Budget Development and Oversight for Current Non-Sponsored Funds

Responsible Officer
Myron Frans
Senior Vice President for Finance and Operations
Myron Frans
Senior Vice President for Finance and Operations
Primary Contact
Julie Tonneson
Associate Vice President for Finance and Operations
Last Revised
Effective Date

Policy Statement

Budget Development

Departments must develop annual fiscal year operating budgets for current, non-sponsored funds. Responsible financial management results in annual operating budgets that:

  • are balanced (planned uses fully supported by identified resources)
  • reflect decisions made during the annual budget development process
  • identify annual financial plans by chartstring
  • if necessary, reflect projected deficits
  • include all anticipated resources and planned uses for the resources

Units must finalize and enter their budgets into the University financial system before the fiscal year begins.

Budgeted deficits at the Resource Responsibility Center (RRC) level should be avoided if possible. Any anticipated deficits at the RRC level or Fund-Z DeptID combination levels must be reviewed with the University Budget Office before being incorporated into the final budget.

The Board of Regents has final approval authority for the current operating budget.

Budget Oversight

Accountability for managing finances and budgets for the University rests with the leaders of the RRCs (the academic/administrative unit head: vice presidents, chancellors and deans).  Within that structure, RRC chief financial managers (and their RRC financial contacts and financial managers if applicable), and the University Budget Office are responsible for direct oversight of current non-sponsored funds, ensuring that:

  • year-to-date resources and expenditures are occurring in a manner consistent with the budget plans
  • resource shortfalls and/or expenditure overruns are identified and addressed as soon as possible
  • emerging or incurred deficits are identified, elimination plans are established, and incurred deficits are actively resolved
  • appropriate budget adjustments are reviewed and entered into the University financial system

Throughout the fiscal year, financial managers must monitor resources and expenditures to determine whether the financial status for their chartstrings is on target or is changing significantly. If significant changes are detected, the underlying reasons for the changes must be identified and, if needed, appropriate corrective action must be taken.

Reason for Policy

The University is committed to effective resource management and accountability. Budgeting is not an end, in and of itself; it is a tool to help the University achieve its strategic goals by managing its financial resources more effectively.

All potential resources (including carry-forward, expected revenue for the fiscal year and transfers in) and all planned uses (including expenditures and transfers out) must be included in the budget for budget planning to be comprehensive and effective. By requiring that all current, non-sponsored funds be included for planning and budgeting, the University can better manage its resources and hold itself to a consistent standard of accountability regardless of the source of funding or category of expenditure.

Regents' approval enhances accountability, provides proper financial oversight and helps align the University's financial resources with its strategic goals.

Ongoing budget oversight ensures that resources and expenditures are occurring in general conformity with the budget plan.



Budget Instructions can be found at the University Budget Office website.


Frequently Asked Questions

  1. Can I budget a chartstring to end the year in a deficit?

    The goal of responsible financial management is to avoid deficit situations.  If a deficit occurs or is projected then the entered budget should reflect those realistic expectations.   Contact the University Budget Office before incorporating anticipated deficits into the final budget at the Fund-RRC level or the Fund-Z DeptID level.


Direct any general questions about this policy to your RRC chief financial manager. If you have specific questions, contact the University Budget Office. For questions on Fringe Benefits, refer to Appendix: Fringe Benefit Contact List.

Subject Contact Phone Email
Primary Contact(s) Julie Tonneson 612-626-9278 [email protected]
Budget Development and Oversight University Budget & Finance 612-625-4517 [email protected]


