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May 19, 2010. 8:30Continental Breakfast 9:00UW System Structure 9:30Overview of Selected Policies/Constraints 10:00Financial Administration 10:30 Stretch.

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Presentation on theme: "May 19, 2010. 8:30Continental Breakfast 9:00UW System Structure 9:30Overview of Selected Policies/Constraints 10:00Financial Administration 10:30 Stretch."— Presentation transcript:

1 May 19, 2010

2 8:30Continental Breakfast 9:00UW System Structure 9:30Overview of Selected Policies/Constraints 10:00Financial Administration 10:30 Stretch Break 10:45Financial Administration (cont.) 11:45Lunch (Capitol B)

3 12:45Administrative Services 1:00Safety and Loss Prevention 1:45Procurement 2:45Stretch Break 3:00Operations Review and Audit 3:30Trust Funds 4:00Concluding Remarks 4:15Adjourn

4 Created by the merger of the former University of Wisconsin and the former Wisconsin State Universities (October 1971) Governed by Chapter 36, Wisconsin Statutes Governed by 18 member Board of Regents 16 members appointed by the Governor 2 ex-officio members (DPI and WTCS) 14 of 16 have staggered 7 year terms 2 of 16 are students with 2 year terms

5 UW System President (Kevin Reilly) 2 Senior Vice Presidents Academic Affairs (Rebecca Martin) Administration and Fiscal Affairs (Tom Anderes) 1 Vice President (Debbie Durcan) Associate, Assistant Vice Presidents, Directors 14 Chancellors 13 Degree granting institutions 13 Two Year Colleges & State-wide Extension (72 counties and 3 tribal nations)


7 Department of Administration State Budget Office (Dave Schmiedicke, Bob Hanle, Dennis Rhodes) State Bureau of Procurement (Helen McCain) State Controllers Office (Steve Censky, Jeff Anderson) State Risk Management (Rollie Boeding) Legislature Legislative Audit Bureau (Jan Mueller) Legislative Fiscal Bureau (Bob Lang, Dave Loppnow, Emily Pope)

8 Enrollment:More than 178,000 Degrees Granted:33,000 Annual Budget:$4.75 Billion State Funding:$1.14 Billion Tuition Funding:$1.05 Billion Gifts, Grants, Contracts:$1.44 Billion Annual Economic Impact$10 Billion/Year

9 Board of Regents: Regent Policy Documents (RPD) UW System: Financial and Administrative Policies (FAP)

10 13-3Authorization to Sign Documents 15-1Distance Education Pricing Principles 20-19Criminal Background Check Policy Investment and Social Responsibility 32-7Student Involvement in Differential Tuition Initiatives

11 F31 Personal Services Payments F36 Travel Regulations F43 Financial Management of Auxiliary Operations F44 Tuition and Fee Policies for Credit Instruction F46 Prizes, Awards and Gifts F50 Segregated University Fees

12 G15 Student Services Funding G18 Student FICA Exemptions G29 Special Course Fees G36 College Courses in High Schools G38 Child Care Centers



15 Mission Statement The Office of Financial Administration has the primary responsibility for the fiscal integrity of the University of Wisconsin System. It is expected to provide a financial environment that is secure, encourages the accomplishment of academic missions, provides timely and accurate information, and assists all levels of management in making prudent financial decisions.

16 Financial Administration is organized around the following five service categories: System wide Accounting and Budget Control – Ginger Hintz Shared Financial System Operations Management – Dwan Schuck Financial and Administrative Policy Development –Terri Gill Financial Analysis and Reporting - Vacant System Administration Accounting and Budget Control –Laurie Grams

17 UWSA Controller Facilitates information flow to/from Campus Controllers Buffer between Department of Administration and Campuses on Accounting Issues Interaction with State Budget Office Interaction with State Controllers Office Owner of the Chart of Accounts Responsible for reconciling SFS to WISMART Responsible for University Banking

18 Institution SFSUW Budget / Wismart MadisonUWMSNA MilwaukeeUWMILB Eau ClaireUWEAU C Green BayUWGBY D La CrosseUWLAC E OshkoshUWOSH F ParksideUWPKS G PlattevilleUWPLT H River FallsUWRVF J Stevens PointUWSTPK StoutUWSTOL SuperiorUWSUPM WhitewaterUWWTWN CollegesUWCOLR ExtensionUWEXTT System AdministrationUWADMW System-WideUWSYSY All Business Units are assigned an alpha character for identification and coding purposes.

