Budgeting for an Academic Depa State University: Can You Believ Gloria Vollmers University of Maine Orono Wendy Comits University of Maine n pl bu be dic bi INTRODUCTION You are the senior accounting faculty member in the business school and your dean. Dean Weller, is asking for help. She is very discouraged after a midyear budget meeting with the Vice President of Finance. The college's Department of Social Work has a large budget deficit, and because of this the VP is inclined towards closing the department entirely or closing its bachelor's program. The department's deficit is the worst in the university and has been so for several years. Weller met with Josh Reynolds, Director of the Department of Social Work, nine months ago, asking him to do his best to reduce expenditures, but Reynolds said then that it wasn't possible - they were down to the bone. The dean has already had to transfer funds from another department to cover the non-buse-budgeted salary of a faculty member. The college will also have to cover the final deficit, which means that the other three departments of the college, operating within their budgets, will find any surplus proportionately depleted. Dean Weller tell you that from a budgetary viewpoint, the college would be better off without Social Work, but that she does not understand what is really going on. The deficit is obvious, but Reynolds says the department is booming-there are plenty of students. She asks you to analyze this situation Visit the department and talk to Director Reynolds. Find out what you can, collect data and report back as soon as possible. You have access to the budgetary information she has and all other possibly relevant information, including student credit hours and price of tuition. Make the case for at against the Vice President's inclination 1 di B be F de MACAUSAUNAASEBAL.. case centre Department at a elieve the Numbers? Maine BACKGROUND INFORMATION ON THE COLLEGE AND THE BUDGET SYSTEM hy The university is facing declining enrollments because of a change in demographies. The number of students graduating from the state's high schools is declining. Efforts to recruit and retain are underway, but between the encolliment decline and rising costs, there are tremendous incentives to find places to cur Tuition and fees (see Table 1) and other student charges contribute about 30% to the revenue side of the university but they do not appear on any college or departmental budget. Only revenues clearly generated by a particular department (es. lab fees) are included in that units budget. State appropriations, grant funding, enduwment earnings, and other revenues make up the remainder of the revenue side of the university budget, but they also are not distributed among the budgets of the colleges or other units. By the same token, no overhead charges appear in college budgets either Well before the beginning of the fiscal year, the VP of Finance sends cach dean the college's basc budget: the total amount available for salaries and other costs. Typically is equals Last year's budget (with minor modifications. The deans send the department heads their budgets and then meet with them to discuss their concerns. Finally, the deans meet with the VP of finance to answer standard questions, such as whether departments and the college can come in on budget, whether revenue opportunities exist; where cu will be taken. Neither the deans ner the department hade 0 Cr VOL 5.2L, MARCH 2012 hole unds for the base IECJ0512C column in the set of columns les columns 3 and 4- variances. The sum of all hade varices els the surplus or deficit of the department. At this moment there is already a deficit of almost 550,000 INFORMATION ON THE DEPARTMENT OF SOCIAL WORK che e entire WE chudget by the dollars lines ning the wen moet not the Every This is an accredited pengram ofering a bachanda master's degree. Both degrees are popular and fully cried About undergraduates can the degrees. The department has the second largest master's program in the universits, radosting Student Lyca, and 28 credit bon respectively were eamed in the undergraduate and graduate courses in the department which had 107 and 119 sented. Most game students take all the credit hewan in the school. This not the case for undergraduates they take my classes in the departments for general de lective etc. These numbers have been holding and for all yan and welkely to remain . Mendeng and all graduate Mudents atestate residents and wetge 13.5 and credit hours per me The director estimates that 35-50% of the undergraduates enter the university because they want that depeche emainder transfer in from her but the graduate students come from the undergrader Others and their degree where that's pm without the undergraduated in which the program for more credits. The am in popular because all ingencies graduates are open it completi The Council on Social Work Education the crediting tedy quite a mim of sex full-facryfa master's program and two for a tocha. The department has wonen full-time faculty and we halftime facut appointments with a dem The there facilemben met de because he is one of them and therefore can't full and another faculty member is the conditio which ale bits full-time teaching. The conditing by que a maior full-time-quivalent to the master's level and the undergradom level. I who requires that each undergraduate de participate in a minimum of 100 cffield cache graduate student participe in Theshow po ced the whole cohol and directe and actual