Office of the Vice President for
Administration and Finance
SECTION: FISCAL INDEX: B-1
SUBJECT: EXPENDITURES AND EXPENDITURE AUTHORITY
PURPOSE AND SCOPE
To ensure prudent management of all funds entrusted to the University for carrying out its programs and activities, this policy and its procedure outline the principles governing university expenditures and prescribes a policy and procedure for ensuring appropriate signature authority for all university expenditures. These guidelines are provided to assist all university departments in meeting their obligation of public accountability to the State of Texas, governmental agencies, and to other constituencies that have provided funds for the University's use.
This document is in compliance with UHS System Administrative Memorandum 03.A.01, Expenditure of all Funds Administered by the University of Houston System. (References)
All University expenditures shall be consistent with applicable state and federal laws and regulations; with any restrictions, rules, or regulations placed on the use of the funds by donors and granting or contracting agencies; and with prudent management practices. In addition, all expenditures must be reasonable and necessary for carrying out the programs and activities of the University within budget allocations. Expenditures must be approved by the Senior Administrative Official of the unit, and must be documented in a way that clearly substantiates such reasonableness and necessity.
It is the responsibility of the Vice President for Administration and Finance to provide controls that ensure accountability for all university funds. The Senior Administrative Official of the unit is responsible for certifying all transactions within their budgetary allocations or delegating authority (not responsibility) to subordinates to certify such transactions. Such delegations are required to be in writing in the format prescribed in this document.
1) To approve an expenditure by signing the appropriate document, e-mail approval, or through electronic workflow. Such certification ensures that:
- The expenditure is made for the purpose for which funds were budgeted.
- The expenditure is properly authorized.
- The procurement process was followed and the documents are prepared in accordance with all state, federal, UH System, and university guidelines.
- The funds required are available.
- The transaction complies with pertinent rules and regulations required by external funding sources and/or oversight entities.
2) To approve revenue transactions by approving GL journals by signature, email approval or through electronic workflow.
3) To approve budgetary transactions by approving budget journals by signature, email approval or through electronic workflow.
4) To approve any other transactions involving assets, liabilities, fund equity, revenue or expense by approving documents by signature, email approval or through electronic workflow.
Certifying Signatory: The university employee who is authorized to certify expenditures for a department, project, or division and whose signature, email approval or approval through electronic workflow must appear on any expenditure document initiated by that unit.
Division/Department Administrator: The chief officer within each division or department.
Expenditure and Other Financial Documents: Generally, documents committing or eliciting payment from university funds, which require a certifying signatory’s signature, email approval or approval through electronic workflow.
Principal Investigator (PI): The faculty or administrator with responsibility for directing the technical aspects of a project, and/or carrying out research efforts within the scope authorized by the agency, and authorizing all expenditures of award funds within administrative constraints imposed by the agency, the state, and/or the University. In the absence of the PI, the division dean may authorize expenditure of funds.
Processing Departments: The University administrative departments that review and approve documents, committing or expending the financial resources of the department: e.g., the Purchasing Department, the Finance Department, the Office of Financial Aid, the Bursar Office, Human Resources, Contract Administration, etc.
Senior Administrative Officials: Personnel charged with the responsibility of ensuring that all transactions of budget allocations in their area are certified in compliance with University policy. Senior Administrative Officials include the President, Vice Presidents, Deans, School/Division/Department Administrators and Principal Investigators.
Sponsored Project/Grant Funds:: Funds in cost centers over which the Research and Sponsored Programs Office has stewardship responsibility.
University Funds: All monetary resources available in institutional cost centers--from all funds, all sources except for funds held by the institution as fiscal agent for individuals or organizations (agency funds/ fund 9).
To provide controls that ensure accountability for all university funds, the following principles shall govern:
- The Senior Administrative Official of a division or department is entrusted with the authority and has ultimate responsibility for ensuring that procurement, expenditure, cash handling, and other financial matters are managed in accordance with this and other institutional policies and procedures.
- Only the Senior Administrative Official of each division/department shall have authority to certify expenditure of university funds or to delegate such authority. Authority will be delegated to a very limited number of capable, responsible personnel within each unit. In the individual's absence, either the immediate supervisor or appropriate cabinet-level supervisor may manually sign, email approve or electronically approve transactions.
- Expenditure documents, i.e. payroll reallocations, vouchers, expense reports and contractual agreements, must be submitted to the Research and Sponsored Programs Office for review and approval when sponsored project/grant funds are used.
- Certain specialized purchases require additional approval by the department with oversight responsibility for those items.
- University processing departments responsible for procurement, payment, or other financial activities shall not approve or process any procurement or expenditure request that has not been certified by the properly authorized signatory or signatories.
Before expenditures are incurred or reimbursement sought against any University funds, there must be evidence that procurement guidelines have been followed that ensure a valid commitment of university funds.
Any obligation incurred by a University of Houston-Victoria employee contrary to university guidelines becomes the personal obligation of the employee and not the University.
Requests for expenditures against university funds shall be fully documented and certified for payment in accordance with these guidelines and with other applicable institutional, UH System, state and/or other governmental agency guidelines prior to the authorization of any payment:
- Every expenditure request must be certified by the signature, email approval or approval in electronic workflow of the properly authorized certifying signatory for the type of commitment and the department from which that expenditure is requested. Expenditure commitments made through purchase requisitions are certified at that level.
- All expenditures against sponsored project /grant funds require the signature, email approval or approval in electronic workflow of the Research Administrator in the Research and Sponsored Programs Office on applicable expenditure documents.
- Generally, payment or reimbursement for purchases of materials and services requires at the minimum an invoice or receipt from the vendor. Purchases made by purchase requisition also require a receiving report and a purchase order (PO) voucher.
- Requests for expenditures not meeting the documentation standards required for that document and other institutional guidelines will be rejected by the processing department and returned to the originating department with the reason for rejection stated. Unless the problem is resolved in accordance with appropriate guidelines, the payment will not be approved.
CERTIFIED SIGNATORY LIST
The General Accounting Manager in the Finance Office maintains a List of Sources with Approvers and Alternate Approvers for the UHS Finance System.
When any change occurs in signature authorization, the Senior Administrative Official shall submit a written authorization or the UHS Finance System Access Form to General Accounting Manager in the Finance Office.
DELEGATION OF AUTHORITY
Approval authority is assigned to the Senior Administrative Official for cost centers which are directly under their supervision. This signature authority may be delegated by the Senior Administrative Office to other employees by submitting the proper written authorization or authorization of appropriate security access with the UHS Finance System Access Form. Although the Senior Administrative Official may delegate approval authority to a business manager or other employee, this does not relieve them of their responsibility for expenditures within cost centers under their control. For this reason, careful consideration must be given to the selection of capable, reliable employees when delegating approval authority for the authorization of transactions.
- UH System Administrative Memorandum 03.A.01, Expenditure of all Funds Administered by the University of Houston System
- Sources with Approvers and Alternate Approvers
- UHS Finance System Access Form
Philip Castille, Ph.D.
Next Review Date: August, 2016
Originating Department: Finance Department
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