Fund Monitoring

Category: Governance
Number: GOV-090-030
Audience: All University employees and the Board of Governors
Issued: January 27, 2004
Revised: September 10, 2014
Owner(s): VP (Administration)
Approved by: Board of Governors
Contact: Associate Vice-President (Finance) - 306-585-4171

Introduction

This policy provides a coordinated approach to ensure the Board of Governors (Board) receives the financial information required to meet its fiduciary responsibilities.

Because the Board exercises little or no control over revenues and expenditures in some funds and because of the more predictable nature of revenues and expenditures in other funds, the frequency and means by which the Board monitors the various funds need not be uniform. The overriding requirement is that Board members receive sufficient information to fulfill their legal responsibilities and, in particular, to satisfy themselves that the University’s revenues and expenditures are in line with the relevant budgets.

This policy sets forth a schedule of monitoring reports for University funds and describes the format of such reports and other related information the Board requires.

Policy

The University uses fund accounting for the purposes of budgeting and recording revenues and expenditures. The Board of Governors sets budgets annually for six funds: 

  • Operating
  • Capital
  • Research
  • Special Projects
  • Trust and Endowment
  • Ancillaries

The Board monitors these funds based on financial information received as detailed under Processes.

Roles and Responsibilities

Board of Governors

  • considers and approves a comprehensive budget for the University
  • compares actual and projected revenues and expenditures with the budgeted figures during the fiscal year
  • if revenues and expenditures are not in line with the budget, ensures appropriate action is taken to maintain the fiscal integrity of the University

University Management

  •  provides sufficient and timely financial information to the Board of Governors

§  Capital

§  Research

§  Special Projects

§  Trust and Endowment

§  Ancillaries

Consequences for Noncompliance

If funds are not monitored in accordance with this policy, the fiscal integrity of the University may be compromised and the University may be denied a clean audit opinion by the Office of the Provincial Auditor, which would in turn jeopardize the provincial operating grant.

Board members will fail to fulfill their fiduciaries responsibilities if they do not monitor the financial status of the University.

Processes

Operating Fund

Frequency of Reporting

Three times per year, for the most recent finalized fiscal month preceding each Finance and Facilities Committee meeting, beginning with a report as at October 31. These dates approximate the end of the University's second, third and fourth fiscal quarters.

Report presented to

Finance and Facilities Committee

Format

Each report will present:

  • approved budget figures;
  • revised budget figures;
  • the current report's projected revenues and expenditures;
  • the variation of this projection from the revised budget;
  • the previous report's projected revenues and expenditures; and
  • the differences between the current and previous reports' projections.

Notes

The operating fund reports are expected to provide a meaningful breakdown of revenues and expenditures, to a level of detail with which the Board feels comfortable. These reports will include written explanations of any variances between budgeted and projected figures as a result of activity during the month. The audited financial statements shall serve as the monitoring report as at April 30.

Capital Fund

Frequency of Reporting

As at October 31, February 28 and April 30

Report presented to

Finance and Facilities Committee

Format

Each report will present:

  • budgeted revenues and expenses;
  • actual year to date revenues and expenses;
  • projected revenues and expenses for the fiscal year; and
  • the differences between budgeted and projected figures.

Variations from budget will be explained. The monitoring reports will discuss major capital project activity in some detail.

Notes

The details in the quarterly reports about each major capital project will be clear as to the sources of all anticipated revenues and will use a sources-and-uses format to explain any shortfalls or surpluses. At each of its meetings, and as appropriate between meetings, the Finance and Facilities Committee will receive written updates on all major capital projects and significant renovation projects. These reports will compare the actual progress of construction to the anticipated schedule and will include projections as to whether the projects will be completed within the approved budget.

If it is determined that the cost of a major capital project will exceed budget, the matter will be reported to the chair of the Finance and Facilities Committee immediately. The audited financial statements shall serve as the monitoring report as at April 30.

Research Fund

Frequency of Reporting

Annually, as at April 30.

Report presented to

Audit and Risk Management Committee

Format

Audited financial statements for the fiscal year

Notes

Revenues from research grants and contracts and expenditures from research accounts are difficult to predict because most federal grants are announced each year in April, the final month of the University's fiscal year. However, the University's planning framework contains targets for the growth of research funding and it is therefore important for the Board to be aware of progress in this area. Accordingly, the Vice-President (Research) shall report to the Board at each of its meetings on significant new research awards and on progress towards research funding targets.

Special Project Fund

Frequency of Reporting

Annually, as at April 30.

Report presented to

Audit and Risk Management Committee

Format

Audited financial statements for the fiscal year

Notes

The Special Projects Fund is composed mainly of one time projects such as conferences, competitions, sport fund-raising events, workshops, dinners, lectures, course conversion to on-line, and alumni awards. It also holds resources supporting the carryforward balances in the General Operating and APEA funds. The main sources of revenue in the Special Projects Fund are conference fees from external sources, grants, and contributions and donations. These projects are also often supported by internal transfers from a faculty or department. Because of the variable nature of when a special project might be initiated, it is difficult to predict revenues and expenditures in the Special Project Fund. The budget for this fund is therefore estimated based on prior years.

Trust and Endowment Fund

Frequency of Reporting

Annually, as at April 30

Semi-Annual Report presented to

Finance and Facilities Committee

Semi-Annual Report Format

Reports from Investment Manager and Investment Performance Monitor

Annual Report presented to

Audit and Risk Management Committee

Annual Report Format

Audited financial statements for the fiscal year

Notes

The main sources of revenue for the Trust Fund are investment income and fundraising activity. Both are difficult to predict with any precision. However, because the University has ongoing commitments (e.g. scholarships) and one-time projects (e.g. new buildings) that rely on funds from the Trust Fund, it is important for the Board to be kept up to date on investment yields and fundraising. The Vice-President (Administration) will report the most recent rates of return on the Trust Fund and the Associate Vice-President (External Relations), will report on fundraising progress, at levels of detail as prescribed by the Board.

Ancillaries Fund

Frequency of Reporting

Semi-Annually, as at December 31 and April 30

Reports presented to

Finance and Facilities Committee

Mid-Year Report Format

The mid-year report will include actual revenues and expenditures for each of the ancillary services as at December 31 and will compare projected revenues and expenses for the full fiscal year with the budgeted numbers approved by the Board.

Year-End Report presented to

Audit and Risk Management Committee

Format

The audited financial statements shall serve as the monitoring report as at April 30

Notes

The Associate Vice-President (Finance) will explain the differences between budgeted and projected amounts.