19 Chart of Accounts Full funding string includes: Business Unit – Fund – DeptID – Program Code – ProjectID – Account – Subclass (used for Building #) Example UWADM

20 Categories and Types Categories GPR – General Purpose Revenue PR – Program Revenue PRF – Program Revenue Federal SEG – Segregated Revenue Types Annual Continuing Sum-Sufficient Biennial

21 Carryover or Lapse? Annual – unless program revenue, funds which are not encumbered or expended lapse at the end of each fiscal year Continuing – balances remaining at the end of the fiscal year are available for expenditure in future years Sum-Sufficient – expenditures are allowable up to the amount necessary to accomplish the purpose for which the appropriation was made Biennial – unless program revenue, funds which are not encumbered or expended lapse at the end of the biennium

22 Allotment UW Campuses

23 Allotments cannot be overspent without DOA approval Approval is given in the form of an allotment increase Exception - PR-continuing allotment increases are automatically approved Transfers between classes may be restricted

24 UW Campuses SFS – Official Accounting Records of UW System WISMART – Official Accounting Records of the State of Wisconsin (DOA) Daily Interface Reconciliation

25 All receipts deposited into local campus deposit account Zero Balance Account (ZBA) State Statute [1] requires all collections be deposited in the Wisconsin State Treasury within one week. Campus Vendors

26 UW System Controllership Questions?

27 Shared Financial System (SFS) SFS Governance SFS Team Production Support Development HRS Retrofit/Interface SFS Change Management

28 Senior Vice President for Admin. University of Wisconsin System (Tom Anderes) SFS Leadership Team Common Systems Review Group SFS Managers Group SFS Advisory Committee Supply Steering Committee SFS Executive Committee SFS Project Mgmt. Office

29 SFS Financial Administration Roles Production Support and Maintenance Monitoring production processes Troubleshooting end user and system errors Ongoing care and feeding of the system Recurring operations Development Active participation in new system/module implementation Identification of user requirements Functional lead in design, development, and unit testing Lead role in integration testing Manage roll out to end user community SFS-HRS Retrofit

30 Overall structure Roles and responsibilities Engagement Directors Program Managers Site Leaders

31 Executive Sponsor Glen Nelson, UWSA Engagement Directors Dwan Schuck, UWSA Carol Block, DoIT Program Managers Katie Chase, DoIT Cara Grib, Huron Consulting Site Leaders Technical Security Batch Scheduling Infrastructure GL Payroll GL Tuition Remission DOA AP/EX AP Vendor Trailer Checks AP Taxes Expense Grants ECRT Cost Share Reporting WISDM Reports

32 Engagement Directors Review and communicate project status Campus interaction Review new functionality / changes to business processes Allocate resources

33 Program Managers Prepare and manage project plan, timeline and budget Monitor progress on the project plan and tasks and communicate to all stakeholders on a regular scheduled basis Support the project team in all project efforts Review final deliverables Produce statistics

34 Site Leaders Advocate campus needs and viewpoints to the project team Provide leadership to site Communicate project details to respective campus Facilitate training Work with subject matter experts along with functional and technical staff Facilitate testing Ensure the necessary testing, prototyping and piloting tasks are completed, according to the agreed upon timelines and deadlines, and that related documentation is complete and accurate for the site


36 Make improvements while maintaining stable, supportable system Give consideration to individual campus initiatives Systematically manage, track and document change requests Communicate change requests and make visible to all impacted parties

37 Use of delivered PeopleSoft functionality is implicit unless compelling justification can be made. Each proposed SFS Change Request to delivered PeopleSoft functionality is considered based on the following decision criteria: Strategic Alignment Regulations, Legislation, and Mandates Functionality Impact and Technical Design Impact Security Impact Production Support Impact Funding (e.g., cost savings) Upgrade Impact PeopleSoft Support Time Constraints Alternative Solutions

38 Shared Financial System Questions?

39 Financial Policies Financial Administration Academic Administration Information Technology Procurement / Risk Management Tuitions and Fees Other

40 Travel Policies and Reimbursement Rates Travel Contracts Car Rental Lodging Airfare Brick and Mortar Online Cliqbook self-booking tool Must register at

41 Miscellaneous Travel Sales Tax Exemption Travelers Reference Guide Reimbursement rates and receipts Travel warnings, baggage fees, currency converters, etc. Relocation

42 Reimbursement instructions and forms Complete Expense Report (Excel form) For UW-Madison, the paper based expense reporting system has been replaced with the implementation of the PeopleSoft Expense Management module of SFS which incorporates electronic signature and paperless workflow.

43 User submits request to supervisor Campus business office reviews for policy and procedural compliance Meal & lodging costs over the allowed policy maximums Reimbursement claimed for costs that should have been paid directly by the University Absence of UW business purpose for incurring reimbursable costs Missing or incomplete required receipts or supporting documentation Food and refreshments for meetings do not included required agenda, justifications or other supporting documentation Payment Paper Check Direct deposit (Madison only)

44 Travel Card Individual Liability Issue based on individuals credit rating Charges must be paid in full within 60 days US Bank limits vendors Purchasing Card Corporate liability Campus liability not individual Access Online Manage applications Card expenditures Transaction funding Reporting US Bank limits vendors

45 Visa Card issued by US Bank UW business expenses only Individual purchases up to $5,000 Campus may approve lower limits Limitation on vendor categories and commodities Best practice for making low dollar purchases Allows employees to obtain supplies and equipment much more quickly and reduces the number of purchase orders and requisitions Provides cost savings through consolidated payment (biweekly payments to US Bank covering each campus purchasing card transactions versus individual vendor invoices) Authorized for travel costs airfare, lodging, conference registrations may reduce out-of-pocket costs for UW System traveler