ws seconds modified they able to the ciated he fourth ME JOURNAL 2 VOL 1 NO ART. 1, MARCH 2013 INFORMA WORK which have an opportunity to challenge the whole Budget changes incremental and ten teman That is a dean muy cure a one-time of funds for some special purpose, but permanent intend to the luxe budget is rate. One exception to this car when faculty member, not a replacement, is hie Anscher in the opposite direction when there we cute to the entire sity's budget. When or how get me wr originally is lost in the dim pust. Initially cach department must bulance its bude allowable expenditures MUST qual planned expenditures All salaried positions (faculty, administrative, and a e hodgeted in salary lines with lentis equating Sosoflary) in the line. Adjunct ad by the cone, have a low benefitte-currently 5 percent. Their pay appears in a different line. After the know any wap, and benctid lines, the remaining bune budget dollar we alcated to the operating budget expenditures by the department budget office. Some might to the copier, to phone to travel to membership. During the yeat, cach department can change the allocations between various budget lines (excope operating line be transferred to salary lines to address specific need Expenditures are recorded as incurred About midway she cal year the dean meets again with anvenifices to discuss whether or not the year's budget will be met. We are this point. Every deurment and every college in veden themes between the bushadigawatile expenditures and actual expenditures. The budget spreadsheets five column ice Exhibit). The fint is the original basebadet. The called the current budget, which is the best modified by temporary financialements that during the year and that increase or decrease the totalment available to the department icone-time true. The third in ea code actual expenditures and actual revenues deurly w.cited with the department has tab i feel. The incubadestary delle for munt, mortly alatex wages, and benefits. The last Then 13 The The themed The wand Ben The she'd ches he bud that. S of which are 60-100 milesway Field study necesitate small groups and individualized supervision and therefore requires a large number of adjunct faculty. In the most recent year, adjuncts were med for 3 desses and field stay requirements. The department pas appimately $100.000 (plus Sk.500 required benefits for adjunct annually about 65 of which is for the graduate program The base budget of the Department of Social Work is $1.045,000, of which $1,037,000 is salaries, wages, and benefits (uee spreadsheets. In that later amount, 547.646 is budgeted adjunct wages and 54,050 is adjunct benefits The full adjunct needs are not basc budgeted. The faculty member who is currently paid for by the college is not in the base budget. (His salary and benefits appear in the current budget" column stranded) The department anticipated other revenues of approximately $61,000,000 (use-budgeted) form field study for $14.000 cuericulum fees (allocated to all departments by the university and $41,000 of buyout money from faculty grants, which free up money that can be used to be adjunts pay for det expenditures. The latter cannot be guaranteed annually. The dean hopes that the faculty will receive additional in the future, but no one can promise it. The department ale anticipates having to spend a total of 575.000 other operating expenditures, which include the copy machine und phone, membership fees, faculty development funds (travel - $1000 cach expenditures en student handboek replacement of computers, etc. All actual receipes or expenditures can be seen in Exhibit CONVERSATION WITH THE DIRECTOR OF SOCIAL WORK CO bu You ask. "Josh, how were you able to get these number past the dean and VP last year when it came time to approve the basc budget Jonhawwers. "Wie simply don't report our needs. We cant. They don't allow us to. So, we show our faculty administrative, and staff salaries and we hac-budget about only $47,000 of adjunct pay-less than half of what we need The remaining amount of the buse, about $13.000, we will for operating expenses. It's joketcally considering that we have to spend about $70,000 to SOGO "But" you say, if the VP has seen adjunct pus of $100,000 or so for years, how can she not insist on base budgeting it?" Josh replies "k's mystery. I think she hopes the problem will disappear. The thing is if she were to insis that the full amount needed to be base-budgeted, then ch tights we I do she'd ches he bud that. S of which are 60-100 milesway Field study necesitate small groups and individualized supervision and therefore requires a large number of adjunct faculty. In the most recent year, adjuncts were med for 3 desses and field stay requirements. The department pas appimately $100.000 (plus Sk.500 required benefits for adjunct annually about 65 of which is for the graduate program The base budget of the Department of Social Work is $1.045,000, of which $1,037,000 is salaries, wages, and benefits (uee spreadsheets. In that later amount, 547.646 is budgeted adjunct wages and 54,050 is adjunct benefits The full adjunct needs are not basc budgeted. The faculty member who is currently paid for by the college is not in the base budget. (His salary and benefits appear in the current budget" column stranded) The department anticipated other revenues of approximately $61,000,000 (use-budgeted) form field study for $14.000 cuericulum fees (allocated to all departments by the university and $41,000 of buyout money