Academic/Administrative Unit Head
Individuals who provide overall leadership for the unit and the University in general. They participate in policy formation and ensure policy implementation for their unit. They are also responsible for their unit’s overall financial management.
Approver Role
Individuals who review and approve sponsored and non-sponsored accounting transactions to ensure compliance with University policies and procedures and funding agency restrictions, and who identify problems and ensure resolutions.
Values used to classify financial transactions entered into the general ledger.
Chartfield value that identifies the organization at the University where budgets, staff, or academic programs are managed.
DeptID Trees
Reflect the management structure of the University and rollup information required for reporting, fiscal responsibility and oversight, and/or physical location. The University currently maintains two trees: UM_DEPTID_FISCAL and UM_DEPTID_BUDGET.
Nodes on the budget tree are managed by the University Budget Office. In the budget tree, each level 4 node is identified by a budget-only DeptID beginning with a "Z," sometimes referred to as the Z DeptID.
Financial Managers/RRC Chief Financial Managers
Individuals who are responsible for policy interpretation and implementation for a department (or other unit). They manage the sponsored and non-sponsored accounting and fiscal operations of a unit in compliance with University policies and procedures and funding agency restrictions. The RRC chief financial manager, as the primary financial official for an RRC, has a dotted line reporting relationship to the University Chief Financial Officer and provides leadership for all financial issues and financial managers of units within the RRC.
Non-Sponsored Funds
Funds which are not administered by Sponsored Projects Administration (SPA), but either 1) can be used by the University at its own discretion because there are no external restrictions, or 2) may be used only in accordance with the purpose established by the funding source.
Resource Responsibility Center (RRC)
Organizational level of the University defined for financial management purposes. Generally it is a campus, college or administrative/support unit led by a vice president, chancellor or dean. It may have multiple departments/divisions for management and reporting purposes (Z DeptIDs or DeptIDs) or only one.
Structural Imbalance
Regardless of fund source, situation in which annual recurring resources are less than annual recurring expenditures. Can occur at all organizational levels.
Z DeptID
Predetermined grouping of one or more DeptIDs that represents a budget level within a RRC whose aggregate total by Fund is used as the level at which deficits are monitored by the fiscal monitor and RRC chief financial manager. (See DeptID tree).


Academic/Administrative Unit Head
  • understand and effectively manage the unit budget
  • foster open and transparent financial processes
  • ensure that units under their management are aware of the sources and uses of funds at their disposal
  • routinely review unit financial activity with their RRC chief financial manager
  • work with their RRC chief financial manager to resolve anticipated and actual financial issues
  • communicate with their unit staff about financial status and expectations including avoiding deficit spending and the development of structural imbalances in the budget
Financial Manager
  • ensure that budgets entered are complete and represent planned activity for the fiscal year for their DeptIDs;
  • monitor DeptIDs across all funds to identify areas of concern;
  • maintain positive balances at the Fund-Z DeptID;
  • transfer funds from University foundations on a regular basis to prevent deficits in University chartstrings from occurring;
  • identify and implement necessary corrective actions on structural imbalances and deficits;
  • work with the RRC chief financial manager to effectively manage unit finances in alignment with RRC expectations.
RRC Chief Financial Manager
  • ensure that budgets entered are complete and represent planned activity for the fiscal year for their RRC;
  • monitor all funds at the RRC level to ensure that positive balances are maintained;
  • ensure that funds are transferred from University foundations on a regular basis to prevent deficits in University chartstrings.
  • identify deficits at organization levels below the RRC level, establish deficit elimination plans, and work with appropriate academic/unit leadership to resolve them;
  • identify ongoing issues/challenges to determine where structural imbalances and deficits could occur within the RRC;
  • provide direction and/or solutions to financial managers within their RRC to help resolve budgeting and/or spending issues;
  • provide leadership on budget and financial management within their RRC;
  • work with the University Budget Office to resolve structural imbalances and deficit spending issues and/or develop deficit elimination plans;
  • meet at least annually with the University Budget Office to review the RRC's finances.
University Budget Office
  • coordinate the budget and the allocation processes;
  • monitor entered budgets to ensure budgeting is complete and consistent with University policies/procedures;
  • monitor funds at the Fund-Z DeptID level and identify RRCs that have outstanding issues/challenges within their units;
  • work with the RRC chief financial managers to resolve structural imbalances and deficit spending issues and/or develop deficit elimination plans;
  • meet at least annually with the RRC chief financial manager to review the finances of the respective RRC.

Related Information


November 2018 - Comprehensive Review. Minor revisions. 1. addition of expectations related to structural balances. 2. clarification on expectations for budgeting and managing deficits. 3. updates to roles and responsibilities. 4. updates to references to reports. 5. removal of references to TIP. 6. updates to terminology.
June 2012 - New Policy, Comprehensive Review. 1. Combines three policies (Budget Development for Non-Sponsored Funds, Budget Oversight for Non-Sponsored Funds, and Allocating Temporary Investment Pool Income (TIP)) into one. 2. Suspends the charging of interest on deficits incurred. 3. Incorporates increased communications and monitoring by the Budget Office and units.
Budget Development for Non-Sponsored Funds, Budget Oversight for Non-Sponsored Funds, Allocating Temporary Investment Pool Income

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