Project and Agency Account Policy

I. Scope

This policy applies to all employees who request agency or project accounts.

II. Policy Statement

Indiana Wesleyan University uses operating accounts, agency accounts and project accounts to accurately classify business activities.

III. Reason for the Policy

This policy exists to govern and control the usage of agency and project accounts, which ensures the accuracy of financial statements published by Indiana Wesleyan University for outside entities.

IV. Procedures

All agency and project account requests are submitted to the Controller’s Office for review, account classification, and approval.

1. Request Process: The following steps should be followed in the opening of an agency or project account.
   1. The account manager completes an Agency/Project Account Authorization Form.
   2. The completed form with all necessary signatures is submitted to the Controller’s Office. 
   3. The Controller’s Office will make the determination on the type of account that needs to be set-up based on the account classification listed below and will establish the operational, agency or project account in the general ledger system. 
   4. Contact will be made with the requestor to explain the account structure. 
2. Account Classification Criteria: The Controller’s Office will evaluate each request based on the following criteria:
   1. Agency accounts are funds held by Indiana Wesleyan University, with the University acting as custodian or fiscal agent.  Funds are used in alignment with the external organization’s purpose.  Agency accounts will have a separate tax identification number.  Agency funds cannot be used in conjunction with the University’s tax exempt status.  Therefore, the use of IWU sales tax exemption and the recording of tax deductible donations are prohibited.  Agency accounts are tracked as liabilities on the Statement of Financial Position. 

   2. Project accounts are funded by donations or other fees outside of normal, ongoing university operational activities.  Therefore, operating budget transfers from a departmental budget are prohibited.  Project accounts have a defined life span and purpose, and therefore, they are not used for recurring activities.  Any excess funds roll into the next fiscal year.  Project accounts are tracked on the Statement of Activities. 

      1. Project accounts must fall into one of the following categories:
         1. Externally Funded Projects:  Funded through external donations that are receipted in the Advancement Office for tax deductibility purposes. 
         2. Trip Project Accounts:  Funded through student payments.
         3. Club Project Accounts:  Funded through student membership fees and/or student led fundraising efforts.  Clubs must have an official organization charter or constitution as well as an employee advisor to assist in management of the Club account.  All clubs must be approved by an academic vice president/dean, department area cabinet member, or the Vice President for Student Development.  All IWU-Marion clubs must register through the Community Engagement Office during the registration process held during May (prior to the start of the fall semester). 
         4. Board Designated Project Accounts:  Funded by excess revenue allotted with approval from the Board of Trustees.
         5. Benevolence Fund Project Accounts:  Funded through external donations to assist with financial hardship.  Organizational documents are required. 
   3. If the account request does not meet the above criteria, then it may be deemed an operating account.  An operating account records routine transactions and is part of the operating budget and at year end any unspent funds are not available for use during the following year. 
   4. Any disagreements in classification will be presented to the CFO for further review.
3. Project Account Use
   1. Project accounts will be used for business purposes only and will abide by the University’s accountable plan. 
   2. Employees that donate to project accounts cannot approve expenses on project accounts to which they donate.
   3. Project accounts funded by employee donations cannot exceed $20,000 annually. 
   4. The University maintains the right to reallocate gifts to align with donor intent. 
4. Maintenance
   1. The Controller’s Office will review project and agency accounts on a quarterly basis.
      1. Project accounts will automatically be closed at the completion of the project, in which funding should be fully exhausted.  
      2. In the rare case a project or agency account goes into a deficit, the deficit balance will be charged to the associated department’s operating accounts.
      3. Accounts that have a balance but have no activity in a fiscal year will be reviewed by the CFO and the Controller’s Office to determine proper management steps for the account.
   2. The Executive Council will review a list of project accounts annually.

V. Definitions

Agency accounts are funds held by Indiana Wesleyan University, with the University acting as custodian or fiscal agent.  Agency accounts will have a separate employer identification number.

Operating accounts are accounts used to record routine financial transactions.  These types of accounts are part of the annual budgeting process.  Unspent funds are not rolled forward to the following year.  

Project accounts are funded by donations or other fees outside of normal, ongoing university operational activities. Project Accounts have a defined life span and purpose, and generally are not used for recurring activities.   Project accounts roll forward to the following year.