from faculty grants, which free up money that can be used to be adjunts pay for det expenditures. The latter cannot be guaranteed annually. The dean hopes that the faculty will receive additional in the future, but no one can promise it. The department ale anticipates having to spend a total of 575.000 other operating expenditures, which include the copy machine und phone, membership fees, faculty development funds (travel - $1000 cach expenditures en student handboek replacement of computers, etc. All actual receipes or expenditures can be seen in Exhibit CONVERSATION WITH THE DIRECTOR OF SOCIAL WORK CO bu You ask. "Josh, how were you able to get these number past the dean and VP last year when it came time to approve the basc budget Jonhawwers. "Wie simply don't report our needs. We cant. They don't allow us to. So, we show our faculty administrative, and staff salaries and we hac-budget about only $47,000 of adjunct pay-less than half of what we need The remaining amount of the buse, about $13.000, we will for operating expenses. It's joketcally considering that we have to spend about $70,000 to SOGO "But" you say, if the VP has seen adjunct pus of $100,000 or so for years, how can she not insist on base budgeting it?" Josh replies "k's mystery. I think she hopes the problem will disappear. The thing is if she were to insis that the full amount needed to be base-budgeted, then ch tights we I do ty . CE "The IECJ0512C she'd have to find money to increase wat bese budget and she doesn't have it or it would have to come from embed cle's budget. Eventually, it does come from the budgets of others, from other departments in our college Josh continues. Anyway, the remainder of our buse budget money, S13.000, is randomly distributed among the operating budget lines. (See Exhibit 1.) We can't operate that. So we spend what we must. In theory, adjunts should only be hired if money is wailable, but we must hire them of not offer clue. We can't do that, although sometimes I'm tempted just to see the reaction if we didn't offer the classes. This spring we have 1 dames or field study couns being offered by adjuncts - one are clectives "Some years ago, two factors played a large part in our growing deficit. Fins about $30,000 of adjunct wages used to be paid by the Continuing Education Division of the university. Then, due to budget cuts, the Liniversity changed its policies, leaving us to pay there was neves That amount was never added to our use budget. Another major factor was the drying up of grant funding-aplicnom occurring crow many disciplines. Our faculty continues to secure grants, but not as many and for not a large amounts. We used to be able to rely on grants that ought in $60,000 to $80,000 a year, which would offset supplice travel, and assistantship costs. We have also just losta large, frontenewable multiveat grant that financed a faculty member. As you know the college in pusing the salary this year. I have no idea what's going to happen next yea "A faculty member who caressant funding can buy out of his or her teaching responsibilities and the grant money can be used to pay for adjuncts supplies, travel etc. Our budget officer will reduce the salary line by the amount paid by the grant and transfer the dollars to the other expenditure lines. It will appear in the year-to-date column of the spreadsheet. Since faculty salaties are much larger on a per-class basis than that of an adjunctcoure buyouts help us pay for things beyond the adjunct wag Unfortunately, we can't rely on a grant mesey. The university encourages departments to engage in revenue creating opportunities, but we can't think of her to create such opportunities because of substantial teaching loads and tightening in the funding agencies "We are as careful as we can be. We avoid long distance calls. The faculty often pay for their own supplies. We need all the adjuncts, and we are not paying them outrageous amounts. We simply cannot come in en budget. Even if we kept operational expenditures expenditures outside of salaries and wages) to ZERO), we would have a deficit! I don't know what we can do. I know we're doing a good . AL he ced ABOUT IMA job the programs are well rulled the undergraduates et job. (What other program can say that. The must graduates all getane. There is a need for licensed social workers in the state. We contribute so much to the community through the fieldwork requirements. The faculty all work and they have active research programs and manage to achieve grant funding. This past year, the indirect funds generated by the department that came to about $102,000. This was real money that went directly to the university offers to "We could cut travel, but this new part of being an academic Wic present reach a conference leam luat othen doing and gain new ideas about teaching research and acquiring funding. We colpine $1,000 to each faculty, where that funding much more "The faculty merced. They don't understand why they reviewed as an illatos, and they we afraid that department will be doned. Closing one of the programs decat make sense. If wedsed the undergraduate program I would estimate a wing of about $13.000 operational costs attributable to undergraduates on Abof the adjunct waper and beach would also be uved. Phone and copier expenditures are mostly fined. Faculty can be asked to continue to use old computers for an extra ya we, but there is a limit. We are not wasting money Wealy have the non-teaching administrative assistants who handle the needs of