46 The Purchasing Card is not: For personal purchases A means to avoid appropriate procurement or payment procedures A card to access cash, cash equivalents or credit A right of employment For reimbursable meal costs (use your Travel Card) For tax (1099) reportable services

47 Process Delegated purchasing authority Supervisor approval required to obtain card Training required Receipts and supporting documentation Bi-weekly reconciliation Campus Purchasing Card Program Administrator

48 Financial and Administrative Policy Development Questions?

49 Financial Reporting unit is responsible for: Compiling the annual financial report Providing grants management expertise Construction accounting IRS tax compliance and reporting Various cost studies and financial analysis Primary interface with the Legislative Audit Bureau for financial audits

50 CAFR State Comprehensive Annual Financial Report UW is a major enterprise fund of the State of Wisconsin and included in the CAFR (page 46) Annual Financial Report Available in total and by campus Audited by Legislative Audit Bureau

51 Integrated Postsecondary Education Data System (IPEDS) Primary source of data on colleges, universities, and technical and vocational postsecondary institutions in the United States UW System is required to complete because we receive Federal financial aid funds Completed for each campus

52 Grants Management Coordinates Single Audit A-133 Develops and negotiates Facilities and Administration (F&A) Rates Develops extramural fringe benefit rates Liaison with campuses and Federal Relations staff

53 Capital purchasing Processes purchase orders and invoices for capital projects Liaison between Division of State Facilities (DSF) and campus Debt Service Calculation of amortization schedules Coordinates payments from campuses to State DOA

54 Tax Compliance and Reporting Co-Chair UW System Tax Compliance Group Unrelated Business Income Tax (UBIT) Tax Intercept Program IRS Form 1098, 1099 and 1042S reporting Other Tax Topics

55 Financial Reporting Questions?

56 Procurement and Safety and Loss

57 Providing procurement and safety and loss services and guidance to the UW Institutions so they can teach, conduct research and provide outreach to the State and world

58 Bureau of Procurement Bureau of State Risk Management Minority Business Office Bureau of Enterprise Fleet


60 Directors of Procurement and OSLP serve on the state wide councils with other state agencies – Risk Management Executive Council (RMEC) Interagency Procurement Council (IPC) Theses councils develop policy and address statewide risk management and procurement issues

61 Governor approves every vehicle bought by the State There are strict caps on the number of vehicles the State is allowed to own DOA centrally purchases vehicles Campuses must turn in a qualifying vehicle in order to buy a new one Campuses can lease a vehicle, with DOA approval, such as the Chancellors vehicle

62 Department of Commerce certifies Minority, Women Owned and Veteran Owned businesses (MBEs) State statutes direct a 5% goal of spending with MBEs DOAs MBE Coordinator works with state agencies to identify spending opportunities and to report actual expenditures

63 UWS Listserves: Risk Managers Health and Safety Workers Compensation Purchasing Semi-annual Face to Face Conferences Risk Managers Purchasing

64 Administrative Services Office of Procurement Office of Safety and Loss



67 It is the goal of the UW System to provide a safe and healthful higher education environment for faculty, staff, students and persons utilizing UW System programs and facilities

68 Proactive loss prevention, health, safety and environmental management Quality claims management Protection of UW System assets, both physical and financial

69 The Office of Safety and Loss Prevention (OSLP) is responsible for providing support services to the campuses in the areas of risk management, occupational safety, environmental affairs and workers compensation

70 Like any multinational corporation the UW System has many manufacturing processes… Foundries Fabrication Farms Laboratories Art studios Chemical Biological Nuclear

71 …as well as student and faculty based exposures… Study abroad Student organizations Experiential learning

72 Dept. of Commerce regulates employee safety for Wisconsins public sector – s WI Statutes Campus staff provide primary responsibility for safety program management OSLP provides consultation and technical expertise on employee training, recordkeeping, written programs, accident investigations, industrial hygiene surveys, regulatory code assistance, hazard prevention guidance, etc.

73 Heavily governed by state and federal laws UW System laboratories, art studios and physical plants generate wastes governed by these rules Other environmental issues include radioactive waste, air toxics, wastewater rules, special and universal wastes including biohazards and electronic scrap

74 UW System is delegated by Department of Administration to manage workers compensation. Governed by Chapter 102 WI Statutes OSLP staff determine compensability, direct and implement medical case mgmt., and oversee dispute resolution Adjust 1200 claims/year Annual premium of $5M

75 s WI Statutes s WI Statutes Liability protection is afforded to all agents, officers and employees of the University while operating within the scope of their employment or agency

76 Auto General Civil Rights Environmental Employment Practices Professional Annual Premium of $2M – General Liability and Medical Malpractice

77 Contract review for insurance requirements including hold harmless and indemnification language Development of master affiliation agreements for student internships Advice on student organizations Fleet and driving issues Sponsored camps and clinics

78 s WI Statutes s WI Statutes Asset management of building contents including libraries and special collections, foreign property, and business interruption

79 UW System is 70% of the States Total Insured Value State of Wisconsin: $17,553,852,358 UW System: $12,175,540,217 Annual Premium: $4.4M

