Budget Retained Funds (Carryover) Institutional Operating Policy
Responsible Officer: Chief Financial Officer
Designated Officer: Manager, Financial Budgeting and Corporate Reporting
Approving authority: Vice-Chancellor
Approval: 1 April 2008
Last Amended: N/A
Effective Starting Date: 2 April 2008
Any policies replaced by this policy: N/A
Policy number: O2.
Related Policies: N/A
Due date for next review: 1 April 2013
Part A: Preliminary
1. Purpose of policy
This policy is designed to provide a framework for financial control with respect to under-expenditure and over-expenditure of budget funds.
2. Application of policy
This policy applies to all staff and members of University decision-making or advisory bodies.
Part B: Policy
3. Retained funds (carryovers)
3.1 Organisational areas will be allowed to retain cumulative carryover operating funds equating to a maximum of 10 percent of the Council Approved Budget.
3.2 Funds in excess of the threshold in 3.1 will be redeployed by the University to either strategic or operational funding priorities.
3.3 As part of annual planning and budget negotiations, an organisational area may make application to the Vice-Chancellor for approval to retain carryovers in excess of 10 percent.
3.4 For funds such as research-specific funds, capital funds, faculty-derived research and consultancy income and other restricted funds the University will monitor expenditure as part of the budget development and review process and usually will redeploy unspent funds where practical and feasible (subject to any such redeployment being in full recognition of obligations and commitments related to those funds).
4. Budget expenditure
4.1 All organisational areas will operate within the level of expenditure approved in the Council Approved Budget (or a subsequent formal Budget Reforecast).
4.2 Organisational area budgets within the Council Approved Budget will be developed on at least a basis of ‘budget neutrality’ whereby deficit budgets will not be supported, unless specifically justified and approved.
4.3 Expenditure in excess of the level approved under 4.1 will be outside of delegations unless the Vice-Chancellor, on the recommendation of the Chief Financial Officer, has given written approval for a specific variation of the level.
4.4 In the context of triennial budgets, deficits will not be supported or approved for operating budgets. However one-off deficits for major institutional initiatives or strategic project-related commitments within the Council Approved Budget may be supported and approved.
4.5 Where a deficit is incurred in a Council Approved Budget, any budgeted carryover will be reduced by the amount of the deficit.
4.6 Where there are insufficient funds in the budgeted carryover to meet any deficit, the budget for the following year will be reduced by the amount of the deficit.
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