students and facules and work with the det requirements of the grants of the department. They are pestrybucy. Another important point is that there are other undergraduate and graduate social wack program the state, so our students could choose to chcwhere. Iesport an additional $15,000 to be spent by the end of the fiscale in the operating budget area. This will result in a de approximately $15.000. I hope you can find some way to help REQUIRED As requested by Dean Wellet you to the financial situation of this department and present in a way convincing to the vice presidenta finance. You will have to make several spine-please indicate them de The dean would like to use your information the next budget meeting, Sour information should be presented dearly so that a financial person will understand Mike recommendations and present them in appiate format. Understand that given the current budget system. your college will be better off if the department inced because all the expenditures of the department will be removed from the books of the college and the deficit will disappear BUT will the university benctie! You M IMA EDUCATIONAL CASE JOURNAL the faculty IECJ05120 that if a program is closed the inity cany offers people without penalty Sou do not need de facile contrachamainenance or depreciate. Nuen the world of non-profits the word "expenditure is used instead of expense. 11 What contribution is the unit making currently both financially and therwise z What effect will the closing of the department have the it! 1 What effect will the closing of the Bachelor's program have on the university 4 Overall, what is the problem! Why does this department look so bad financial? indirect ty to to rences + at st of the ABOUT IMA Wicha walide network of methane.00 pm IMA is the wild leading on dedicated cmpowering ting and finance et de business perfomance. IMA pewides a dynamic fonam professionals to advance their career the Cented Management Accountant Mencin, peofeminal education, networking and advocacy of the highest ethical and professional standarth. For more information IMA please visit www.imante o be Nic only handle bude other und the expect Set of You will hem the Make ned be ume 29VINAR 11 M e del 5 of 6 rummer EC205120 Et Dale of the Shell Social Well SU LE LOT ECJ05120 Toll 2006- Spring 2000 Residential and Amerfest wie IMA EDUCATIONAL CASE JOURNAL VOLS Table 1 Fall 2008- Spring 2009 Resident (In-State) Tuition and Fees (Amounts are per semester. Fees cannot be avoided) Total 888.00 1.127.00 Undergraduate Tuition & Fees #ol Credits Tasan Fees 1 121.00 2 47800 17100 217.00 121.00 4 95600 17100 5 1.195.00 171.00 6 1434.00 490 00 7 1573.00 19000 & 1912.00 190.00 9 2.151.00 10 239000 190 00 2629.00 490.00 12 2.368.00 96500 13 3.10700 965.00 14 3.346.00 95.00 15 2585 96500 3.824.00 9800 For each additional credit add $229.00 1924.00 216200 2.402.00 254100 49000 3630 4072.00 4311.00 455000 Fores IMA EDUCATIONAL CASE JOURNAL VOLS Table 1 Fall 2008- Spring 2009 Resident (In-State) Tuition and Fees (Amounts are per semester. Fees cannot be avoided) Total 888.00 1.127.00 Undergraduate Tuition & Fees #ol Credits Tasan Fees 1 121.00 2 47800 17100 217.00 121.00 4 95600 17100 5 1.195.00 171.00 6 1434.00 490 00 7 1573.00 19000 & 1912.00 190.00 9 2.151.00 10 239000 190 00 2629.00 490.00 12 2.368.00 96500 13 3.10700 965.00 14 3.346.00 95.00 15 2585 96500 3.824.00 9800 For each additional credit add $229.00 1924.00 216200 2.402.00 254100 49000 3630 4072.00 4311.00 455000 Fores VOL.S. NO. 1, ART. 2. MARCH 2012 IECJ0512C Total Graduate Tuition & Fees #of Credits Fees 1 25700 201.00 2 71400 2010 2 3071.00 201.00 4 12800 20100 5 2010 6 2.10.00 75.00 7 2.499.00 2.256.00 9 3.213.00 475.00 10 357000 475 00 3.927 00 75.00 12 4.254.00 950.00 854100 950 30 14 4.98.00 950.00 15 5.255.00 950.00 16 571200 97100 For each additional credit add $357.00 915.00 127200 1529.00 1988.00 2517.00 2.37400 230100 2.622.00 3.045.00 4402.00 5.234.00 559100 5.948.00 2050 558330 howy Kamion 22- M2021 Order F41100 You are the online day your person 22 Mw.2022 Partido de former VOL.S. NO. 1, ART. 2. MARCH 2012 IECJ0512C Total Graduate Tuition & Fees #of Credits Fees 1 25700 201.00 2 71400 2010 2 3071.00 201.00 4 12800 20100 5 2010 6 2.10.00 75.00 7 2.499.00 2.256.00 9 3.213.00 475.00 10 357000 475 00 3.927 00 75.00 12 4.254.00 950.00 854100 950 30 14 4.98.00 950.00 15 5.255.00 950.00 16 571200 97100 For each additional credit add $357.00 915.00 127200 1529.00 1988.00 2517.00 2.37400 230100 2.622.00 3.045.00 4402.00 5.234.00 559100 5.948.00 2050 558330 howy Kamion 22- M2021 Order F41100 You are the online day your person 22 Mw.2022 Partido de former IMA TROCATIONAL CASE JOURNAL | Exhibit 1 | Budget of the School of Social Work Balpet atlas Setheart | Agri in theeal year at me 185.000 16.000 other 760 18.00 10002 faculty 55 4758 120 SES 7210 200512 OR 1394 545 100 SED total saleswages 1 33272 1.115282 4219 berships postage printing copy 105 1 2341 wa 300 207 27 1.200 1200 maintenance of total operating expe LOST net revenus & 122 2240 Amounts in Brackers are positive indditional money wailable extant in the budget ware lime FIONAL CASE JOURNAL VOLS NO AT MARCH IECJ0512C 12. flocal year ende June VID Actual Buget Var 000 SRO Shared curricanes ONE 15572 11 100021 Coured 5770 30 3646 1 247 12301 9354 2 WE 114.10 1534 22 3212 52 226232 115,437 5.200 4209 1025 31 2341 2010 Charged 100 2.47 754 21 15.15 1.500 EUR 1677 11.7 MIN 3543 7200 795 40 2593 mos 731 LEN 22 73 Deficio Antice 25 224 2012) the