Self-Supporting Recharge Operations - Monitoring

University of California Davis Self-Supporting Recharge Operations - Monitoring

Self-supporting recharge operations must operate on a break even basis. Therefore, units must make every effort to ensure that an activity does not generate a year-end deficit or surplus in excess of 15% of prior year expenditures. If the activity is subject to seasonal fluctuations, then a calendar year or other 12-month period may be used to evaluate the surplus or deficit.  In all instances, deficit or surplus balances should be resolved within a 3-year period at most.    

Account managers are responsible for monitoring self-supporting recharge activities and ensuring that only expenses necessary to provide the good or service are posted to the general ledger.  Annual expenditure to revenue reconciliation must be performed at least every 2 years to determine the need for any necessary rate adjustments, but is it recommended rates be updated annually for salary and benefits increases.  Helpful information on compliance and reporting is noted in the section below.  


Considerations when reviewing financials

Revenue from internal and external customers post to the general ledger (GL) only.   It is the departments responsibility to monitor recharge operations at the GL level, whether or not transacting within the Project Portfolio Management (PPM) module.  Departments can utilize the budgeting within the PPM module, however, it should not be considered a replacement to monitoring the GL.  

If the activity has more revenue or more expenses than expected, find out why. 

Possible issues with more revenue than expected:

  • rate had depreciation or reserve for improvement, but it was not set up by General Accounting;
  • all expenses associated with the activity are not being posted to the account;
  • actual costs is lower than estimated cost used in the rate calculation;
  • there is a cost savings or efficiency due to larger than expected volume.

Possible issues with more expenses than expected:

  • actual cost is higher than estimated cost used in the rate calculation;
  • expenses not associated with the approved rate are posting to the account;
  • billing is not current.

It is important to note that balance sheet Natural Account totals should not always be included in the review.  

Include Balance Sheet when:

  • Reconciling your ledgers
  • Reallocating the unexpended balance from the prior year

Exclude Balance Sheet when:

  • Budgeting for the year or revising the budget
  • Monitoring your revenue and expenses

Finally, it is important to keep in mind that assessments are posted monthly and excess funds related to the departmental portion of NUD and markup remain within the Project until the department requests it be moved at fiscal year-end.  


Useful Financial Reports

The financial reports below are useful tools to help monitor self-supporting recharge operations and activities.  Please use the links below to Knowledge Base Articles (KBA) that provide additional guidance on running each report:

  • Department P&L
  • Currently in Aggie Enterprise, the Department P&L Report is the best option to view self-supporting operations to monitor their financial position and perform financial analysis. It is a summary of operations at a point in time with beginning balance (including accounts receivable balance), total revenue (including external income and recharges), total expenditures, and total ending balance similar to the FIS-193.  The user can customize CoA segments in the report for their needs.  More instruction on running the report can be found in the KBA Run The Department P&L Report.     

    The Department PL report should be used for compliance checks using the COA Segments as follows:

    FUND - 12100 (Sales and Services Rate Based)

    PROJECT - Unique assigned project for Activity

    FINANCIAL Department - Top level financial department.

  • Transaction Listing
  • The UCD Transaction Listing Report is regularly utilized by UC Davis Finance staff to monitor the accuracy and completeness of the university’s general ledger postings, review financial transactions, and perform financial analysis. It provides details of journal entries by period, journal source, journal category and COA attributes.  It also provides commitments, obligations, and actual balances.  More instruction on running the report can be found in the KBA Run the UCD Transaction Listing Report.
  • This information is summarized when it's sent to Aggie Enterprise General Ledger (GL) for those operations that are utilizing boundary systems such as Stratacore for billing.  Look for "GLIDE" in the Reference column of the GL transaction details to indicate when this system was used.  Instruction on running the report can be found in the KBA Understanding the GLIDE Report.
  • Review/Inquire Journal
  • UC Davis employees will use these steps to inquire and view General Ledger journal entry status and details. This guide also includes tips for customizing searches and creating saved searches.  Please click here to access instructions for this report.
  • Department Billing Report
  • The Department Billing Report shows the list of complete and incomplete invoices and includes transaction numbers, transaction dates, financial departments, and customer names. You use the report primarily to track and review incomplete invoices.  Please click here to access instructions for this report. 
  • Customer Billing History
  • The Customer Billing History Report provides an overview of a financial department's transactions and billing activities. Reviewing the report can help identify invoices that were billed, which have been paid, and any adjustments made to the invoices. Please click here to access instructions for this report. 
  • Receivables Aging Report
  • The Receivables Aging Report is designed to provide information about unpaid invoices. The report shows the list of customers and their unpaid invoices in 30-day (non-CGA) or 60-day (CGA) segments. Reviewing the report can help identify customers who might be of financial risk and allow your department to adjust revenue forecasts accordingly. Please click here to access instructions for this report. 
  • UCD Equipment Inventory Listing Report
  • The Equipment Inventory Listing is regularly utilized by both UC Davis Central Office and campus departments to monitor the accuracy and completeness of the university’s moveable equipment inventory and ensure the University meets physical inventory and sponsor requirements.  Please click here to access instructions for this report. 


Annual Compliance

The office of Budget & Institutional Analysis (BIA) along with Costing Policy & Analysis (CPA) must annually review the overall performance of all recharge activities. The purpose of the review is to identify activities that demonstrate signs of non-compliance and whose risk profile may have changed. BIA will focus on activities that have significant year-end surplus or deficit balances.  In addition, recharge activities with no income or expense activity during the past fiscal year will be reviewed and closed as needed. 

Campus will identify activities that are not in compliance with the requirement that self-supporting, rate-based recharge activities must operate on a break-even basis. Units must make every effort to ensure that a recharge activity does not generate a year-end deficit or surplus in excess of 15% of annual expenditures.  The ratio is developed by dividing the accumulated net income or loss by the total expenditures .  The accumulated balance percentage is what will be reviewed by BIA for compliance reporting.  Departments can review their activities utilizing the Department P&L report. 

Department P&L Report Compliance Calculation Example (.xlxs) as of 3/25/24

As outlined in the Guidelines for Deficit Management and Monitoring in Campus Units, following the end of any given fiscal year, data from the GL is utilized to generate the Recharge Operation Compliance Report for each Unit.  The results are posted to the Unit's individual BOX folder (BIA Document Sharing > Unit Folders).  Please contact your Dean/Vice Chancellor Office for a copy of the file if you are not authorized user as access is limited.

As part of the workflow process, departments will work with their Dean/VC office to validate the parameters of each Project listed on the Recharge Operation Compliance Report. Additional information on this step is outlined in the Recharge Compliance Workflow Instructions (PDF).  Templates for recharge operations requiring action plans can be found in the appendix of the deficit guidelines linked above. 

**Financial Activity with No Assigned Project Code Segment (as of 4/9/24)**



Units maintaining supply inventories in excess of $50,000 as part of a recharge activity must maintain perpetual inventory records. For detailed information, see PPM 350-60, Management of Major Supply Inventories and PPM 330-11, Departmental Financial Administrative Controls and Separation of Duties.