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Purpose
Service centers generate significant direct charging to externally sponsored grants and contracts. Service centers must also be appropriately treated in the University's Facilities and Administrative cost rate calculation. As such, service centers involve significant compliance risk to the institution. As a result, there is a significant amount of oversight and accounting that is unique to these types of operations. The purpose of this document is to provide guidance to administrators of service centers and specialized service facilities by detailing how to properly establish, maintain, and account for these operations in accordance with federal regulations and University policies.
Guidance for this document comes from many sources. Primarily, service centers are regulated by OMB Circular A-21, specifically section J.47. Circular A-21 was interpreted by a 1994 report issued by the Department of Health and Human Services' Office of Inspector General entitled "Summary Report of Audits of Recharge Centers at 12 Universities". Additionally, service centers may generate activity that is regulated by the IRS rules pertaining to Unrelated Business Income Tax and state sales tax. Also, all things must be accounted for according to Generally Accepted Accounting Principles and, as a state institution, we must abide by state budget regulations and controls.
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