and with reporting requirements. In most cases the

distinction is clear, but in times when the distinction is not clear, sponsored program accounting

staff can help to appropriately deposit and track the revenue. Ivy Tech Community College

manages grants under the Office of Management and Budget’s Uniform Guidance. This

guidance, while strictly applicable to federal awards, also shapes many of the College’s policies

for all of its grant management practices.

II. Roles and Responsibilities

A.1. Grants Development Office

A.1.a. Pre-award

The Grants Development Office is responsible for assisting campus and Systems Office staff

with identifying funding opportunities, coordinating grant writing and proposal development

assistance, and engaging appropriate College and community partners. The campus

Development Offices and Grants Development Office serve as the first point of contact for all

College and Foundation grant submissions. The Grants Development Office reviews all

proposals, and in collaboration with the campus Development Offices ensures all appropriate

College and Foundation approvals have been obtained, including the Office of Information

Technology, Facilities, and other departments as applicable. As requested, the Grants

Development Office provides training on pre-award processes such as identifying opportunities

and developing a proposal.

A.2. Grants Management Office

A.2.a. Pre-award

Once a proposal has been reviewed and approved by the appropriate parties, the final proposal

documents are sent by the Grants Development Office to the Grants Management Office for

submission to the granting agency. Any exceptions, such as local community foundation

submissions, companies, or organizations where there is an established relationship, must still be

reviewed and approved by Grants Management prior to submission.

A.2.b. Post-award

The Grants Management Office jointly maintains responsibility for management of an active

grant in partnership with the Project Director (PD), the Executive Director of Finance/Executive

Director of Administration (EDF/EDA) or assigned Finance Designee, Campus Development

Offices and Sponsored Programs Accounting (SPA). The Grants Management Office is available

to assist PDs and campus finance staff to ensure grants are effectively managed. When

negotiations about modifications need to occur with the sponsoring agency, the Grants

Management Office is the primary contact in facilitating the request, and the Grants Management

Office will submit the modification request to the sponsor. Any exceptions, such as

modifications on local community foundation grants, companies or organizations, must be

reviewed and approved by Grants Management. It is of vital importance that all parties (SPA,

EDF/EDA or Finance Designee, EDD or designee and PD) are kept apprised of any events

surrounding these modification requests.

A.3. Sponsored Program Accounting (SPA)

A.3.a. Pre-award

The Sponsored Program Accounting office is not directly involved in pre-award activities but is

available as a resource in any capacity during the pre-award stage. Consultations with the Grants

Development and Grants Management Offices on budget issues, federal policies or participation

in grant proposal preparation are available from the Sponsored Program Accounting office on an

as-needed basis.

A.3.b. Post-award

SPA becomes more involved in a grant as soon as it is awarded. Once a grant is awarded to the

College or the Ivy Tech Foundation, and signed copies of the agreement and a fund request form

are forwarded to SPA, the work of preparing the grant account begins. It is imperative that the

grant is set-up to be in compliance with both the agreement and governmental guidance. Within

Banner, SPA ensures the sponsor is established, enters the grant and budget information and

ensures time certifications will be generated when needed. Cost-Sharing information and

Indirect Cost protocol are also established at grant inception, allowing all funds within the grant

to share common characteristics.

SPA is ultimately responsible for the fiscal reporting and billing for all Federal and State

projects. Most have quarterly fiscal reporting and generally these reports are submitted by SPA

separately from the programmatic report submitted by the PD. SPA is also responsible for

account closeout and for working with auditors in audits of sponsored accounts.

SPA is responsible for providing access to tools and training to help Finance staff and PD’s

manage their grants in compliance with Ivy Tech Policies, Federal policies and all other

guidelines. Training will be provided not less than annually updating staff in both project related

roles and fiscal roles of their responsibilities in managing their grants effectively and within legal

boundaries.

A.4. Business Office (EDF/EDA or Finance Designee) & Project Director (PD)

A.4.a. Pre-award

EDF/EDA’s or Finance Designee’s, EDD’s and PD’s are responsible for oversight of the

preparation of the grant proposal packet, including a budget which fully costs out the grant

proposal and acquisition of the signature(s) on the Grant Proposal Approval Form from their

Chancellor or designee, PD and EDF/EDA or designee. PD’s must be thorough as they examine

grant proposal opportunities and evaluate the impact such a proposal may have on other areas of

the College; examples of such areas include Academic Affairs, Information Technology, Student

Affairs and Facilities. PD’s and EDF/EDA or Finance Designee shall not submit proposals

directly to agencies; this responsibility lies with the Grants Management Office. As previously

stated, exceptions to this submission process, such as local community foundations, companies

or other organizations, must be reviewed and jointly approved by Grants Management Office and

the campus.

A.4.b. Post-award

EDF/EDA’s or designee’s and PD’s accept a great deal of responsibility when they accept a

grant from a sponsor. It is the responsibility of the EDF/EDA or Finance Designee and PD to

manage the fiscal and programmatic operations of an active grant. Specifically, the PD is

responsible for submission of program reports, jointly managing the fiscal condition of the grant

with the guidance of the Finance office, and providing evidence of expense allocability to a

grant. The Finance Office is responsible for ensuring that the expenditures being incurred are

reasonable, have evidence of allocability and are allowable to the project. The Finance Office is

available to assist/partner with the PD in preparation of any project revisions (project extensions,

budget modifications, personnel modifications, etc.). Submission of such modifications would

be facilitated through the Grants Management Office, but it is imperative that communication

between the PD, the EDF/EDA or Finance Designee, EDD, SPA and the Grants Management

Office be managed effectively.

B.1 Grant Proposal Background

Grant proposal format is generally dictated by the agency solicitation for a grant proposal. These

solicitations will typically include all the information needed in the grant proposal, including

formats for budgets, timelines and narrative. Most funding agencies will have guidelines for

submission, regardless of the presence of a formal solicitation; the Grants Development Office

and the EDF/EDA or Finance Designee are available to assist in the assembly of all grant

proposals to help ensure compliance with sponsor specific regulations. Many agencies have

strict policies regarding length, font-size or dollar amount. Failure to adhere to these specifics

could quickly eliminate a grant proposal from competitive review.

B.2. Grant Proposal Budget Development

The initiator of a grant proposal and the campus business office are responsible for developing a

grant proposal budget in coordination with the Grants Development Office. All parties share the

responsibility of reviewing the funding agency guidelines to determine allowable costs and

ensure they are both sufficiently budgeted in the required categories. The process will help to

assure the grant or contract’s accountability requirements are addressed, as well as facilitate

required project reporting.

The budget should be clear, precise and realistic in relation to the grant proposal’s

narrative. When preparing budgets, reference Banner account codes which may be obtained

from the EDF/EDA or Finance Designee, the Grants Management Office or SPA. Fringe

Benefits should typically be budgeted following the fringe benefit estimate provided by the

Grants Management Office, unless a more definite rate is expressly used by the responsible

organizational unit. It is the responsibility of the Grants Management Office to provide training

on preparing a budget for a sponsored project.

Cost-Sharing

It is common for sponsors to require matching funds for a grant proposal. Matching funds, or

cost-share, is defined at CFR 200.29 as the portion of project costs not paid by grant funds.

Typically, a specific percentage of effort, cash, or assets promised as a College contribution for

matching purposes, the amount of time spent and/or the dollars expended must be accounted for

and be auditable. Percentage of effort cost-sharing commitments are based on percentage of

effort obligation(s), and are not restricted to a certain dollar amount but instead a percent of

effort for a position over the stated period of time. Dollar amount cost-sharing is reflective of a

need to spend a certain dollar amount in support of the project. Typically, expenses are not line-

item restrictive; however sponsor regulations/guidelines would predicate any interpretation

otherwise. As an example, if only 80% of the grant expended, typically the required cost-sharing

amount would also be proportionally reduced. Memo-Match cost-sharing is a commitment which

cannot be accounted for in the accounting system. Typically, it may include vendor or

subcontractor commitments, equipment usage, space or other tangible items. These will be

certified via a memorandum or form by the Project Director under guidance from SPA.

Each of these commitments, once agreed to in a sponsored award, require tracking to ensure

accountability of the commitment.

Unless there is verbiage from the sponsor that indicates such cost-sharing/matching funds are

highly encouraged or required, it is the expectation that commitments made in grant proposals

will be written to be non-auditable. Non-Auditable cost-sharing is a written means of showing

institutional commitment to a project in a grant proposal without imposing an institutional

burden of making that cost-sharing auditable. This can be done by writing in broad terms and

leaving out specific percentages, figures and amounts. An example of non-auditable cost share

would be stating a portion of a program chair’s time will be spent on the project. Auditable cost-

sharing is that which is verifiable from institutional accounting records or as a condition of the

award. Auditable cost-sharing may include third-party or in-kind contributions which would be

documented via alternate means and would include project director certification. Inclusion of

auditable cost-sharing absent a sponsor mandate requires the approval of the Grants Management

and Sponsored Programs Accounting Offices. An example of auditable cost share would be

stating 10% of the program chair’s time.

It is imperative that grant proposals are routed through the Grants Development Office and

submitted by the Grants Management Office to help ensure auditable cost-sharing is not included

unless necessary or approved. Additionally, cost-sharing committed to in the proposal should not

exceed the amount required by the sponsor; exceptions to this must be approved by Grants

Management Office and SPA. Assistance in modifying cost-sharing to be non-auditable can be

obtained from the Grants Management Office and SPA.

Under CFR 200.306 federal funding agencies are prohibited from considering Voluntary Cost

Sharing (VCS) in the merit review process. Voluntary Cost Sharing is defined as cost-sharing

which is not required by the proposal nor reflected in the final proposal or grant award

notification. It is non-auditable but is tracked for internal purposes and could be used within

sponsor guidelines if budget were available. Involuntary cost-sharing is that which is required

by the sponsor/agency or that which has been committed to in the grant

proposal/award. Involuntary cost-sharing must be accounted for in the same manner as the

sponsor funds. All applicable grant rules apply to involuntary cost-sharing funds. Some

sponsors specifically prohibit the inclusion of VCS and will not fund proposals which include

VCS.

Facilities and Administrative Costs

Facilities and Administrative costs (F&A or IDC {Indirect Cost}) are allowable charges against

grant funds for reimbursement of the College operating costs it incurs in connection with the

operation of a grant. As defined by CFR 200.56, these costs are those that are incurred for

common or joint objectives and therefore cannot be identified readily and specifically with a

particular sponsored project, an instructional activity, or any other institutional activity. They

may include administrative and/or clerical salaries, utilities costs, office supplies, computer

service, photocopies, telephone, etc.

The College uses a negotiated F&A rate approved by the Department of Health and Human

Services (DHHS). Sponsored Programs Accounting is responsible for negotiating of this rate

with the DHHS. The predominate portion of projects/grants should utilize the on campus

rate. The off-campus rate should only be used when more than 50% of the project is performed

off campus (campus equals any building owned/operated by Ivy Tech Community College of

Indiana). Budgeting and collection of Facilities and Administrative Costs (Indirect Costs

{F&A/IDC}) at the maximum allowable amount is required for all sponsored projects. The

current rate can be obtained from the campus business office, SPA, Grants Development or the

Grants Management Offices.

Specific sponsors and agencies may have published/written guidelines that dictate modified F&A

rates/policies. These written exceptions are generally acceptable to be used; formal

documentation should be included in the grant proposal packet. If a campus/project director

wishes to waive the collection of all or a portion of F&A/IDC costs, approval must be secured

from the Associate Vice President of Finance.

Facilities and Administrative (F&A/IDC) cost recovery will be divided between campuses (60%)

and Systems Office (40%). The Systems Office recovery is limited to a cap which is generated

by SPA and demonstrates an approximate cost in managing grants in the Systems Office.

B.3. Submission and Processing of Grant Proposals

B.3.a. Required Approvals

All grant proposals require the Project Director’s or individual initiating the proposal’s,

EDF/EDA’s, Executive Director of Development’s, and the President’s or designee with

signature authority as outlined in the Contract Authorization Section of the FMM (Section

J.III.L). These signatures, proposal due date, and signatures from the departments affected by the

project, Office of Information Technology, Grants Development Office, Grants Management

Office, and if applicable, Foundation Finance will be captured on the Grant Proposal Approval

Form; this is the paper record of the grant proposal information. Additionally, statewide grants

involving multiple campuses must document approval from the campus EDF/EDA or designee

and Executive Director of Development or designee.

B.3.b What and When to Submit

The complete grant proposal must be submitted to the Grants Development Office at least two

weeks prior to the due date to the sponsor. Exceptions to this policy must be approved by both

the Grants Development Office and Grants Management Office. In addition, a copy of the

funding source's regulations, guidelines, the Grant Proposal Approval Form and any other

relevant information also need to be either e-mailed or sent to the Grants Development Office for

review prior to submission.

Failure to submit a proposal to the Grants Development Office by the two week deadline places a

proposal at risk of a submission failure. Due to this, proposals submitted to the Grants

Development Office after the internal deadline will be processed on a first-come, first serve basis

and may only receive a limited review. Every possible attempt will be made to submit the

proposal on time; however, the Grants Development Office in collaboration with the Grants

Management Office will not ensure successful submission of any proposal received after the

internal deadline. The Project Director* assumes any risk for the proposal being rejected

following administrative review by the funding agency.

