Skip to Search Skip to Navigation Skip to Content

Section 1: Internal Control

Revenue Reasonableness Review

Effective Date:

09/01/10

Approved By:

Lenora Chapman, Associate Vice President for Financial Affairs

Last Revised On:

05/01/14

For Assistance Contact:

Budget Planning and Development
Associate Director of Financial Assessment and Reporting

 

PURPOSE/SCOPE

This guideline details the process for performing reasonableness testing for the following revenues as a monitoring activity to enhance and document fiscal accountability.

  • Statutory Tuition
  • Designated Tuition
  • Lab Fees and Supplemental Fees
  • Mandatory Fees
  • Course Fees
  • Revenue not Assessed on a Basis of Semester Credit Hours or Headcount

AUTHORITY

It is an institutional best practice to assure that revenue posted to the financial accounting system is an amount that would reasonably be expected. The variance is then analyzed to determine materiality and/or cause to help ensure integrity of systems and detect fraud.


UNIVERSITY GUIDELINES

Table of Contents

A. Revenue Reasonableness Testing Defined

Financial Affairs staff performs reasonableness testing on a per semester basis on tuition and fees. The amount of revenue expected to be collected from statutory tuition, designated tuition, lab and supplemental fees, mandatory and course fees assessed through the student information system is calculated using data independent of the financial accounting system. Those amounts are then compared to the amounts posted to the financial accounting system. The results should be reasonably close and within acceptable tolerance ranges.

Financial Affairs also analyzes fees not assessed on the basis of semester credit hours or headcount. This analysis consists of comparing current year-to-date income to income as of the same month of the prior year. The variance from year to year should be within acceptable tolerance ranges or have a logical explanation.

B. Timeframe for Revenue Reasonableness Testing

Reasonableness testing is performed on a per semester basis.

C. Reviews Performed by Financial Affairs

The following reviews are performed centrally by assigned Financial Affairs staff.

1. Statutory Tuition

Statutory tuition rates are set by the Texas Education Code with different rates per semester credit hour based on a student’s residency and the course level:

  • Undergraduate – Resident
  • Graduate/Doctoral – Resident
  • Undergraduate – Non-Resident
  • Graduate/Doctoral – Non-Resident

The number of semester credit hours taken by each student category is obtained from Banner Student reports based on the number of paying students (net of exemptions and waivers). The number of semester credit hours is multiplied by the respective statutory rates giving an expected value of statutory tuition revenue. The Budget Office is responsible for this analysis.

A COGNOS-generated revenue report (Educational and General Revenue by Semester) reflects the statutory tuition revenue posted in the financial accounting system from student records uploaded to the financial accounting system by an interface file from the Banner Student system and verified by the Student Information Systems Financial Accounting Manager.

The total revenue posted to the financial accounting system should be within a reasonable percentage and amount difference from the expected amount calculated. The Budget Office is responsible for this analysis. Variances are reviewed to assure the amount is immaterial or due to another issue, and then reported in a timely manner to the Associate Vice President for Financial Affairs (AVPFA).


2. Designated Tuition

Designated tuition rates are set by the UT System Board of Regents (BOR) and assessed on a per semester credit hour basis. Semester credit hour data is obtained from Banner Student reports based on the number of paying students. The number of semester credit hours is multiplied by the approved designated tuition rate, which computes the expected value of designated tuition revenue. Designated tuition revenue is posted to the financial accounting system via an electronic interface from the Banner Student system. The total revenue posted should be within a reasonable percentage and amount difference from the expected amount calculated. The Budget Office is responsible for this analysis. Variances are reviewed to assure the amount is immaterial or due to another issue, and then reported in a timely manner to the AVPFA.

3. Lab Fees and Supplemental Fees

Lab and supplemental fees are established in accordance with the Texas Education Code and UT System Board of Regents’ Rules and Regulations. Detailed data per course and amount is extracted each semester from the Banner Student system. The total revenue posted to the financial accounting system is in the following Cost Centers:

  • Lab Fees (LABFEE)
  • Audit Fees (AUDIT)
    NOTE: Banner Student data does not include audit fees collected from non-students.

  • Music Fees (MUSIC)

The total revenue posted to the financial accounting system should be within a reasonable percentage difference and amount from the total indicated from Banner Student data. The Budget Office is responsible for this analysis. Variances are reviewed to assure the amount is immaterial or due to another issue, and then reported in a timely manner to the AVPFA.

