Handbook of Business Procedures

2.2.2. SERVICE CENTER FUNDS—18-ACCOUNTS

Note: For detailed information about service centers, see the Handbook of Business Procedures, 10.2. Service Center Policy Summary.

A. Purpose

A Service Center (18-account) provides goods or services at approved rates that are essential in supporting The University of Texas at Austin’s teaching and research functions. Examples of Service Centers include machine shops, analytical equipment usage, analytical sample testing, or ITS Services.

The primary purpose for establishing a service center is to allow the university to recover costs incurred for goods or services used and required in support of sponsored research programs or academic needs. A service center can provide services to internal and external users. A service center must meet the following criteria:

• Operate on a break-even basis.
• Act as an ongoing activity, not a one-time distribution of expenses.
• Comply with both university accounting policies and federal guidelines published by the Office of Management and Budget, Circular A-21, Section J., General provisions for selected items of cost.

B. Source of Funds

Each service center operates as a self-supporting activity by charging rates for goods and services provided. Service centers are classified as designated funds in the financial statements. Rates for services must be reviewed and approved by Accounting and Financial Management.

C. Terminology

The type of service center is determined by the revenue threshold amount, whether the service is provided to internal or external users, and other factors.

Clearing and pass-through activities are included in the service center 18-account group but are not considered service centers. Clearing and pass-through activities are not subject to the same revenue thresholds or review requirements.

For detailed information about the types of service centers, see the Handbook of Business Procedures, 10.2.F. Types of Service Centers.

D. Transfers

Funds cannot be transferred to other account groups while the service center is active.

E. Rules and Restrictions

• Purchasing and payment procedures of The University of Texas at Austin must be followed.
• Activities and expenses described in the Handbook of Business Procedures, 9.1.1 Entertainment and Official Occasion Expenses are not allowed.
• For rules and restrictions associated with managing a service center, see the Handbook of Business Procedures, 10.2. Service Center Policy Summary.

Part 2. Fund Accounting - Table of Contents