Auxiliary Standard Operating Procedures


SUBJECT:

Deferral or Prepayment of Bursar (SIS) Student Charges

SOURCE:

Auxiliary Accounting, Financial management Services

DATE ISSUED:

April 2008

ASOP NO:

19.0

RATIONALE:

To provide guidelines on the timeliness and appropriateness of bursar billings for auxiliary units, related to unearned revenue.

 

Students are billed by the Bursar’s Office for tuition-related fees and other services, resulting in revenue for some auxiliary units. A receivable is recorded in the general ledger when the student is billed, which occurs before the semester begins. This entry is recorded as a debit to object code 8160 (Bursar Accounts Receivable) and a credit to either object code 1xxx (Revenue) or 94xx (Deferred). The timing of this entry may result in an overstatement of the Auxiliary’s revenue for a given quarter if the bursar billing occurs in a quarter prior to the beginning of the semester (e.g., bursar billing occurs in the second quarter and the semester begins in the third quarter).

ASOP:

The following provides examples of the entries pertaining to the bursar feeds that automatically occur each semester, as well as those that must be completed via the auxiliary voucher by materially affected auxiliary and service units.

 

The Bursar feed occurs monthly as a net debit to object code 8160 (Bursar Accounts Receivable) in the general ledger, with a corresponding credit to 1xxx (Revenue) or 94xx (Deferred). Included in this figure for each term code are student billings, payments, and credits. The objective is to identify material charges for future semesters where the income has not yet been earned. This would include student fees (i.e., student health fee, transportation fee, etc.) and/or housing charges, parking passes, Auditorium tickets, tickets for athletic events, etc. for future semesters.  (Earned income that would not be considered for this entry includes book sales for textbooks, parking tickets, etc.)

 

The bursar assessments date is determined by each campus individually and may vary from semester to semester; therefore, it is important that auxiliary units pay special attention to monthly balance sheets and income statements to ensure the accuracy of their entries.

 

Assessments and the corresponding feed date is most likely to occur as follows:

 

Tuition and Fees Assessment

Bursar Feed

Spring Semester

November

Summer Semester (s)

April

Fall Semester

July

 

AUTOMATIC ENTRIES BOOKED VIA THE SIS (Example)

Automated Entry

Bursar feed to record

student receivable in July

Object Code

Object Code Name

Debit

Credit

8160

Bursar A/R

$1100

 

1800

Revenue

 

$1100

 

CALCULATION


Suggested Allocation Formula = # of Semester Days in Month x (Total Billed to Students / Total # of Semester Days)*

 

*  Allocation should be based the # of semester days per the official registrar calendar accessible here –

http://registrar.indiana.edu/~registra/time_sensitive/tentcalen.shtml

 

*  Calculation based on 7-day week

 

* This is a suggested allocation unless the unit has specific information based on usage of its services. For e.g., if calendar days are more representative of the unit’s operations then that metric should be used instead of semester days.

 

MONTHLY ADJUSTING ENTRIES (Examples)

 

These entries need to be done monthly to recognize portions of the amount booked in the automated entry above:

 

Entry #1 –

AVAD

July Reclassification

of Income to Post to Period

ObjectCode

Object Code Name

Debit

Credit

1800

Revenue

$1100

 

94xx

Deferred Income

 

$1100

 

 * Exception – If the automated entry identified above credits 94xx (Deferred Income) instead of 1800 (Revenue), then this Entry #1 is not required.

 

Entry #2 –

AVAD

Aug. Recognition

Object

Code

Object Code Name

Debit

Credit

94xx

Deferred Income

$50

 

1800

Revenue

 

$50

 

*  Example assumes Fall semester between August 27, 2007 - December 14, 2007 and the following days in each month –

Month

Days in Month

August

5

September

30 (including Labor Day)

October

31

November

30 (including Thanksgiving Day)

December

14

Total

110

 

5 Days in August x ($1100 Billed to Students/110 Days in Fall Semester) = $50

 

Entry #3 –

AVAD

Sep. Recognition

Object Code

Object Code Name

Debit

Credit

94xx

Deferred Income

$300

 

1800

Revenue

 

$300

 

Entry #4 –

AVAD

Oct. Recognition

Object Code

Object Code Name

Debit

Credit

94xx

Deferred Income

$310

 

1800

Revenue

 

$310

 

Entry #5 –

AVAD

Nov. Recognition

Object Code

Object Code Name

Debit

Credit

94xx

Deferred Income

$300

 

1800

Revenue

 

$300

 

Entry #6 –

AVAD

Dec. Recognition

Object Code

Object Code Name

Debit

Credit

94xx

Deferred Income

$140

 

1800

Revenue

 

$140

 

As of December-end, all $1100 will have been recognized in the correct periods. 


DEFINITIONS:

Bursar Billing – Billing charged to students who enroll in Indiana University courses, which is separate from tuition (e.g., the Student Health Fee, Housing charges).

 

Calendar Days – Number of calendar days in a month e.g. 31 days in August.

 

Semester Days – Number of calendar days in a month in a given semester beginning the first day of classes and ending on the last day of final examinations. E.g. If the semester begins on August 27, 2007 then 5 days will be counted for August. 

CROSS

REFERENCE:

IUIE Training Manual
Registrar Tentative Future 9-Year Calendar
ASOP 18.0 – Deferred Revenue
ASOP 5.0 – Non-Student Accounts Receivable

RESPONSIBLE

ORGANIZATION:

 

Auxiliary organizations with student fee income