CHAPTER 38
CSU RISK MANANGEMENT AUTHORITY (CSURMA)
1.0 OVERVIEW AND DEFINITIONS:
The California State University Risk Management Authority (CSURMA or Authority) is an
association of the CSU and the auxiliary organizations established for the purpose of protecting
member resources through the provision of broad coverage and quality risk management services
aimed at stabilizing risk costs in a reliable, economical and beneficial manner.
The Chancellor's Office staff and representatives of auxiliary organizations within the CSU
collaborated to developa systematic approach to the managment of risk exposures prevalent
across CSU campuses. Special legislation was obtained which permitted both the CSU, as a
state agency and auxiliary organizations, as separate nonprofit corporations, to create a quasipublic entity to establish and perform pooled group insurance and related risk management
functions for the benefit of all who elected to join the CSURMA. On January 1, 1997, the
CSURMA was formed by the CSU and those qualified auxiliary organizations that opted to join
the entity with the intent to participate in the risk management programs offered by the
Authority.
The CSURMA presently has several risk management programs in effect, as detailed in
subsection 3.2.
2.0 FUND SPECIFICS:
CSU Fund 547, TF-CSU Risk Management, will be deactivated effective July 1, 2013 as
CSURMA is now reported as a discretely presented component unit on the CSU’s consolidated
financial statements in accordance with GASB 61.
3.0 FUND MANAGEMENT AND ACCOUNTING PRACTICES:
3.1 Unique FIRMS Object Codes
Effective July 1, 2013, the following object codes specific to CSURMA are:
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580092
CSURMA Dividend Revenue - Used by campuses to record dividends granted
and distributed by the Authority. The dividends represent a return of premiums
paid by the members of the pool which CSURMA management deems to be
excess revenue.
660011
NDI/IDL Claims Expenses(CSURMA use only)- Used by CSURMA to record
claims paid to member organizations.
603100
NDI/IDL Claims Reimbursement (contra expense)- Used by campuses to record
the IDL/NDI reimbursements received from CSURMA.
660013
CSURMA Dividend (CSURMA use only)- Used by CSURMA only to record the
return of excess funds to the participants in the insurance pool.
3.2 CSURMA Coverage Programs
The CSURMA presently has several risk management programs in effect, including the Pooled
Liability Program, the Pooled Workers’ Compensation Program, the IDL/NDI/UI Program, the
Property Program, the Athletic Injury Medical Expense (AIME) Program, Auto Liability
Program, the Auxiliary Group Purchase Insurance Programs and the Owners Controlled
Insurance Program (OCIP).
The Pooled Liability Program is designed to cover the general liability and errors and omissions
risks of the CSU campuses. The annual premium is collected at the beginning of the fiscal year
via a Cash Posting Order (CPO). Campuses are to record the annual premium to FIRMS object
code 660010, Insurance Premium Expense, and to NACUBO program code 0606, General
Administration. CSURMA’s Liability Coverage Program offers each campus the opportunity to
re-evaluate its deductible every three years. Throughout the policy year, CSURMA makes
payment on claims on behalf of the campuses. Quarterly, CSURMA Accounting invoices and
collects via a CPO from the campuses amounts up to their deductible limit. This function is
referred to as the Deductible Recovery process. Campuses record the deductible recovery
invoice to FIRMS object code 660012, Insurance Claim Deductible, and program code 0606.
The Pooled Workers’ Compensation Program is designed to cover both
workers’
compensation benefits and employer’s liability obligations of the CSU campuses. The annual
premium is collected at the beginning of the fiscal year via a CPO. Campuses record the annual
premium to FIRMS object code 660010, Insurance Premium Expense, and to various program
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codes based on where payroll expenses are incurred. Campuses will have no further accounting
transactions throughout the policy year.
The Industrial Disability Leave (IDL), Non-Industrial Disability Leave (NDI) and
Unemployment Insurance (UI) Program is designed to cover the CSU employees’ disability
leave and unemployment costs of the CSU campuses. The annual premium is collected at the
beginning of the fiscal year via a CPO. Campuses record the annual premium to FIRMS object
code 660010, Insurance Premium Expense and to NACUBO program code 0606, General
Administration. Under the IDL and NDI procedure, campuses incur the cost up front and then
are reimbursed by CSURMA based on the campus’ submitted quarterly FIRMS data. IDL and
NDI payments are made to employees through the payroll system and are recorded to either
FIRMS object code 603009, Non-Industrial Disability or 603008, Industrial Disability .
Campuses record the reimbursement for NDI/IDL to FIRMS object code 603100, NDI/IDL
Claims Reimbursement.
For the UI program, CSURMA Accounting issues payment to the Employment Development
Department (EDD) directly. Campuses are not reimbursed by CSURMA.
The Property Program is designed to cover property losses, except for losses resulting from
earthquakes, incurred by CSU campuses. The annual premium is collected at the beginning of
the fiscal year via a CPO. Campuses record the annual premium to FIRMS object code 660010,
Insurance Premium Expense, and to NACUBO program code 0701, Physical Plant
Administration. Campuses will have no further accounting transactions throughout the policy
year.
The Athletic Injury Medical Expense (AIME) Program is designed to cover injuries sustained
by regularly enrolled students of the universities who are participants on the intercollegiate team
roster. The annual premium is collected at the beginning of the fiscal year via a CPO. Campuses
record the annual premium to FIRMS object code 660010, Insurance Premium Expense, and to
NACUBO program code 0606, General Administration. Campuses will have no further
accounting transactions throughout the policy year.
The Auto Liability Program is designed to cover the liability risks associated with campusowned vehicles. The annual premium is collected at the beginning of the fiscal year via a CPO.
