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.

POLICY

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 the budget allocations.  These expenditures must be approved by the senior administrative official having the appropriate signature authority (e.g., director, department head/dean, or principal investigator) 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.

DEFINITIONS

Certify:  To approve an expenditure by signing the expenditure document. Such certification ensures that:

1. The expenditure is made for the purpose for which funds were budgeted.
2. The procurement process was followed in accordance with all state, federal, UH System, and university guidelines.
3. The funds required are available.

Certifying Signatory:  The individual who has been authorized to approve expenditures for a department, project, or division and whose signature must appear on any expenditure document initiated by that unit. In the individual's absence, either the immediate supervisor or whoever the individual has designated to the Finance Office by memorandum or e-mail to manually sign or electronically approve transactions.

If an authorized individual fails to appoint a designee in his/her absence, then the PeopleSoft Department ID-Rollup tree will set precedence, i.e., the immediate Level 3 may authorize Level 4; the immediate Level 2 may authorize Level 3; Level 1 (President) may authorize Level 2 as well as expenditures for any UHV department.

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.

Principal Investigator (PI):  The faculty or administrator 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.

Signature (Signing): Refers to handwritten or digital signatures. A digital signature is an electronic identifier that is intended by the person using it to have the same authority and effect as the use of a manual signature.  The Department of Information Resources publishes Standards Review and Recommendations Publications (SRRPUB) that are intended to be used as guidance by Texas institutions of higher education.

University Funds:  All monetary resources available in institutional accounts--from all ledgers, all accounts, all sources--except for funds held by the institution as fiscal agent for individuals or organizations (agency funds/ledger 9).

PROVISIONS

DELEGATION OF AUTHORITY

Approval authority is assigned to University department heads, deans, directors and other unit heads for cost centers which are directly under their supervision. This signature authority may be delegated by unit heads to other employees by submitting the proper written authorization or authorization of appropriate security access within administrative computing applications.  Although a unit or project head 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 either hardcopy or electronic transactions.   Stamped approvals of facsimile signatures are not acceptable.

To provide controls that ensure accountability for all university funds, the following principles shall govern:

• The 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 president, the vice president, the division or departmental administrators of each division shall have authority to certify expenditure of university funds or to delegate such authority. Authority will be delegated to a very limited number of personnel within each division.
• Principal investigators (or their designees) will provide an additional approval of all expenditures against the project/program accounts for which they are responsible. Designees must have sufficient expertise to certify to specific project need. Maintenance of designated P.I. signatories is a departmental responsibility.
• Expenditures of funds from centrally controlled, special-purpose accounts, must be approved by the vice president or other university official controlling that account, in addition to the division administrator of the initiating unit.
• 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.

DOCUMENTATION STANDARDS

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 certified for payment in accordance with these guidelines and with all other state, institutional, and governmental agency guidelines.

• Every expenditure request must be certified by the signature of the properly authorized 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 accounts require the signature of the principal investigator (or designee) or the sponsored project/program manager 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 copy of a purchase order.
• Requests for expenditures not meeting the documentation standards required for that document and other institutional guidelines will be rejected by the Finance Office 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.

EXPENDITURE DOCUMENTS

PROCUREMENT

1. Purchase requisitions/purchase orders (including departmental delegated purchases)
2. Purchase vouchers
3. Receiving reports, university-certified invoices
4. Invoice(s)

CASH HANDLING

1. Cash Receipts

TRAVEL, CONTRACTS, AND MISCELLANEOUS

1. Travel Requests forms
2. Travel vouchers (backup airline tickets, hotel bill, etc.)
3. Contract review documents
4. Authorized standard agreements
5. Scholarship award memos/ forms

INTERNAL PROCUREMENT

1. Work Orders - maintenance, telephones

ACCOUNTING ADJUSTMENTS

1. Expenditure reallocations and corrections (JVs)

HUMAN RESOURCES/PAYROLL:

1. Staff requests
2. Personnel Action Requests (PARs)
3. Payroll reallocations
4. Timesheets

Approved by:

Signature obtained                11/06/06
Tim Hudson, Ph.D.               Date 
President

Next review date:  November 2008
Origination:  Finance Department