2010 Finance Forum
8 July 2010
Innovation Lecture Theatre
Agenda
Welcome and Significant Current Issues
David Sturgiss
10 minutes
Transparent Cost of Research
Peter Shipp
10 minutes
HERDC Update
Lorraine Piper
5 minutes
FBT Return Review
Callum Burke
10 minutes
Vendor Record Management
Wendy Fox
10 minutes
Report Distribution Tool
Ben Lees/Eric Li 10 minutes
Receipting Project
Pat Price
Afternoon Tea
10 minutes
20 minutes
Budget Template and Summary Code
Mark Baker
10 minutes
PCI-DSS
Brigid Lever
10 minutes
Student debtor policy/procedures
Brigid Lever
10 minutes
Update on other initiatives
Brigid Lever
10 minutes
F&BS training opportunities
Amanda Walker
10 minutes
Welcome and Significant Current Issues
David Sturgiss
Transparent Cost of Research
Peter Shipp
Background
• First considered by the ANU in June 2008
• Participated in work undertaken by Allen Consulting Group in 2008 and
2009 on behalf of DIISR
• Based on approaches identified under the UK Model to a degree
• DIISR were seeking to identify an approach that could substantiate
university claims regarding the indirect cost of research and a model to
assist in driving a funding model within the Sustainable Research
Excellence (SRE) context
Background
• SRE focus to support research excellence and secure
longer term sustainability of quality research
• SRE providing $510 million over 4 years 2009/10 to
2012/13 to :
• Support indirect costs associated with Australian
Competitive Grant Research (ACGR)
• Increase transparency and accountability
Background
• 2010 a trial year for Transparent Costing exercise
• Universities to provide:
• Results of a ‘Staff time spent on ACG Research’
survey (Staff Time Survey)
• Report on the University’s Indirect Costs (IDC)
• Option of a Preferred and/or Alternate method of
calculation given by DIISR
Promising Start
• Open minded approach by DIISR in the development of a
TC model
• Option of 2 models to determine TC
• Preferred and Alternate
• Alternate model from high level data and all
universities should be able to undertake
• No disadvantage provision for those adopting the
Preferred model if this resulted in a lower number
Promising Start
• Use of a Trial Year approach to enable development of the
model
• TC outcomes used as a moderator NOT a determinator in
the funding model
• Not a true ABC model
• Implementation funding for those participating in SRE and
TC exercise
DIISR Methodology
• Identify from Staff Time Survey the amount of time
dedicated to ACG research as a proportion of Total
Academic effort (Alternate method) or as a proportion of
Total Research effort (Preferred method). Academic staff
surveyed to determine time spent on:
• Research ACG
• Research Other
• Teaching
• Research Training
• Other (includes grant application and preparation)
• Leave
DIISR Methodology
• Determine ‘Allowable Indirect Costs of Research’ –
Preferred Method
• Non academic salaries and on-costs related to
supporting research activities
• Maintenance of physical infrastructure used for
research including most IT
• Finance and Insurance costs related to research
activities
• Other costs indirectly associated with research
DIISR Methodology
• Determine ‘Allowable Indirect Costs’ – Alternate Method
• Identify all indirect costs associated with research and
teaching which are all costs of operations EXCEPT
• Academic salaries and on-costs
• Depreciation
• Borrowing costs
• Commercial activity related costs
• E-research/high performance computing costs
• Joint venture and controlled entity costs
• Costs of acquiring research animals
Alternate Method Approach
• The simplest of the two methods
• Requires:
• Outcome from Staff Time Survey
• Identification of ‘Allowable Indirect Cost’ at high level
• Risk is that it is less accurate than the results from the
Preferred Method
• Predicated on the assumption that the non-research
indirect costs are similar to those for research
Preferred Method Approach
• Requires recognition of the following allowable:
• Indirect costs at the local research Business Unit level
• Indirect costs at the College or Central level
• Once the College/Central allowable non-local Indirect costs are
identified they are to be reallocated to the research area on a relevant
Cost Allocation Proxy (CAP)
• The Indirect Cost at local research Business Unit + College/Central
costs reallocated to research Business Unit = Indirect Cost of
Research
• The costs MUST be related to research activity
ANU Approach
• ANU approach will not be applicable to ALL universities
• Following principles should however be adaptable to most
universities
• Always view as a work in progress
• Our operational structure and physical layout only allows
us to adopt a ‘predominance use’ approach.
ANU Approach
• Established a system generated report to identify
contribution to P&L result by each Fund type*
• Report can be run at whole-of-University or
College or Business Unit level
• Can be reconciled back to P&L values
* Fund types R = Recurrent; S = Contract Research; Q = Consultancy; Other = Trading
Areas, Endowment, and Investment returns etc.
