Faculty of Medicine training: Budgeting and Planning

Transcription

1 Faculty of Medicine training: Budgeting and Planning 1

2 Objective of the session Understanding the UBC budgeting methodology 10 year faculty plan Operating report for Executive Hyperion 2

3 UBC budgeting methodology 3

4 UBC budgeting methodology Admin units on zero based budgets, no carryforwards, access to contingency Faculties receive revenues driven by the faculty funding model and stand alone, keep carryforwards Variations in domestic enrolment at 75% (tuition fees and gov t grants) Variations in ISI enrolment at 65% after deductions, half to teaching faculty and half to home faculty Revenue is allocated at faculty level, each faculty decides how to share incremental revenue within the faculty 10 year plan in November, input to Hyperion in December (new version to be created within Hyperion which will not update from FMS or Position Management) 4

5 New Budget Allocation Model Faculties are more accountable and independent Purpose is for sustainability (no more budget cuts) of each unit Driver based by FTE Faculties kept whole with base budget from March 31, 2010 New definition of operating budget = GPOF + Feefor-service + Continuing studies + unrestricted special purpose funds + unallocated research overhead ICP allocation based on 3-year average Tri-Council Space budget transferred to Faculties to administer

6 New Budget Allocation Model Cont d Faculties keep 75% of new/increased tuition revenue Only opportunity for FoM is increased students in Basic Sciences Faculties responsible for PTR and merit Addressed through turnover savings and ensuring budget exists for full cost of new hires Faculties get full share of any increase in research ICPs Previously received only a portion, if any, of increase

7 Implications for the FoM There are only two planned budget increases for the Faculty: 4 F-slots related to the SMP expansion (already allocated) Incremental funding increases as outlined on preceding slide In the foreseeable future there will be little/no growth, any new positions must come from existing, recurring funding. 7

8 10 Year faculty plan 8

9 10 Year faculty plan All faculties are reviewed each November by the Budget Committee (Provost, VP FRO, VP Students) Focus is whether the long term plan is sustainable no requirement to balance bottom line every year 10 year outlook includes all Operating funds No use of carryforwards to plug recurring deficits May require 2 scenarios depending on outcome of wage negotiations 9

10 10-Year Plan Purpose is to show sustainability Process for preparing 10-year plan a) For each academic unit and administrative unit b) Refine further at departmental unit level c) Assumptions provided for salary increases and CPI Mandate is: no deficits 10

11 F-slots and Turnover Savings Used to fund faculty salary increases FoM tracks f-slots manually Base is March 31, 2011 GPOF report 35% turnover savings on retirements to fund salary increases (collected by UBC Central) 30% turnover savings on resignations to fund salary increases and other FoM initiatives (collected by FoM) 11

12 Use of Carry Forwards Current financial priority is to spend down reserves University target is to spend down over 3 years Reserves include unspent operating budgets + unrestricted expired research & start-up funding Allowed 5% for contingency funds Priority use: a) Bridging salary b) Salary increases c) Endowment top-ups d) For sustainable salary funding including creating endowments 12

13 10 Year faculty plan - revenue Operating Funds Planning Scenarios (In $000s) 12/13 Forecast 12/13 Budget 12/13 Variance 13/14 14/15 15/16 16/17 REVENUE Tuition 59,732 59,732 28,209 28,646 29,093 29,548 Domestic Tuition 32,929 32,929 ISI Tuition 21,444 21,444 21,873 22,310 22,756 23,211 Exchange Students Differentiated Fee to teaching faculty CO-OP Tuition Graduate Tuition to Administering Faculty 5,209 5,209 6,336 6,336 6,336 6,336 Institutional Costs of Research (ICR) ICP Research Overhead Operating Grant 44,410 44,410 44,410 44,410 44,410 44,410 Incremental Government Funding Complement 24,267 24,267 24,267 24,267 24,267 24,267 Incremental Space Chargeback Base Faculty Operating Grant 20,143 20,143 20,143 20,143 20,143 20,143 Endowment Spend Rate Cost Recovery Continuing Studies Income TOTAL REVENUE 105, ,097 73,575 74,014 74,461 74,918 13