If a proposal is found to have errors when it is uploaded into an Agency’s grant system it will be

sent back to the campus for correction, time permitting. The campus will be given the

opportunity to correct any identified errors but it will be placed at the end of the submission

queue.

B.3.c Collaborative Review

The campus Development Office, the PD and the EDF/EDA or Finance Designee are all

responsible for reviewing the grant proposal collaboratively before submission to the Grants

Development Office. Decision Support should be utilized, as needed, to obtain accurate

enrollment, labor market, and other data to ensure feasible goals are set within the grant

application. All parties should remain in communication to resolve discrepancies, evaluate

concerns and ensure timely submission of the grant proposal.

After receipt of the final proposal documents from the Grants Development Office, the Grants

Management Office will complete forms such as assurance forms, certification regarding

lobbying, debarment, drug-free workplace certification, non-collusion affidavit, etc. The Grant

Proposal Approval Form and/or the internal sponsored required form (e.g. SF424) will include a

line for the President's signature. The Grants Development Office in collaboration with the

Grants Management Office will acquire the necessary signature(s) beyond those obtained in the

campus(es).

B.3.d. Subrecipient

If the grant proposal being prepared includes a subrecipient, it is mandatory that the

subrecipient’s risk be assessed and documentation received at proposal time or before a

subrecipient agreement is executed (subcontract). This analysis will be accomplished with a

Subrecipient Risk Analysis tool by the Grants Development Office or Sponsored Programs

Accounting during the proposal stage. This assessment will help the College classify and

document the subrecipient as a low, medium or high risk subrecipient. Strong consideration

should be given to proceeding into a subcontractual relationship with a high-risk grantee. For

campus grants, Chancellor or EDF/EDA will determine how to proceed based on the results of

the risk assessment. For Systems Office grants, this decision will be made by the Senior Vice

President and Chief Financial Officer or designee. The results of the risk assessment should be

used by SPA to determine the frequency and scope of subrecipient monitoring. The monitoring

plan should include strategies to mitigate potential risks of non-compliance.

*In the event, a Project Director has not yet been determined, the proposal developer assumes

this risk.

B.3.e. Submission to sponsor

Grant proposals that meet the guidelines of the College, the Ivy Tech Foundation (if applicable),

and the funding source will be forwarded to the President for signature and the Assistant Vice

President for Development for the Ivy Tech Foundation if needed. Upon completion, the Grants

Management Office will submit the grant proposal to the funding source unless an exception has

been jointly approved by the campus and Grants Management Office. This applies to proposals

on behalf of the College and the Foundation.

In the event that a grant award is made for a proposal that did not follow the College’s review

and approval policies outlined above, College leadership with contract signature authority

according to the levels established in Section J of the FMM reserve the right to decline the grant

award.

C.1. Overview

Sponsored program accounts include projects funded by federal, state and local governments,

industry, foundations, societies, universities, and Ivy Tech Foundation funds managed by

Sponsored Program Accounting (SPA). These accounts are restricted in nature and generally

require a fiscal and/or programmatic report be submitted on some regular interval (such as

quarterly). In order to account accurately for sponsored projects individually, each contract or

grant is accounted for in a unique fund/grant. The purpose of the individual accounting is to

fulfill the requirements as stewards of these funds, being able to ensure funds are spent in

accordance with College and sponsor guidelines and being able to provide comprehensive

accounting for all aspects of a sponsored agreement.

Management of a sponsored account is a joint task between the campuses and Systems

Office. The process begins when a campus is notified of an award. An agreement/contract is

signed by the appropriate party as outlined in the Purchasing, Section J of the FMM and the

campus notifies SPA of the grant via a Sponsored Program Fund Request Form. SPA will then

establish a Grant in the Banner system and any related funds, including cost-share funds. SPA

will notify the PD, EDF/EDA or Finance Designee and Grants Management Office of the new

accounts and include a copy of the new Grant Award Notification, indicating basic grant details

such as invoicing detail, and grant type.

Once a grant and related funds are established, PD’s and EDF/EDA’s or Finance Designee’s take

over primary responsibility for managing the grant in line with sponsor and College

policies. Expenditures must be in line with policy and Finance staff must keep back up

documentation in the account file. Depending on the specifications laid out on the GAN, campus

or Systems Office staff will report fiscally on the project to the sponsor in their stated

format. PD’s will prepare and submit programmatic reports and copy the EDF/EDA or Finance

Designee on submissions. It is the expectation that these reports be shared with both SPA and

the Grants Management Office.

During the life of a project, accounts shall be managed with a proactive sense of

accountability. At least monthly, accounts should be analyzed to discover any issues or

concerns. Such items may include: accounts expiring soon, accounts in overdraft, accounts with

no expenses, questionable transactions and expired accounts with balances or activity. As the

grant closeout approaches, all parties should be in communication to ensure deadlines are being

met and no modifications will be needed.

Grant closeout is not more than 90 days after a project has expired, but some sponsors require

close out in as little as 30 days. Failure to have expenses posted and received could result in

disallowance of those expenditures. The closeout procedure is typically managed by SPA but

will require participation of all involved parties. Upon completion and closeout of a sponsored

project, documents shall be retained in line with the document management guidelines outlined

in this section E.4.h.

C.2. Grants awarded to the Ivy Tech Foundation (ITF)

By the nature of the relationship with the Foundation and many foundations require applications

to be made from 501 (c)(3) organizations, many times grants will be awarded directly to the Ivy

Tech Foundation. However, these grants should still be managed, as they should have been

submitted, by the College staff. The management of a grant in a sponsored program account

allows the College a great deal more resources in managing the grant. The College’s financial

systems have triggers for reports, deadlines, project periods, and are linked to the payroll and

purchasing systems. These advantages combined with the ability to report on all grant

expenditures and submissions from one definitive source are imperative as the College continues

in its environment of accountability. Grants awarded to the Foundation will be invoiced by SPA

to Ivy Tech Foundation and Ivy Tech Foundation will still work to obtain sponsor payments

directly. This process is ultimately invisible to the sponsor.

C.3. Account Management

C.3.a. Managing a Grant

Account Management is the binding concept in effective grant management. It consists of steps

related to Account Maintenance, Transaction Management, Document Management, Cash

Management and Closeout Management.

C.3.b. Signatures

The Grant agreement should be signed in accordance with the Purchasing, Section J of the FMM.

Should a contract require the signature of the President or Senior Vice President and CFO, please

contact Grants Management to obtain signature. Signed original contracts should be sent to SPA

for filing in the central project file. Documentation of the designees must be maintained and

kept up to date in the office of the EDF/EDA.

C.4. Account Maintenance

C.4.a. Establishing a New Grant

The PD, EDF/EDA or Finance Designee, or Development representative will typically receive a

signed copy of the agreement with the sponsoring agency. This signed agreement is the result of

a grant proposal which was submitted via the Grants Management Office. The signed

agreement is utilized to complete the sponsored program fund request form by the EDF/EDA or

their designee. This form will provide SPA the summary details they will need to establish the

grant in Banner. In conjunction with the signed agreement, and a budget matching the award, a

new grant can be established and ready to be used. If the budget in the award is modified from

the grant proposal or a detailed budget was not included, the EDF/EDA or Finance Designee, PD

and Grants Management Office should work together to develop a detailed budget by Banner

account code.

Sponsored Program Fund Request Form (SPFR)

The Sponsored Program Fund Request Form should be completed by the EDF/EDA or their

designee. Details on the SPFR will be maintained in Banner; it is important that careful attention

to detail is maintained on this form. The SPFR Form should be filled out as completely as

possible, including the Org Code and Program Code. Please contact SPA for assistance with or

questions regarding this form.

In many cases, multiple funds will be needed for any specific grant. It is not necessary to

complete a separate SPFR for each fund, but it is mandatory that an attachment be included with

the detail of all funds needed (Name, Purpose, Org Code [if different]). If the grant has been

awarded to the Ivy Tech Foundation, it is important that the foundation account number be

included on the Sponsored Program Fund Request Form.

Grant Establishment in Banner

Once SPA receives the SPFR, the budget, and the signed agreement, they will enter the relevant

grant information in FRAGRNT (Banner) and derive all of the related funds. It is the

expectation that SPA will established grants for usage within two business days of receipt of the

appropriate materials. Grant proposals submitted through the Grants Management Office can be

converted in the financial system into grants, bringing relevant information along with it into the

Research Accounting module of Banner, reducing the timeline for grant establishment.

The start and end date must coincide with the agreement for which the grant is being

established. The Termination Date drives the deadline for all entries on grants to be completed;

typically it is 90 days/three months out from the end date of the grant. The Expenditure End

Date is a future date not to be encountered within any specific ‘Active’ grant. It is 10 years past

the Termination Date. It is the expectation that all grants will be closed out and completed well

before the Expenditure End Date.

The effective date is the date the account is being established or a change being made. It is not

possible to have a transaction on a date prior to the effective date, and the effective date cannot

be changed to a date which has passed on existing funds.

Once a Grant and all relevant Sponsored Program Funds have been established, the SPA office

will complete a GAN (Grant Award Notification) Form notifying each EDF/EDA or Finance

Designee, PD and the Grants Management Office of the specifics of that award/fund for

consistent reference between parties. This GAN will be updated and redistributed if changes

occur to the original award that is not captured in Request for Grant Modifications.

Cost-Sharing Account(s)

When cost-sharing exists the amount of time spent and/or the dollars expended on the grant must

be accounted for and be auditable. This will be managed via establishment of a ‘C’ fund

connected to the restricted grant and based within the campus operational budget line. C funds

will be established by the Office of Sponsored Programs Accounting, under direction from

campuses via a submission of a Sponsored Program Request Form.

External third party or in-kind contributions require no College cash outlay and are generally

discouraged as a means of meeting sponsor requirements for auditable cost share. However, if

they are to satisfy matching requirements, they must be verifiable from the records maintained

by the grant recipient. Sponsored Programs Accounting must approve forms or other

documentation used to capture third party or in-kind contributions.

All matching documentation required by a grant, contract or agreement must be maintained in

each respective campus business office and be available for audit examination. It is imperative

that all matching accounting records are maintained with the same level of detail as

sponsored/restricted funds. Guidelines on expended cost-share/match dollars are identical to the

grant which it is being expended upon. Cost-sharing/matching accounts are an extension of the

grant award. Funds must be spent in accordance with sponsor guidelines and unspent funds will

impact the project budget and likely the available sponsor dollars. Failure to meet matching

obligations may result in a reduction of funding and overages become the responsibility of the

campus.

Project Folders

Physically establishing a project folder is an important task. Files must be maintained to keep

documentation on grant correspondence, transaction information, award notifications, award

modifications, and other project related information.

Meeting with Project Director

When a campus receives a new grant, one of the most valuable activities that can occur is a

meeting between the finance staff and the Project Director for the new grant. The new Project

Director may have many questions or concerns about policies and procedures and it will be

important for the EDF/EDA or their designee to make contact to start the fiscal life of the grant

off quickly and accurately.

Topics could include:

Payroll Distribution Changes

Budget Review

Reporting Review

Ordering process review

PD Training from SPA

Timeliness of purchases

Sponsor specific guidance

C.4.b. Modifying a Grant

When a grant modification is received by the office of the EDF/EDA or Finance Designee, the

PD , the EDD, or the SPA Office, it shall be shared with all the parties who reviewed/approved

the initial proposal. It is the responsibility of SPA to modify the electronic records and maintain

a copy of the approved modification in the Systems Office grant file.

Prior Approval Grant Modifications

PD and Finance staff should partner together to prepare sponsored project prior approval

amendments in line with sponsor expectations regarding format and signature. Prior Approval is

functionally defined as the written permission of an authorized official (typically

sponsor/agency) prior to the incidence of an action on a grant that would result in a need for

amendment to an existing grant/contract. Common examples include: extension of project

period, budget modification, purchase of non-budgeted capital equipment. The Grants

Management Office is the Systems Office resource responsible for providing guidance and

submitting requests which do not flow through the PD or Development Office. Additionally,

proposed modifications should be shared with campus Development Offices to ensure

stewardship of the relationship.

Requests should be completed at least 45 days in advance of the effective date or ‘need.’ Once

sponsor approval is obtained, the College’s Request for Grant Modification Form (RGM) must

be completed and signed by the Project Director and EDF/EDA or Finance Designee. The RGM

form and a copy of the sponsor approval must be sent to the Grants Management Office and SPA

within a timely manner. This ensures allowable/authorized project adjustments can be made

within the official financial records of the College during the effective funding period of the

project.

Monthly monitoring of grants will allow Finance staff and PD’s to forecast their immediate

needs for any budget modifications/revisions. Typically the budget revision will be prepared in

line with the original grant submission guidelines showing the changes and documenting the

justification for the changes in writing. It is important to note that typically a budget revision

should not impact the project scope or outcome. Should it do so, it must be adequately

documented for sponsor approval.