ANU Approach
R
S ACGR
S Other
Q ACGR
Q Other
Other
Total
414,466
87,002
83,174
131
53,675
197,021
835,469
Acad Salary
128,358
39,574
10,589
0
5,892
298
184,711
Non-Acad Sal
145,025
12,610
13,700
2
3,866
36,571
211,774
Services
143,530
33,508
32,394
66
27,769
26,892
264,159
Depreciation
44,314
0
0
0
0
5,232
49,546
Other
46,039
9
740
0
6,335
5,035
58,158
Total Op Exp
507,266
85,701
57,423
68
43,862
74,028
768,348
AFS P&L
(92,800)
1,301
25,751
63
9,813
122,993
67,121
Op Income
Op Expense
ANU Approach
• Direct costs
• Direct Costs funded by Projects PLUS Direct Costs
that are met from University operational budgets e.g.
Chief Investigator Salary and possibly other expenses
of this nature
• For the purpose of this exercise we have not identified
these salaries as Direct Cost nor apportioned them in
the allocation of Business Unit Indirect Costs (as they
are excluded under DIISR Guidelines)
ANU Approach
• Indirect Costs
• Generally recognised as operational expenses
recorded in the R Fund of the relevant Business Unit
(Research School or Centre in this case)
• Exceptions to the above are:
Academic Salaries
Depreciation
ANU Approach
Overhead Cost recognition
Generally located in the Recurrent Fund expenses associated with:
• College General operations (primarily administration of the
College or in some cases area in which utility charges are held if
not distributed to Business Units of the College)
• Central University Administration operations
• To determine overhead costs related to Research ANU’s CAPS
are applied to redistribute these costs to Teaching and Research
Business Units
ANU Approach
Overhead Cost recognition (cont’d) - College
• College General Business Unit generally contains
costs associated with administration and in some
cases some other costs that the College does not
distribute to Business Units.
• Total College expenses allocated to Business Units
(BU) of the College based on the ANU CAP
• BU AFS Income/Total College AFS Income
ANU Approach
Overhead Cost recognition (cont’d) – Central Admin
• The following Central Admin Areas Costs have been
redistributed
• Based on ANU CAP: Current Replacement Value BU
Buildings/Total Current Replacement Value of Teaching &
Research Buildings
• Building Maintenance
• Campus Wide Property Costs
• Facilities and Services Division
ANU Approach
• Overhead Cost recognition (cont’d) – Central Admin
• Based on ANU CAP: BU AFS Income/Total Teaching
& Research BU AFS Income
•
•
•
•
•
•
University Executive
Finance & Business Services
General University Activities
Marketing and Communications
Statistical Services
Development Office
ANU Approach
• Overhead Cost recognition (cont’d) – Central Admin
• Based on ANU CAP: BU Student EFTSL/Total
Teaching & Research BU Student EFTSL
• Division of Registrar and Student Services
ANU Approach
• Overhead Cost recognition (cont’d) – Central Admin
• Based on ANU CAP: BU Average of(Staff FTE +
Student EFTSL)/Total Teaching & Research BU (Staff
FTE + Student EFTSL)
• Information Services (IT)
• Based on ANU CAP BU Raw Staff Numbers/Teaching
& Research Raw Staff Numbers
• Human Resources Division
ANU Approach
• Overhead Cost recognition (cont’d) – Central Admin
• Based on ANU CAP BU Number of S Accounts Held
31 Dec/ Total Teaching & Research BU S Accounts
Held 31 Dec
• Research Office
Issues to be resolved in the future
• How to address direct cost of academic salaries covered
by universities not recognised as direct or indirect costs in
the TC exercise
• How to reflect depreciation
• Current DIISR approach is that only function of universities
is Teaching & Research – impact of this on redistributing
College/Central costs where central costs associated with
servicing non-eligible operations not recognised (eg
commercial activities)
Issues to be resolved in the future
• Need for us to be more definitive in what is a Research and
Teaching Department and associated costs to be
recognised at that level
• Move towards an ABC model methodology in the future
• Determine cost drivers
• Understand true cost of Research and Teaching
deliverables
• Look to identify costs associated with BOTH Research and
Teaching
Issues to be resolved in the future
• Significant system and administrative practice changes
likely to arise and need to be managed
• Significant cost in both time and dollars will be involved in
moving down this path and will require buy-in from
university executive
• The work, fun, and challenges for us in identifying the real
cost of Research and Teaching in our universities begins!!!
