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Understanding Accounts and Funds

To aid in the tracking and measurement of resources and how they are spent, higher education institutions use Fund Accounting.

UC Davis is a public, nonprofit higher education institution. As such, it is measured by how effectively and efficiently resources are spent and not on profitability or return to stockholders. To aid in the tracking and measurement of resources and how they are spent, higher education institutions use Fund Accounting. In fund accounting financial activity is recorded and reported by the following:

  • Source: who gave the institution the resources
  • Purpose: what the funds can be used for
  • Function: what activity are the funds being used (e.g, instruction, research, institutional support)
  • Natural Classification: type of transaction (e.g., salaries, benefits, supplies)

As a public university, UC Davis financial reporting follows the accounting pronouncements and guidelines promulgated by the Government Accounting Standards Board (GASB). In addition, UC Davis has adopted parts of the Sarbanes Oxley Act. UC Davis is one of 10 campuses that are consolidated and reported as the University of California. While most campuses have different accounting systems (UC Davis uses Kuali Financials), each campus is required to report in a specific way to the University of California Office of the President (UCOP) to consolidate the data for the audited financial statements, for systemwide reporting (to the State, regulatory agencies and other constituents) and to enable other institutions and interested parties to compare financial data.