Expanded Authority

Certain sponsors and agreements have delegated expanded authority to the sponsoring

institution. This authority provides the institution the ability to make some grant modifications

without seeking approval from the sponsor. Instances which have been delegated are outlined

below and approval must be garnered from SPA, requests must be submitted to SPA not less

than 45 days in advance of end date or ‘need.’ SPA or the Grants Management Office should be

contacted by the PD or EDF/EDA or their designee to initiate changes whose authority has been

delegated. Any contract/agreement specifics would supersede those guidelines listed below.

Definitions of processes delegated Expanded Authority (require at minimum SPA

Approval)

Budget Line-Item Modification – Re-budgeting within direct costs to accomplish the

project objectives without a request for additional funds

90 Day Pre-award – Authority to incur costs up to 90 days prior to a grant start date. In

order to incur costs prior to the start date, the costs must be imperative to the success of

the project. Should the project not be received for any reason, the campus shall be

responsible for any pre-award expenditure made.

Single No-Cost Extension from original end date - extension of project period to meet

project deliverables. SPA and/or Grants Management must notify sponsor 30 days before

end date. Must be to request additional time to accomplish project objectives or phase out

a project which is ending. A remaining grant balance is not a justification for an

extension.

Agencies with expanded authority – authority varies by sponsor, work with Grants

Management Office or SPA for guidance

ONR – Office of Naval Research (except no-cost extensions)

NASA – National Aeronautics and Space Administration

NSF – National Science Foundation

USDA/CSREES – Cooperative State Research Education and Extension Service

US-Ed – US Dept of Education

NIH/PHS – National Institutes of Health/Public Health Service

NOAA – Nat’l Oceanic & Atmospheric Administration

DOE – US Dept of Energy

EPA – Environmental Protection Agency

ARO – Army Research Office

AFOSR – Air Force Office of Scientific Research

EDA – Economic Development Agency

C.4.c Subcontracting and subrecipient monitoring

The determination for whether each agreement the College is making on an active award casts

the receiving party into a subrecipient role or a contractor role lies with Ivy Tech Community

College. This determination will be made by SPA, with consultation by all involved parties,

based on the available knowledge of the relationship and any additional guidance given by the

awarding agency.

At the time of proposal or when a subrecipient agreement is drafted, an assessment of the risk

that subrecipient poses should be completed using a Subrecipient Risk Analysis Tool developed

by SPA. This assessment will help define the necessary monitoring for this particular subaward.

When establishing a subcontractual relationship – the agreement must contain the following data

elements in addition to the standard terms being flowed from the prime, statement of

work, budget, payment terms, invoice terms, closeout terms, at minimum the following data

elements( 200.331):

Subrecipient Name and DUNS Number – these must match

Federal Award Identification Number (FAIN) (if applicable)

Federal Award Date

Subaward Period of Performance Start and End Date

Amount of Federal Funds Obligated by this action

Total Amount of Federal Funds Obligated to the Subrecipient

Total Amount of the Federal Award

Federal Project Description

Name of Federal Awarding Agency, Pass-through entity and contact information for

awarding Official

CFDA Number and Name

Identification of whether the award is R&D

Indirect Cost Rate for the Federal Award

A template for a subcontract is available from SPA and Grants Management Office. Fixed

amount subawards may not pass the Simplified Acquisition Threshold. Indirect costs for

subrecipients who have an approved federally negotiated rate must be included at that

agreement/budget/proposal. If the subrecipient does not have a federally negotiated F&A rate,

they are required to use a de minimis F&A rate, except when the subrecipient is able to allocate

and charge 100% of its costs directly.

Responsibility for monitoring the subagreements is managed by SPA but takes the joint effort of

all the involved parties. Ivy Tech Community College is responsible for monitoring the

programmatic and financial activities of its subrecipients in order to ensure proper stewardship of

sponsor funds. In addition to ensuring the subrecipient makes progress in achieving performance

goals, the College must also confirm that subrecipients are complying with Federal laws and

regulations as well as any additional provisions of the specific agreement. This subrecipient

monitoring policy applies to all subawards issued under sponsored programs without regard to

the primary source of the funding. A subrecipient monitoring plan will be established for each

subcontract based partially on the results of the Subrecipient Risk Assessment. Frequent

communication between the project director, SPA, Grants Management Office and the campus

finance staff is essential to ensure effective management and compliance. At minimum, as

defined by CFR 200.331.d the subrecipient will have required financial and programmatic

reports reviewed by program and financial staff, invoices reviewed for relevant progress and

approved by the project director, prompt follow-up on any deficiencies, and management

decisions delivered by Ivy Tech on any audit findings pertaining to the award provided to the

subrecipient from the pass-through entity (200.521). Additional measures for higher risk

subrecipients could include but are not limited to providing training, performing on-site reviews,

more frequent invoicing, and additional reporting measures.

C.5. Transaction Management

It is the responsibility of the site PD and EDF/EDA to assure that all expenditures charged to

sponsored agreements are appropriate, allowable, reasonable, allocable and in accordance with

all applicable federal and state laws and regulations.

Each purchase should be reviewed by the project director (academic) approval and appropriate

fiscal authorization. Project Directors can delegate their authority for approval to other staff in

the eProcurement system via their EDF/EDA or their designees.

C.5.a. Procurement

It is mandatory that purchases on a grant account follow not only the College purchasing

policies, but also the particular terms of the agreement (including flow down clauses). Many

sponsors have specific restrictions on items such as the purchase of equipment and computers.

Consult the grant agreement, SPA or the Grants Management Office for assistance in identifying

sponsor specific purchasing protocol.

Goods must be purchased, and received within the project period to be of benefit to the

grant. Timing of purchases should be scrutinized. It may be difficult to justify an expense for

furniture in the final months of a grant. However, if the grant’s purpose was to prepare a

classroom for students, the expense could likely be justified. The bottom line is that the goods

received must benefit the project during the project.

Another important aspect of payroll management in respect to grants is in regards to the start

and end dates of grants. It is important to start faculty/staff on a grant as soon as the grant is

established. A delay in setting up payroll could cause issues to pay periods which have passed,

or those which have been certified. Conversely, when a grant is ending it is important to be

proactive in moving faculty/staff off of a grant and onto another source of funding. Failure to

move faculty/staff off of grants could result in a need to process payroll redistribution, impede

the grant closing process and affect future funding.

C.5.b. Allowable Sponsored Project Expenses

In order for a cost to be charged to a sponsored project, it must be allowable. There are 4

principles outlined in the 2 CFR 200 Uniform Guidance which describe the considerations

affecting allowability of costs. The expense must be reasonable, allocable to the project,

consistently treated and allowable within the parameters of College and sponsor guidelines.

Reasonableness

Is the price of the item and the quantity appropriate given the unique circumstances of the

grant/purchase occurring at the time expense is being incurred? Would a reasonable person view

the expense as in line with expectations?

Allocability

Does the expense benefit the project? Is it necessary to conduct the work of the project? Is it

easily tied to the specific project?

Consistent Treatment

Regardless of the source of funding, is the expense being handled in a similar fashion across the

College? It is not appropriate to have a surcharge for expenses on grants or separate allowances

approving purchases on grants which may not be allowable on College operation funds.

Allowable

The expense is not expressly forbidden in the sponsor guidelines, government regulations, or the

contract/grant requirements.

C.5.c. Unallowable Sponsored Project Expenses

In accordance with OMB CFR 200.407, the following costs should not be borne on federal

grants. It is the policy of the College that when the allowability of expenditures is being

considered all grants be treated as federal grants unless award documentation or sponsor

approval would indicate otherwise. In any case, should an approved award explicitly state that

such expenses are allowable, then that would supersede the OMB guidance.

Examples of Unallowable Expenses

Advertising and Public Relations

Alcohol

Alumni Activities

Bad Debts

Charitable Donations

Entertainment

Fines and Penalties

First Class or other Non-Coach Travel

Fund Raising and Investment Management Costs

Goods or Services for Personal Use

Insurance and Indemnification

Memberships, Subscriptions and Professional Activity

C.5.d. Unlike Circumstances

In some instances it may be appropriate to charge an ‘unallowable’ expense or an expense which

is typically considered an indirect cost to a sponsored project. This should be documented via an

Unlike Circumstances form which has been reviewed and approved by Sponsored Program

Accounting. This approval will be maintained in the project file and referenced on purchases or

journal entries for relevant expenses. These costs must:

Be specifically identifiable with the objectives of the project with relative ease and a high

degree of accuracy

Be relatively extensive – (fairly significant dollar amounts)

Be included in the grant proposal budget, justification, project narrative, or approved

separately by the sponsor

Be justified adequately on the documentation for such charges

C.5.e. Payroll and Time and Effort Certification

Payroll maintenance is one of the most important parts of grant management. Not only is payroll

the base of the College’s indirect cost rate, it is also the item that makes up the bulk of a

College’s expenses. Therefore, it has a significant impact if it isn’t managed appropriately.

Effort certification is detailed below, but in summary, on Federal Grants, Federal pass-through

and Perkins funds (at minimum) the College requires staff paid on grant funds to have their effort

certified after the fact via signature of their supervisor or project director/staff member with first-

hand knowledge of the work being completed on the project at the conclusion of each pay period

on the Time and Effort Certification Report. This certification indicates that the supervisor

verifies the staff member did in fact spend the allocated amount of time on the grant

(approximated over a longer length of time). Once certified, it is difficult to explain how a staff

member was certified to a grant, but later is being moved off that grant or onto another.

Any employee who receives compensation for personnel services, either in full, or partially from

a grant, contract or agreement directly or indirectly funded (federal pass through) by the federal

government must have his/her effort certified on a ‘Time and Effort Cert Report.’ This includes

employees receiving compensation for personal services which are funded as cost-sharing on a

directly or indirectly funded federal project.

Compensation for personnel services covers all amounts paid currently or accrued by the

institution for services of employees rendered during the period of performance under sponsored

agreements. Such amounts include salaries, wages, and fringe benefits. These costs are allowable

to the extent that the total compensation to individual employees conforms to the established

policies of the institution, consistently applied, and provided that the charges are for work

performed directly on sponsored agreements and for other work allocable as indirect costs are

determined and supported, or for maintenance of effort purposes.

General Requirements

After-the-fact Activity Records have been adopted by the College as the method used to support

the time and effort reporting requirement. The report will reflect an after-the-fact reporting of

the percentage distribution of an employee’s activity on a sponsored project. Charges are made

initially on the basis of estimates made before the services are performed. Activity reports,

completed by the Project Director, will reflect an after-the-fact reporting of the actual percentage

distribution of activity of employees. If significant (>5%) differences between the charges and

actual distribution, the charges must be promptly adjusted to reflect actual activity. Short-term,

such as one or two month fluctuations between workload categories, need not be considered as

long as the distribution of salaries and wages is reasonable over the longer term (e.g. 120

days). To confirm that the distribution of activity represents a reasonable estimate during the

period, the College has determined that the employee's supervisor or staff member/project

director with firsthand knowledge will be required to sign and verify the time and effort

certification report and activity reports must be completed and signed by the Project Director.

The Banner Payroll System will generate a Time Certification Report which will be distributed

to the appropriate personnel every payroll under the direction of the EDF/EDA. This report is to

be verified and returned to the business office prior to the employee's next payroll. It is the

business office's responsibility to assure that all of the Time Certification reports have been

certified and returned. This responsibility in the Systems Office lies with the Payroll Manager.

Once the Time Certification report is received by the Finance Office, a review for required

changes to the labor and/or benefit account distribution must occur. If a change in account

distribution is necessary, the business office will prepare and process payroll redistribution

(PHAREDS). A copy of the completed Time Certification report is to be attached as backup to

the payroll redistribution. The redistribution should be processed no later than 90 days after the

payroll has been processed. If a grant or contract is ending, immediate processing may be

necessary to include the changes in the final fiscal report. Otherwise the funds may not be

reimbursed and, therefore, the campus Operations Fund would be charged. If the account

distribution is a permanent change, the Human Resources Department must be notified to update

the labor distribution on the employee’s position in Banner.

Once a Time Certification report is certified it should not be changed. Any changes would

require documentation and explanation relating to the nature of the incorrect certification and

propriety of any changes. Moving charges/salary off of a grant does still require review, and

documentation should be included regarding the reasoning. The PHAREDS must be attached to

the approved Time and Effort Certification which showed the change or a new Time and Effort

Certification must be manually generated by the EDF/EDA or their designee. This time

certification must include the time and effort certification statement and be routed for approval to

the appropriate staff.

The Time Certification Report will be incorporated into the official records of the institution. It

will reasonably reflect the activity for which the employee is compensated by the institution and

it will encompass both sponsored and all other activities on an integrated basis.

Background/Process Requirements

One Time Certification will be generated per employee paid on funds requiring certification.

Time Certification reports are generated for employees who are paid on grants which are labeled

as Federal, Non-Federal Pass-Through, and Subcontract Pass-Through in FRAGRNT. If a

faculty or staff member is removed from a Federal, Non-Federal Pass-Through or Subcontract

Pass-Through, Human Resources and Payroll should be notified.

