Office of the Controller Procedures

Internal Billing

Financial Affairs, Office of the Controller  |  Approved March 25, 2010

Purpose

Process internal billings between UMB Operational Units.

Applicability

UMB Operational Units (schools, departments, divisions) billing another UMB Operational Unit as a result of one UMB Operational Unit providing goods or services to another UMB Operational Unit.

Instructions

In the course of business operations an Operational Unit may charge another Operational Unit for goods or services rendered (“internal billing”). A properly documented journal entry is used for internal billings.  In order to prevent misstating revenues and expenses on the UMB financial statements, the following account codes are used for internal billings:

Revenue – The following revenue accounts are the only allowable revenue accounts for internal billings:

1. General
   1. 0798 – Internal Conference Fees
   2. 0998 – Internal Billing Revenue
2. Facilities
   1. 0956 – Project Administration Fees
   2. 0981 – Project Accounting Revenue
   3. 0985 – Transfer for Construction/Renovations

Expense – The following expense accounts are preferred* for internal billings:

1. General
   1. 3751 – Services - Internal
   2. 3999 – Supplies/Other - Internal
2. Specific Services
   1. 2175 – Labor Reimbursement (Facilities only)
   2. 3221 – Telecommunications Allocation (Internal)
   3. 3749 – Medical/Physician Services - Internal
   4. 3757 – Biopolymer Core (SOM only)
   5. 3759 – Pharmacy Research Allocation (Pharmacy only)
   6. 3775 – Facilities Management Services (Facilities only)
   7. 3790 – Guest Parking – On Campus parking violations (paid internally by JE)
   8. 3887 – Software Allocation (CITS only)
   9. 3925 – Vet Services Allocation (Veterinary only)
   10. 3945 – BIORESCO (Freezer Program only)
   11. 4711 – Staff Development – Internal
   12. 4980 – Space Charges
   13. 5131 – Construction & Renovation Transfers (Facilities)
   14. 5153 – Project Management Fees (Facilities only) 

*Note:  Operational Units may use a specific expense account (e.g. 3718 – Printing & Reproduction, 3746 – Catering Services) if required to do so for budgeting or reporting purposes.

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• The journal entry must have a description documenting what was provided and when it was provided.
• The journal entry should be processed within one month of the goods or services provided.
• Chartstrings used in the journal entry must be valid and active.
• Pre-payment of goods or services is prohibited.

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Employees who do not comply with this procedure may be subject to disciplinary action and/or criminal action.  An Authorized Affiliate Employee who does not comply with this procedure may be subject to disciplinary action, lose the privilege of being an Authorized Affiliate Employee, and will have UMB fiscal authority terminated.

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Exceptions to this Procedure must be approved in writing by the University Controller (UC) in Financial Services. All requests must be submitted to the UC using the Policy or Procedure Exception Request Form available on the Financial Services website.  The request must be signed/e-mailed by the Department Head or designee.

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Questions?  Contact the Financial Reporting Manager, Financial Services at 410-706-2910.

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RESPONSIBILITIES

Operational Units

• The Operational Unit initiating the internal billing must maintain supporting documentation showing that the charge is proper, reasonable, and authorized by the Operational Unit being billed.  

Financial Services

• Approves journal entries.  Supporting documentation review may be necessary prior to approval.

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DEFINITIONS AND TERMS

Authorized Affiliate Employee - Person employed by an entity that has a relationship with UMB authorized by the Board of Regents or by law, e.g., faculty practice plan organizations, University of Maryland Baltimore Foundation (UMBF) and other affiliated foundations, recognized incorporated alumni associations, recognized affiliated business entities, University of Maryland Medical System/University of Maryland Medical Center, and other University System of Maryland institutions.  An Authorized Affiliate Employee is responsible for the administration and reporting of UMB resources.

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Additional Guidance:

• Tutorial for Journal Entries 
• Navigation Path for Tutorial on Journal Entries:  eUMB Systems Tutorials Browser > Journal Entry