Administrative Service Charge Rates

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Administrative Service Charge Rates

To: Campus Community

From:

Financial Services Office and Budget Office

Subject: Administrative Service Charge Rates

Date: July 6, 2015

In order to assist the University in meeting the institutional requirements of our recent budget reductions, beginning in Fiscal Year 2015-2016 we will be implementing a change to the Administrative Service Charge rates. These changes are effective July 1, 2015.

A portion of the budget reduction will be covered by changes to the Administrative Service Charge (ASC) rate currently charged on external revenues. The core component of the ASC rate on external revenue will increase from 9.0% to 9.5%. Any established rates below the current 9.0% level will also have a 0.5% increment (e.g., 6.0% to 6.5%).

Additionally, a new component of the ASC rate will be implemented as 1.0% on operational expenditures (excluding student aid, cost of goods sold – including animal and feed, the ASC revenue component – Object Code 7955, and transfers) on all auxiliary and designated funds unless protected (institutionally mandated accounts and service centers) or already reduced as a part of the base cuts (F&A return, retained fees, program fees and differential tuition, and mission support agreements). Splitting the ASC rate into a revenue and expenditure component broadens the base of funds to which budget reductions are applied, provides greater flexibility in recovering funds across a fiscal period instead of all at once, balances out recovery mechanisms between auxiliary units that have greater rate variability, and encourages strategic investments and savings. You will see this new expenditure component of the ASC posting to your accounts on Object Code 7956.

This communication is also being distributed via the UAccess Financials listserv. Please share as appropriate with anyone in your offices and departments who has a need to utilize the new ASC rates.

Please direct any questions via your College/Unit Business/Finance lead to Garth Perry, Budget Office at perryg@email.arizona.edu or 621-0075.

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