State Funds

As outlined within the Banner Fund Codes webpage, the fund code is an important segment of the Banner accounting string which helps properly classify the University of Illinois’ financial resources for financial reporting purposes.

Classifying these financial resources into separate fund types also helps monitor compliance with applicable guidelines and restrictions to ensure proper stewardship of these funds. State funds are a common type of fund used across the University of Illinois System.  See the following sections for answers to commonly asked questions regarding state funds, as well as tips for properly managing your state C-FOPs.

What are State Funds?

State funds (which primarily reside in fund type 1A) are funds which account for financial resources generated primarily from:

• Appropriations from the State of Illinois (which are received on a reimbursement basis)
• Tuition assessed to students
• Certain types of fees (such as mandatory fees) or fines (such as fines for lost or overdue library books) assessed to students

How Are State Funds Identified in Banner?

State funds can be identified by examining the fund code segment of the Banner C-FOP. The state fund codes reside in the 1000YY – 1800YY numerical range within Banner, with YY representing the applicable fiscal year that the state fund is tied to.

For example, the 100024 state fund would be used to account for FY24 financial activity.

Most units at the University of Illinois System use the 1000YY fund code for state funding, but some specific units have their own unique codes within this range. Although 1000YY is commonly associated with state funds, it's important to note the existence of other distinct state fund codes.

How Are State Funds Budgeted to Units?

The applicable budget offices are responsible for allocating state budget across the University of Illinois System. They will assign an expense budget to your unit’s specific organization and program code combination, using the primary state fund code (1000YY) which is used across the University of Illinois System.

If you have any questions on this process, contact your applicable budget office.

What Will My State C-FOP Look Like?

The primary state fund code (1000YY) is used across the entire University of Illinois System. In order to segregate your unit’s portion of the overall state fund budget allocations, you will need to use this shared state fund along with your unit’s applicable chart, organization, and program code.

For example, if a UIUC unit which has an assigned organization code of 123000 wants to assign FY24 state budget to one of their professor’s research program codes (e.g., 123004), then that state C-FOP would be 1-100024-123000-123004. Units will typically need to request a new program code (not a new fund code) when requesting a new C-FOP string to use for their state fund activities.

What Fiscal Year Limitations Apply to State Funds?

Per guidelines provided by the Illinois Office of the Comptroller, the only expenses allowed to post to a current fiscal year’s state fund are expenses where “…the goods or services were contracted for or received…” on or before June 30 of the current fiscal year.

As for expenses that cross fiscal years (such as annual membership renewals) – if a state fund must be used to pay for these types of expenditures, then you are allowed to charge the entire expense to the state fund which correlates to the fiscal year in which the services begin. However, come July 1, if you would like to reclassify the applicable portion of the expense to the new fiscal year’s state fund code, you are welcome to do that as well.

For example, if the renewal period ranges from 5/1/24 – 4/30/25, then you could use the FY24 state fund to pay for this entire expense (as the renewal period begins in FY24). You could also reclassify the applicable portion of the expense (i.e., the portion which relates to 7/1/24 – 4/30/25) to the new fiscal year’s state fund code once it opens on July 1 to better match the expense to the appropriate year. However, this is not required.

What is the Lapse Period?

The lapse period is a timeframe implemented by the State of Illinois Comptroller which allows state agencies to post expenses for goods and services that were contracted for or received on or before June 30 to the prior year’s state fund during July and August of the new fiscal year.

The lapse period occurs during the first two months of each new fiscal year (i.e., July 1 through August 31). During the lapse period, both the prior year and current year state funds are open. Since both funds are open at the same time, it increases the risk of expenses posting to the incorrect fund code, so it’s important to pay close attention and regularly reconcile these state C-FOPs during the lapse period.

Once August business closes, the prior fiscal year’s state fund will be terminated, and no further transactions will be allowed.

Given these restrictions, it is essential to perform regular reconciliations and daily reviews of the prior year’s state fund before it is terminated on August 31. This will help ensure all corrections and adjustments have been made to the prior year’s state fund by the close of August business.

Why Is It Important to Use Accurate Account Codes on State Fund Expenses?

