March 2008Business Affairs -Your Partner for Successful Solutions 1 SERVICE CENTERS

March 2008Business Affairs -Your Partner for Successful Solutions 2 Service Center Definition: A unit that performs specific technical or administrative services primarily for the internal operations of the university and charges users for its services. A service center can be authorized to provide services to external customers.

March 2008Business Affairs -Your Partner for Successful Solutions 3 OMB Circular A-21 Requires that all costs be reasonable, allowable, allocable and consistently treated. Contains a list of allowable and unallowable costs. Unallowable costs cannot be budgeted or expensed on service center accounts.

March 2008Business Affairs -Your Partner for Successful Solutions 4 Specialized Service Facility (SSF) A service center that offers highly complex or specialized services that are not readily available from outside sources – for example, animal care facilities.

March 2008Business Affairs -Your Partner for Successful Solutions 5 Service Centers Facilities Telephone Services General Stores Core lab facilities Electron Microscope Research Ctr

March 2008Business Affairs -Your Partner for Successful Solutions 6 Billing Rates/User Fees Customer Base General Guidelines for Rates Key Compliance Issues

March 2008Business Affairs -Your Partner for Successful Solutions 7 Customer Base Internal –University Departments –Sponsored Programs External –Those who do not have a university account number –Industry –Students, faculty or staff acting in a personal capacity

March 2008Business Affairs -Your Partner for Successful Solutions 8 Billing Rates – Internal Users Billing Rates – Internal Users All internal customers must be charged the same rate for the same level of service under the same circumstances. Federal grants or contracts must be charged a rate equal to or lower than the rate charged to any other customer.

March 2008Business Affairs -Your Partner for Successful Solutions 9 Billing Rates – Internal Users Rates must be designed to recover the direct costs of the services or goods. Rates cannot be marked up to accumulate reserves. Rates must break even over time.

March 2008Business Affairs -Your Partner for Successful Solutions 10 Surplus Must be used to adjust future billing rates. Used to purchase equipment? No Used to fund salary increases? No Transferred to other activities unrelated to the center? No

March 2008Business Affairs -Your Partner for Successful Solutions 11 Billing Rates – External Users Recover all costs – and Include a surcharge equal to the current approved F+A rate. Rates cannot constitute unfair competition. External customers cannot be charged less than internal customers or the Federal government.

March 2008Business Affairs -Your Partner for Successful Solutions 12 Federal Concerns Administrative –Inadequate policies and procedures. –Records not retained by the Service Center for a period of 5 years. –Fund balance not properly monitored.

March 2008Business Affairs -Your Partner for Successful Solutions 13 Federal Concerns Administrative –Surplus funds were transferred to other university accounts. –Surplus funds were used for purposes unrelated to center activities.

March 2008Business Affairs -Your Partner for Successful Solutions 14 Federal Concerns Billing Rates –Cost studies not done to insure that rates represented actual costs. –Unallowable costs were included in the rates. –Rates not adjusted to eliminate operating surpluses and deficits.

March 2008Business Affairs -Your Partner for Successful Solutions 15 Federal Concerns Billing Rates –Some users billed at reduced rates and the federal programs subsidized the difference. –Surplus balances not always used to reduce future rates.

March 2008Business Affairs -Your Partner for Successful Solutions 16 Administrative Operational Guidelines Establishment and Financial Management of Authorized Service Centers and Specialized Service Facilities xy-86089_1-t_wcQmjthn Or