Old Westbury has adopted SUNY’s Cash Reserve policy which applies to unrestricted and restricted cash balances in the General IFR, SUTRA, and Stabilization funds (to be referred to as the “operating funds”). Campuses are encouraged to maintain an unrestricted cash balance between 10% - 25% of their operating disbursements in the above-mentioned funds. DIFR funds are excluded from this policy.
Maintaining adequate reserves is essential to establishing financial stability. Indeed, the level of current unrestricted net assets is reviewed by the Middle States Commission on Accreditation as part of the fiscal component of the accreditation process.
On an ongoing basis, campuses should work to establish and maintain unrestricted operating reserves (cash available within the operating funds not committed to any particular purpose) of up to 25 percent of operating disbursements [disbursements in the General IFR, SUTRA, Stabilization and Core Operations (i.e. state tax support plus income offset ) funds], or the equivalent of three months of disbursements. This is especially important during a State fiscal crisis where the level of unpredictability and high potential for mid-year budget reductions are likely. SUNY has three classifications of Unrestricted Operating Reserves: Low, Within Range and Excess. Balance are considered Within Range if between 10 percent and 25 percent of the total core operations, IFR disbursements and fringes. Low Reserves are balances less than 10 percent and Excess Reserves are balances greater than 25 percent at the end of the SUNY fiscal year (June 30). Old Westbury typically sets a target for the unrestricted cash reserves between 10 and 15% but this percentage can fluctuate depending on State Support and tuition fee levels approved by SUNY.
Campuses are allowed to restrict or reserve certain cash balances that are not to be used for general operating support. Examples of restricted balances include broad base fees (technology, student health, transportation, athletic, etc.), and course base fees, overseas academic programs, and contracts with third parties (continuing education program, etc.). Strategic Investment Reserves are also considered restricted. Campuses are encouraged to create and maintain these reserves which are critical to the long-term financial stability of programs. These reserves may be established for Equipment Replacement and Repairs, Facilities Rehabilitation and Renovation, Program Stabilization, Scholarships, Campus Program Initiatives, and Research Investment.
Monitoring and Reporting
The Budget Office distributes Cash Reserve Reports twice per fiscal year: mid-year (as of 12/31) and fiscal yearend (as of 6/30). Strategic Investment Reserve plans will be updated annually as part of the annual budget development and Campus Financial Management Strategy process. SUNY will monitor actual activity in the strategic investment reserves compared to plan and campuses will be asked to explain large discrepancies in the actual versus planned amounts.
SUNY Old Westbury
At the onset of the new fiscal year, IFR cash balances are reviewed with Vice Presidents and Department Heads responsible for those accounts. Balances and planned usage are discussed. If funds are needed, a formal request must be submitted to the Budget Office for review and approval. The Budget Office monitors cash balances monthly, prepares quarterly reports and reviews activity with the CFO.