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UPDATE OF CELL PHONES AND OTHER TECHNOLOGY TOOLS Finance-Tax department - DRAFT 1 Flint Campus 2:00 to 3:30 Friday, October 15, 2010.

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Presentation on theme: "UPDATE OF CELL PHONES AND OTHER TECHNOLOGY TOOLS Finance-Tax department - DRAFT 1 Flint Campus 2:00 to 3:30 Friday, October 15, 2010."— Presentation transcript:

1 UPDATE OF CELL PHONES AND OTHER TECHNOLOGY TOOLS Finance-Tax department - DRAFT 1 Flint Campus 2:00 to 3:30 Friday, October 15, 2010

2 Agenda Finance-Tax department - DRAFT 2 It is a bad plan that admits of no modifications – old proverb. Revisit Policy on Technology Tools Process Update Goal and Characteristics Next Steps and Target Dates

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4 Revisit Policy: Tax a non-factor. Finance-Tax department - DRAFT 4 Current Events: On the Hill In the Small Business Act, Congress recently changed the law regarding the tax treatment of cell phones and other remote technology by reducing the level of substantiation required to receive tax-free treatment. However, Congress delegated authority to the IRS to define specific substantiation requirements. Previously, the IRS issued a notice requesting comments on certain approaches. We anticipate guidance in the near future.

5 Revisit Policy: Focus on University needs Finance-Tax department - DRAFT 5 Taxes aside, feedback is as follows:  Units want a simple policy with clear guidance as well as ‘teeth’ to support their positions but flexibility and incentive to serve the faculty.  Finance and Provost want a financially efficient and cost-effective policy.  Manifest prudent fiscal stewardship by funding exclusively those efforts which directly benefit UM’s mission. Our philosophy - to provide employees with mobile technology tools that ameliorate communications and promote the mission of the University. Our goal – implement a policy using the (4) corners of fairness and effectiveness:  Simplicity, consistency, fiscal prudence and flexibility.

6 Process Update Finance-Tax department - DRAFT 6 Finance met with stakeholders individually to explain revisions and to have representatives appointed to a working committee. Stakeholders include Provost, Medical School, Hospital, BAG Representatives (Engineering, LSA, and School of Business), Athletics, AVPF, Development and ITS. Working committee is in the process of vetting certain issues.  Members include: Ruth Addis, IT; Glenna Schweitzer, Provost; Jim Murdock and Shane Fortune, Bus. Sch.; Virginia Wait and Leigh McGrath, Engineering; Robin Sarris, LSA; Karen Lang, Med. Sch.; John Ellison, Hospital, Jim Balgooyen, Athletics; Kim Kiernan, Finance and possible delegates. Met with Internal Audit and UMHS compliance office.

7 Overview Temporary: This SPG is temporary in nature and is subject to any major campus-wide initiatives regarding mobile technology tools. More restrictive: the units may enforce a more restrictive policy than this SPG. Strategy: The hope is to employ an 80/20 approach, i.e. 80% of the tools are processed ‘mainstream’ with the remainder, 20%, deferring to a process based on an exception basis or ‘facts and circumstances’ determination. Finance-Tax department - DRAFT 7

8 Goal and Characteristics: Simplicity We have placed all technology tools into one of three baskets;  Basket #1 - Home internet connectivity,  Basket #2 - Laptops,  Basket #3 - Cell phones and all other telecommunication tools. All other telecommunication tools include the following (Basket #3): Blackberries, Smart phones, I phones and I pods, PDAs, Data cards, etc. Finance-Tax department - DRAFT 8

9 Goal and Characteristics: Consistency We have developed a ‘one-size fits all’ model with few exceptions;  No reimbursement for home internet connectivity, but for those expressly provided in the SPG.  Certain identified IT professionals and telecommuters with no permanently assigned office space.  No stipends for laptops, tools will be provided by the University,  Stipends will be provided for cell phones and other telecommunication tools, but for those expressly provided:  Coaches as part of NCAA regulations that require University monitoring,  Certain physician/staff healthcare programs that require group access and communications. Finance-Tax department - DRAFT 9

10 Goal and Characteristics: Fiscal Prudence The model manages use and costs effectively as follows: Home Internet Connectivity: Generally, no payments will be made to employees. It is difficult for UM, as steward, to justify paying for this service which every household uses indiscriminately for personal as well as university purposes. Laptops: Subject to general University restrictions. Cell Phones and all other telecommunication tools; Stipends are limited to a$50 threshold per month,  Employees may have only one telecommunication device unless excepted, Employees are responsible for insuring and replacing any tools and any additional features (if acceptable to and approved by the unit). Finance-Tax department - DRAFT 10

11 Goal and Characteristics: Fiscal Prudence Other aspects: Ensures validation of business purpose: use limited to the following; – Travel, work location, emergency response, or job requirement. Minimizes administrative burdens on employees and the University. – Each year the employees must sign a verification statement validating the University’s business purpose and provide one month’s bill as evidence of cost. The Dean or VP must countersign when approving exceptions. – No reimbursements will be allowed through Accounts Payable. Encourages pooling or temporary use of tool whenever possible. Provides annual cost assessments: each year Finance will distribute an annual summary statement to units regarding costs incurred in using these tools. Finance-Tax department - DRAFT 11

12 Goal and Characteristics: Flexibility The model allows flexibility as follows: Includes a grandfather clause and grace period. Allows for exceptions, examples include the following: Stipends in excess of the $50 threshold, More than one telecommunication technology tool, Additional features. Please note that only the Dean or Vice President may approve these exceptions. No delegation is permitted but for the hospital where the budget officers may review exception requests. Discounts: Procurement is establishing strategic alliances with providers to offer discounts to employees. Finance-Tax department - DRAFT 12

13 Next Steps and Target Dates Next Steps: Have working committee approve a draft of the ‘SPG’. Include an overview and a section on FAQs. Revisit with stakeholders to ensure acceptance of policy. Meet with other interested groups, e.g. medical administrators group. Meet with Deans, Executive Officers, and others. Other recommended forums in rolling out the policy. Target dates: Provide pilot programs to campus units and UMHS departments on a voluntary basis beginning this fall term. Implement policy for new employees this January 1, Implement policy for the rest of campus, July 1, Finance-Tax department - DRAFT 13

14 Questions? Finance-Tax department - DRAFT 14


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