EFFECTIVE DATE: July 05, 2019
ISSUE #: 5
PRESIDENT: Juan Sánchez Muñoz
This policy statement sets general guidelines to be followed to ensure financial system
verification of cost center activity. In order to minimize the risk of unauthorized uses of
funds, entries in the financial system must be monitored monthly by all University of
Houston-Downtown (UHD) departments.
There are no definitions associated with this policy.
3.1 Departments shall verify all financial system cost center activity, on a monthly basis,
against departmental records to insure accuracy and propriety of all entries. Cost
centers are to be monitored each month through the preparation of a verification
report. Verifications must be completed and documented no more than 60 days after
the close of the accounting period being verified. A complete verification will
include the following steps:
3.1.1 Verification that transactions on the UGLS1074 report, which include all
revenue, expense, fund equity, budget, open commitment and soft
commitment transactions are correct in accordance with the documents
processed by the department. Asset and liability transactions that were entered
manually into the system and are not system-generated offsets to revenue and
expense should all be verified.
3.1.2 Identification of transactions not yet processed by the financial system. If these
transactions have been outstanding for more than two months, inquire with the
department to which the documentation was submitted.
3.1.3 Preparation and transmittal of requests for correction, in case of discrepancies,
to the appropriate department (See PS 05.A.12, Expenditure Allocations and Adjustments Policy, for additional information).
3.1.4 Close scrutiny of encumbrance items against actual expenses to insure a proper
release of encumbrances.
3.1.5 The Business Affairs Department will provide training for all authorized
signatories and employees responsible for preparing verification reports.
Authorized signatories and employees responsible for preparing verification
reports should attend the training. Attendance records will be maintained.
3.1.6 Authorized signatories are responsible for reviewing and approving monthly
verification reports within 60 days of the end of the accounting period.
Electronic signatures are authorized for verifications that are reviewed and
approved in a workflow system such as SharePoint.
3.1.7 Verification reports shall be retained by all departments and made available to
internal auditors upon request. Verification reports, documentation of review
and approval of those reports, and written delegation of authority related to the
verification or review and approval process are to be retained for all periods
of the current and previous fiscal year.
3.1.8 Cost centers that will no longer be utilized should be inactivated in accordance
with University procedures, so they are removed from the list of cost centers
to be verified. However, cost centers cannot be inactivated until all of the
following conditions are true:
a. All individual asset and liability account balances are zero;
b. The net total of all fund equity accounts is zero;
c. The cost center has no soft or open commitments; and
d. Original budget (base budget) is zero
There are no procedures associated with this policy.
Responsible Party (Reviewer): Vice President for Administration and Finance
Review: Every three years on or before August 31st.
Signed original on file in Employment Services and Operations.
Issue #1: 09/03/94
Issue #2: 03/18/14
Issue #3: 05/20/15
Issue #4: 06/08/16
PS 05.A.12, Expenditure Allocations and Adjustments Policy
UH System Administrative Memorandum 03.G.03