C.5.f.Correcting Documents

Ideally, the College would operate in a fiscal environment free of correcting documents. The

reality of the matter is that it is not feasible to expect to have no correcting documents, however,

it is the expectation that the use of a correcting document should be minimized as much as

possible, and should never be the norm for handling transactions. If the campus has a process

which requires frequent correcting documents be processed, please contact SPA to evaluate the

effectiveness of the process and determine if alternate methodology could be instituted to post

charges correctly initially.

Correcting documents are a primary focus of concern when agencies conduct audits. The more

transactions are being shifted onto or from sponsored project accounts after the initial entries

raise the level of an agency’s concern. Frequent, late, unexplained or poorly explained cost-

transfers or corrections raise serious questions about the appropriateness of those adjustments as

well as focus on the overall reliability of the College’s accounting systems and internal

controls. These speculations are only heightened when the grant in question is in overdraft or

has a remaining balance.

The timeliness of entries is also a point of contention. It is difficult to justify correction of any

charges greater than 90 days after the month-end in which the entry posted. It is the expectation

that any corrections that are needed are made promptly, within the month following the closing

month where the error occurred. All journal entries for charges which are greater than 90 days

after the month-end close of their posting will require justification for the lateness of the

correction. Failure to include such a justification will result in disallowance of the charge on the

grant.

College procedures for correcting documents involving grants are established in accordance

with federal accountability requirements contained in the Office of Management Budget (OMB

CFR 200 Subpart E) “Cost Principles.” Entries which are disallowed on grants will be

transferred to campus operating funds in coordination with the campus EDF/EDA or their

designee.

Cost-Transfers on Sponsored Projects

This guideline is being issued to ensure the integrity of the College’s charging practices for

sponsored program accounts after it had been charged elsewhere in the College’s accounting

system and to ensure compliance with sponsor terms and conditions, regulations and College

policies.

When cost transfers to move expenses involve sponsored project accounts, it is critical that the

transfer meet the requirements for allowability, allocability, reasonableness, and consistency that

are addressed in this financial management manual in line with CFR 200 Subpart E.

It is noted that all sponsors could view frequent and/or late cost transfers and those which are

inadequately documented or poorly explained as indicative of poor fiscal or project

monitoring. Diligent review of financial records and timely communication between EDF/EDA

or Finance Designees, PD’s, and SPA should prevent the necessity of transfers; however, under

certain circumstances they may be appropriate.

The College is committed to ensuring that all cost-transfers are legitimate and conducted in

accordance with sponsor terms and conditions, regulations and College policy.

Any transfers MUST be supported by documentation which contains a full explanation of the

error, why it occurred and evidence of the appropriateness of the expense/entry to the account

being impacted.

Cost Transfers should not be viewed or utilized as a tool to manage awards – they are a means

for correction. Journal entries for reconciliation of credit card expenses and allocation of

photocopying and postage charges are not recognized as cost-transfers (NOTE: photocopying

and postage are typically F&A/IDC and if charged to grants require an Unlike Circumstances

Form).

Cost Transfers should be prepared as soon as the need is identified. If the College is aware of an

inappropriate charge on a sponsored account, it should be removed expeditiously. Charges in

excess of 90 days cannot be moved to a grant without justification for the tardiness of the entry.

PD’s and EDF/EDA’s share a dual responsibility for quick and accurate preparation and

documentation for cost-transfers.

Journal Entries

When it is determined that a Journal Entry should be prepared to correct a charge to a sponsored

project, it is imperative that appropriate documentation be included with the correction.

Back-up documentation consists of evidence of the inappropriate charge and the reason the

inappropriate charge occurred. This documentation must be able to establish the allocability of

the charge to the project.

Entries posting charges to a grant must include certification of the project director or another

with first-hand knowledge of the transaction.

The journal entry will require a written justification explaining the correction. This explanation

can be put in the ‘Document Text’ field or attached as a separate document. The justification

should clearly explain to an auditor who picks up the file in 5 years why the correction was

needed. Explain why and how the error occurred, why the entry appropriately corrects the

problem, and any steps taken to avoid the error reoccurring.

The written justification should include:

Original Transaction Information (Doc #, Date, Entry Type)

Explanation for how and why error occurred

Explanation of proper project allocability

Justification for late correction (if necessary)

Payroll Redistribution

When payroll redistribution must occur, it is mandatory that the payroll redistribution be backed

up with the certification by the project director that the charges are correct. The payroll

redistribution does not route through SPA for approval, so it is important that all communication

regarding the change and copy of the document are maintained in the Finance project file.

The entries to redistribute payroll must be done on a timely basis. Entries greater than 90 days

after the payroll date are considered questionable and must include justification of the propriety

of the correction.

Any entry to change payroll which had been previously certified to another grant is highly

suspect and documentation should be carefully maintained to explain why effort had been

certified on an alternate project. Documentation should also be maintained which shows

evidence of an attempt to correct the error which caused the improper certification.

C.5.g. Document Management

Subject to any additional requirements from Ivy Tech Community College’s Document retention

policy (detailed in Section D of the Financial Management Manual), it is the policy of Ivy

Tech to maintain files for 5 years after the end date of the project, this is not to be less than 3

years after the date of submission of the final expenditure report. Federal requirements regarding

sponsored programs record retention will be followed, these are enumerated below.

CFR 200.333 outlines the record retention requirements as well as the access guidelines for

universities, hospitals and other not-for-profits receiving grants from the federal

government. Subpart C.53 (b) states:

Financial records, supporting documents, statistical records, and all other College records

pertinent to a Federal award must be retained for a period of three years from the date of

submission of the final expenditure report or, for Federal awards that are renewed quarterly or

annually, from the date of the submission of the quarterly or annual financial report, respectively,

as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient.

Federal awarding agencies and pass-through entities must not impose any other record retention

requirements upon the College. The only exceptions are the following:

(a) If any litigation, claim, or audit is started before the expiration of the 3-year period, the

records must be retained until all litigation, claims, or audit findings involving the records have

been resolved and final action taken.

(b) When the College is notified in writing by the Federal awarding agency, cognizant agency for

audit, oversight agency for audit, cognizant agency for indirect costs, or pass-through entity to

extend the retention period.

(c) Records for real property and equipment acquired with Federal funds must be retained for 3

years after final disposition.

(d) When records are transferred to or maintained by the Federal awarding agency or pass-

through entity, the 3-year retention requirement is not applicable to the College.

(e) Records for program income transactions after the period of performance. In some cases,

recipients must report program income after the period of performance. Where there is such a

requirement, the retention period for the records pertaining to the earning of the program income

starts from the end of the College’s fiscal year in which the program income is earned.

(f) Indirect cost rate proposals and cost allocations plans. This paragraph applies to the following

types of documents and their supporting records: indirect cost rate computations or proposals,

cost allocation plans, and any similar accounting computations of the rate at which a particular

group of costs is chargeable (such as computer usage chargeback rates or composite fringe

benefit rates).

(1) If submitted for negotiation. If the proposal, plan, or other computation is required to be

submitted to the Federal government (or to the pass-through entity) to form the basis for

negotiation of the rate, then the 3-year retention period for its supporting records starts from the

date of such submission.

(2) If not submitted for negotiation. If the proposal, plan, or other computation is not required to

be submitted to the Federal government (or to the pass-through entity) for negotiation purposes,

then the 3-year retention period for the proposal, plan, or computation and its supporting

records.

C.5.h. Campus Risk Backed Accounts

In rare instances, a campus will desire to have a grant established within Banner prior to all of

the paperwork being fully executed and received. In these instances, the campus may request the

grant be established while bearing all risk for any expenses which may come to be unallowable

on the grant. The EDF/EDA must acknowledge acceptance of the risk and grants must be fully

executed within 90 days. After 90 days, absent approval from SPA, expenses will need to be

shifted back to the campus. In limited instances when perceived risk is minimal or operations

may suffer due to a delayed grant agreement, Systems Office may also proceed with a risk

backed account establishment. These Systems Office Risk Backed accounts require the approval

of the Senior Vice President and CFO.

C.6. Cash Management

Cash for Ivy Tech sponsored projects is typically managed on a reimbursement basis. Sponsored

Programs cash is managed at the individual fund level.

C.6.a. Billing/Invoicing

All grant invoicing is handled by SPA. Based on the grant agreement, invoices may be

submitted monthly or quarterly. There is an exception if there are no expenses on a grant during

the quarter.

Cash and checks are deposited into a holding fund prior to being reconciled to the appropriate

restricted fund. Wires/ACH may be directly reconciled into the restricted fund. If a region

receives a check it should be deposited into their holding fund (R99999) and SPA needs to be

notified.

C.6.b. Cash Reconciliation

Cash Receipts should be reconciled not less than quarterly to ensure the amounts reconciled into

the restricted funds are consistent with the amounts billed/invoiced to the agencies. Typically

and more appropriately, cash should be reconciled at each billing.

C.7. Monthly Expectations

C.7.a. Overdrafts

Management reporting is available for all staff to review their campus management overdrafts.

SPA will contact campus EDF/EDA or Finance Designee on overdrafts to investigate steps

underway to correct overdrafts.

C.7.b. Accounts Receivable

Systems Office should maintain a list of invoices/bills and their ‘age.’ The Business Office

should contact the agency at 30, 60 and 90 days to request payment. Duplicate invoices can be

generated. At 120 days delinquent, the Executive Director of Finance and the Executive Director

of SPA should be notified to investigate and recommend appropriate action. These reviews

should occur at each billing and not less than monthly to maintain up to date accounts receivable

records.

C.7.c. Expired Projects/Closing Accounts

EDF/EDA and PD staff are responsible for the review and preparation in advance of projects

which are expiring. Accounts expiring in 30, 60, and 90 days are included on the monthly

account management reports and should be reviewed and discussed with the Project Director to

ensure spending and project goals are being met. Prepare in advance for any prior approval

modification requests which will be needed and ensure the account is ready to be closed after the

project period end-date. Accounts should be reviewed not less than monthly to evaluate expired

and expiring projects.

C.7.d. Transactions on Inactive/Closed Accounts

Lists of transactions which occurred on expired or expiring accounts are included in the monthly

management report. These transactions should be reviewed to ensure they are appropriate. This

is a good way to help ensure salaries are not charged to a closed or inactive project, which might

occur if salary distribution was not updated at project closeout.

C.7.e. Cash Deficit

Accounts whose cash balance is in deficit should be reviewed not less than monthly. Provided a

billing has been generated and the billing is equivalent to the overdraft at the prior month-end, no

immediate action is required. SPA should develop a plan of action and communicate with the

sponsor. A management report is available for consistent review of accounts in cash deficit.

C.7.f. Questionable Transaction Listing

A listing of ‘questionable’ transactions is also included. This listing is based on a selection of

account codes which may be typically unallowable, typically indirect or may require prior

approval. These transactions should be reviewed by the EDF/EDA or their designee (business

office) monthly to ensure no follow-up action is required; removing the charge, obtaining

sponsor approval, completing an unlike circumstance form. If the charge is an allowable direct

expense no action is required. Expenses for items such as food, professional development,

memberships, promotion, advertisement and recruitment may be indicative of an improper usage

of funds. A sample list of unallowable expenses is located in the transaction management

section of this manual.

Expenses which are deemed inappropriate for the grant account should be removed to College

funds via journal entry as soon as determination is made. In cases of uncertainty, err on the side

of conservative thought and remove the charge from the grant.

C.8. Annual Expectations

C.8.a. Management Outline

The Executive Director of SPA and the office of the EDF/EDA should maintain an active and

open dialogue to discuss active grants in the campus, training needs and address any other

concerns relating to grants.

SPA and the Grants Management Office should maintain updated training materials for delivery

to new staff with Grant responsibilities or refreshers for existing staff.

New Project Directors have training opportunities made available from SPA and the Grants

Management Office to help familiarize themselves with grant management expectations and

federal guidelines which will dictate their account management responsibilities.

C.8.b. Year End

At year-end, closing entries are made to record Accounts Receivable and apply Deferred

Revenues (if applicable) as of June 30th for all Sponsored Program Funds. Those A/R are

reduced when cash is received and remaining deferred revenues are reduced when the

expenditures are reported.

Ongoing sponsored programs are carried forward automatically by reflecting 6/30 budget

balances.

C.8.c. Conflict of Interest Management

Ivy Tech maintains a rigorous conflict of interest (COI) policy in the employee

handbook. Section 200.112 of the Uniform Guidance requires the College to take the COI policy

two steps further for staff engaged as a project director or key personnel on a federal

award. Sponsored Program Accounting will proactively seek conflicts of interest by requesting

Conflict of Interest Disclosure Forms (COIDF) by project directors and key personnel not less

than annually who are engaged in Direct Federal Awards and any pass-through federal

awards. SPA will send out annual certification forms and maintain a log ensuring all are

returned. A centralized record will be maintained in SPA of COIDF’s. If a conflict of interest

does exist, it will be forwarded to the standard review and mediation practice. Once the conflict

of interest is addressed, these conflicts of interest and their circumstances and solutions must be

disclosed to the respective federal agency or awarding agency of pass-through dollars.