80 Property, Liability (including medical malpractice) and Workers Compensation – self insured through the State of Wisconsin Excess coverage for Property and Liability UW System purchases separate policies for machinery and boiler, crime, broadcasters liability, camps/clinics, special events, contractual, study abroad, nuclear, and student health insurance

81 Student Health International Risks Experiential Learning Sustainability Emergency Management/Security Enterprise Risk Management (ERM)







88 Review legal and process framework for State Purchasing under Ch. 16 and 36 WI Statutes Review socio-economic programs Introduce Vendornet Review resources available

89 Five person shop Develop and negotiate system-wide contracts in IT, individual Auxiliary contracts (Bookstores and Food service) for comprehensive campuses Serve multiple customers on campuses: Campus Purchasing, CIOs-IT staff, Librarians, and Auxiliary Directors Help campuses navigate the state procurement process in order to buy the goods and services they need to operate

90 Who? Procurement Staff Responsibilities Help campuses buy the goods and services they need Guide purchasing process in accordance with laws, codes, policies, and procedures Lead official sealed bid and request for proposal processes Ensure solicitations are open and fair, specifications are not restrictive, end user needs are met Are aware of and enforce use of mandatory state contracts Report to DOA/ Legislature Keep records

91 The goal of procurement is to get the right: Product Process Price Quantity Time Place

92 Competition Consistency Integrity Openness

93 I am a steward of state, federal or student funds, I want to buy goods and services in compliance with the laws of Wisconsin, I want to inspire public confidence by following open and transparent process, I want to ensure the vendor community open and fair competition, I am liable and can be sued. (Ch (2)) WI Statutes(Ch (2))

94 Agencies and the UW System together purchased $1,055,497,397 of goods and services in FY08.

95 General Purchasing under §16.75, Wis. Stats.Total SpendTotal %MBE SpendMBE % University of Wisconsin 440,647,76242% 7,736,9222% Health and Family Services 144,971,11614% 4,727,2773% Corrections 135,264,60713% 2,578,6772% Administration 73,261,7767% 4,219,4036% Transportation 55,684,4525% 3,050,8955% Natural Resources 39,486,1984% 831,0252% Revenue 31,278,6393% 1,177,8114% Public Instruction 28,673,3473% 57,6320% Workforce Development 25,615,0202% 2,203,5929% Other 66,790,1316% 2,847,5454% Total 1,041,673,048100% 29,430,7793%

96 UWMSN 255,644,69758% UWMIL 35,497,4148% UWSTO 18,206,0624% UWSTP 16,532,9554% UWLAC 15,548,0634% UWWTW 12,756,2703% UWOSH 12,335,7463% UWRVF 12,074,1533% UWEAU 11,227,9313% UWPLT 10,365,1262% UWSYS 8,959,9842% UWGBY 8,270,3052% UWCOL 6,548,1601% UWPKS 5,964,5511% UWEXT 5,939,1451% UWSUP 3,066,5051% UWADM 1,720,6960% Total 440,657,762100%

97 Act in accordance with the Ethical Code of Conduct (Ch ) (Ch ) Do not use your public position for personal gain (ER- MRS-24.04) (PRO-D-8)(ER- MRS-24.04)(PRO-D-8) Practice heightened awareness

98 Accept gifts, food, promotional material or anything of value from vendors Use state computers for conducting personal business Write non-business or personal letters on state stationery Make personal long-distance phone calls on state telephones Accept speaking fees or honoraria for personal gain if it is related to your official duties Endorse vendors products or services

99 State employees are subject to criminal and civil sanctions for ethics violations Fines between $100 and $5000 County jail up to one year Possible disciplinary action, including suspension or termination of employment Similar ordinances may exist at local levels

100 State laws govern state purchases Statutes Administrative Codes Ch.5-11 and 50 Place authority and responsibility for state purchases in the Department of Administration (DOA) – Ch. 16 DOA established State Bureau of Procurement (SBOP) to implement State Procurement Manual defines Policy and Procedures Board of Regents has authority under Ch.36

101 Permit the delegation of some purchases to some state agencies and institutions Establish competitive bidding as the preferred method

102 Chapter 36 gives the Board of Regents authority to obtain goods and services to fulfill their statutory mission Limited use of this authority Academic Support Services Agreement (ASSAs) If competition exists, we will follow competitive procurement process

103 Some services provided by independent contractors represent special talents needed by the UW System on a temporary basis to fulfill its missions of instruction, research and public service. If the service is a unique, noncompetitive activity supporting instruction/research/public service, it will be considered an Academic Support Service. If the cost of the service will be greater than or equal to $5,000, an Academic Support Services Agreement (ASSA) must be executed and approved by a contracting officer of the institution prior to commencement of the service to certify that the competitive purchasing process need not be used.Academic Support Services Agreement (ASSA) An ASSA must be executed regardless of the payment method utilized. An ASSA may also be executed in connection with contracts for services under $5,000. Authority to sign ASSAs may be delegated in writing by the President/Chancellor. ASSAs $5,000 or greater must be reported to the University of Wisconsin System Vice President for Finance in accordance with Regent Resolution 7548.

