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Section 1: Internal Control

Revenue Reasonableness Review

Effective Date:

09/01/10

Approved By:

Lenora Chapman, Associate Vice President for Financial Affairs

Last Revised On:

05/26/17

For Assistance Contact:

Budget Planning and Development
Associate Director of Financial Assessment and Reporting

 

PURPOSE/SCOPE

To describe the process for performing reasonableness reviews for the following revenues as a monitoring activity to enhance and document fiscal accountability.

  • Statutory Tuition
  • Designated Tuition
  • Lab Fees and Supplemental Fees
  • Mandatory Fees
  • Course Fees
  • Revenue not Based on Semester Credit Hours or Headcount

AUTHORITY

It is a best practice to verify that revenue posted to the financial accounting system is an amount that would reasonably be expected. Variances are analyzed to determine cause and materiality level to help ensure the integrity of systems and detect fraud.


UNIVERSITY GUIDELINES

Table of Contents

A. Overview

Tuition and fee revenue is generally assessed through the Banner student information system (Banner) and uploaded to the financial accounting system (UTShare/PeopleSoft).

To test the accuracy of amounts posted to UTShare/PeopleSoft for revenue based on headcount or semester credit hours, the UTShare/PeopleSoft revenue is compared to the expected revenue calculated using data independent of UTShare/PeopleSoft (e.g., headcount, semester credit hours).

For revenue not assessed through Banner based on headcount or semester credit hours, current year-to-date revenue is compared to year-to-date revenue as of the same month of the prior year.

Reviews are performed on a per-semester basis. Any variances should be within acceptable tolerance ranges or have a reasonable explanation.

B. Review Process

  1. For tuition and fees based on headcount or semester credit hours, the expected revenue amount is calculated independently of UTShare/PeopleSoft based on Banner information.
  2. For revenue not assessed through Banner based on headcount or semester credit hours, the expected revenue is the year-to-date revenue as of the same month of the prior year (this may also be used as an additional test for course fees based on headcount or credit hours).
  3. The expected amount is compared to the amount posted in UTShare/PeopleSoft.
  4. The amount posted should be within a reasonable percentage and amount difference from the expected (or prior year) amount.
  5. Variances are analyzed to determine cause and materiality level.
  6. This information is reported to the Associate Vice President for Financial Affairs.

C. Reviews Performed by the Budget Office

1. Statutory Tuition

Statutory tuition rates are set by the Texas Education Code with different rates per semester credit hour based on a student’s residency and the course level:

  • Undergraduate – Resident
  • Graduate/Doctoral – Resident
  • Undergraduate – Non-Resident
  • Graduate/Doctoral – Non-Resident

The number of semester credit hours taken by each student category is obtained from Banner reports based on the number of paying students (net of exemptions and waivers). The number of semester credit hours is multiplied by the statutory rates to calculate the expected revenue.

This is compared to the revenue posted in UTShare/PeopleSoft, and any variances are analyzed and reported as described in Section B.

2. Designated Tuition

Designated tuition rates are set by the University of Texas (UT) System Board of Regents (BOR) and assessed on the basis of semester credit hours. Semester credit hour data is obtained from Banner reports based on the number of paying students. The number of semester credit hours is multiplied by the tuition rate to calculate the expected revenue. This is compared to the revenue posted in UTShare/PeopleSoft, and any variances are analyzed and reported as described in Section B.

3. Lab Fees and Supplemental Fees

Lab and supplemental fees are established in accordance with the Texas Education Code and UT System Board of Regents’ Rules and Regulations. Detailed data per course and amount is extracted from Banner. The revenue amount based on the Banner information is compared to the revenue posted in UTShare/PeopleSoft in the following Cost Centers:

  • Lab Fees (LABFEE)
  • Audit Fees (AUDIT)
    NOTE: Banner Student data does not include audit fees collected from non-students.
  • Music Fees (MUSIC)

Any variances are analyzed and reported as described in Section B.