Budgeting for an Academic Depa State University: Can You Believ Gloria Vollmers University of Maine Orono Wendy Comits University of Maine n pl bu be dic bi INTRODUCTION You are the senior accounting faculty member in the business school and your dean. Dean Weller, is asking for help. She is very discouraged after a midyear budget meeting with the Vice President of Finance. The college's Department of Social Work has a large budget deficit, and because of this the VP is inclined towards closing the department entirely or closing its bachelor's program. The department's deficit is the worst in the university and has been so for several years. Weller met with Josh Reynolds, Director of the Department of Social Work, nine months ago, asking him to do his best to reduce expenditures, but Reynolds said then that it wasn't possible - they were down to the bone. The dean has already had to transfer funds from another department to cover the non-buse-budgeted salary of a faculty member. The college will also have to cover the final deficit, which means that the other three departments of the college, operating within their budgets, will find any surplus proportionately depleted. Dean Weller tell you that from a budgetary viewpoint, the college would be better off without Social Work, but that she does not understand what is really going on. The deficit is obvious, but Reynolds says the department is booming-there are plenty of students. She asks you to analyze this situation Visit the department and talk to Director Reynolds. Find out what you can, collect data and report back as soon as possible. You have access to the budgetary information she has and all other possibly relevant information, including student credit hours and price of tuition. Make the case for at against the Vice President's inclination 1 di B be F de MACAUSAUNAASEBAL.. case centre Department at a elieve the Numbers? Maine BACKGROUND INFORMATION ON THE COLLEGE AND THE BUDGET SYSTEM hy The university is facing declining enrollments because of a change in demographies. The number of students graduating from the state's high schools is declining. Efforts to recruit and retain are underway, but between the encolliment decline and rising costs, there are tremendous incentives to find places to cur Tuition and fees (see Table 1) and other student charges contribute about 30% to the revenue side of the university but they do not appear on any college or departmental budget. Only revenues clearly generated by a particular department (es. lab fees) are included in that units budget. State appropriations, grant funding, enduwment earnings, and other revenues make up the remainder of the revenue side of the university budget, but they also are not distributed among the budgets of the colleges or other units. By the same token, no overhead charges appear in college budgets either Well before the beginning of the fiscal year, the VP of Finance sends cach dean the college's basc budget: the total amount available for salaries and other costs. Typically is equals Last year's budget (with minor modifications. The deans send the department heads their budgets and then meet with them to discuss their concerns. Finally, the deans meet with the VP of finance to answer standard questions, such as whether departments and the college can come in on budget, whether revenue opportunities exist; where cu will be taken. Neither the deans ner the department hade 0 Cr VOL 5.2L, MARCH 2012 hole unds for the base IECJ0512C column in the set of columns les columns 3 and 4- variances. The sum of all hade varices els the surplus or deficit of the department. At this moment there is already a deficit of almost 550,000 INFORMATION ON THE DEPARTMENT OF SOCIAL WORK che e entire WE chudget by the dollars lines ning the wen moet not the Every This is an accredited pengram ofering a bachanda master's degree. Both degrees are popular and fully cried About undergraduates can the degrees. The department has the second largest master's program in the universits, radosting Student Lyca, and 28 credit bon respectively were eamed in the undergraduate and graduate courses in the department which had 107 and 119 sented. Most game students take all the credit hewan in the school. This not the case for undergraduates they take my classes in the departments for general de lective etc. These numbers have been holding and for all yan and welkely to remain . Mendeng and all graduate Mudents atestate residents and wetge 13.5 and credit hours per me The director estimates that 35-50% of the undergraduates enter the university because they want that depeche emainder transfer in from her but the graduate students come from the undergrader Others and their degree where that's pm without the undergraduated in which the program for more credits. The am in popular because all ingencies graduates are open it completi The Council on Social Work Education the crediting tedy quite a mim of sex full-facryfa master's program and two for a tocha. The department has wonen full-time faculty and we halftime facut appointments with a dem The there facilemben met de because he is one of them and therefore can't full and another faculty member is the conditio which ale bits full-time teaching. The conditing by que a maior full-time-quivalent to the master's level and the undergradom level. I who requires that each undergraduate de participate in a minimum of 100 cffield cache graduate student participe in Theshow po ced the whole cohol and directe and actual