104 Can bid goods up to any amount Can bid services up to $25,000 Can request proposals up to $25,000 Can justify sole source procurements up to $25,000


106 VendorNet is a resource to: Interface with vendors Access procurement information Download required forms Search bids and contracts Create bidders lists Post bids and contracts Perform other critical tasks

107 Without a login, you can access content on the General Procurement Information pageGeneral Procurement Information Contact the VendorNet Information Center for a login authorization form to create an account for yourself as purchasing staff or for program area staff:VendorNet Information Center State Agency Operations login for viewing more info, downloading forms, and creating and maintaining bid and contract announcements View Only login for viewing more info and downloading forms only

108 The State Procurement Manual is a reference on the process for purchasing goods and services and which forms to use.State Procurement Manual forms

109 Levels of Bidding Foster competition through a simplified process Best judgment Simplified Bid Official Sealed Bid

110 At least 3 But as many as practical Open advertising fulfills requirement

111 Request for Bid Request for Proposal Sole Source

112 $5,000 or less Can make the purchase from the vendor of choice Bids may be taken if prudent Services require written bids - RFBs Does NOT apply to mandatory contract items

113 $5,000 < X < $25,000 Three quotes - can be telephone, verbal, catalog, written Services require written bids - RFBs Document on bid form Award to lowest responsible bidder

114 Over $25,000 Written request for bid Written response from vendors Stated bid opening time Public opening Legal notice – Public Notice System Protest / appeals language when services*

115 Know desired outcome but not approach Mandatory and/or desirable Evaluate on other factors (technical expertise, experience, financial soundness) Evaluation committee awards points - cost only a portion (20-40%) Award to vendor with highest point total not necessarily lowest cost

116 Services procured through Request for Bid or Proposal require (Act 89):(Act 89) Cost Benefit Analysis (CBA) (PRO-I-15)(PRO-I-15) Continued Appropriateness (PRO-I-15)(PRO-I-15) Union Notification (PRO-I-9)(PRO-I-9) Protest and Appeal (PRO-I-13, PRO-C-5 and PRO-C-12)PRO-I-13PRO-C-5PRO-C-12

117 Some goods and services or processes differ from standard procurements and process. Examples include: Goods/Services Legal services Printing Vehicles Telecomm Equipment Travel Process Sole source Emergency procurements Grants Non-procurement transactions Interagency purchases

118 Good, ServiceInvolveProcess & Approval Legal ServicesPurchasing StaffRPA – DOA, Governor PrintingPrint ManagerBid only – Ch. 35 VehiclesFleet Manager - buy DOA - lease >30 days Form 3016, Governor Justification, DOA Telecomm. Equipment Telecomm. ManagerTSSR if off contract and > $10,000 TravelTravel CoordinatorDepends on need Sole SourcePurchasing Staff< $25K del/SBOP/Gov > $25K SBOP/Gov

119 How? Special Considerations and Requirements Emergency Procurements (PRO-C-3)(PRO-C-3) Are defined by threat to public health, safety or welfare; or exists by Governors proclamation Write justification within 72 hours including: the nature of threat the call for unforeseeable immediate action why need cant be met by procurement process and the steps taken to obtain competition Purchases over $25,000 require approval by SBOP and DOA Secretary

120 How? Special Considerations and Requirements Grants & Other Non-procurements (PRO-C-32) Grants are transfers of things of value to a recipient for purpose of support or stimulation rather than to acquire goods or services which directly benefit the state. Exemptions require SBOP and DOA Secretary approval or as Ch. 36 Non-procurement transactions are payments made pursuant to statute when only one provider is statutorily permissible and the rate of reimbursement is set by statute Interagency purchases between Wisconsin state agencies are not procurement transactions

121 If what you need is on a mandatory contract, you will buy from the contract (PRO-B-1)(PRO-B-1) SBOPs centralized purchasing acts in the best interest of the state to aggregate spend, leverage price, and standardize contracts for commonly used products across agencies and campuses Mandatory contracts (10-, 14-, 15-, 18-, 20- series) include goods and services from SBOP statewide/ enterprise contracts, work centers, and Badger State Industries (BSI)(10-, 14-, 15-, 18-, 20- series)

122 Is what I need available on an existing contract or directly from another government entity? Statewide/Enterprise Contracts (11-series)(11-series) Piggybacking is the use of a contract from another Wisconsin state agency (PRO-D-29)(PRO-D-29) Collective Purchasing (Consortium) is the use of contract from another state or federal government and requires SBOP approval (PRO-D-25) (PRO-D-25) Inter-governmental Purchasing is purchasing directly from the federal, state, or municipal governments (except GSA contracts and other non-competitive bid contracts) (PRO-C-25)(PRO-C-25)

123 You may use a Purchasing Card (P-card) to pay for purchases under $5,000 through best judgment PRO-E-23 outlines roles and responsibilities for an agency or campus administrators P-card program management and cardholders use and training PRO-E-23 Program administrators may request SBOP approval to use the P-card as payment for purchases over $5,000 through simplified bid, request for bid/proposal Program administrators

