Printed on: 08/21/2018. Please go to http://policy.umn.edu for the most current version of the Policy or related document.

ADMINISTRATIVE PROCEDURE

Handling Sponsorships and Correlating Registrations

Sponsorship Packages

Prior to any event/activity communications, announcements, solicitations, or payments received, units determine the price and assign a fair market value to registration, tickets and sponsorship packages.

Units provide sponsors with a written sponsorship package form detailing the price of the sponsorship package, any return benefits offered, and how and where to remit payment based on the Job Aid for Sponsorship for University-Hosted Events/Activities. Units should also complete a return benefits valuation worksheet for internal purposes, identifying the fair market value of each return benefit.

  1. Sponsorship package forms should include at a minimum the following details:
    1. University cause that benefits from the event
    2. Total payment and the tax-deductible gift portion, if any
    3. Detail of each benefit included in a package (including fair market value of the benefit)
    4. Sponsor Information (i.e. name as they wish to appear in marketing materials, contact name & title, address, email and phone, website, etc.)
    5. Billing and payment options & information
      1. Indicate payable to the University of Minnesota Foundation (for Gift Eligible Sponsorships) or to the Regents of the University of Minnesota (for Non-Gift Eligible Sponsorships)
      2. Indicate payment forms not eligible for partially deductible gifts (currently gifts from donor-advised funds, private foundation and transfers of securities cannot be used for payment)
    6. Signature Line
  2. Each sponsor should submit sponsorship package form with their payment.

Processing Sponsorship Revenue & Expenses

Gift Eligible – Deposit at UMF

If the sponsorship contains a charitable donation component and is allowable for UMF to accept, per the Job Aid for Sponsorship for University-Hosted Events/Activities, direct the revenue to UMF in accordance with the current gift processing procedures.

Sponsorship package forms should include the following, in addition, to the above details:

  1. Option to only make a donation to the cause (and not purchase a sponsorship package)
  2. Indicate that payments should be made payable to the University of Minnesota Foundation

Options for directing event/activity revenue to UMF:

  1. Route gift portion to a UMF fund that supports the event/activity cause and route the nondeductible portion used to cover event/activity expense to a separate UMF event/activity expense fund where event/activity expenses will be paid or reimbursed via EFS invoices.
  2. Route the total amount to UMF event/activity expense fund dedicated to accept eligible event/activity revenues. After the event/activity is complete and all event/activity expenses have been paid or reimbursed via EFS invoices; unit transfers money to separate UMF fund(s) that support the University event/activity cause.
  3. Use University approved event/activity systems (currently UMTE – U of M Tickets and Events) to route gift portion to UMF fund that supports the event/activity cause and route the nondeductible portion used to cover event/activity expense to an EFS chart string where event/activity expenses will be paid.

Withdrawing event/activity revenue from UMF:

  1. When incurring expenses in the University designated ChartField string related to the event/ activity, create an invoice (page 39) requesting disbursement from the UMF fund consistent with donor intent and as close to incurring the actual expenses as possible.
  2. Use revenue account code 540101 - Gifts and Bequests for donations of funds or non-capital property from businesses, foundations, or individuals, or bequests from individuals.

Non-Gift Eligible – Deposit at University

If the sponsorship is not allowable for UMF to accept per the Job Aid for Sponsorship for University-Hosted Events/Activities invoice the sponsorship package in accordance with Administrative Policy: Managing Billings to and Receivables from External Customers.

  1. Invoice the sponsorship through the EFS system, the invoice provides payment instructions when paying by check, electronic funds transfer or credit card. Contact your Financial Cluster for invoice instructions.
  2. Use the following revenue account codes based on the transaction:
    1. 520102 - Ticket sales, admission and event registration fees for non-athletic events
    2. 520204 - Fees charged by academic units to participants for trips and tours associated with non-credit conferences or courses hosted by the University
    3. 520218 - Sponsorships for revenue received from sponsors to assist in covering the costs of events that are non-athletic related and not considered advertising
    4. 520222 - Revenues generated from advertisements
    5. 520603 - Fees charged by units to participants for non-credit conferences or courses hosted by the University
  3. For athletic sponsorships use, account 520704 Athletic Marketing Sales. This accounts for revenue generated by intercollegiate athletics from advertisements, promotional events/activities, and sponsorships.
  4. The unit may acknowledge the sponsor with a thank you, specific situations may require the unit to work with the Tax Management Office on an appropriate acknowledgment.

Processing Registration Revenue

All event/activity registration and ticket revenue will be processed through the University unless the registration or ticket contains a charitable gift component or is part of a Gift-Eligible Sponsorship package per the Job Aid for Sponsorship for University-Hosted Events/Activities.

Reporting and Reconciliation

  1. For those events/activities that have Gift Eligible (funds deposited at UMF) transactions use the UMF DMS (Donor Management System) to access the Fund Statement Report. For those events/activities that have Non-Gift Eligible (funds deposited at the University) transactions use the University Account Budget Status Report to track revenue and expenses for the event/activity. These two reports may need to be combined for a comprehensive event/activity review.
  2. Review the UMF expense fund for the specific event/activity and reconcile expenses incurred at the University to ensure enough funds have been drawn from the UMF funds to cover the University incurred expenses for the event/activity. O&M funds can only be used for events/activities if UMF funds are insufficient to cover University incurred expenses for the event/activity and are allowable. Refer to Administrative Policy: Hospitality and Other Special Expenses for further guidance.
  3. Units must review and reconcile the financial transactions of the event/activity between the UMF fund and the University chartstring in accordance with Administrative Policy: Reconciling and Verifying General Ledger Accounts and Other Financial Information at least twice a year by December 31 and June 30.

Determining How to Handle Events/Activities From a Sponsorship Perspective

  1. To request assistance in determining how to handle an event/activity, send a copy of the planned sponsorship and/or event, date of event, contact person and other pertinent information to sponsorships@umn.edu.
  2. The University’s sponsorship classifications group, comprised of representatives from the Tax Management Office, UMF and the Controller’s Office will review the materials and respond with rapid input to those who are uncertain on how to handle an event/activity. An answer related to proper handling or a request to obtain clarifying information will be provided to the requestor within three working days.
  3. Additional resources related to Unrelated Business Income - Advertising and Unrelated Business Income - Corporate Sponsorships can be found on the Tax Management Office website.

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