Section 13.5 - Internal Transfers
Date: February 2005
Approved: Senior Associate Vice President for Business and Finance
The internal transfer function deals with journal vouchers used to record transfers from one University fund to another. These processes do not result in a check being prepared - unlike the vouchering function, which does result in the issuance of a check or warrant.
The Senior Associate Vice President for Business and Finance formulates, and, after necessary consultations, publishes policies and procedures required to define the responsibility for the internal transfer function and processes. The Assistant Vice Presidents for Business and Finance are responsible, within the policies and procedures, to:
- Develop and issue necessary operating policies and procedures for the processing of stores or services vouchers on their campus (intra-campus transfers).
- Provide general supervision of the storeroom and service operations.
- Develop and maintain the required manual and computer systems.
The OBFS, University Accounting and Financial Reporting oversees day-to-day internal vouchering and the processing of vouchers within and between campuses.
Debits (expenditures) and credits (revenues) are used as required to record internal transfers for sales, adjustments, and corrections.
Internal Transfer Types
The accounting entry to record the reversal of an expenditure is a debit to the original selling Fund/Organization/Account/Program (FOAP) and a credit to the original buying FOAP. This type of transaction is normally used to record the return of goods, errors in posting, correction of over charges, etc.
Revenue - It is sometimes necessary to transfer income/revenue from one FOAP to another. The accounting entry to record this type of transfer is a credit to the receiving FOAP and a debit to the FOAP from which the revenue is being transferred.
Expense - It is sometimes necessary to transfer non-personnel expenses from one FOAP to another. The accounting entry to record this type of transfer is a debit to the receiving FOAP and a credit to the FOAP from which the expense is being transferred. Personnel expenses must be transferred through Banner Payroll using the labor redistribution form.
Funds - Occasionally, funds are transferred from one FOAP to another; for example, from one gift fund to another gift fund. The accounting entry to record this type of transfer is a credit to the receiving FOAP and a debit to the FOAP that is giving up the funds. Special account codes beginning with "4" are used for intrafund or interfund transfers.
Budget Transfers - Transfers of budgets are made using journal vouchers. These transfers must be processed by the campus budget offices.
The accounting entry to record any original internal sale is a debit to the buying FOAP and a credit to the selling FOAP. Sales may not be credited to any state-appropriated fund. Internal sales transactions should be initiated by the selling unit who maintains the documentation for the value of the transaction.
Please send questions regarding this policy manual to OBFSPolicies@uillinois.edu.
Last Updated: March 23, 2008