Trust fund legislation was enacted by the 1977 General Assembly and revised in 1998 to include Facilities and Administrative funds (also known as F&A funds or overhead receipts). General Statute 116-36.1 allows the University to establish accounts or trust funds outside State budget codes for certain categories of funds. Departments, organizational units, individuals, or groups may request the establishment of a trust fund or special fund that falls within the definitions and criteria outlined in Understanding Banner Funds and in this Policy. Requests for trust funds that are funded through contracts, grants, and agreements are processed through the Contract and Grants-Post Award Office.
Section 116-36.1(a) of the trust fund legislation states that the "Board of Governors is responsible for the custody and management of the trust funds of The University of North Carolina and of each institution. The board shall adopt uniform policies and procedures applicable to the administration of these funds which shall assure that the receipt and expenditure of such funds is properly authorized and that the funds are appropriately accounted for." The legislation also requires the trust funds to be deposited with the State Treasurer. Section 116-36.1(d) states that trust funds "are subject to the oversight of the State Auditor pursuant to G.S. 147-58 but are not subject to the provisions of the Executive Budget Act except for capital improvement projects which shall be authorized and executed in accordance with G.S. 143-18.1."
Each new trust fund must be approved by the Controller. The following conditions must be present to establish an institutional trust fund or special fund:
A fund should be requested when monies are anticipated that qualify under the conditions outlined above. Additionally, trust funds must fit clearly in one of the following categories with respect to sources of receipts.
Gifts, devises and bequests
Contracts and Grants (Requests for trust funds of this type are processed through the Contracts and Grants Office-Post Award tracts and Grants)
Collections to support the extracurricular activities of students
Self-Supporting Auxiliary Enterprises - (must complete Sales Activity Questionnaire)
Sources of significant amounts should not be combined except by type of revenue and purpose of fund. For example, revenue obtained through gifts should be placed in a separate trust fund from revenue generated by contractual services.
Creation of a trust fund which will result in the sale of goods and services must comply with provisions of the Umstead Act. Contact the Controller's Office for additional instructions for this type fund.
Complete the SFA requesting the new fund
Each trust fund request (SFA) is examined carefully and must contain the following information about the proposed fund:
After review and approval of the SFA requesting a new fund, University Controller's Office will assign a fund number. The requesting department will receive a notification of the new trust fund number which is to be used as a guide for initiating financial transactions.
Trust funds must at all times maintain a positive cash balance unless prior approval for exception has been obtained from the Vice Chancellor for Administration & Finance or his designee.
Submit a revised SFA for any anticipated changes in disbursing authority and/or address, fund name, source of funds, or purpose to the Controller's Office so that a revised fund authority may be processed.
Significant correspondence regarding the trust fund should be copied and forwarded to the Controller's Office to be placed in the official fund folder.
A new trust fund should be requested if significant amounts are received that do not fit the description of an existing trust fund.
If the purpose of the fund no longer exists, the disbursing authority should request that the account be closed. If the conditions of the gift or grant have been fulfilled, unless the grantor has specific instructions, any residual monies, whenever possible, should be used to support a program or purpose of similar nature, or closely related, to the original program or purpose.
The disbursing authority should prepare and submit the Inactive Trust Fund form to the Controller's Office so that the fund may be closed.