4. Mandatory Fees

Mandatory fee rates are set by the BOR in accordance with Chapter 54 of the Texas Education Code. The assessment basis will vary; rates are charged by semester as a flat fee or per semester credit hour, some with minimum and maximum amounts. The number of semester credit hours taken by each student is obtained from Banner Student reports based on the number of paying students. This data is then multiplied by the fee rates to determine the expected income for each mandatory fee. The total revenue posted to the financial accounting system should be within a reasonable percentage difference and amount from the expected value that was calculated. The Budget Office is responsible for this analysis. Variances are reviewed to assure the amount is immaterial or due to another issue, and then reported in a timely manner to the AVPFA.

5. Course Fees

Course fees are set in accordance with the Texas Education Code and BOR policies. The assessment basis will vary. Banner Student reports are used to obtain the number of students in a particular course along with the fees assessed. Using that data, the expected income is calculated for a particular course. The total revenue posted to the financial accounting system should be within a reasonable percentage difference and amount from the expected value that was calculated. Financial Affairs also compares current year-to-date income to income as of the same month of the prior year. The variance from year to year should be within acceptable tolerance ranges or have a logical explanation.

The Associate Director of Financial Assessment and Reporting is responsible for this analysis. Variances are reviewed to assure the amount is immaterial or due to another issue, and then reported in a timely manner to the AVPFA.

6. Revenue Not Assessed on Basis of Semester Credit Hours or Headcount

For revenue not assessed through Banner Student on the basis of semester credit hours or headcount, Financial Affairs compares current year-to-date income to income as of the same month of the prior year. The variances from year to year should be within acceptable tolerance ranges or have a logical explanation. The Department Manager may be asked to explain material variances.

The Associate Director of Financial Assessment and Reporting is responsible for this analysis and Department Managers may be asked to explain certain material variances. Once variances are reviewed to assure the amount is immaterial or due to another issue, the results are reported in a timely manner to the AVPFA.



DEFINITIONS

Term

Description

Banner Student

UTSA’s Student information application software from SunGard Higher Education.

Course Fees

Fees authorized by Texas Education Code §54.504 not to exceed the actual costs of materials or services and which are not separately authorized under other statutes. Course fees also include discretionary fees required of students in a given course, or for students participating in a special activity, such as a parking fee. This includes fees for state-funded continuing education courses.

Designated Tuition

A tuition charge authorized by Texas Education Code §54.0513 that a university may impose on any graduate or undergraduate, resident or non-resident student, in an amount that  the governing board “considers necessary for the effective operation of the institution.”  For more information see the UTSA Financial Affairs Tuition and Mandatory Fees website.      

Lab Fees and Supplemental Fees

Lab fees are authorized by Texas Education Code §54.501 to cover only the actual cost of laboratory materials and supplies used by the student, not to exceed $30 per any one semester or summer term for a student in any one laboratory course.  Music fees are charged for courses where individual coaching or instruction is the usual method of instruction.  Audit fees are charged to a student who attends a course but does not otherwise participate in or receive credit for the course.

Statutory Tuition

A tuition charge authorized under Texas Education Code §54.051 in an amount determined by the Texas Legislature for resident and nonresident students. Currently the university rate is set at $50 per semester credit hour for resident students.  Higher rates are charged for nonresident students.  For more information see the UTSA Financial Affairs Tuition and Mandatory Fees website.

Mandatory Fees

Authorized by the Texas Education Code and the UT System Board of Regents, mandatory fees are charged to a student upon enrollment to provide services available to every student. For a list of fees and descriptions, see the UTSA Financial Affairs Tuition and Mandatory Fees website.

 

REFERENCES/LINKS

RELATED FORMS/WORKSHEETS

  1. None at this time.

REVISION HISTROY

Date Description
05/01/14

Updated DEFINE information for transition to PeopleSoft.

06/23/11

  • Revised section title to reflect Internal Control.

  • Revised Purpose/Scope to include reasonableness testing purposes of the FMOG.

  • Revised Authority section to reflect the assurance of integrity of systems and fraud detection.

  • Added subsection Revenue Not Assessed on a Basis of Semester Credit Hours or Headcount.

  • Added the frequency that Financial Affairs staff performs reasonableness testing and described the type of analysis performed on fees not assessed on the basis of semester credit hours.

  • Removed the revenue reasonableness testing schedule as it is performed on a per semester basis.

  • Added process for comparing current year-to-date course fee income to income of the same month of the prior year.

  • Deleted the Reviews Performed by Administrators of Revenue Generating Accounts section.

  • Deleted the Variance Analysis definition.

09/01/10

Published guideline.

 


In All We Do, We Do With Excellence - Every Person - Every Day - Every Job