C.9. Closeout Expectations

C.9.a. PD/EDF/EDA

Office of EDF/EDA shall have grants ready to close not more than 15 days after the project

expired, with the exception of sponsors (e.g. Department of Workforce Development 10 days)

who require final fiscal reports earlier. This includes reviewing charges, clearing overdrafts,

moving post-period charges and other actions as appropriate.

Project ending should be discussed with PD at 30, 60, 90 days remaining to ensure all aspects

were being brought to a successful close.

C.9.b. SPA

SPA is responsible for submission of final fiscal reports and closeout materials to

sponsors/agencies. SPA will work with campuses to acquire signatures on documents needing

campus certification, equipment inventories, etc.

SPA will invoice/report with what is anticipated to be the most reasonable expectation of final

invoices and failure to have accounts prepared for close could result in disallowance of some

expenses which hadn’t been posted or corrected within the 90 day time frame (or less depending

on sponsor regulations).

Account Closeout shall be completed with a complete reconciliation of the account and

cash. The project shall be closed in Banner and the file shall be inspected to ensure award

amendments and important sponsor correspondences are maintained.

D. Published Guidance

In addition to noted special terms and conditions or referenced regulations and state or federal

laws, the following items (not to be considered totally inclusive) may be applicable to a

particular grant or contract depending on the funding source:

Education Department General Administrative Regulations (EDGAR)

Department of Labor Titles 20, 29, and 41 of the Code of Federal Regulations

Job Training Partnership Act and Implementing Regulations

State of Indiana Management and Cost Principles for Administering Job Training

Programs Under the Job Training Partnership Act

Notice of 2/28/80 Updated Listing of Federal Agencies Responsible for Approval of Cost

Allocation Plans and Other Cost Proposals of State and Local Governments (pages A-

87:8 through A-87:20)

OMB 2 CFR Chapter 1, Chapter II, Part 200, et al.

SECTION M: FINANCIAL DOCUMENTS

I. Overview

Financial Documents are the official forms for the College, used to support financial

transactions, and are used on a College-wide basis. Once a form has been recommended or an

existing form has been revised, the following sign-off must take place before the form is released

for bid or printing:

Vice President originating request

Executive Director Data Services

Assistant Treasurer

General Counsel

Director Internal Auditing

College Affirmative Action Officer

State Board of Accounts (if applicable)

State Board of Accounts approval is required on all forms and reports used to support financial

transactions. (I.C. 5-11-1-2 and 5-11-1-6). For further information, the Indiana Code may be

referenced at http://www.state.in.us/legislative/ic/code.

The Vice President for Finance/Treasurer, or designee, should make the determination as to

which forms require such approval and institute the appropriate communications.

NOTE: Refer to FMM, Section H, Travel Authorization for travel related information.

II. Signature Card

The Financial Documents Processing and Retrieval Department staff and regional business office

staff will review for proper employee signatures on all appropriate financial documents

submitted to those departments.

1. Delegation to authorize purchases below $10,000 must be made on a signature

card. The signature card must include the designated employee's signature and must be

authorized by the following:

Department Supervisor/Director

Executive Director of Finance

Executive Dean

Vice President/Chancellor

Vice President for Finance/Treasurer (Central Office staff only)

2. A Vice President's signature is not required on the purchase order check request copy when

payment of $15,000 or above is being made if the signature is on the original purchase order.

3. The purchase order check request that has a material variance greater of 10% or $1000

between the invoice amount and the purchase order amount must be approved at

the authorization level outlined in Section J: Purchasing, corresponding to the total

invoiced amount for the purchase order.

4. The Executive Director of Finance is responsible for maintaining regionally approved

signature cards. The Financial Documents Processing and Retrieval Department is responsible

for maintaining Central Office approved signature cards.

III. Journal Entry

Rationale

The Journal Entry is used to record changes in the accounts of the accounting system. These

entries may be of four kinds: (1) adjusting entries, (2) correcting entries, (3) facilitating entries,

and (4) entries designed to reclassify trial balance items.

Adjusting entries are required because it is impractical to record some changes on a day-to-day

basis.

Correcting entries are necessary to correct errors discovered in the account balances. While this

is not the place to consider auditing procedures, it may be well to emphasize that they correctly

represent the actual facts with respect to assets, liabilities, revenue, and expense.

Facilitating entries may be necessary in order to record data from a subsidiary ledger into

the general ledger. Sometimes it is practical to record all of a particular expense in a single

account, whereas actually the amount should be allocated.

One of the most useful purposes of the Journal Entry is to permit reclassification of items shown

on the trial balance that have changed due to time.

Procedure

1. The business office, in order to correct their financial figures so that their data correctly

represents the actual facts, must initiate the request by preparing a Journal Entry. The Central

Office financial staff usually prepares adjusting, facilitating, and reclassification entries.

2. The Journal Entry form must include the following:

a. The titles of the accounts to be debited (charged for expenditures) indicating the fund

and account descriptions followed by the amount.

b. The titles of the accounts credited indicating the fund and account

descriptions followed by the amount.

c. Each account and amount must be identified by its ten-digit account number.

d. The explanation and justification of the entry must be appended at the end. Emphasis

is placed on the necessity of including in the explanation reference to document

numbers and dates, as well as a clear statement of the reason for the entry, and if

applicable, the name of the sponsored program to which the entry applies.

e. Supporting documentation must be attached. Photocopies of check vouchers with

check numbers, State Board resolutions, purchase orders or other financial schedules

or data will suffice for adjusting, correcting or reclassification entries. However, the

original documentation necessitating the need for an original entry must be attached,

if available.

f. The explanation, justification, and supporting papers are to be sufficiently thorough to

provide a complete reason for the entry. The documentation must be adequate so "a

person with basic accounting knowledge" can understand the journal entry. For

example: entries to record void checks should include original check number, reason

for voiding the check, and replacement check number and date, if available.

g. The preparer/Executive Director of Finance must sign and date the request.

h. Distribution of copies needs to be indicated.

3. The College uses a double entry fund accounting system whereby each debit must have an

offsetting credit, whether it is in the same fund.

4. The pink copy of the Journal Entry form is to be filed in an "open file" by the originator to be

edited to the weekly (FBW091) or monthly Report of Transactions (FBM092) for the

verification of processing.

5. The white (original) and yellow copies of the Journal Entry form, with adequate supporting

documents, are to be forwarded to the Financial Documents Processing and Retrieval

Department.

6. The Financial Documents Processing and Retrieval Department date stamps all Journal Entry

forms upon receipt, assigns the document numbers, and routes them to the financial staff

responsible for the affected fund's activity. If more than one fund is affected, the Journal Entry

form goes to the financial staff responsible for the affected fund with the highest fund number.

7. The financial staff responsible for the affected fund's activity reviews the Journal Entry form

for accounting accuracy as defined in items 2a through 2f above. The financial staff responsible

for the affected fund's activity may make minor corrective changes to the Journal Entry form to

ensure proper recording. Some changes may require a phone call to the originator. In some

cases, the document may be returned to the originator for correction after the Financial

Documents Processing and Retrieval Department voids the assigned number.

8. The financial staff responsible for the affected fund's activity then approves the posting of the

Journal Entry form by signing the area designated "Posted By." An exception to this is an entry

affecting fund balance must be reviewed and approved by the Assistant Treasurer.

9. Financial Documents Processing and Retrieval Department reviews the Journal Entry form for

necessary signatures, initials and processes. Rejected items will be returned to the financial staff

responsible for the entry for appropriate action.

10. The yellow copy is returned to the originator. The white copy is filed by document number

by the Financial Documents Processing and Retrieval Department in ascending numerical

sequence.

IV. Cash Receipts Form

Rationale

The Cash Receipts Form (CRF) is used to record the day's receipts. The Cash Receipts

Form must be accompanied by receipts and bank deposit tickets providing evidence for

proper identification of funds received.

1. Receipts are required to be deposited and recorded daily.

2. The Cash Receipts Form must include the following:

a. Document Reference Number: Individual CRF number. The Region

identification number is the first two digits. The next five are regionally assigned

ascending numbers starting at the beginning of each fiscal year, July 1.

b. Depositing Department: The department that performed the bank deposit and

is responsible for receipts.

c. Location: Region Name/Site

d. Date of Deposit: Validated date on deposit ticket. One date per document is

entered on-line.

e. Bank Number: Two-position regional bank number.

f. Source and Description: Description of monies collected and their source using

the descriptions of account attributes.

g. Account Number: Ten-digit account number applicable to written description.

h. Credit Amount: Amounts collected by item. Amounts collected in the same

revenue account from identical source may be totaled.

i. Cash Overage/Cash Shortage: Dollar amount of overage or shortage based

on documented receipts.

j. Prepared By: Individual preparing the form.

k. Approved By: Authorized signature. (Vice President/Chancellor, Executive

Director of Finance, or appropriate designee.)

l. Totals reconciliation: The amount of deposits recorded on the deposit tickets, the

total of the Register Clearing Reports and manual receipts, the total of amounts

recorded in the revenue accounts, the total of amounts deposited in the bank

account, and the total of checks, currency, silver, and charge cards must all be

equal.

m. Cash Register Transaction From/To: Period of time from/to that cash register

tapes are being maintained.

n. Manual Receipts From/To: Period of time from/to that manual receipts are

being maintained.

3. Student fee receipt tickets must be used in numerical sequence with all voids/canceled

receipts recorded on the face of the Cash Receipts Form.

4. The sequence of daily deposits should agree with the sequence of Cash Receipts Forms.

5. Adequate supporting documentation providing evidence of deposit and revenue must be

attached to the form to include cash register tapes, Cashiers Summary Reports, and

handwritten receipts.

6. A copy of the Cash Receipts Form is to be kept and filed in an "open file" to be edited to

the weekly (FBW091) or monthly Report of Transactions (FBM092) for verification of

processing.

A cash overage or shortage is defined as the difference between the recorded business (cash

register tapes, Cashier's Summary Reports, or handwritten receipts) for a time period as

compared to total of actual cash on hand, checks received, credit sales, for that same time

period. All cash overages or shortages must be recorded on the face of the CRF to be reviewed

and approved by supervisory personnel. All CRF's which contain a cash overage or shortage

must have the approval of either the Vice President/Chancellor, Executive Dean, or Executive

Director of Finance before the CRF is processed in the accounting system.

A copy of all cash over/shorts in excess of $25 must be sent to the Internal Audit

Department. Any cash over/short in excess of $250 must be reported immediately to the Vice

President for Finance/Treasurer (designee is Assistant Treasurer) for review and approval. The

CRF should be processed.

Record the ending grand total for the day (if available) from each cash register tape on the CRF

or supporting documentation.

If the cash register provides a breakdown of cash, checks, and/or credit sales, the Executive

Director of Finance or designee should compare the breakdown amounts of the cash, checks,

and/or credit sales on the cash register tapes and the Cashiers Summary Report(s) and handwrites

to those same amounts on the deposit slip. For example: total cash on the register tape should

equal total cash on the deposit slip; the total amount of checks on the register tape should

equal the same on the deposit slip. If the totals do not agree, the reason should be

documented.

Cash Register Transactions/Manual Receipts: All void transactions should be reviewed and

initialed at the time the void occurs by both the employee making the void and a supervisor. If

the supervisor is unavailable, an employee independent of the employee voiding the transaction

should review and initial. At sites where it may not be possible to receive independent approval

at the time the transaction is taking place, supervisory personnel must review the supporting

documentation to the extent necessary to satisfy him/herself that all voids were reported and

considered adequately explained. The customer's sales receipt (cash register/manual receipt)

should always be included as supporting documentation for the void. All void transaction

numbers and amounts should be listed on that day's Cash Receipts Form for management

review. All copies of voided receipts (cash register/manual receipt) must be retained and clearly

indicated as void on all copies.

PLEASE NOTE: The volume and amount of daily voids and discrepancies should be routinely

reviewed by management personnel.

V. Purchase Requisition/Check Voucher

The Purchase Requisition/Check Voucher form is to be used for two purposes, as a Purchase

Requisition and also as a Check Voucher, depending upon the need. The proper portion of the

form should be completed for the purpose intended.

A. Purchase Requisition

Rationale

The Purchase Requisition portion of the form must be the first step in the purchasing process

and is required to be completed to obtain approval for all purchases before a purchase is made,

and a purchase order is issued.

Procedure

1. Purchase Requisition portion of the form includes the following:

a. Suggested Vendor (source of supply): Full name and address of supplier

recommended. Vendor changes will be made if applicable.

b. Vendor (assigned by Business Office or Purchasing): Full name and address

of vendor assigned.

c. Purchase Order No.:Number of the authorized purchase order document to which

the requisition applies.

d. FOB: options

Vendor pays freight

College pays freight - 3109 account

e. Terms: Conditions under which payment will be made. Known discounts should

be indicated to ensure savings.

f. Delivery: Expected delivery date to receive goods or services as provided

by vendor.

g. Department Name/Deliver To: Department completing the requisition or for

whom the requisition is being produced, and the name, building, room number

to deliver order.

h. Vendor #: Eleven-digit identifier for specified vendor.

i. Line No./Quantity/Unit/Description/Unit Price and Total

j. Grant/Contract Name and Grant/Contract No.: Full name and number of grants

or contracts. Where appropriate, CVTE/CHE grant and item number should be

placed in the description area.

k. Special Instructions: Any special requirement surrounding the requisition.

l. Date Required: Date the goods and services are required. Allow for sufficient

lead time.

m. Requested By/Date: Signature of requester and date signed. (Required)

n. Signatures/Date: (required) Authorized personnel to sign the Purchase

Requisition portion of the form may be department head, Business Office, Vice

President/Chancellor, Budget Office, and Purchasing. All purchase requisitions

must be signed in accordance with expenditure level authorization (reference

FMM Section J) prior to purchase. Any signature designations must be made in

writing by the appropriate Vice President/Chancellor.