14 10 Year faculty plan - expenses 14

15 Quarterly Operating report 15

16 Operating report Prepared by Budget Office for Executive Committee Shows the same level of row detail as the Operating budget on the Budget Office website (one row per faculty) Shows actual funding costs and revenues to date, future projected costs and revenues, and carryforwards Draws information directly from Hyperion future costs and revenues are updated by faculties Budget Office advises deadlines, time allows one week after quarter FMS close to revise future months data in Hyperion before report is run 16

17 Hyperion 17

18 Hyperion - overview Implemented 3 years ago with a view to offer planning functionality to campus and replace shadow systems Annual budget data is prepared in Hyperion Units can use Hyperion for scenario planning as well as the official budget Log-in through CWL Data is input via forms (pre-set templates) Salary data is populated automatically from Position Management, and updates regularly on an automated basis As each month closes, Hyperion budget data for that month is overridden by actual results (possible to still access original budget data) Data can be extracted using forms or Smartview Detailed training is available Plan to build into Intergrated Reporting 18

19 Hyperion Workforce Reflects data in the HR system Populates either from position data (Position Management in HRMS) which is a budget salary or from hire data in HR (actual salaries) through a flag for each position Defaults to Position Management salary when the position is vacant Positions are created as part of the hire process Position data is useful when current hire profile is not typical for long range planning, but requires periodic update as salary data gets stale Workforce allows additional input for planned salary increases and overtime Actual closed months currently report by FTE, not position report solution is being developed 19

20 Hyperion Transfers Fundplan application allows units to transfer GPO funding between PGs, departments and faculties The recipient to the transfer must accept the transfer before it completes Transfer can be recurring or fiscal only Transfers in Hyperion automatically update funding allocations in FMS 2 business days after acceptance Interfund transfers operate in a similar manner but are effective for planning purposes only (actual transfers must be processed through FMS) 20

21 Hyperion Smartview Excel add-in Data extraction tool designed for power users only Permits easy manipulation of data, not limited to forms Runs instantly Templates can be set up which populate at the press of a button Limitations that output is limited to numerical data only Can be ed as Excel spreadsheet to non Smartview users 21

22 Other FOM information 22

23 From FMS Financial Reports a) Rollup reports by account (monthly) b) Rollup reports by fund (monthly) c) Over/Under reports (monthly) d) Endowment status reports (quarterly) From Hyperion a) Budget vs. Variance reports (weekly) b) Long-term forecasts (in progress) 23

24 Endowment Budgets Endowment rate = 3.5% Stabilization account = Original principal contribution market value spending allocation UBC strategy: to recover original principal over 10-years Strategies to improve spending allocation: a) Increase capital through fund raising b) Use reserves to top up capital c) Encroachment Quarterly status report of endowments 24

25 Refer to Policy 87 Research Overheads FoM overhead distribution: 76% is distributed to Department/Centre where the project grant is set up 24% is retained by the Dean s Office Different allocation methods based on hospital or non-hospital involvement 25

26 Research Overhead Allocation 26

27 Research Overhead Allocation 27

28 Research Overhead Allocation 28

29 Research Overhead Allocation 29

30 Research Royalties Income derived from the sale or other disposal by the University of inventions or discoveries Net income is calculated as gross income less direct costs, such as patent fees, legal expenses, etc. Administered by UILO Income is distributed as follows: 50% to the inventor 25% to the Faculty 25% to UBC 30

31 Budgeting for Recruitments Need to budget for full salary and benefits at the top of the scale Salary increases Other resources a) Startup b) Housing benefit For CRCs need to budget for backup salary funding With multiple funding need to create a financial plan showing revenue and expenses 31

32 Other UBC Financial and Operational Reforms Reduced chart of accounts Consolidate fund codes to simplify financial management and reporting Shared administrative support and restructure certain functions Increase ISI enrollment Summer programs to increase use of residences and facilities (University program little impact on FoM) 32

33 New Financial Information Systems Travel and Expense system Business Information (BI) tools 33

34 Internal Controls Regular review of departmental finances Actual vs. budget report & variance analysis Look for large and unusual items Review consulting fees Scan list of vendors Review what you are signing Ensure separation of financial duties Certification of financial records & internal controls Ensure ledgers are reconciled monthly Implement two-signature policy 34

35 Internal Controls (cont.) Get rid of signature stamp Don t share digital signatures Periodic external review of departmental finances Internal control check list 35