SOURCE:

Cost Accounting, Financial Management Services

DATE ISSUED:

November 2015

DATE OF  LAST REVISION:

RSOP NO:

1.0 

RATIONALE:

To aid fiscal officers, account managers and account supervisors in understanding which activities are subject to federal cost accounting standards.

RSOP:

Recharge/ Service Center Activity:

A recharge/service center activity is an activity that furnishes goods or services to another Indiana University department for the convenience of the university and charges a fee directly related to providing the goods or services, and not more than the allowable costs.

As a general rule, any internal transaction that records income to one university account and expense to another, using any KFS document type, effectively creates recharge center activity.

Fundamentally, a recharge/service center is managed as a self-supporting or subsidized activity with the intent to operate at breakeven. Recharge/service center rates cannot exceed allowable cost and cannot exceed the rate charged to an external customer for the same product or service.

Recharge/service center (internal) activity should be separated, at the account level, from external activity.

All recharge activity in excess of $100,000 must be recorded in a service center account (66).

All recharge activity regardless of the account or amount must comply with Federal OMB Uniform Guidance.

DEFINITIONS:

External Activity: An activity that furnishes goods or services to a non-Indiana University department. This includes sales to students, faculty and staff for non-IU business, or the general public.

Internal Activity : An activity that furnishes goods or services to another Indiana University department (account).

CROSS REFERENCE:

OMB Uniform Guidance (PDF) "Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards"

RESPONSIBLE ORGANIZATION:

Organizations that bill other Indiana University departments for goods or services