YOUR BUSINESS AND FINANCE RESPONSIBILITIES

1. YOUR BUSINESS AND FINANCE RESPONSIBILITIES Heather J. Haberaecker, PhD Executive Assistant Vice President for Business & Finance Kevin T. Fair, Interim Director of Purchasing

2. * Campus based WHO IS OBFS? • The Office of Business and Financial Services (OBFS) serves the University community on all three campuses • Primary Offices: • Accounting & Financial Reporting • Budget Operations & Financial Services* • Business Development Services (Revenue Contracts)* • Business Information Systems • Capital Programs & Real Estate Services • Grants & Contracts* • Purchasing* • Student Financial Services • Training & Communication • University Payables • University Payroll & Benefits • University Sourcing

3. WHO IS OBFS? • Many people view us as the compliance arm of the University but we believe great customer service and compliance can peacefully co-exist Compliance Customer Service

4. OBFS MISSION & VISION • OBFS will provide business and financial management services of exceptional quality in the most cost effective manner to support the research, teaching, public service, and economic development missions of the University of Illinois • In collaboration with our customers, we will provide innovative business and financial services to the University community

5. BEST PRACTICES – DEVELOP A PARTNERSHIP • Build a partnership between the Department Chair and Business Manager • Review financial status • Segregation of duties • Empower your department business manager to facilitate business transactions on your behalf • Reduce administrative burden on faculty

6. BEST PRACTICES - SEGREGATION OF DUTIES Approver Reviewer • Understand the importance of segregation of duties in business and financial matters from day one; i.e. how not to be in the headlines. • Segregation of duties means that no one person can initiate, process, record and reconcile transactions and take physical custody of assets/equipment. • Segregation of duties is adequate when no one person can misappropriate assets or improperly record or account for transactions without reasonable assurance of detection by another person. • Have your staff take University Audit’s Risk Assessment Survey to determine adequacy at: http://www.audits.uillinois.edu/cms/one.aspx?portalId=1201536&pageId=1202200

7. GETTING STARTED – WHAT YOU NEED TO KNOW ABOUT PURCHASING • Purchasing is the office on campus designated to procure Commodities, Equipment, and Services above designated dollar levels to support the mission of the University • Office Purpose: • Provide quality customer service and consultation to departments to assist them in procuring goods and services in the most cost effective manner possible. • Ensure compliance with the Illinois Procurement Code, Higher Education Procurement Rules, & State and Federal Regulations and the integrity of the purchasing process

8. TYPES OF PURCHASES • General Services, Commodities and Equipment • Computers; Copiers; Furniture; Printing; Lab, Janitorial and Office Supplies • Software Licenses • Regardless of the dollar amount, licenses are usually formal contracts that need to be submitted with a CARF • Hotel and Catering Arrangements • Regardless of the dollar amount, many hotels use a contract that needs to be submitted with a CARF • Healthcare Related • Medical and Surgical Supplies; Blood; Organs; Patient Billing; Pharmaceuticals • Professional and Artistic Services • Accountants; Consultants; Medical Professionals; Graphic Design; Web Design

9. WAYS OF PURCHASING

10. AUTHORIZED BID LIMITS & APPROVAL LEVELS State Bid Limits • $54,600 and over for General Services, Equipment and Commodities • $20,000 and over for Professional and Artistic Services Board of Trustees Approval Levels • $1,000,000 and over within a fiscal year for Professional and Artistic Services, General Services, Equipment and Commodities State Procurement and Chief Procurement Officers • Involved in all procurement above state bid limits throughout the process and have final approval

11. ** Add two months for those items requiring BOT approval ($1 mil. or more in a FY) BOT – Board of Trustees SPO – State Purchasing Officer CPO – Chief Procurement Officer for Higher Education PPB – Procurement Policy Board PROCUREMENT TIMELINE FOR PURCHASES ABOVE BID LIMIT BUY

12. BENEFITS OF iBUY CATALOG vs. BANNER/P-CARD Benefits include: • No Purchasing approval unless with a contract vendor over $100,000 or a non-catalog order over $5,000 • No bidding requirements • No SPO/CPO or PPB approvals • Faster turnaround times • Fewer potential compliance problems than with a P-Card since there are no order logs and reconciliations required • Better pricing than through use of P-Card due to volume discounts The benefits to Purchasing include: • Freeing up staff time to work on larger projects that save UIC big $’s vs. spending time processing low dollar transactions

13. PURCHASING REMINDERS DO’s DON’Ts Plan ahead Have staff develop detailed scope of work / specifications Involve Purchasing early in the process Encourage MAFBE participation Engage in non- conforming purchases/amounts above bid limits Divide large purchases into a series of smaller purchases Avoid contracts involving conflicts of interest (e.g. issuing a purchase contract to an employee owned business) Don’t have faculty or staff sign any contract, license, proposal, order confirmation, agreement…

14. GETTING STARTED (cont.) – WHAT YOU NEED TO KNOW • Signed contracts need to be in place before work begins • Only the University Comptroller, or approved delegates, has the authority to sign agreements/contracts for the University. • The University’s Property Insurance program is subject to a high deductible of $500,000 per occurrence. By electing to insure contents and/or provide business interruption, insures a unit can “buy-down” the deductible to $25,000 per occurrence by contacting the University Office of Risk Management (UORM)

15. GETTING STARTED (cont.) – WHAT YOU NEED TO KNOW • The Office of Real Estate Services needs to be involved in the development and execution of all leases • State or University rules limit reimbursement amounts for hotels, meals, airfare and business meals • All surplus / scrap equipment must go to the UIC surplus warehouse

16. COMMON PITFALLS TO AVOID • Having unit/department faculty or staff sign contracts. It is non-enforceable and the individual is potentially liable for payment • Not terminating an employee on time resulting in an overpayment and unnecessary collection efforts • Charging unallowable and unrelated costs to a grant

17. COMMON PITFALLS TO AVOID • Negotiating your own real estate deal (no matter how well you know the landlord). • Selling department equipment. All equipment is owned by the State of Illinois • Assuming any personal purchases made by an employee with a P-Card are a mistake. Have departmental checks and balances in place.

18. KEY RESOURCES FOR SUCCESS • The Business Manager is your BIGGEST asset • Meet monthly to review pertinent reports to understand the status of your accounts and whether transactions are appropriate • Encourage your faculty to go through your business manager for all business transactions • New business managers and staff should be encouraged to attend training opportunities • OBFS can help you select new business staff ( as a search committee member)

19. QUESTIONS