Planning and Budgeting

Office of

Planning and Budgeting

OFFICE OF

Planning and Budgeting

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Glossary of Budget Terms

Activity-based budget model

In 2013-14 the university transitioned to an activity-based budget model which sees all revenues flow directly to the faculty or school that generates that revenue, and charges a proportionate share of central university costs, such as shared services, back to the faculties and schools. The model provides a transparent budget process and incentives to grow revenue and contain costs.

Shared Services

The units on campus that provide services to the university as a whole, such as Human Resources, Advancement, the Library, senior administration, student services, and ITServices. Occupancy costs, like utilities and custodial services, and student financial support are also included among shared services. Shared Services should be viewed as enablers or facilitators whose purpose is to support and enhance the academic enterprise, through direct support to faculties and schools or indirect support to other shared services.

Hold Harmless

When the university transitioned to the activity-based budget model in 2013-14, the budgets of faculties and schools were set according to the revenue they generate and costs they incur, where previously budgets were determined largely by historical practice. The hold harmless guarantee ensures that no faculty or school would receive a budget under the activity-based model that was lower than what they received in 2012-13. Full hold harmless funding was guaranteed in 2013-14 and 2014-15, and will then be phased out over a period of five years.

Operating Budget

Approved annually by the Board of Trustees, the operating budget sets out projected revenue and expenses associated with the university’s operations.

PACB

The Provost’s Advisory Committee on the Budget reviews budget submissions from faculties, schools and shared service units and advises the Provost on the university’s budget.

Jointly sponsored pension plan

A jointly sponsored pension plan (JSPP) is one that is jointly sponsored and governed by the employer and the employees. Many JSPPs include multiple employers and employee groups and have permanent exemptions from funding solvency deficits.

Going concern deficit

A deficit occurs in a pension plan when the value of its assets (cash and investments) is lower than the value of its liabilities (the value of all the benefits earned by members). A deficit on a going concern basis assumes that the pension plan continues to operate, receive contributions and earn a return on its investments. Queen’s is currently required to make special payments to the pension plan to fund the going-concern deficit.

Solvency deficit

A deficit occurs in a pension plan when the value of its assets (cash and investments) is lower than the value of its liabilities (the value of all the benefits earned by members). A deficit on a solvency basis assumes that the pension plan is wound-up, such as when an employer goes out of business, and the plan must immediately purchase an investment like an annuity to pay out all earned benefits.

Solvency special payments

Mandated by the government, payments that must made into the plan to pay down the solvency deficit. For Queen’s, special payments are currently set to begin in 2015 and are amortized over 10 years.