What is fund balance?

Fund balance is the inception-to-date sum of the revenue and expense posted to a fund balance funds.  At Rice, fund balance fund groups include:  A0 (agency), A2 (auxiliary), C (student clubs), D (designated), E (endowment), G (gift), H (endowment spending), K (trusts), L (revolving student loan), N (subsidiaries), and U (university internal awards).

Fund balance funds are like checking accounts.  The balance persists across financial periods.  The ending balance in one period becomes the beginning balance in the next period.

In contrast, budgetary funds have an allocated (budgeted) amount to spend.  At Rice, budgetary fund groups include: A1, B P & M funds (capital projects), R (sponsored research and other sponsored projects).

Budget funds have access to the budgeted amount until the end of the budget period.  For A1, that means the end of the fiscal year on June 30 (or rather, when we close the books for June in mid-July).  For B, P, & M funds the budget runs until the capital project is substantially complete and placed in service.  For R funds, the budget runs until the end of the project period as defined by the sponsor.   Generally, at the end of the budget period the budgetary funds go away, like Monopoly money going back into the box at the end of the game.

What does this mean to me?

The distinction between fund balance and budgetary funds really makes no difference on a day-to-day basis.  The few places you will notice a difference if you paying close attention:

• Budgetary funds may have a circumscribed display in Web Apps. R funds, for example, do not display revenue transactions because the arrival of cash from the sponsor is irrelevant to the management of the sponsored activity.  B, P, & M funds do not display transfers because the funding entries made to pay for the project are not germane to the management of the project expenditures.
• Budget transfers out of A1 must be made from an account with a positive budget amount. This generally excludes account 80410.  If you do not specify, it will be the budget pool account 70100.