Finance and Administration - Board of Trustees - The University of ...

Finance and Administration Committee - VI. FY 2012 Revised Operating Budget - ActionFY2012 REVISED BUDGETUnrestricted Net AssetsThe University of Tennessee’s practice is to maintain 2-5 percent ofunrestricted Educational and General (E&G) expenditures and 3-5percent of unrestricted auxiliary enterprise funds in its unallocated fundbalance to function as a “rainy day” fund. The fund is needed in case ofa downturn in enrollment, a sharp decline in state appropriations, orother situations that cause expenditures to exceed available revenues.This provides short-term funding support while necessary expenditureadjustments are made to bring the budget back into balance.4With the FY 2012 Revised Budget, unrestricted E&G unallocated fundbalance projected at June 30, 2012, is $42.3 million, or 3.8 percent of expenditures, which iswithin the target range. The unrestricted auxiliary enterprises unallocated balance is $7.2million, or 3.6 percent of expenditures, which is also within the target range. The totalunallocated balance projected at June 30, 2012, is $49.5 million, which is 3.8 percent ofexpenditures.FY 2012 Revised Budget Unrestricted Net Assets (in millions)$49.7$50.0$45.0$42.5$40.0$35.0$30.0$18.7$25.7$27.8$30.5UnallocatedWorking CapitalRevolving Funds$25.0Reappropriations$20.0Encumbrances$15.0$10.0$5.0$9.7$6.7$7.2$9.1$4.8$0.3$0$9.7$7.0$0.0E&G Auxiliaries Total$42.5 million$7.2 million$49.7 millionUnallocated Balance3.83%3.62%3.80%Percent Unallocated1197