Establishment and Use of Agency Funds

The University may grant agency fund status if the AO or other certain entities external to the University comply with applicable University policies and complete the following steps to obtain such status:

1. Obtain University Department Sponsorship

The Agency must seek a University department to sponsor its request for agency fund treatment.

2. Completion of Agency Questionnaire

Upon mutual agreement between the sponsoring department and the Agency, the person initiating the request and the RRC Manager residing over the sponsoring department must complete and sign UM 1652 Agency Questionnaire. Submit the questionnaire to Accounting Services.

3. Review of Agency Questionnaire

Accounting Services will review the answers to the questionnaire and determine if sufficient justification exists for agency fund treatment based on relevant accounting standards. Accounting Services will notify the RRC manager of the status of the request within 10 working days.

The notification may reflect one of the following decisions:

  • Agency fund treatment is appropriate for this separate legal entity according to generally accepted accounting principles. In such cases, Accounting Services will forward the request to the Office of General Counsel for its consideration before an agency fund DeptID is setup by Accounting Services.
  • Agency fund treatment is not appropriate according to generally accepted accounting principles for reasons indicated, and Accounting Services will recommend an alternative type of fund.
  • Presence within the Enterprise Financial System, regardless of fund type, is not appropriate because the Agency’s activities are not consistent the University’s overall mission, policies, and/or in the best interest of the University’s overall operations.

4. Consultation with Office of General Counsel (OGC)

Once Accounting Services has deemed that the use of an agency fund is appropriate for a legal entity that is separate from the University, a contract may be required. The sponsoring department will consult with the OGC once Accounting Services determines an agency fund is appropriate. OGC will notify both Accounting Services and the RRC manager within 30 days of its decision of whether a contract is required. OGC will draft a contract between the University and the Agency to identify the rights and responsibilities of the parties involved.

5. Assignment of DeptID in an Agency Fund

Once OGC forwards a fully executed agreement to Accounting Services or OGC has notified Accounting Services that no contract is required, Accounting Services will establish a DeptID within an appropriate agency fund and notify the RRC manager of the agency fund status.

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