Campuses record the annual premium to FIRMS object code 660010, Insurance Premium
Expense, and to NACUBO program code 0606, General Administration. Campuses will have no
further accounting transactions throughout the policy year.
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3.3 CSURMA Account Coding Overview and Definition
The table below summarizes CSURMA-related account coding for both campuses and
CSURMA. This table is also presented at the Systemwide Financial Standards and Reporting
website
(http://www.calstate.edu/SFSR/standards_and_rules/2013/CSURMA_Coding_Illustration.pdf).
California State University, Risk Management Authority (CSURMA)
CSURMA Coding Illustration
Campus Accounting
Object Code
Program Code
1 Premiums
General Liability Premiums, AIME Premiums, Auto Liability Premiums
Workers' Comp Premiums
NDI/IDL & Unemployment Insurance Premiums
Property Premiums
Other Purchased Premiums Paid Directly to Alliant or Others
660010
660010
660010
660010
660010
0606
(A)
0606
0701
0701
2 Payroll Expense
Non-Industrial Disability (NDI)
Industrial Disability (IDL)
603009
603008
(B)
(B)
3 Reimbursements
NDI/IDL Claims Reimbursement/Expenses
603100 (CR)
4 Deductibles
General Liability deductibles : Reimburse CSURMA for deductibles paid on
behalf of the campus
Property deductibles: Campus deductibles per each property loss occurrence
660012 (DR)
660012 (DR)
580090
580090
580090
580090
580090
5000
5000
5000
5000
5000
(B)
660011 (DR)
0600
0606
0701
660012 (CR)
660012 (CR)
0600
0600
660012
603007
0600
SW %
5 Claims
General Liability Claims (including Aux Organizations)
Workers' Comp Claims
6 Dividends
7 Loans
Loan Principal
Loan Interest
CSURMA Accounting
Object Code
IPEDS Prog
580092
1500
660013
1500
201005/261003
660006
9000
1400
109010/109710
508090
9002
5000
(A) WC Premiums should be charged to appropriate funds and programs. It is recommended to use prior year payroll as basis for allocation among funds and FIRMS program codes.
(B) Labor Cost Distribution (LCD) will record to the appropriate fund and FIRMS program code based on department ID when payroll expense is incurred.
HR subsystem amounts must reconcile to GL.
3.4 CSURMA Dividend
In years when the CSURMA pool has a positive claims history in the campus programs and a
fully funded program status, the CSURMA executive committee may approve distribution of
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program dividends. It should be noted that campuses should not rely on CSURMA dividends as
they are only distributed when the pool has met its funding requirements.
Effective July 1, 2013, campus members are to record the annual dividend as a revenue to
FIRMS object code 580092, CSURMA Dividend Revenue.
3.5 CSURMA Cash Posting Order (CPO) Process
CSURMA Accounting utilizes Cash Posting Orders (CPO) to remit/collect payments to/from
campus members. (Auxiliary member payments are issued via check or wire). A CPO is a
mechanism to move Systemwide Investment Fund Trust (SWIFT) dollars among its members.
General guidelines have been developed to assist campuses with their reimbursement requests.
Please refer to the CSURMA CPO Process Overview and CSURMA Reimbursement Request
Guidelines located on the CO Financial Services-Accounting website. Check this site regularly
for any updates to the process.
For more information regarding the year end accrual process for invoices relating to
reimbursements and collections issued after June 30 of any fiscal year , please refer to the Year
End Instructions for Deductible Recovery
As mentioned at subsection 3.2, the annual premium for the Pooled Liability Program is
collected at the beginning of the fiscal year and each campus selects a deductible limit.
Throughout the policy year, CSURMA makes claims payments on behalf of the campuses.
Quarterly, CSURMA provides the campuses with a report of all the claims payments made on
their behalf. Within 30 days following the issuance of this report, CSURMA Accounting
processes a CPO to collect the payments made, up to the deductible limit per occurrence selected
by the campus. Campuses record the deductible recovery CPOs with a debit to FIRMS object
code 660012, Insurance Claim Deductible, program code 0606, General Administration and a
credit to 101100, Cash-Short Term Investments (SWIFT).
4.0 REPORTING REQUIREMENTS:
There are no campus reporting requirements.
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5.0 FUND BALANCE:
Not applicable.
6.0 GAAP IMPACT:
Effective July 1, 2012, CSURMA changed from blended to discretely presented component unit in
the CSU Systemwide financial statements in accordance with GASB 61. As a result, there has been
changes in the object codes to be used both by the campuses and CSURMA (refer to section 3.1
above). It is imperative that each transaction is recorded exactly as instructed above for
consolidation purposes at the CSU systemwide level. For accurate and consistent systemwide
consolidated reporting, specific accounting treatment for CSURMA activities have been developed.
7.0 RESOURCES:
If you have any questions regarding the above CPO process please email
CSURMA_Acctg@calstate.edu
Helpful websites include:
Enterprise and Chancellor’s Office Financial Reporting Website:
IDL/NDI/UI reimbursement general guideline
CSURMA CPO Process Overview and CSURMA Reimbursement Request Guidelines
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CSU RISK MANANGEMENT AUTHORITY (CSURMA)
REVISION CONTROL
Document Title:
CHAPTER 34 CSU RISK MANAGEMENT AUTHORITY (CSURMA)
Contributor:
Alice Kim, Senior Manager, Enterprise and CO Financial Reporting
Reviewer:
Kelly Cox, Associate Director, Accounting
CO Owner:
Roberta McNiel, Senior Manager, Financial Systems, Statutory Reporting and
Tax Administration
Issuance Date:
January 21, 2014
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