Financial Accounting and Controls
ACCOUNTING FOR DEPARTMENTAL REVENUES
Departmental revenue or "income" is defined as "Departmental revenue generated from sales to non-University clientele for goods or services." (Business and Finance Bulletin A-56 (PDF)). This policy does not cover gift or contract and grant revenues -- see Program Income on the Contracts & Grants Accounting site.
Inter-departmental transactions between units should not be reported as revenue, these transactions should be recorded as recharge income, which is an expenditure offset account.
1. Revenue Account Values
Departmental Revenue is generally recorded using the following accounts:
|46xxx||Sales & Services of Educational Activities|
|47xxx||Sales & Services of Auxiliary Enterprises|
|48xxx||Other Operating Revenues|
If a department feels it is more appropriate to code a transaction with an account in the range 40xxx – 45xxx, please contact General Accounting or Contracts and Grants Accounting as follows:
Contact the Contracts and Grants Accounting Office (CGAhelp@berkeley.edu ) for transactions in the following fund ranges:
|18200 – 18999||State Agencies|
|20400 – 20499||State Agencies|
|20600 – 20939||State Agencies|
|20950 – 20999||Local Government – Contract & Grants|
|21000 – 21099||Federal Appropriations|
|21100 – 26499||Federal Contracts & Grants|
|26500 – 26599||Private Contracts & Grants|
|26600 – 33999||Federal Contracts & Grants|
|57000 – 58999||Private Contract & Grants|
|77001 – 77050||Local Government – Contract & Grants|
|77051 – 77099||State Agencies|
|77100 – 77149||Local Government – Contract & Grants|
|79000 – 79499||Private Contracts & Grants|
|79500 – 79999||Private Contracts & Grants|
For all other fund ranges, contact the General Accounting Office (firstname.lastname@example.org).
2. Revenue and Fund Values
Whenever a department generates a significant amount of income from outside sources, such as other institutions, companies or the general public, these amounts should be recorded in a revenue fund range.
Currently, the campus considers any income regularly exceeding $50,000 per fiscal year to be significant enough to establish a revenue fund and to be permanently budgeted.
If revenue is less than $50,000 per annum, please use the following funds:
If the department has an established fund for this type of income, it can continue to be used otherwise:
a. Accounts in the range 46xxx-Sales & Services of Educational Activities should be used with Fund number 60050.
b. Accounts in the range 47xxx-Sales & Services of Auxiliary Enterprises should be used with the existing fund numbers set up for each auxiliary operation.
c. Accounts in the range 48xxx-Sales & Services of Service Enterprises & Other Revenues should be used with Fund number 66350.
Org. codes, project or flex field values, along with the account, can differentiate the type of revenue for reporting & analysis purposes.
3. Revenue ORG Code Values
The appropriate departmental org. code should be used with revenue accounts in the range 46xxx, 47xxx or 48xxxx. Central org codes should not be used to record departmental revenues.
4. Combination Validation
The following revenue accounts can only be used in conjunction with specific fund ranges.
Note: Departments should only use accounts in the range:
a. 46xxx – Sales & Services of Educational Activities,
b. 47xxx – Sales & Services of Auxiliary Enterprises and
c. 48xxx – Other Operating Revenues
If a department feels it is more appropriate to code a transaction with an account in the range 40xxx – 45xxx, please contact General Accounting (email@example.com) or Contracts and Grants Accounting (CGAhelp@berkeley.edu ) on how to proceed.
|Account range||Account description||Fund range|
|401xx||Application for Admission Fees||19900|
|404xx||Summer Session Revenues||20290-20291|
|4051x||Health Insurance Fees||20270|
|4052x||Special Law / Med. School Fees||20221|
|4053x||Professional Degree Fees||20225, 20226, 20231, 20234 or 20237|
|4054x||Campus Services Support Fees||20158|
|4055x||Self-Supporting Program Fees||20150 or 19900|
|4056x||Course/Instructional Materials Fees||20xxx|
|4059x||Other Student Fees||200xx**|
|406xx||Other General Fund Fees||19900|
|407xx||University Extension Revenues||20300-20399|
|410xx||State General Support||19900-19999|
|4110x||State Specific Support||18000-18069|
|4111x||State Special Funds||18070-18199|
|4200x||U.S. Government Appropriations||21003-21099|
|412xx||State Agencies||18200-18999, 20400-20499, 20600-20939, 77051-77099|
|421xx||U.S. Government Grants||21100-24999, 29000-33999|
|422xx||U.S. Government Contracts||25000-26499, 26600-28999|
|431xx||Local Government Contracts & Grants||20950-20999, 77001-77050, 77100-77149|
|4402x||Private Gifts-Uncollectible||39600-39999, 40000-56999|
|4403x||Private Gifts-Discounts on Pledges||39600-39999, 40000-56999|
|44100||Private Restricted Grants||57000-58999|
|442xx||Private Restricted Contracts||26500-26599, 59000-59999 79000-79999|
|450xx||Endowment Funds Income||* see below|
|46xxx||Sales & Services of Educational Activities||60000-65999|
|47xxx||Sales & Services of Auxiliary Enterprises||70000-74999|
|480xx, 48xxx||Other Sources-Service Enterprises||66000-66099|
|481xx||Other Sources-Other||66100-66399, 67320-69999***|
* The UC Berkeley campus does currently not use this account, hence no fund range provided.
