Managing Financial Resources at UCLA

Policy

Each operating unit on campus requires financial resources to perform its role in the University's mission of research, teaching and public service.

Each unit head is responsible for ensuring that his or her unit manages financial resources in an efficient and cost-effective manner.

Each unit head shall adopt the following principles and responsibilities to ensure sound financial management:

 Principle 1 A budget must be established to provide a tool to:
  • Project resources necessary to achieve a unit's goals and objectives.
  • Measure current financial performance.
  • Discover significant transaction errors.
  • Detect substantial changes in circumstances or business conditions.
 Principle 2 A budget must be realistic, reasonable and attainable.
 Principle 3 A budget must be based on a thorough analysis that includes:
  • Clear identification of the budget's purpose with regard to the unit's mission, goals and objectives.
  • A comprehensive assessment of the unit's financial needs in order to fulfill its goals.
  • A plan to increase resources or modify goals and objectives if current resources fall short of meeting a unit's needs.
 Principle 4 Actual financial results must be compared to the budget on a regular basis to:
  • Detect changes in circumstances or the business environment.
  • Discover transaction errors.
  • Measure financial performance.
  • Avoid unnecessary costs.
  • Ensure that expenditures are reasonable and necessary to accomplish the unit's goals.
  • Ensure that transactions are adequately supported.
 Principle 5

 When actual financial results vary significantly from the budget, a manager must:

  • Determine the cause.
  • Evaluate the activity.
  • Take corrective action.
 Principle 6Units must operate within their budgets. Where expenditures exceed the budget, justification must be provided. Additionally, units must develop a formal plan to eliminate deficits.
 Principle 7All expenditures must comply with all relevant policies, rules and regulations.
 Principle 8Each unit must evaluate the financial consequences before a new activity is started or a current activity is a changed or eliminated.
 Principle 9Each unit must ensure that the anticipated benefits are greater than the costs for any planned or ongoing activities.
 Principle 10Each unit must provide adequate safeguards to protect against the loss or unauthorized use of University assets. (See Related Information.)