Items may not be requested and approved by the same individual. Purchase requisitions must be

approved at management level above the requisitioner.

2. Distribution of Purchase Requisition/Check Voucher Form

When the form is used for the purpose of a Purchase Requisition, it is suggested that the

Purchase Requisition/Check Voucher form be distributed in the following manner:

a. The requisitioner/originator retains the pink copy of the form in a follow-up file.

b. The white and yellow copies will be submitted to the Business Office

for processing. All material requisitioned will be researched by the Business Office to

ensure the available discounts are taken and all possible savings are secured. A change of

vendor may be made if applicable. The Business Office retains the white copy of the

form. The yellow copy is returned to the requisitioner/ originator as an indication that the

form has been approved.

B. Check Voucher

Rationale

The Purchase Requisition/Check Voucher form is also to be used to pay for goods or services

delivered to the College which are not procured through the Purchase Order process. The Check

Voucher portion of the form can be used for payments below $3,000.

The Purchase Requisition portion of the form must be completed, properly approved, signed and

dated, prior to the Check Voucher portion of the form being completed. The Business Office or

Purchasing, which receives the form and invoice, will prepare or process the Check Voucher

portion of the form to initiate payment.

Procedure

1. Purchase Requisition portion of the form includes the following:

item b. Vendor Name of vendor/individual to whom the check will be made payable, and the

address where the check will be mailed. Payee's social security number or tax identification

number (if payment is to an individual).

item h. Vendor #: A unique eleven-position identifying number for a vendor.

item h-1. Voucher #: A seven-digit number uniquely identifying a voucher. The first two digits

is the location identification number. The next five are location-assigned ascending numbers,

starting at the beginning of each fiscal year on July 1.

item i.

Account #: Ten-digit account where payment will be charged.

Invoice No.: Invoice number supplied by or created by invoice.

Description: Brief description of transaction.

Invoice date: Date of the invoice.

Due Date: Use with discount processing when appropriate.

Amount: Amount due to vendor.

Discount Amount/Type: Amount or percent of discount. Use decimals. Indicate type of

discount ($ = dollar, % = percent).

item k. Grant/Contract Name and Grant/Contract No.: Required if payment is to be made

against grant or contract accounts.

item o. Signatures/Date: (required)

2. Adequate supporting documentation providing evidence of payee, what was purchased, and

amount due must be attached to the form, i.e. original invoice, signed letters, bills, etc., or a valid

Claim Voucher. (Fax copies and photocopies may be used as substitutes for original

receipts..) In order to reduce the risk of duplicate payments, it is required to review payments

already made to assure that the invoice has not been previously paid. Vendor invoices should be

date-stamped upon receipt.

3. A copy of the Check Voucher is to be filed in an "open file" to be edited to the weekly

(FBW091) or monthly Report of Transactions (FBM092) for verification of processing.

4. Distribution of Purchase Requisition/Check Voucher Form When the form is used for the

purpose of a Check Voucher, it is suggested that the Purchase Requisition/Check Voucher form

be distributed in the following manner:

a. The originator retains the pink copy of the form in a follow-up file.

b. The white and yellow copies will be submitted to the Business Office

for processing. The Business Office retains the white copy of the

form. The yellow copy is returned to the originator as an indication that the form

has been processed.

C. Hand Write Vendor Check

Rationale

Occasionally, a check must be processed as an exception to the normal Check Voucher

procedure by issuing a handwritten check. Complete the Check Voucher portion only of the

Purchase Requisition/Check Voucher form, as shown on Exhibit D3.

Procedure

The originator of the transaction completes the Check Voucher portion of the Purchase

Requisition/Check Voucher form with the following information:

item b. Name of vendor/individual to whom the check will be made payable, and the address

where the check will be mailed. Payee's social security number or tax identification number (if

payment is to an individual).

item h. Vendor #: A unique eleven-position identifying number for a vendor.

item h 1. Voucher #: Central Office enters a seven-digit number uniquely identifying a voucher.

The first two digits is the location identification number. The next five are location-assigned

ascending numbers, starting at the beginning of each fiscal year on July 1.

item i.

Account #: Ten-digit account where payment will be charged.

Invoice No.: Invoice number supplied by or created by invoice.

Description: Brief description of transaction.

Invoice date: Date of the invoice.

Due Date: Use with discount processing when appropriate.

Amount: Amount due to vendor.

Item l. Special Instructions ? If the check should be returned to a specific person or area, these

instructions must be written in the description area.

2. When the form is completed, the preparer must obtain "handwrite" approval from the

Assistant Treasurer. The approval must be written in the area under Description.

3. Once the Check Voucher portion of the form is approved, the white and yellow copies, along

with the original invoice, are sent to the Financial Document Processing and Retrieval

Department. The form is date stamped as received, a voucher number is assigned, and a check is

typed.

4. The check is verified by appropriate supervisory personnel, signed, sealed, and hand-delivered

to the requesting person.

5. A session sheet is attached and the document information is entered into the accounting

system. Once the document information is entered into the accounting system and the input

verified, the yellow copy will be returned to the department that originated the form, confirming

processing.

VI. Purchase Order

Rationale

A Purchase Order is a document authorizing a vendor to deliver described merchandise,

materials, or services at a specified price. Upon acceptance by a vendor, a Purchase Order

becomes a contract. A Purchase Order is used to encumber (set aside) necessary funds to cover

an anticipated expenditure, document receipt of goods and/or services, and to initiate payment(s).

Purchase orders must be issued for all purchases of $3,000 and above. There may be occasions

when issuance of a purchase order is necessary for purchases of $3,000 or less. For example, a

vendor may require a copy of a purchase order or a purchase order number before an order is

filled, regardless of cost. Another example may be where a Region considers it important to

encumber the expenditure for budgetary purposes.

All lease purchases, service and rental agreements, construction contracts, professional services,

and other financial commitments (excluding faculty agreements) should be attached to and

encumbered by a Purchase Order.

Procedure

1. The Purchase Order form authorizing a vendor to deliver merchandise, materials, or services

at a specified price must include the following:

a. Date: Date of Purchase Order.

b. Vendor No.: Eleven-digit vendor number beginning with V and ending with zero. At

time of payment, the vendor number may change due to the invoice showing an address

for remittance other than the ordering address.

c. To: Vendor name and ordering address.

d. Region PO Number Reference: Two-digit regional reference followed by pre-printed

four-digit number.

e. Ship To: Location to which order is to be shipped.

f. Ship To/ATTN: Individual responsible for accepting delivery.

g. Invoice To/ATTN: Accounts payable personnel responsible for payment.

h. Line No.: Line item of goods that corresponds to the item on the approved CVTE/ CHE

project equipment list as applicable.

i. Class Code: Fixed Asset code identifying type of item(s) being purchased.

j. Quantity, Unit, Description, Unit price, and Total

k. Quoted prices and other information such as terms.

l. Grant/Contract Name and Grant/Contract No.: Full name and number of special grant

or contract.

m. Sales Tax Exemption No.: Last four numbers associated with the State Sales

Tax Exemption number, unique to each Region.

n. Authorized Signature: Purchase authorization - see Section J, Authorization

of Contracts, and Authorization of Expenditures. For items for resale, see Authorization

of Expenditures in Bookstore Purchasing. If the Chancellor has already signed the

purchase requisition, he/she need not sign the purchase order given there is not a material

variance between the purchase requisition and the purchase order. A material variance

occurs when the purchase order amount exceeds the purchase requisition amount by a

material amount. A material amount is defined as the greater of 10% of the original

purchase requisition amount or $1,000. The reason for the material variance must be

attached to the (gold) check request copy of the Purchase Order.

2. The vendor (white) copy of the Purchase Order is to be mailed to the vendor. The

business office may make exceptions for blanket purchase orders and confirming orders.

Account number

Description

Amount of encumbrance

3. The business office (yellow) and check request (goldenrod) copies of the Purchase Order

are to be retained by the initiating College business office and filed in an accounts

payable "open file". This will allow the business office to edit Purchase Orders filed in

the "open file" to the Open Commitment report and to match with vendor invoices upon

receipt. The shipping/receiving copy (green) of the Purchase Order will be supplied to

the receiving clerk for verification of the merchandise received.

4. Once the goods or services have been received in acceptable condition by the Region, the

receiving clerk should indicate receipt on the shipping/receiving copy of the Purchase

Order, and submit the copy and packing slip to the business office. If a packing slip is

not provided, the Certificate of Missing Documentation form should be attached. The

form is available in the forms page of the College's intranet. If the Region has a central

receiving point, then the Purchase Order should also indicate the inventory tag number

placed on the item. The business office will match the receiving copy to the Purchase

Order copies retained in the "open file".

5. If the merchandise or service has been received and the vendor invoice has not been

received within a reasonable length of time (no more than thirty (30) days), the business

office should notify the vendor to send the invoice directly to the business office to

expedite payment.

6. The business office accounts payable "open file" is used to determine if a vendor invoice

is applicable to a Purchase Order. When applicable, the vendor invoice must be matched

with the check request copy of the Purchase Order for payment processing.

7. The Open Commitment report is by Purchase Order number sequence. All Purchase

Orders three (3) months and older should be reviewed for delivery of merchandise or

submittal of invoice and check request copy of Purchase Order for payment.

A. Correcting an account number or encumbered amount after purchase order issuance

1. Encumbrances can be modified regionally through the College financial accounting system

using debit/credit indicators in conjunction with dollar values (not equal to original value if to be

debited) or can be canceled if dollar value equals original encumbrance when using debit/credit

indicator.

2. All encumbrance transactions to be modified must be reviewed by the Executive Director of

Finance or designee.

B. Check Request Document

Rationale

The check request copy of the Purchase Order is used to pay for goods or services delivered to

the College which were procured through the Purchase Order process. The check request

copy (goldenrod) alone is not adequate to substantiate payment. The check request copy must

be accompanied by adequate supporting documentation providing evidence of payee, amount

due, the goods or services procured, and the proper account numbers to be charged.

Procedure - Partial or Final Payment

1. Vendor invoices should be date stamped upon receipt.

2. The check request copy of the Purchase Order form must include the following:

a. Voucher No.: Seven-digit number assigned by Region. First two digits

identify Region.

b. Transaction Code: for regular payment, 9 for a separate check.

c. Invoice number: supplied by or created for invoice.

d. Date of invoice and payment due date: from vendor invoice.

e. Gross amount: from vendor invoice.

f. Identify if payment is partial or final.

g. Identify discount amount (dollar or percent): allowed by vendor if terms are

met.

h. Authorized signature(s) and date(s) for payment. The Vice President's or

designee's signature will suffice for authorization of payment unless:

There is a variance between invoice amount and Purchase Order amount which

causes the total purchase to exceed the original level of authorization. See

Purchasing, Section J, N 5-c. "Material Variance Between Invoice and Purchase

Order Amount.

3. Adequate supporting documentation providing evidence of payee, what was purchased,

and amount due must be attached to the check request copy. Definition of adequate

supporting documentation is originals of invoices, signed letters, bills, etc. Fax copies

and photocopies may be used as substitutes for original receipts. If any of the

supporting documentation is missing, the Certificate of Missing Documentation form

should be completed and attached. The form is available in the forms page of the

College's intranet. In order to reduce the risk of duplicate payments, it is required to

review payments already made to assure that the invoice has not been previously paid.

Vendor invoices should be date-stamped upon receipt.

4. Partial payment requests are accepted in accordance with the following steps:

a. Photocopy of check request copy must be attached to vendor invoice with

partial payment code identified.

b. Each partial payment must be recorded on the business office copy of the

Purchase Order, or on an attachment, so that payment history is recorded for

future reference.

c. For final payment, the original check request and invoice must be

presented. Final payment must also be recorded on the business office copy

of the Purchase Order retained by the business office in the "open file".

5. The partial or final payment of the Purchase Order should be kept in an "open file" to

be edited to the weekly (FBW091) or monthly Report of Transactions (FBM092) for

verification of processing.

C. Cancellation of a Purchase Order

Cancellation of a Purchase Order must be made by the College location initiating the Purchase

Order. Cancellation of an executed Purchase Order must be substantiated by a letter to the

vendor explaining in full the reason for cancellation. Copies of the letter should be retained by

the business office and attached to both the business office copy and the check request copy of

the Purchase Order. The word CANCELLATION must be written on all copies of the Purchase

Order held by the business office. All copies and supportive letters are filed in strict Purchase

Order number sequence in a separate file identified as "Purchase Order Cancellations".

