Policy: 403-Revenue Producing Activities
Date:
05/31/02


Statement of Policy:

Revenue Producing Activities (RPAs) should be integral to fulfilling UW-Madison's mission of instruction, research and public service. They should be self-supporting or, if not, must be subsidized from specifically identified university sources. Revenue from the sale of goods or services must be deposited to university accounts and recorded on the university's accounting system. RPAs must comply with State of Wisconsin statutes and regulations and UW-System and Board of Regents' policies governing the conduct of business and the use of state monies. Rates must be calculated and applied in a consistent manner for each class (internal and external) customers. The RPA must maintain adequate documentation to support rate calculations for at least five years.

Sales to internal customers must be priced at or below the selling unit's cost of providing the goods or services as required by federal regulations. Virtually all federal grants and contracts awarded to UW-Madison are on a cost reimbursement basis, thus charges based on rates that recover more than cost would be subject to disallowance in the event of audit.

If sales to external customers do not fulfill UW-Madison's mission, the sale must meet one of the following criteria. The goods or services:

  • make university resources available to the public at little additional cost to the university (e.g., the stadium);
  • are unavailable elsewhere in the community (e.g., research by-products);
  • are provided as a convenience to the campus community (e.g., cafeteria services);
  • are important to maintaining the quality of the institution.

Sales to external customers must be priced to recover all of the selling unit's costs of providing the goods or services plus the University's indirect costs as calculated by the University's federal indirect cost rate unless the goods or services are a byproduct of, and integral to an instructional program.


Related Procedure(s):

403-Revenue Producing Activities
403.A-Calculating Rates for Revenue Producing Activities (RPA)


Who should know this policy?

Deans, Directors, and Staff Dealing with Revenue


Related Documents:

Deposit of All Revenues within One Week of Receipt Memo

RPA Questionnaire | Instructions

Office of Auxiliary Operations Analysis (AOA) Crosswalk Documents for Fund 128 to 136

UW-Madison Facility Use Policy
UW-Madison Alcohol Policy
UW-Madison Division of Information Technology E-Commerce Service
UW System Financial and Administrative Policies
UW System Board of Regents, “Policy on Competition with the Private Sector
Federal Government Cost Accounting Standards
Office of Management and Budget (OMB) Circular A-21
Office of Management and Budget (OMB) Circular A-110
Office of Management and Budget (OMB) Circular A-133


Contacts:

Cash Management | Sharon Hughes

Policy and Procedure Index