**The proper fund range for account 40593 (Continuing Education Fees) is 60000-65999.
***The proper fund range for account 48106 (Workstudy Revenue) is 66400-67319.
If your department receives payments from sources not associated with the University for services or materials provided by your department, and the payments directly benefit your department or the University, then these payments are probably revenue. If the total revenue your department receives exceeds $50,000 per fiscal year, your department should obtain a revenue fund and permanently budget for these revenues.
Revenue should not be confused with agency operations or other expenditure reimbursements. A department may undertake work for and incur costs on behalf of professional societies and organizations and receive reimbursements from the particular society or organization. In these cases the department should obtain the monies up front, to prevent potential problems in cash collection for services provided. These reimbursements are not considered revenues and should be credited on the miscellaneous cash receipt form to the departmental expenditure account from which the original expenditures were made. If the transactions relate to an established agency operation, please follow policies for agency operations. See UC Business and Finance Bulletin A-54 Agency accounts for further information.
In general, the process for obtaining a revenue fund is as follows:
Submit a Revenue Fund Number Request form. Download the Revenue Fund Number Request form and instructions. The form should include a detailed description of the revenue-generating activity and a projected budget of revenues. In order to establish the new fund, revenue-generating activity should amount to at least $50,000 per year.
For revenue fund requests, prepare a memo to accompany the fund request form. The memo should contain the following information to provide additional background to persons reviewing your department's request:
1. Description of the items or service to be sold, including pricing and cost information and to whom the sales are expected to be made. This information will be useful in determining if any net revenue generated from the activity is subject to reporting to the Internal Revenue Service as Unrelated Business Income Taxes (See Caveats).
2. The estimated amount of annual revenue to be generated from sales of the items or services.
Estimated annual revenue sources less than $50,000 do not have to be permanently budgeted.
Estimated annual revenues sources greater than or equal to $50,000 need to be permanently budgeted as follows:
Departments with revenue accounts should periodically review annual revenue estimates/budgets and determine if re-budgeting is necessary. Budgeted revenue is an estimate and is subject to fluctuation. The pot of money you might have thought would be available at the end of the year might not fully materialize. As a result, if actual income is less than budgeted income, budgeted expenditures may also need to be reduced to remedy the situation. Deficits in "revenue" funds are subject to Short-Term Investment Pool charges.
Please contact your budget representative if you have questions on how to budget for miscellaneous revenues. If you do not know who your contact is, see the Budget Office Contact list.
1. Instuctional Fees
Care should be taken in attempting to generate revenues from students. University budget policy prohibits departments from imposing instructional fees on students. Such things as charging for access to and use of laboratory facilities during normal instructional hours would violate this policy. Approval for imposing instructional fees is vested in the Chancellor, the President of the University, and the Regents. Consult the Vice Provost Office or the Budget Office for additional guidance.
2. Unrelated Business Income Taxes
Any profits generated by the campus from revenue-generating activities which are not consistent with the purposes of the University are subject to being taxed by the Internal Revenue Service as unrelated business income. Please see the Unrelated Business Income Taxes (UBIT) section in the General Accounting website.
3. Sales Tax
In certain circumstances, the University as the seller must charge sales tax on sales to third parties. This determination needs to be made depending on whether the transaction is subject to sales or use tax, or the sale is exempt from tax. This will depend on the type of sales being made or services being rendered. See the University of California Sales and Use Tax Manual for further information on whether a transaction is taxable. If you have further questions, please contact General Accounting at firstname.lastname@example.org.
Additional information can be obtained by consulting the following references:
- Business & Finance Bulletin, A-56, Academic Support Units Costing and Billing Guidelines (PDF)
- Business & Finance Bulletin, A-59, Costing and Working Capital for Auxiliary and Service Enterprises (PDF)
- Business & Finance Bulletin, A-61, Procedures for Determining Unrelated Business Income and Expenses (PDF)