VI. Revolving Fund Reimbursement Voucher

Rationale

The Revolving Fund Reimbursement Voucher is used to reimburse the fund custodian for goods

or services delivered to the College which were paid by issuing a revolving fund check. These

reimbursements should be processed at least weekly. A Revolving Fund Reimburse- ment

Voucher alone is not adequate to justify reimbursement. A Revolving Fund Reimburse- ment

Voucher must be accompanied by adequate supporting documentation providing evidence of

payees, amount due, the goods or services paid for, and the proper account numbers to be

charged. The revolving fund may be used for payments up to $300. Exceptions may be made

for "non-reimbursable" checks such as a Stafford loan where the revolving fund balance is not

reduced since an offsetting deposit is made. Often exceptions for unusual circumstances may be

made upon approval by the DRBA or Executive Dean. See Section E, Authorized Bank

Accounts.

Procedure

Revolving fund checks may not be used for employee education reimbursements. Payment to a

nonemployee, which requires reporting to the Internal Revenue Service at the end of the calendar

year, should not be made by a revolving fund check. The Purchase Order or Check Voucher

should be used for all such nonemployee payments which will require a Form 1099 sent to the

Internal Revenue Service. See Section J, Purchasing, 5-d, "Payments to Nonemployees for

Services Provided to the College".

1. The custodian who needs his/her revolving fund reimbursed must prepare a Revolving Fund

Reimbursement Voucher to initiate the reimbursement. Revolving fund reimbursements should

be processed at least weekly.

2. The Revolving Fund Reimbursement Voucher must include the following:

a. Vendor number and date of form

b. Voucher No.: A seven-digit number uniquely identifying the document. The first two

digits is the location identification number. The next five are location assigned

ascending numbers starting at the beginning of each fiscal year, July 1.

c. Account/Amount: Account number and amount charged to that account.

d. Date: The date payments were made.

e. Paid To: To whom the payments were made.

f. Check No.: The check number on which payment was made listed in

numerical sequence with all checks accounted for.

g. Explanation: An explanation of items of which reimbursement is requested.

h. Amount: The amount of each revolving fund check written.

i. Total: The total amount of request.

j. Authorized signature, Date, Region: The revolving fund reimbursement authorization,

date of signature, and College location.

3. Adequate supporting documentation providing evidence of payee, what was purchased, and

amount due must be attached to the reimbursement voucher (placed inside a manila envelope):

originals of invoices, signed letters, bills, paid receipts, and check copies or photocopies of

checks.

4. All supporting documentation must be attached to its revolving fund check copy. The ten-digit

account number should be recorded on the attached Purchase Requisition or on the face of the

invoice.

5. All revolving fund checks must be listed on the face of the manila envelope in (check)

numerical sequence. Voided and canceled checks must also be reported in the numerical

sequence even though no reimbursement is claimed.

6. Documentation should be organized in revolving fund check number sequence within the

manila envelope.

7. Petty cash receipts should be placed in a smaller size envelope with revolving fund check

copy, or attached and placed within its proper sequence with the other documentation.

8. The total dollar amount of documentation within the envelope, the total amount recorded

against the expenditure accounts, the total of all disbursements listed by check number, and the

amount requested for reimbursement to the revolving fund must all be equal to each other prior

to submitting the voucher for processing.

9. The Revolving Fund Reimbursement Voucher is to be retained in the business office "open

file" for editing to the weekly (FBW091) or monthly Report of Transactions (FBM092) for

verification of processing.

VII. Budget Transfer Request

Rationale

The Budget Transfer Request is used in adjusting, correcting, or entering budgetary data after the

beginning of a new fiscal year. Revenue budgetary funds are transferred from one account to

another by debiting the account from which the funds are coming and crediting the account

which receives the funds. The reverse is true in expenditure accounts. Since the budget/

accounting system at Ivy Tech Community College of Indiana is a double-entry system, it is

necessary to have offsetting budget accounts. When new budgetary funds are received, the

revenue budget for that particular area is credited and the revenue budget offset account for the

fund group is debited. The reverse is true for the expense budget. Reference Budgeting, Section

B, for details. Operation revenue accounts are not to be revised regionally. Other accounts may

be transferred on-line by the Regions; however, these transfers must be documented by a Budget

Transfer Request to be kept on file at the regional location for audit reference.

Procedure

1. Processing a Budget Transfer Request form must include the following:

a. Fiscal year of transfer and formal name of fund to/from which budgets are

transferred.

b. Screen Input: Data required by College accounting system to process transaction.

c. Accounting system transaction codes to process transfer budget information.

d. Account numbers to be transferred to/from.

e. Formal description of each account.

f. Amount to be transferred (debit/credit).

g. Summary totals of debit(s) and credit(s).

h. Specific reason for the transfer request. This section must be completed for

clarity, control, and future audit reference.

i. Region name, authorized signature and date.

j. Authorized Central Office signature and date, if applicable.

VIII. Credit Memo

Rationale

The Credit Memo form is used for entering credit memo transactions. A Credit Memo is issued

by the vendor and represents credit for goods that were returned. Credit Memos are used by the

accounting system to offset voucher payments. Credit Memos are entered for the following:

1. If applicable, the Credit Memo should be entered to the accounting system and utilized

against future purchases.

Where additional purchases applicable toward a Credit Memo are not anticipated within four

months and the vendor is infrequently contacted, the business office should return the Credit

Memo with a request for a check refund.

2. Travel advances

Advances are entered into the accounting system as prepaid travel which enables the system to

track and apply the advances as a credit against the employee's Travel Voucher. This process

records the outstanding amount of the advance and assures the advance amount is deducted from

the final payment.

3. Void revolving fund checks

The next reimbursement check will be adjusted by the Credit Memo amount, enabling the

revolving fund account to be adjusted to the authorized amount, and a credit to the respective

expense account.

For additional details, see Purchasing, Section J, Other Purchasing Considerations (N-5-

b), Credit Memos and Auxiliary Enterprise, Section K, Inventory Valuation (I-fifth paragraph)

Returns/Credit (Publishers).

Procedure

1. A Credit Memo must include the following:

a. Vendor number identifying vendor's credit.

b. Voucher number assigned to Credit Memo.

c. Account number associated with the Credit Memo. Use prepaid travel

account for advances.

d. Accounting system transaction code.

e. If applicable, Purchase Order number (including P) that identifies the

Purchase Order the credit is to be applied against.

f. Vendor assigned Credit Memo number.

g. Brief description of basis for credit.

h. Date Credit Memo is created.

i. Amount of monies to be credited.

j. Prepared By/Approved By: authorized signatures and dates.

IX. Account Request/Notification

Rationale

The Account/Request Notification form (ARN) is used to request account numbers to be created,

modified, or deleted. Account Request/Notification forms are sent to Central Office for

processing The ARN will be used as a turn-around document to inform regional business offices

of the completion of the request.

Procedure

1. All data items listed on the ARN must be completed if the account pertains to specific grants,

contracts, or projects. If the account does not pertain to grants, contracts, or projects, identify as

such.

2. If the account utilizes payroll or benefits, Section I: Use of Funds, must be fully completed.

X. Deferment/Payment Agreement

Rationale

Students whose tuition, fees, books, and supplies are to be paid by a third party will be required

to sign a Deferment/Payment Agreement making the student liable for any balance not covered

by the third party. In all cases, tuition, fees, books and supplies that are to be billed to a third

party, must be verified by a letter, contract or other documentation on file at the regional

Institute.

By approval of the Vice President's designee, students who are unable to pay their entire tuition

and fees may defer up to two-thirds (2/3) of their account balance. The student must pay at least

one-third (1/3) of the balance due upon registration and must pay at least one-half (1/2) of the

remaining balance within thirty (30) days. The remainder must be paid within thirty (30) days

after the second payment was due (not to exceed sixty (60) days from time

of registration). Students receiving approval are required to sign a Deferment/Payment

Agreement holding them liable for the balance due. Charges for books and supplies may not be

deferred unless they are to be billed to a third party. Exceptions are made on an individual basis

and approved by the Vice President/ Chancellor or designee.

XI. Wire Transfer/Debit Adjustment Form

Rationale

Ivy Tech Community College of Indiana regularly performs transactions involving the Federal

Wire System. These transactions include, but are not limited to: investment activity, payment of

payroll taxes, and payment of sales tax. In addition, there is an occasional need to

perform miscellaneous debit adjustments to the accounting system. The Ivy Tech Wire

Transfer/Debit Adjustment form is used to perform both of the above-mentioned activities.

Procedure

1. The originator of the transaction completes the form with the following information:

Originator's signature

Date prepared

Date of the transaction

Ten (10) digit account number to be debited

Account description

Amount of the transaction

2. Adequate documentation must be attached supporting the transaction. Maintain the pink copy

and forward the form to the appropriate person for approval.

3. Once the form is approved and signed in accordance with the approved signature card

authority, the white (original) and the yellow copy must be sent to the Financial documents

Processing and Retrieval Department for document number assignment and input into the

accounting system.

4. Once the document is entered into the accounting system, the yellow copy will be sent back to

the person who approved the form.

5. The individual authorizing the College's bank to perform the wire transfer must not be the

same individual who authorizes the Ivy Tech Wire Transfer/Debit Adjustment form.

XII. Document Filing

The following describes acceptable College-wide document filing. A College-wide standard is

important to assure that documents can be identified and retrieved at all College locations.

College locations are given the option of creating supplemental files. That is, an additional file

in other than the prescribed order may be maintained if a need for such a file exists. However, all

locations will assure the standard is adhered to in establishing a primary file prior to creating

supplemental files.

This standard applies both to numbered and unnumbered documents.

The College's financial documents are required to be filed under one of the following two

alternatives:

1. The first alternative would be that all accounting system documents be filed in batch number

sequence by type of batch (Check Vouchers, Cash Receipts Forms, Purchase Orders, etc.) All

document logs will be used for cross-reference of this filing system. This file will be maintained

on a fiscal-year basis.

In the batch filing system as described above, a copy of the financial document, supporting

documentation, and the computer-generated report for each respective batch are to be filed with

the appropriate batch control document as listed below:

AP Data Collect Control Form

FA Data Collect Control Form

AP Real-Time Session Data Control Form

FA Real-Time Session Data Control Form

2. The second alternative is identified by filing financial documents by vendor name in alpha

sequence. All payment history should be recorded on the face of Purchase Orders or an

attachment to the Purchase Order for payment history. All backup documentation is included

with each accounting document.

Prior to filing the processed document with backup in the vendor file or batch sequence file, an

"open file" should be maintained at least weekly or monthly. It is recommended that

all processed documents in the "open file" be verified for accuracy of input.

XIII. Affidavit Concerning Forged Endorsement

Affidavit Concerning Forged Endorsement must be used when a vendor, student, or employee's

check has been signed and negotiated by someone other than the payee, without permission to do

so.

It is important to include a police investigation case number on the affidavit. Along with the

affidavit being completed in full, a paper must be attached where the payee has signed his or her

name at least five times.

The detailed procedures to complete the form are as follows:

(1) the State of Indiana

(2) the county of the region of the College involved

(3) the case number given to the payee, by the police, when the police were notified of this

forgery

(4) the name of the payee

(5) the word "his or her" depending on gender

(6) the word "he or she" depending on gender

(7) the issued date of the forged check

(8) the check number

(9) the issuer "Ivy Tech Community College of Indiana"

(10) the dollar amount of the check written out

(11) the word "he or she" depending on gender

(12) the name that was endorsed on the check

(13) the word "he or she" depending on gender

(14) the dollar amount of the check written out

(15) the word "him or her" depending on gender

(16) the payee's signature

THE NOTARY PUBLIC FILLS OUT THE FOLLOWING....

(17) current day

(18) current month

(19) current year

(20) the signature of the Notary Public

(21) the date of the Notary Public commission expiration

AT THIS POINT THE FORM MUST BE EMBOSSED WITH THE NOTARY SEAL.

N. FIXED ASSETS

I. Equipment Capitalization and Inventory Control

A. Policy

Property management is a legally mandated requirement. An inventory of capital equipment is

one element of a total property management system. Because an accurate inventory of the

College's physical assets is important for accounting and insurance purposes, for establishing

equipment replacement cycles, and for preparing and justifying biennial budget requests to state

agencies, it is the policy of the College to maintain a current inventory of all physical assets of

the College. All items which have a unit acquisition cost of $3,000 or more (with the exception

of computer equipment and tablets which are inventoried at up to $3,000), and a useful life of

one year or greater are to be included in the inventory. All computer equipment valued up to

$3,000 should be posted to account code 3403C and tablets to 3403T because they are

inventoried but not capitalized. Additionally, high theft, specialized technology, scanners,

projectors and printers noted below having an acquisition cost of $500 or more and useful life of

one year or greater will be included in the inventory of the College. Any and all high theft,

specialized technology, scanners, projectors and printers must be removed from the inventory

records when lost, stolen, or otherwise disposed of. Account codes listed below should only be

used for these high theft and other specialized assets:

1) 3403H – High Theft – Small digital or IT-type technology not considered a typical

computing component that has value and is susceptible to theft. While not an inclusive

list, some examples are iPods, PDAs, Televisions, Smart-Pens, pocket-sized scanners and

digital cameras and audio visual equipment. Classroom related assets, such as specialized

tools should also be considered.