Useful Links
• http://www.innovation.gov.au/Section/Research/Document
s/IndirectCostsUniResearch.pdf
• http://www.innovation.gov.au/Section/Research/Document
s/FAQsSREFinance100610.pdf
• http://www.innovation.gov.au/Section/Research/Document
s/GuidelinesForTheAssignmentOfTheIndirectCosts100610
.pdf
• http://www.innovation.gov.au/Section/Research/Document
s/SRE2010GuidancePaper.pdf
Useful Links
• http://www.rcuk.ac.uk/cmsweb/downloads/rcuk/reviews/fec
/fecexecsum.pdf
• http://www.rcuk.ac.uk/cmsweb/downloads/rcuk/reviews/fec
/fecreport.pdf
• http://www.rcuk.ac.uk/cmsweb/downloads/rcuk/reviews/fec
/fecannex.pdf
• http://www.rcuk.ac.uk/cmsweb/downloads/rcuk/documents
/qavreport.pdf
• RCUK website
Happy to take Questions
HERDC Update
Lorraine Piper
SPECIAL PURPOSE FUNDS
HERDC
• Financial return submitted successfully 30 June
• Increase of $2.6M over 2008 return
• New & improved method of preparing return well received –
further feedback will be sought prior to the preparation of the
2010 return
30 June Statements
• List of 122 statements due for preparation as at 30
June distributed to College Finance officers on Friday
2/7
• 18 require internal audit
• 8 require external audit
• Documentation to be returned to SPF by Wed 21/7 (at
latest) to ensure timely conduct of audits
FBT Return Review
Callum Burke
TOTAL FBT payable
$1,400,000
1,321,544.00
1,278,983.72
1,149,105.68
$1,200,000
1,079,293.78
$1,000,000
1,065,510.32 1,071,399.06 1,054,597.68
917,428.01
873,286.77
FBT ($)
$800,000
737,729.79
$600,000
$400,000
$200,000
$2001
2002
2003
2004
2005
2006
Year
2007
2008
2009
2010
ANU FBT 2001-2010 by benefit type
$600,000
534,140.00
$500,000
346,012.87
2001
Taxable value
$400,000
2002
2003
2004
$300,000
2005
82,295.00
2006
2007
$200,000
2008
2009
$100,000
2010
42,437.00
11,980.00
30,168.00
$Expense payment
Fringe Benefits
Entertainment Fringe
Benefits
Loan/Debt Waiver
Fringe Benefits
Motor Vehicles (less
Sal Pack)
Benefit type
Property & Residual
Housing, LAFHA
Meal Entertainment
- Overall increase in taxable value of approximately $75,000.
- Currently working strategies to reduce future FBT on ME.
- Business areas need to encourage staff to reduce
expenditure on ME.
- FBT cost should be considered before ME takes place.
Motor Vehicles
-Increased taxable value of approximately $19,000.
-Make the most of exempt vehicles.
-Reduce home garaging of non-exempt vehicles.
-Reduce personal use.
-Statutory percentages, Increased KM’s does unfortunately
reduce FBT cost.
2009-10 FBT Return
-FBT packs received from Colleges
- Overall very high quality
- Declarations
-Individual area reports
- Sent out in June for review
-Reconciliation
- Currently working on making adjustments for ‘actual
FBT amounts’ v ‘System generated amounts’
Salary Sacrificing of iPads (e-readers)
-
ATO has confirmed that iPads can be defined as laptops or PDAs
(section 58X(2) FBTAA).
-
However to be exempt and therefore effective under a salary
packaging arrangement:
1. The device must have been acquired for the primary
purpose of use in your actual employment duties, and
-
2. You must not have salary packaged any similar items earlier in
the relevant FBT year.
iPad is marketed primarily as an entertainment making it much harder
to justify the primary
-
purpose is for work.
Result = No iPads under salary packaging arrangements at this
stage.
Vendor Record Management
Wendy Fox
Vendor Record Management
Vendor request job logging in DOI Helpdesk
• Email to vendor.maintenance@anu.edu.au with supporting
documentation
• Follow-up directly in DOI Helpdesk
• Email from DOI Helpdesk when vendor approved
Revised Web documentation:
• POI – Get Employee/Student, default to cheque
• 21 day payment terms default
• Vendor reactivate – email vendor.maintenance@anu.edu.au with
supporting documentation
Report Distribution Tool
Ben Lees and Eric Li
Introduction
• Approximately 10,000 nVision reports produced each
Period End
• Significant time spent by Finance staff distributing
reports to the right recipients
• College of Science developed an email based
distribution tool
Key Features
• Distributes reports via Microsoft Outlook
• Distribution template
• Maintain recipient/report relationships
• Map new reports at period end
• Filtering by report id/recipient
• Logs distribution history
• Displays reports not yet distributed
• Allows for adhoc usage
• Multiple reports per recipient
Requirements
• Microsoft Windows platform
• 2003 or 2007 Microsoft Excel and Outlook
Demonstration
1. Run Report Book within ES Financials, zip them, and
unzip to your local machine.