124 Competition does not exist Prior process may dictate (software compatibility) Best interest of the State as determined by State over $25k – requires Governors approval Waivers usually for intrinsic value, emergency, bidding not possible, or substantial time pressure

125 When? Minority Business Enterprise (MBE) The State of Wisconsin has a 5% goal and a 5% price preference (§16.75(3m)(b)) for certified MBEs Agencies apply the 5% preference as outlined in PRO-D-1 and submit activity tracking reports to DOA PRO-D-1 For more program info, visit the DOA webpages at or contact (608) Search for a minority business by industry at

126 BSI is the Dept. of Corrections vocational and work skills development program State law requires agencies and campuses to Write, to the extent possible, specifications to permit purchase of good or service from BSI Purchase from BSI if price is comparable See PRO-C-33 for more detailed process informationPRO-C-33 Examples of current mandatory contracts include furniture and signage

127 When? State Use Program The State Use program supports certified work centers that offer training and job opportunities to individuals with severe disabilities per § Agencies must purchase from a work center if the good or service meets specification and is at fair market value (e.g. mail, lawn, or janitorial services) You must purchase from work center mandatory enterprise 14-series contracts (e.g. clothing, mops, brooms, pens, pencils, food, crates, pallets, first aid kits, toothpaste, and vinyl floor mats)14-series See and PRO-K Work Centers for more information PRO-K Work Centers

128 UW-Madison MDS The MDS Web Ordering System allows customers to order from MDS and all the Prime Vendors at one time, through one web site Items that can be ordered are computers, lab supplies, maintenance supplies and office supplies More information can be found at:

129 Pay properly submitted invoices within 30 days of receipt or pay interest (PRO-E-6)(PRO-E-6) Invoice must be received at address indicated on the purchase order Goods or services must be received or performed satisfactorily Notice of Good Faith Dispute stops the clock Interest paid out is covered by agency budget and annually reported to the legislature

130 The Procurement office is there to help Visit our website at: New initiatives on the horizon Supply project - vendor management Improved website On-line training Remember…..

131 If everything is going well, you have obviously overlooked something. Murphys 6th Law


133 Presenters 1 st concern


135 …responsible for providing objective review and analysis to assure that University of Wisconsin programs, policies, and practices are conducted in accordance with state law and Board of Regents policy. The Office helps ensure University operations are proper, efficient, and effective.

136 Report to the UW System Vice President for Finance Dotted line to UW System President and Board of Regents Formal audit/review reports typically presented to the Business, Finance, and Audit Committee Relationship with institutional auditors

137 Gain understanding of risks/issues through multiple sources Conduct risk analysis of identified policies, issues, or programs Share draft plan with and receive input from UW System management and institutional management Present to Board of Regents Maintain flexibility for internal projects

138 Project overview or scope memo Background data Specific purpose Project methodology Fieldwork Campus visits or interviews Draft reports for institutional review Comment period

139 Textbooks costs UW-sponsored camps & clinics Prior learning assessments Student evaluation of instruction Division III athletic departments Internal reviews Fund 402 Academic staff job security Committee or support work

140 Considered to be UW Systems external auditors for annual financial and federal compliance audits May perform additional financial and program reviews requested by the Legislature Institutional involvement may vary

141 As soon as there is any indication of actual or suspected theft, embezzlement or falsification of documents: The discovering party should immediately notify the Unit Business Officer, who should immediately notify the Chancellor and the System Vice President and Trust Officer. The System Internal Auditor, in cooperation with appropriate institution officials designated by the Chancellor, will investigate the matter and determine if audit assistance is needed. Following a full investigation, determination will be made by the System Internal Auditor, the General Counsel's Office and institutional officials of whether to notify the Department of Justice.

142 Julie Gordon, Director (608) Joshua Smith, Assistant Director (608)



145 Core Functions Provide for the administration, record-keeping and investment of endowment and other investable funds entrusted to the Board of Regents (BOR) of the UW System Mission Provide the BOR with the support, information and analyses they require to fulfill their responsibilities as fiduciaries/trustees Provide excellent (valuable, timely, accurate & efficient) products & services to our internal and external customers, primarily Trust Funds account holders and donors Products/services include investment vehicles, investment counseling, transaction processing, record-keeping, and the dissemination of useful information and data

146 Office Staffing Douglas Hoerr, CFA – Director and Assistant Trust Officer Thomas Reinders – Senior Investment Analyst Debra Morgan – Senior Accountant Jamie Erbs – Financial Specialist 3 (half-time) Trustees & Other UWSA Officers BOR – Business, Finance, and Audit Committee Deborah Durcan – V.P for Finance and Trust Officer Patricia Brady – General Counsel and Assistant Trust Officer

147 External (directly to TF) Primarily bequests (estate gifts via wills or trusts) Other individual & corporate gifts (including matching dollars) where stipulate: endowment invest FBO program… Documents name: UW System or Board of Regents of the UW System any UW institution or unit Documents do not name an affiliated UW foundation: UW foundations are separate legal entities if a bequest does not name a foundation, it cannot go to a foundation UW Trust Funds is also available if: a campus does not have a foundation (e.g., UW-Extension) a donor does not want to give through a foundation