ws seconds modified they able to the ciated he fourth ME JOURNAL 2 VOL 1 NO ART. 1, MARCH 2013 INFORMA WORK which have an opportunity to challenge the whole Budget changes incremental and ten teman That is a dean muy cure a one-time of funds for some special purpose, but permanent intend to the luxe budget is rate. One exception to this car when faculty member, not a replacement, is hie Anscher in the opposite direction when there we cute to the entire sity's budget. When or how get me wr originally is lost in the dim pust. Initially cach department must bulance its bude allowable expenditures MUST qual planned expenditures All salaried positions (faculty, administrative, and a e hodgeted in salary lines with lentis equating Sosoflary) in the line. Adjunct ad by the cone, have a low benefitte-currently 5 percent. Their pay appears in a different line. After the know any wap, and benctid lines, the remaining bune budget dollar we alcated to the operating budget expenditures by the department budget office. Some might to the copier, to phone to travel to membership. During the yeat, cach department can change the allocations between various budget lines (excope operating line be transferred to salary lines to address specific need Expenditures are recorded as incurred About midway she cal year the dean meets again with anvenifices to discuss whether or not the year's budget will be met. We are this point. Every deurment and every college in veden themes between the bushadigawatile expenditures and actual expenditures. The budget spreadsheets five column ice Exhibit). The fint is the original basebadet. The called the current budget, which is the best modified by temporary financialements that during the year and that increase or decrease the totalment available to the department icone-time true. The third in ea code actual expenditures and actual revenues deurly w.cited with the department has tab i feel. The incubadestary delle for munt, mortly alatex wages, and benefits. The last Then 13 The The themed The wand Ben The she'd ches he bud that. S of which are 60-100 milesway Field study necesitate small groups and individualized supervision and therefore requires a large number of adjunct faculty. In the most recent year, adjuncts were med for 3 desses and field stay requirements. The department pas appimately $100.000 (plus Sk.500 required benefits for adjunct annually about 65 of which is for the graduate program The base budget of the Department of Social Work is $1.045,000, of which $1,037,000 is salaries, wages, and benefits (uee spreadsheets. In that later amount, 547.646 is budgeted adjunct wages and 54,050 is adjunct benefits The full adjunct needs are not basc budgeted. The faculty member who is currently paid for by the college is not in the base budget. (His salary and benefits appear in the current budget" column stranded) The department anticipated other revenues of approximately $61,000,000 (use-budgeted) form field study for $14.000 cuericulum fees (allocated to all departments by the university and $41,000 of buyout money from faculty grants, which free up money that can be used to be adjunts pay for det expenditures. The latter cannot be guaranteed annually. The dean hopes that the faculty will receive additional in the future, but no one can promise it. The department ale anticipates having to spend a total of 575.000 other operating expenditures, which include the copy machine und phone, membership fees, faculty development funds (travel - $1000 cach expenditures en student handboek replacement of computers, etc. All actual receipes or expenditures can be seen in Exhibit CONVERSATION WITH THE DIRECTOR OF SOCIAL WORK CO bu You ask. "Josh, how were you able to get these number past the dean and VP last year when it came time to approve the basc budget Jonhawwers. "Wie simply don't report our needs. We cant. They don't allow us to. So, we show our faculty administrative, and staff salaries and we hac-budget about only $47,000 of adjunct pay-less than half of what we need The remaining amount of the buse, about $13.000, we will for operating expenses. It's joketcally considering that we have to spend about $70,000 to SOGO "But" you say, if the VP has seen adjunct pus of $100,000 or so for years, how can she not insist on base budgeting it?" Josh replies "k's mystery. I think she hopes the problem will disappear. The thing is if she were to insis that the full amount needed to be base-budgeted, then ch tights we I do she'd ches he bud that. S of which are 60-100 milesway Field study necesitate small groups and individualized supervision and therefore requires a large number of adjunct faculty. In the most recent year, adjuncts were med for 3 desses and field stay requirements. The department pas appimately $100.000 (plus Sk.500 required benefits for adjunct annually about 65 of which is for the graduate program The base budget of the Department of Social Work is $1.045,000, of which $1,037,000 is salaries, wages, and benefits (uee spreadsheets. In that later amount, 547.646 is budgeted adjunct wages and 54,050 is adjunct benefits The full adjunct needs are not basc budgeted. The faculty member who is currently paid for by the college is not in the base budget. (His salary and benefits appear in the current budget" column stranded) The department anticipated other revenues of approximately $61,000,000 (use-budgeted) form field study for $14.000 cuericulum fees (allocated to all departments by the university and $41,000 of buyout money