2. Open the Distribution Tool and go to the TEMPLATE
worksheet to setup mappings between filenames and
recipient email addresses.
3. Select Directory where the unzipped files are saved
4. Excel files in folder will be picked up and assigned
emails provided that they match keywords from
TEMPLATE worksheet.
5. Assign email addresses for the remaining files, that
you want to distribute, then click on Distribute Report.
6. A pop-up message appears to notify the number of
reports sent.
7. Click DISTRIBUTED worksheet to review distribution
log.
8. Sample Email from Outlook.
Questions?
Receipting Project
Pat Price
Receipting Project Purpose
•review processes, tools and technology employed to collect funds (tuition
fees, goods and services income, cost recoveries)
•identify areas of inefficiency or risk;
•review banking products available to assist;
•propose implementation plans to deliver preferred solutions; and
•provide the business information to support:
• a reduction in manual processing and cash handling across the
University;
• improved processing of international receipts and reductions in the
number of unidentified receipts; and
• PCI-DSS compliance of customer payment card transactions (by
30/9/2010)
Receipting Project Execution
•Review and document end-to-end process – customer to GL
•In Scope – cash, EFTPOS, web payments, direct deposits
•Out of scope – direct debits, BPay
•Visit all receipting points and document current processes
•Collate, analyse, process map and review
•Recommendations for improvement future project(s)
•Complete visits by end September, review and analysis
through Sept-Nov
Afternoon Tea
Everyone
Budget Template and Summary Code
Mark Baker
2011 Budget Website
http://info.anu.edu.au/fbs/Finance_Functions/2011-Budget-2
2011 Budget Website
http://info.anu.edu.au/fbs/Finance_Functions/2011-Budget-2
Draft 2011 Budget Timetable
Key dates
• 13 August 2010 – CFO 2011 budget memorandum issued.
• 19 August 2010 – ED (A & P) budget process email sent.
• 28 September 2010 – submission due for summary performance
data by academic.
• 11 October 2010 – one page budget submission report due.
• 19, 20, 22 October 2010 – VC budget meetings..
Draft 2011 Budget Timetable
Key dates (continued)
• 12 November 2010 – submission of preliminary 2011 budget
summary report due.
• 19 November 2010 – VC’s budget plenary meeting & budget
papers sent to Finance Committee.
• 26 November 2010 – budget papers considered by Finance
Committee.
• 3 December 2010 – budget papers presented to Council for
approval.
Questions?
2011 Budget Tool
What has changed for 2011?
• Update EB dates and rates.
• Review oncosts.
• Review and update CPI.
• Make sure salary increments are biannual, for those that are
biannual.
• Include employee ID on salary sheet.
• Include 25% loading for casuals (bug from last year).
• Update statement sheet to use new budget accounts tree layout.
• Natural account codes retained.
• Aim to release within the next month.
• Additional explanatory notes added.
• Any questions or suggested improvements email
Trevor.Langtry@anu.edu.au
2011 Budget Tool
2011 Budget Tool
Questions?
PCI-DSS
Brigid Lever
PCI-DSS
•
•
•
•
•
•
Purchase Card Industry Data Security Standards
Costs of compliance – physical and electronic security
Cost of non-compliance – fines $100K plus
Attest to level of compliance by 30/9/2010
PC data must be personally controlled by cardholder
Only feasible response is to NOT record PC data
anywhere, anytime within University
Student Debtor Policy/Procedure
Brigid Lever
Student Debt Management
•C’wealth-supported students - cancelled at census
•DTF and ISF can be cancelled and still have a debt
•DRSS liaise with student admin in Colleges
•College SA liaise with College Finance
•Write-off – College bears FULL fees
•Pursue – College Finance to liaise with F&BS
•MUST provide full evidence of enforceable debt
•Subject to standard debt collection policy/cycle
•Subsequent write-offs will bear FULL fee plus D&B costs
Updates on other initiatives
Brigid Lever
Updates
•
•
•
•
OCR – development and testing underway
Stipend advances (overpayments)
Travelex 24/7
Visiting artists
F&BS Training Opportunities
Amanda Walker
Training
-Senior Leaders Guide to Finance @ ANU
- Delegations
- Structure of ledger
- Budget process
- How to read a financial report
- Where to go with questions
- Periodic mail out of finance “tips”:
- SPF/FMR Guides
- How to see if an invoice has been paid
- Training info on web
- Training page
- Toolkits
End