148 Internal (indirectly to TF) Transfers for temporary investment of other gifts/grants/contracts where sponsor/donor stipulates: invest FBO sponsored program or related activities… investable amount is to $5,000 (UW Madison - $50,000) Temporary TF account established, but: an associated account remains at RSP (e.g., in Fund 133, 233, 144) funds for expenditures must be transferred back to RSP account Basically, UW-Madisons RSP policies/practices Monies transferred in from foundations are not transferrable to Trust Funds

149 Endowment (E) – donor/sponsor restricts use of principal Designated Endowment (DE) – Board of Regents restricts use of principal (bequests $250,000, where donor silent) Quasi-Endowment (QE) – no restriction on use of principal; all monies expendable 149

150 Three distinct funds/pools for different investment time horizons: Income Fund (161) – earnings/interest distribution from all Funds are posted to the Income Fund to provide dollars for current spending; also, QEs can be partially or wholly invested here; time horizon ~ 2 years or less Intermediate Term Fund (162-IT) – QEs can be partially or wholly invested in IT; also, unspent earnings from prior fiscal years within Income Fund transferred to IT annually; time horizon ~ 2-7 years Long Term Fund (162-LT) – E/DEs must be wholly invested in LT; also, QEs can be partially or wholly invested in LT; time horizon ~ 7+ years Funds are unitized pools invested in various underlying funds and separate accounts (private mutual funds) 150

151 Target Asset Allocations Long Term Fund – a very diverse portfolio of asset classes categorized as growth and high-yielding (~55%), event-risk and deflation hedges (~20%), real assets and inflation-hedges (~25%); valued quarterly Intermediate Fund – intermediate-term bonds (~75%), large-cap stocks (~15%), alternatives (~10%); valued quarterly Income Fund – invested 100% in short-term money market instruments (SWIBs State Investment Fund); valued daily

152 Grantham, Mayo, van Otterloo (GMO) UBS Global Asset Management J.P. Morgan Investment Management Adams Street Partners 300 North Capital Seix Advisors Applied Security Analysis Program Russell Mid-Cap ETF (iShares) Russell 2000 Growth ETF (iShares)

153 Reams Asset Management Applied Security Analysis Program Seix Advisors Lehman TIPS ETF (iShares) S&P 500 ETF (iShares) MSCI EAFE ETF (iShares)

154 Donor/individual investment accounts 1,502 parent accounts 1,238 child or sub-accounts (more on these later) Assets (as of December 31, 2009): Income Fund $ 46.8 million IT Fund 75.6 million LT Fund million UW Trust Funds Total $ million

155 UWSA - Office of Trust Funds Investment Performance Results (periods ending December 31, 2009) 1 Year3 Years5 Years10 Years Income Fund0.5%2.7%3.3%3.1% T-Bill (30-day)0.1%2.0%2.7% Intermediate Term Fund15.9%6.8%5.3%6.1% Lehman Intermediate Aggregate6.5%6.1%5.0%6.1% S&P %-5.6%0.4%3.1% Long Term Fund22.4%1.5%6.3%5.3% 70/30 Benchmark22.5%-1.5%2.8%1.8% CPI + Spending Rate + Expenses 7.7%7.1%7.4% Peer Median19.4%-1.2%3.8%3.5% Peer Ranking: Percentile36th10th7th22nd

156 For External Funds (directly to TF) All original gift documents should come to TF Office Director works with estate/donor reps to secure gift Director coordinates with benefiting campus/unit: letter to Chancellor (or System President for UW System gifts), copying unit heads provides gift information (including donor terms); asks for further direction where appropriate TF Office opens new investment account on SunGard (TF record-keeping system) and SFS new account notification ed to benefiting unit giving details (e.g., UDDS, program/activity coding, investment direction…) TF Office maintains all donor documents

157 For Internal Funds (indirectly to TF) Route the following to TF Office: letter describing reasons for transfer and deposit/gift routing/T-form: note associated RSP account number indicated investment direction (or call for help) attach check Deans approval/signature copy of relevant gift/grant/sponsor stipulation, re: investment TF Office opens new investment account (same as on prior slide) RSP (or other originating unit) periodically requests transfers to associated RSP account for expending RSP (or other originating unit) maintains all donor/sponsor/grantor documents and is entirely responsible for proper administration

158 Purpose and Limitations Generally, used only for large, endowed parent accounts that are: discretionary or multi-purpose (e.g., UWMSN-Hilldale Fund ) for named Chairs or professorships (e.g., UWMSN - Dr. Robert Turrell Professorship Fund-1814) for research (e.g., UWMIL-Uihlein Trust Funds-1084) Generally, only income from a parent account is transferred to sub earnings on sub wrap back to parent Expenditures from sub must conform to parent terms/conditions where applicable Establishing Sub-Accounts Route the following to TF Office: letter of request, describing purpose, parameters, budget transfer amount, begin/end dates Deans approval/signature TF Office opens new sub-account and initiates money transfer from parent