2) 3403T – Specialized Digital Technology – IT related or digital technology related

items such as iPads, Tablets and other computer hybrids.

3) 3403S – Projectors and Scanners < $3,000 – Overhead and Desktop Projectors and

Scanners.

4) 3403P – Printers < $3,000

(This is not an all-inclusive list.)

It is the policy of the College in accordance with federal regulations that a complete physical

inventory, including corrections, be completed by June 1 of each even-numbered fiscal year (i.e.

2013-2014). In the odd-numbered year (i.e. fiscal 2012-2013) each region may perform a

verification of equipment at each site.

In addition to the physical inventory, the College annually confirms all land and buildings valued

at $100,000 or greater with the regions prior to year-end close.

The College has established a threshold capitalization of assets at $3,000 or more. Any item

valued $3,000 or more should be posted to the appropriate account code with “CAP” in the Title

because it should be capitalized. Consequently all capitalized equipment for the College is

maintained in an inventory.

Please note, that all equipment purchased with Carl Perkins and Department of Workforce

Development (DWD) State grant funds must be tagged if the equipment has a useful life of one

year or greater and a value of $500 or more. All assets purchased under these guidelines must be

appropriately inventoried until disposed of. Carl Perkins and DWD assets of $500 or greater

require a State of Indiana inventory tag. Contact Office of the President Sponsored Program

Accounting for instructions relating to equipment tagging and reporting. These assets are not

owned by the College and must be coded to account code 3403N in Banner and assigned the XA

Asset Type. Other grants may have similar requirements regarding ownership. Contact

Sponsored Program Accounting prior to making purchase for clarification.

B. Definitions

Capital Equipment is defined as any non-expendable item or a group of items making one unit

with a life of more than one year and unit acquisition cost of $3,000 or more. General exceptions

to this policy are materials constructed of glass or non-durable material, a repair part, or a

replacement of a component of a larger unit.

Acquisition Cost of procured equipment means the net invoice price of the equipment, including

the cost of modifications, attachments, accessories, or auxiliary apparatus necessary to make the

equipment usable for the purpose for which it was acquired. Other charges such as the cost of

installation, transportation and duty or protective in-transit insurance shall be included in the unit

acquisition cost if they appear as part of the invoice or are identifiable and material in nature.

1) If the item is acquired by trading in another item and paying an additional amount,

"acquisition cost" means the amount received for trade-in plus the additional outlay.

2) Freight charges are capitalized as part of the acquisition value of equipment if they

appear as part of the original invoice, or are readily identifiable and material in nature.

3) Necessary modifications, installation charges and capital acquisition expenditures are

capitalized if they appear as part of the original invoice, or are material in nature.

4) Reconditioning costs of used capital equipment at the time of acquisition are not

capitalized unless they are directly identifiable and material in nature.

C. Procedures

Regional Administration:

1) It is the responsibility of each Chancellor and Executive Director of Finance or

Administration to ensure that an equipment management system is in place and that

responsibilities for regional Fixed Asset Coordinators have been assigned.

2) Fixed Asset Coordinator responsibilities include providing coordinated direction for

physical inventory taking, and timely update of equipment inventory records on the

Banner Fixed Assets system.

Instructional Sites:

1) Each Instruction Site is responsible for coordination of equipment by assisting the

Fixed Asset Coordinator in assuring that procedures regarding equipment are followed at

each site. Such responsibility is to be assigned to an individual at each instructional site.

2) Items located in the facility are to bear a unique identification tag.

3) Items newly acquired:

a) By purchase - For sites with central receiving functions, the item is to be

checked, at time of equipment acquisition, against the purchase order and tagged

before delivery to point of usage. For other sites, the tagging is to take place as

soon as practicable. On a regular basis, the Fixed Asset Coordinator will print

their regional Pending Tag listing obtained from Discoverer. The Fixed Asset

Coordinator is to ensure that all of the items have been tagged and entered into the

equipment inventory system in a timely manner.

b) By donation – When an asset valued at $3,000 or greater is donated to the

College, the region must contact the Office of the President Finance Department

upon receipt of the donation. Once the gift is received from the donor, the value

of the gift must be established. For land and buildings, an appraisal stating the

value of the land and buildings at the time of the gift must be obtained. For other

assets, the region must establish the value of the gift by obtaining estimates or by

an affidavit or appraisal provided by the donor, provided the appraisal is current.

An appraisal must be less than one year old. If a building is on a piece of land, the

appraised value of the building and land must be separate. All methods of

valuation must be in compliance with IRS rules.

Once a gift is accepted by the region and reviewed by Office of the President

Finance Department, it will be determined who is responsible for recording the

gift in Banner. Just as with any other asset, once a donated asset is no longer

wanted, the asset must be disposed of in the same manner as a purchased asset.

For any donated asset with a value $3,000 or greater, the asset must be capitalized

and a journal entry processed to recognize the revenue for the value of the

donated asset. The Office of the President Finance Department will process the

journal entry. Send all documentation for donated assets to the Executive Director

of Capital Assets and Debt Accounting prior to recording the donated asset in

Banner.

The regions need to contact their regional Development Office so that the donated

asset can be captured in their database.

c) By transfer - The transferring region is to complete the top portion of the

Banner Fixed Asset Transfer Form. The form will then be sent to the receiving

region’s Fixed Asset coordinator listing the item by tag number and location. The

receiving region will complete the remaining portions of the form and then make

the necessary updates in the fixed asset system for the asset. The form will be

maintained by the receiving region.

All items that cannot be physically tagged (i.e., land, buildings, computer software and

automobiles) are to have the tag and serial number attached to the Banner Fixed Asset

Add Update Form describing the asset and its location. The Fixed Asset Coordinator is to

maintain all forms. Items that cannot be tagged, but are attachments are to have the

pending tag information attached to the Banner Add Update form for the primary asset.

4) Every department director or chairperson is to notify the Fixed Asset Coordinator

when capital equipment maintained in the department does not have an attached property

tag. Also, the department director/chairperson is to notify the Fixed Asset Coordinator

when equipment is moved from one room to another or transferred to another department.

This will facilitate keeping inventory records up-to-date and ease the reconciliation and

physical inventory processes.

5) Loss or theft - Items that cannot be located must be removed from the inventory

system. In each case the Executive Director of Finance/Administration must review and

sign the Banner Delete Form. The College maintains insurance to replace missing

equipment in the event of fire, disaster, theft or vandalism. A police report or Campus

Security theft report must be obtained and maintained on file for review.

II. Standard Depreciation Policy

A. Policy

Certain assets in the equipment inventory control system which have been capitalized will be

depreciated. Excluded from depreciation are land, works of art, and periodicals. The assets are to

be depreciated using the straight-line method and useful lives based upon defined equipment

classes assuming one-half year of depreciation in the year of acquisition and one-half year

beyond its remaining useful life. For example, if an asset has a useful life of ten years, only half

is taken during the first year. The full yearly amount will be charged for the next nine years, and

any remaining amount will be taken in the eleventh year. A zero salvage value will be assumed

for all assets based upon the College's past history. Assets which become fully depreciated over

time will be maintained on the system. Assets will be deleted from the system only when they

are sold, traded-in, or disposed of in another manner.

B. Definitions/Procedures

1) Capital Equipment as previously defined is depreciated. Assets acquired

under capital leases are to be depreciated. This would exclude leased land. Capital leases

are entered into the Fixed Assets system under account code 3603 for Equipment and

Buildings. Capital leases are treated as if assets were being purchased over time. The

College records an asset and a liability at the lower of the present value of the minimum

lease payments or the fair market value of the leased property. All capital leases will be

entered into Banner in the Office of the President Finance Department. All entries for the

capital lease will follow an amortization schedule for the specific capital lease.

The leased asset is depreciated one of two ways:

a) If the lease requires capitalization due to Criterion No. I or II:

Criterion No.

I. The lease transfers ownership of the property to the lessee by the end of

the lease term.

II. The lease contains a bargain purchase option. If the lease is capitalized

due to Criterion I or II, it is depreciated in a manner consistent with the

College's normal depreciation policy using the economic life of the leased

asset. The economic life is determined asset type code used in Banner.

b) If the lease requires capitalization due to Criterion No. III or IV:

Criterion No.

III. The lease term is equal to 75 percent or more of the estimated economic

life of the leased property.

IV. The present value at the beginning of the lease term of the minimum lease

payments, excluding that portion of the payments representing executory

costs, to be paid by the lessor, including any profit thereon, equals or

exceeds 90 percent of the excess of the fair value of the leased property to

the lessor at the inception of the lease over any related investment tax

credit retained by the lessor and expected to be realized by them. If the

leased property does not meet one of these criteria, then it is considered

an operating lease and should not be capitalized and depreciated. If

the lease is capitalized due to Criterion III or IV, it is depreciated in a

manner consistent with the College's normal depreciation policy leased

asset’s useful life. To properly depreciate for the leased asset, you must

manually enter the useful life in Banner form FFADEPR. See the Fixed

Assets Section in the Banner Training Manual for instructions Capital

leases (buildings and land) should be sent to the Associate Vice President

for Facilities Planning in the Office of the President for approval. A copy

of the approved lease will be provided to the Executive Director of Capital

Assets and Debt Accounting for recording. Capital leases (equipment)

should be sent to the Office of the President Finance Department for

review and approval. A copy of the approved lease will be provided to the

Executive Director of Capital Assets and Debt Accounting for

recording. Throughout the term of the lease, the regions will make

payment using account code 3601 or 3602. At year end, the Executive

Director of Capital Assets and Debt accounting will reduce the obligation

by processing a journal entry to debit the lease obligation and crediting

lease expense, accounts 3601 or 3602. This is done within the Plant Fund

P94000. Although the amount capitalized as an asset and the amount

recorded as an obligation at the inception of the lease are computed at the

same present value or fair market value, the amortization of the asset and

the discharge of the obligation follow the amortization schedule for each

capital lease.

2) Leasehold improvements are improvements or additions to property obtained under a

capital or operating lease. The cost of the leasehold improvement should be

depreciated over the remaining life of the asset if it is a capital lease or over the

remaining life of the lease if it is an operating lease not including any renewal options.

Once the project is complete, all leasehold improvements for capital leases are attached to

the primary tag for the capital lease. For operating leases, once the lease expires and is

not renewed, the related asset record should immediately be deleted from the Fixed

Assets system.

3) Building improvements are those changes made to an owned building which are

substantial but not major enough to be considered an addition (a portion which could

stand alone if the original building were demolished). The cost of the building

improvements should be depreciated over the remaining life of the building to which it

pertains. Individual projects greater than $10,000 generally funded by the state

appropriation for Repair and Rehabilitation or fund transfers fall into this category. Once

a project is approved, a new fund will be set up in Banner to track all expenses.

When the cost of improvements is substantial or when there is a change in the estimated

useful life of an asset, depreciation charges for future periods should be revised on the

basis of the new book value and the new estimated remaining useful life.

Examples of leasehold and building improvements are: new roof, new windows, new

lighting systems, and general remodeling. All are limited by the State requirements for

capitalization (General R&R projects costing greater than $10,000 each).

Individual expenditures for repair and rehabilitation projects are fed through funds set up

for specific projects within Banner. At year-end, projects are either capitalized when

complete or construction-in-progress is recorded for those projects not yet complete. If

additional expenditures occur after the capitalization of the project, the additional

expenses will be capitalized and attached to the primary tag for the asset.

At year-end, the Executive Director of Capital Assets and Debt Accounting will

capitalize all completed projects or record construction-in progress for those projects not

yet complete.

4) Buildings which are owned, leased or under construction are added to the Fixed

Assets system for purposes of having an accurate building Master List. However,

facilities under construction (construction-in-progress) are not capitalized until all costs

associated with the construction are completed. As these new buildings under

construction are placed in service, the project is capitalized in Banner. Depreciation will

be set up at this time.

Once the building or building component is placed in service, then the facility must be

added as a capitalized asset of the College for depreciation purposes. The final cost will

be obtained from the associated Banner Plant Fund. The process should be coordinated

with the Office of the President Finance Department

Note that if additional costs are incurred after the building asset record is capitalized, then

the additional capital expenses will be added to the primary asset tag for the building in

the fiscal year they occur.

5) Land - All parcels of land owned or leased by the College should be included in the

Fixed Assets system. The total cost of land represents the purchase price and additional

costs such as razing and removal cost (less salvage value), legal fees, broker's

commissions, title fees expense, and other cost directly related to the cost of acquiring the

property. If the land is donated, then the fair market value at the time of donation

represents its value to the College. As with R&R projects, the various costs incurred for

land acquisition should be consolidated and the asset approved when the College takes

possession of the property (normally the date of closing). Subsequently, any related costs

incurred such as demolition should be added to the asset record during the fiscal year in

which they occur. Land itself is never depreciated.

6) Land improvements are additions to property which are not part of the buildings.

These include sidewalks, landscaping, parking lots, fences, and lights. These assets are to

be capitalized and are to be depreciated using the straight-line method over a ten-year

period.

7) Library material capitalization procedures should be the same as those applied to