To ensure compliance with state appropriation billing and financial reporting requirements, as well as to prevent state compliance audit findings, it is very important to use accurate expense account codes when posting expenses to state funds. The expense account code should accurately reflect the goods, services, or personnel expenses which are being paid for.

What Types of Transactions Are Prohibited on State Funds?

Given that state funds are only meant to account for tuition, certain types of fees, and state appropriation revenue, it is inappropriate to credit any type of sales revenue to a state fund.

• State funds cannot be used for the purchase of any type of alcoholic beverages.
• State funds cannot be used to subsidize any type of activities for auxiliary enterprises under indenture.
• State funds cannot be used for financial support or sponsorship payments per policy 8.1.5 Determine the Allowability of Specific Financial Support or Sponsorship Payments to Outside Organizations under the “Funding” section.
• State funds cannot be used on a split-funded purchase order (PO) or invoice voucher (IV).

  For example, you cannot process a PO or IV, which contains a state fund for a portion of the expense and an ICR fund (or any other fund type) for the other portion of the expense. This limitation is caused by the fact that these different fund codes use different default bank codes and are thus processed on a separate check processing cycle. If a split PO or IV was allowed with state funds, it would cause the vendor to receive two checks instead of one, which is obviously not ideal.

  Given this system limitation, it is required to pay the entire PO or IV off of one funding source. Then, after the related expense posts, you can complete a JV to reclassify a portion of the expense to the other fund if needed.

Am I Allowed to Deposit Cash or Checks to My State C-FOP?

Typically, the only times where it is allowable to make a deposit (such as cash or a check) into a state fund are: 1) Your unit received a vendor refund or rebate from a past purchase or 2) Your unit received reimbursement from an employee who erroneously charged the state fund for a personal expense (such as a movie rental in a hotel during a business trip that was charged to the state fund).

If either of these situations occurs, the Bursar Cashiering Office will deposit your cash or check into a temporary state clearing fund which UAFR monitors. Once UAFR sees this amount deposited to this clearing fund, the applicable subject matter expert will be in touch with you to verify the details surrounding the deposit. If approved, UAFR will then reclassify the deposit to the correct C-FOAP.

How Do I Find the Budget Balance Available (BBA) For My State C-FOP?

• To find the available budget balance for a state C-FOP string, go to Banner page FGIBDST and enter the applicable C-FOP string.
• Then, uncheck the Include Revenue Accounts box within this page, and hit the Go button.
• Your available budget balance will then appear in the lower right-hand corner of the page, on the Net Total row of the Available Balance column.

For further details, refer to Finding Your C-FOP Balance.

How Do I Transfer State Budget from One C-FOP to Another?

If you ever need to transfer budget from one state C-FOP to another (e.g., to move the expense budget to a different organization or program code), always be sure to work with your applicable budget office for guidance. See Section 3.1, Adjust a Budget for further details.

There are limitations on where you can transfer your state budget.

For example, it is unallowable to transfer state budget to a self-supporting or gift fund. You may be able to transfer state budget to institutional fund C-FOPs (such as ICR or administrative allowance). These type of requests would need to be reviewed, approved, and processed by the applicable budget office.

What Rule Code Should I Use When Posting Journal Vouchers Involving State Funds?

When processing journal vouchers (JVs) on state funds, you are required to use either a 170 or 175 rule code (also referred to as a Journal Type within Banner) on the JV sequence which contains the state fund. See below for a breakdown:

• If your JV includes only one debit and one credit, then you would use the 170 rule code on the JV sequence which contains the state fund.
• If your JV includes one debit and multiple credits (or vice versa), then you would use the 170 rule code on the JV sequences which contain the state fund.
• However, if you are completing a JV which has multiple debits and multiple credits, then you would be required to use the 175 rule code on any of the sequences containing the state fund.

Do I Need to Update Payroll Appointments, Index Codes, PCards, and TCards at the Beginning of Each New Fiscal Year?

If your unit has payroll appointments, index codes, or purchasing/travel cards that use the state fund as it’s default funding source, these fund codes are automatically updated to the new fiscal year’s state fund code on July 1 of each new fiscal year. No effort is needed on your part to make these changes each fiscal year.