159 Terms/Conditions Donor-imposed terms/conditions: upon written request from donor upon court approval if purpose deemed unlawful, impracticable, impossible to achieve, or wasteful (UPMIFA) changes/modifications must still be consistent with the charitable purposes expressed in the gift document for smaller (less than $75,000), older (greater than 20 years) funds, upon 60 days notice to Attorney General (with above limitation) Insitution/unit-imposed terms/conditions: upon written request from Dean or Chancellor Account Coding Upon written request from department head Changes cannot be inconsistent with terms/conditions Investment Direction Upon written request from department head Generally involves only QEs Can call for help

160 Investment Income/Earnings Distributions: All flow back to Income Fund (161) for spending purposes all actual earnings on Income Fund and IT Fund balances for LT (endowment) Fund: 4% per year of moving 3-year average Fund market value (1% per quarter) Balances Available Depend on Account Type: For all accounts, Income Fund (161) balances are available for immediate spending all expenses are to be charged to 161 For all accounts, Intermediate Term Fund (162-IT) balances are available but can only be liquidated to cash and transferred to Income (161) at quarter- ends values can fluctuate For QEs only, Long Term Fund (162-LT) balances are also available same cautions here as for IT

161 PAL (Portfolio Account Link) Access via TF web-site: Accesses SunGard account record-keeping database View all balances: Income Cash (161), Intermediate Term (162-IT), Long Term (162-LT) IT and LT balances/market values are as of prior quarter-end View transaction activity: 24 months available transactions include internal investment-related activity, not just expenditures/payments Can download data to Excel WISDM View only Income Cash Fund (161) balances Best way to view expenditure activity (PAL shows other activity) Actual Cash balance should equal Income Cash Fund on PAL (except for daily timing issues)

162 Go to Account Balances and Transactions (PAL access – see appendix in hand- out material) Account Terms, Conditions and Coding (see appendix in material) Investments, etc.

163 Charge directly to TF 161 account: ensure expenditure complies with account terms/conditions complete proper form (PIR, TER, non-salary payment transfer with invoice) note Fund 161, and the 7-character account/project being charged (e.g., or PJR21EW) no transfers to campus accounts required as with foundations Payments will be made if: sufficient available funds exist conforms to pre-audit guidelines complies with account terms/conditions verified by TF office on post-audit basis Campuses/departments can conduct only expenditures on TF accounts all revenues of any kind can only be conducted by/through TF Office

164 Other Policies/Practices Pending account for new bequests IT sweep of unspent Income Cash Fund balances Overdraft coverage policy Danger Will Robinson! Compliance with laws/statutes, including UPMIFA underwater endowments Socially Responsible Investment (SRI) efforts Performance benchmarking (NCSE, Big 10, TUCS) Fees Assessed to Trust Funds Internal TF Office costs: ~0.10% Investment management-related costs: ~0.68% (LT and IT Funds)

165 TF: A Capable Investment Office TF Office stands ready to invest other UW monies! Contact Information: Doug Hoerr Debi Morgan DirectorSenior Accountant (608) (608) Tom ReindersJamie Erbs Senior Investment AnalystFinancial Specialist 3 (608) (608)

166 How to Get Account Info Via PAL Go to TF website: Go to Customer Corner: click on Account Balance and Transactions link At User ID prompt, type in (lower case): UW_ _ _ (3 letter campus code, e.g., MSN) – allows access to all campus accounts to be more selective, type in first 2 digits of UDDS, or entire UDDS (e.g., MSN48 for all L&S accounts) At Password prompt, type in trust (lower case) Click on Login button

167 How to Get Account Info Via PAL (cont.) To pull up desired account, either: click on drop-down arrow under Account (upper left-hand of screen), click on desired account number click on Go! Button or, click on Find More link, and: enter core 4-digit account code (e.g., 1574, 21FH) at Search Text prompt click on Find button account number and name will come up below click on the account number itself UWMSN should use this approach – too many accounts for a drop-down menu

168 How to View Account Terms/Conditions/Coding Go to TF website: Go to Customer Corner: click on Account Terms, Conditions, and Coding link enter core 4-digit account code (e.g., 1574, 21FH) at Enter 4 digit account number prompt click on Find this Account button



171 Lots of Rules Lots of Regulation Lots of Resources Available

172 CORE GOAL More jobs CORE GOAL More jobs CORE GOAL More graduates CORE GOAL More graduates Foundational Activity Competitive UW workforce Foundational Activity Competitive UW workforce


174 7,700

175 Cumulative Additional Associate & Bachelors by UW-Platteville4,350 UW-River Falls5,600 UW-Stevens Point3,700 UW-Stout4,350 UW-Superior1,700 UW-Whitewater4,000 UW Colleges11,700 Cumulative Additional Associate & Bachelors by UW System80,000 Cumulative Additional Associate & Bachelors by UW-Eau Claire 6,750 UW-Green Bay 5,650 UW-La Crosse 4,600 UW-Madison 4,950 UW-Milwaukee 14,050 UW-Oshkosh 7,500 UW-Parkside1,100

176 Remaining Questions? Please Complete the Evaluation Form at:

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