4. Mandatory Fees

Mandatory fee rates are set by the BOR in accordance with Chapter 54 of the Texas Education Code. The assessment basis varies. Rates are charged by semester as a flat fee or per semester credit hour, and some fees have minimum and maximum amounts. The number of semester credit hours taken by each student is obtained from Banner reports based on the number of paying students. This data is multiplied by the fee rates to calculate the expected revenue for each fee. This is compared to the revenue posted in UTShare/PeopleSoft, and any variances are analyzed and reported as described in Section B.

D. Reviews Performed by the Associate Director of Financial Assessment and Reporting

1. Course Fees

Course fees are set in accordance with the Texas Education Code and BOR policies. The assessment basis varies. Banner reports are used to obtain the number of students in a particular course along with the fees assessed. This data is used to calculate the expected revenue for a particular course. The revenue posted to UTShare/PeopleSoft is compared to the expected amount, and current year-to-date revenue is also compared to year-to-date revenue as of the same month of the prior year. Some variances may occur due to the timing of Banner and UTShare/PeopleSoft reports. All variances are analyzed and reported as described in Section B.

2. Revenue Not Based on Semester Credit Hours or Headcount

For revenue not assessed through Banner on the basis of semester credit hours or headcount, current year-to-date revenue is compared to year-to-date revenue as of the same month of the prior year, and any variances are analyzed and reported as described in Section B. The Department Manager may be asked to explain material variances.


DEFINITIONS

Term

Description

Banner Student Information System UTSA’s Student information application software from SunGard Higher Education.
Course Fees Fees authorized by Texas Education Code §54.504 not to exceed the actual costs of materials or services and which are not separately authorized under other statutes. Course fees also include discretionary fees required of students in a given course, or for students participating in a special activity, such as a parking fee. This includes fees for state-funded continuing education courses.
Designated Tuition A tuition charge authorized by Texas Education Code §54.0513 that a university may impose on any graduate or undergraduate, resident or non-resident student, in an amount that the governing board “considers necessary for the effective operation of the institution.” For more information see the UTSA Financial Affairs Tuition and Mandatory Fees website.
Lab Fees and Supplemental Fees Fees authorized by Texas Education Code §54.501 to cover only the actual cost of laboratory materials and supplies used by the student, not to exceed $30 per any one semester or summer term for a student in any one laboratory course. Music fees are charged for courses where individual coaching or instruction is the usual method of instruction. Audit fees are charged to a student who attends a course but does not otherwise participate in or receive credit for the course.
Statutory Tuition A tuition charge authorized under Texas Education Code §54.051 in an amount determined by the Texas Legislature for resident and nonresident students. Currently the university rate is set at $50 per semester credit hour for resident students.  Higher rates are charged for nonresident students.  For more information see the UTSA Financial Affairs Tuition and Mandatory Fees website.
Mandatory Fees Fees authorized by the Texas Education Code and the UT System Board of Regents, charged to a student upon enrollment to provide services available to every student. For a list of fees and descriptions, see the UTSA Financial Affairs Tuition and Mandatory Fees website.

 

REFERENCES/LINKS

RELATED FORMS/WORKSHEETS

  1. None at this time.

REVISION HISTROY

Date Description
05/26/17

Non-substantive edits and updates throughout.

05/01/14

Updated DEFINE information for transition to PeopleSoft.

06/23/11

  • Revised section title to reflect Internal Control.
  • Revised Purpose/Scope to include reasonableness testing purposes of the FMOG.
  • Revised Authority section to reflect the assurance of integrity of systems and fraud detection.
  • Added subsection Revenue Not Assessed on a Basis of Semester Credit Hours or Headcount.
  • Added the frequency that Financial Affairs staff performs reasonableness testing and described the type of analysis performed on fees not assessed on the basis of semester credit hours.
  • Removed the revenue reasonableness testing schedule as it is performed on a per semester basis.
  • Added process for comparing current year-to-date course fee income to income of the same month of the prior year.
  • Deleted the Reviews Performed by Administrators of Revenue Generating Accounts section.
  • Deleted the Variance Analysis definition.

09/01/10

Published guideline.

 


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