from faculty grants, which free up money that can be used to be adjunts pay for det expenditures. The latter cannot be guaranteed annually. The dean hopes that the faculty will receive additional in the future, but no one can promise it. The department ale anticipates having to spend a total of 575.000 other operating expenditures, which include the copy machine und phone, membership fees, faculty development funds (travel - $1000 cach expenditures en student handboek replacement of computers, etc. All actual receipes or expenditures can be seen in Exhibit CONVERSATION WITH THE DIRECTOR OF SOCIAL WORK CO bu You ask. "Josh, how were you able to get these number past the dean and VP last year when it came time to approve the basc budget Jonhawwers. "Wie simply don't report our needs. We cant. They don't allow us to. So, we show our faculty administrative, and staff salaries and we hac-budget about only $47,000 of adjunct pay-less than half of what we need The remaining amount of the buse, about $13.000, we will for operating expenses. It's joketcally considering that we have to spend about $70,000 to SOGO "But" you say, if the VP has seen adjunct pus of $100,000 or so for years, how can she not insist on base budgeting it?" Josh replies "k's mystery. I think she hopes the problem will disappear. The thing is if she were to insis that the full amount needed to be base-budgeted, then ch tights we I do ty . CE "The IECJ0512C she'd have to find money to increase wat bese budget and she doesn't have it or it would have to come from embed cle's budget. Eventually, it does come from the budgets of others, from other departments in our college Josh continues. Anyway, the remainder of our buse budget money, S13.000, is randomly distributed among the operating budget lines. (See Exhibit 1.) We can't operate that. So we spend what we must. In theory, adjunts should only be hired if money is wailable, but we must hire them of not offer clue. We can't do that, although sometimes I'm tempted just to see the reaction if we didn't offer the classes. This spring we have 1 dames or field study couns being offered by adjuncts - one are clectives "Some years ago, two factors played a large part in our growing deficit. Fins about $30,000 of adjunct wages used to be paid by the Continuing Education Division of the university. Then, due to budget cuts, the Liniversity changed its policies, leaving us to pay there was neves That amount was never added to our use budget. Another major factor was the drying up of grant funding-aplicnom occurring crow many disciplines. Our faculty continues to secure grants, but not as many and for not a large amounts. We used to be able to rely on grants that ought in $60,000 to $80,000 a year, which would offset supplice travel, and assistantship costs. We have also just losta large, frontenewable multiveat grant that financed a faculty member. As you know the college in pusing the salary this year. I have no idea what's going to happen next yea "A faculty member who caressant funding can buy out of his or her teaching responsibilities and the grant money can be used to pay for adjuncts supplies, travel etc. Our budget officer will reduce the salary line by the amount paid by the grant and transfer the dollars to the other expenditure lines. It will appear in the year-to-date column of the spreadsheet. Since faculty salaties are much larger on a per-class basis than that of an adjunctcoure buyouts help us pay for things beyond the adjunct wag Unfortunately, we can't rely on a grant mesey. The university encourages departments to engage in revenue creating opportunities, but we can't think of her to create such opportunities because of substantial teaching loads and tightening in the funding agencies "We are as careful as we can be. We avoid long distance calls. The faculty often pay for their own supplies. We need all the adjuncts, and we are not paying them outrageous amounts. We simply cannot come in en budget. Even if we kept operational expenditures expenditures outside of salaries and wages) to ZERO), we would have a deficit! I don't know what we can do. I know we're doing a good . AL he ced ABOUT IMA job the programs are well rulled the undergraduates et job. (What other program can say that. The must graduates all getane. There is a need for licensed social workers in the state. We contribute so much to the community through the fieldwork requirements. The faculty all work and they have active research programs and manage to achieve grant funding. This past year, the indirect funds generated by the department that came to about $102,000. This was real money that went directly to the university offers to "We could cut travel, but this new part of being an academic Wic present reach a conference leam luat othen doing and gain new ideas about teaching research and acquiring funding. We colpine $1,000 to each faculty, where that funding much more "The faculty merced. They don't understand why they reviewed as an illatos, and they we afraid that department will be doned. Closing one of the programs decat make sense. If wedsed the undergraduate program I would estimate a wing of about $13.000 operational costs attributable to undergraduates on Abof the adjunct waper and beach would also be uved. Phone and copier expenditures are mostly fined. Faculty can be asked to continue to use old computers for an extra ya we, but there is a limit. We are not wasting money Wealy have the non-teaching administrative assistants who handle the needs of