Board of Trustees
Approved: November 16, 2001
Section V. Administrative Affairs
Subsection: G. Non-Appropriated Funds
Section 6a of the State Finance Act (30 Illinois Compiled Statutes 105/6a) provides that certain nonappropriated funds may be retained by the Board and the University. This regulation is issued to establish uniform procedures relating to the use and handling of such funds as receipts from revenue bond operations, auxiliary enterprise operations, and other self-supporting activities; governmental and private gifts, grants, and contracts; a working cash fund; unrestricted institutional funds; tuition; student fees; and such other funds as may from time to time be approved by the Board.
Non-appropriated funds may only be deposited in depositories approved by the Board. The only financial institutions eligible for consideration as depositories are: banks located in Illinois and insured by FDIC. Guidelines for the preparation and submission of requests for approval of depositories shall be issued by the President, who shall be informed as soon as possible of any circumstances which may require modification or revocation of a depository's approval.
As a general rule, all deposits at a depository in excess of the amount insured by FDIC shall be secured by the pledge of: (a) United States government securities, (b) securities guaranteed by the full faith and credit of the United States government, or (c) any other security permitted by law and approved by the Board. Guidelines for determining the amount to be pledged as security for such deposits and for imposing other appropriate conditions to protect uninsured deposits shall be issued by the President. The requirement for securing uninsured deposits may be wholly or partially waived by the Board if an economic advantage may be gained thereby or conditions otherwise warrant such waiver.
Investment of Funds
Non-appropriated funds which are not secured in accordance with paragraph 2. above shall, unless otherwise provided by terms of a bond resolution or unless needed for operational expenses, be invested through approved depositories or through other means authorized by the Board in (a) United States government securities, (b) securities guaranteed by the full faith and credit of the United States government, or (c) any other investment permitted by law and approved by the Board. Several funds of the same general category or classification may be combined in a single account; however the books and records of the University shall reflect the amount in each fund and the charges against each fund.
As required by Illinois State Statute (30 ILCS 235/2.5), Investment Policy, the President shall submit a quarterly report to the Board on the deposit and investment of non-appropriated funds during the preceding quarter.
Records and Audits
The University shall maintain detailed financial records of operations and prepare formal financial reports in accordance with generally accepted principles and standards of accounting as are necessary for sound financial management and adequate disclosure. Each year the University shall file with the Board a copy of their annual financial report and audit by the Auditor General.
In the event of a conflict between the provisions of these Regulations and the requirements of specific bond resolutions adopted by the Board, the latter shall govern.
Board approval shall be required to establish or change non-instructional facilities reserves or other reserves authorized by the University Guidelines 1982 (as amended 1997) issued by the Legislative Audit Commission. The President or the President’s designee shall issue guidelines for such reserves consistent with said University Guidelines 1982 (as amended 1997).