students and facules and work with the det requirements of the grants of the department. They are pestrybucy. Another important point is that there are other undergraduate and graduate social wack program the state, so our students could choose to chcwhere. Iesport an additional $15,000 to be spent by the end of the fiscale in the operating budget area. This will result in a de approximately $15.000. I hope you can find some way to help REQUIRED As requested by Dean Wellet you to the financial situation of this department and present in a way convincing to the vice presidenta finance. You will have to make several spine-please indicate them de The dean would like to use your information the next budget meeting, Sour information should be presented dearly so that a financial person will understand Mike recommendations and present them in appiate format. Understand that given the current budget system. your college will be better off if the department inced because all the expenditures of the department will be removed from the books of the college and the deficit will disappear BUT will the university benctie! You M IMA EDUCATIONAL CASE JOURNAL the faculty IECJ05120 that if a program is closed the inity cany offers people without penalty Sou do not need de facile contrachamainenance or depreciate. Nuen the world of non-profits the word "expenditure is used instead of expense. 11 What contribution is the unit making currently both financially and therwise z What effect will the closing of the department have the it! 1 What effect will the closing of the Bachelor's program have on the university 4 Overall, what is the problem! Why does this department look so bad financial? indirect ty to to rences + at st of the ABOUT IMA Wicha walide network of methane.00 pm IMA is the wild leading on dedicated cmpowering ting and finance et de business perfomance. IMA pewides a dynamic fonam professionals to advance their career the Cented Management Accountant Mencin, peofeminal education, networking and advocacy of the highest ethical and professional standarth. For more information IMA please visit www.imante o be Nic only handle bude other und the expect Set of You will hem the Make ned be ume 29VINAR 11 M e del 5 of 6 rummer EC205120 Et Dale of the Shell Social Well SU LE LOT ECJ05120 Toll 2006- Spring 2000 Residential and Amerfest wie IMA EDUCATIONAL CASE JOURNAL VOLS Table 1 Fall 2008- Spring 2009 Resident (In-State) Tuition and Fees (Amounts are per semester. Fees cannot be avoided) Total 888.00 1.127.00 Undergraduate Tuition & Fees #ol Credits Tasan Fees 1 121.00 2 47800 17100 217.00 121.00 4 95600 17100 5 1.195.00 171.00 6 1434.00 490 00 7 1573.00 19000 & 1912.00 190.00 9 2.151.00 10 239000 190 00 2629.00 490.00 12 2.368.00 96500 13 3.10700 965.00 14 3.346.00 95.00 15 2585 96500 3.824.00 9800 For each additional credit add $229.00 1924.00 216200 2.402.00 254100 49000 3630 4072.00 4311.00 455000 Fores IMA EDUCATIONAL CASE JOURNAL VOLS Table 1 Fall 2008- Spring 2009 Resident (In-State) Tuition and Fees (Amounts are per semester. Fees cannot be avoided) Total 888.00 1.127.00 Undergraduate Tuition & Fees #ol Credits Tasan Fees 1 121.00 2 47800 17100 217.00 121.00 4 95600 17100 5 1.195.00 171.00 6 1434.00 490 00 7 1573.00 19000 & 1912.00 190.00 9 2.151.00 10 239000 190 00 2629.00 490.00 12 2.368.00 96500 13 3.10700 965.00 14 3.346.00 95.00 15 2585 96500 3.824.00 9800 For each additional credit add $229.00 1924.00 216200 2.402.00 254100 49000 3630 4072.00 4311.00 455000 Fores VOL.S. NO. 1, ART. 2. MARCH 2012 IECJ0512C Total Graduate Tuition & Fees #of Credits Fees 1 25700 201.00 2 71400 2010 2 3071.00 201.00 4 12800 20100 5 2010 6 2.10.00 75.00 7 2.499.00 2.256.00 9 3.213.00 475.00 10 357000 475 00 3.927 00 75.00 12 4.254.00 950.00 854100 950 30 14 4.98.00 950.00 15 5.255.00 950.00 16 571200 97100 For each additional credit add $357.00 915.00 127200 1529.00 1988.00 2517.00 2.37400 230100 2.622.00 3.045.00 4402.00 5.234.00 559100 5.948.00 2050 558330 howy Kamion 22- M2021 Order F41100 You are the online day your person 22 Mw.2022 Partido de former VOL.S. NO. 1, ART. 2. MARCH 2012 IECJ0512C Total Graduate Tuition & Fees #of Credits Fees 1 25700 201.00 2 71400 2010 2 3071.00 201.00 4 12800 20100 5 2010 6 2.10.00 75.00 7 2.499.00 2.256.00 9 3.213.00 475.00 10 357000 475 00 3.927 00 75.00 12 4.254.00 950.00 854100 950 30 14 4.98.00 950.00 15 5.255.00 950.00 16 571200 97100 For each additional credit add $357.00 915.00 127200 1529.00 1988.00 2517.00 2.37400 230100 2.622.00 3.045.00 4402.00 5.234.00 559100 5.948.00 2050 558330 howy Kamion 22- M2021 Order F41100 You are the online day your person 22 Mw.2022 Partido de former IMA TROCATIONAL CASE JOURNAL | Exhibit 1 | Budget of the School of Social Work Balpet atlas Setheart | Agri in theeal year at me 185.000 16.000 other 760 18.00 10002 faculty 55 4758 120 SES 7210 200512 OR 1394 545 100 SED total saleswages 1 33272 1.115282 4219 berships postage printing copy 105 1 2341 wa 300 207 27 1.200 1200 maintenance of total operating expe LOST net revenus & 122 2240 Amounts in Brackers are positive indditional money wailable extant in the budget ware lime FIONAL CASE JOURNAL VOLS NO AT MARCH IECJ0512C 12. flocal year ende June VID Actual Buget Var 000 SRO Shared curricanes ONE 15572 11 100021 Coured 5770 30 3646 1 247 12301 9354 2 WE 114.10 1534 22 3212 52 226232 115,437 5.200 4209 1025 31 2341 2010 Charged 100 2.47 754 21 15.15 1.500 EUR 1677 11.7 MIN 3543 7200 795 40 2593 mos 731 LEN 22 73 Deficio Antice 25 224 2012) the