University Business - October 2012 - (Page 59)

CAmpus FINANCE The ABCs of TDABC Universities face a conundrum: Funding for higher education is on the decline, but enrollment is at an all time high—how can they do more with less? One answer may be Time-Driven Activity-Based Costing (TDABC). It’s a system to discern and analyze costs and compare this to what is driving demand. For example, a finance officer may know how much certain departments spend on which vendors, but not have the ability to align shared services (duplicate services or programs) between those departments. Robert Kaplan and Steven Anderson, creators of this costing model, claim TDABC accurately estimates cost and demand through measuring the unit cost of supplying capacity and the time required to perform a transaction or an activity. Implementing a TDABC model will help universities take control of: • Financial Reporting: Universities can reduce costs while gaining efficiency through financial planning with real-time budget visibility and consolidated financial reporting. They’ll streamline cash-flow activities and optimize financial transactions. • Cost Transparency: Schools will be able to gather insight into departmental activity cost details, which produce a more accurate and holistic representation of a department’s overall cost, capacity, and consumption level. Instead of reducing staff and facility costs, they can recognize where support levels can be shifted without adversely impacting overall program and service quality. • Allocation of Resources/Budget Development: To help with accountability, universities can allocate interdepartmental costs accurately, allowing them to understand the total resources consumed and create accountability in the budgeting process. • Shared Services: Through the simplified budgeting and reporting capabilities TDABC provides, colleges will be able to efficiently manage shared services and allocate costs and resources across all departments, without duplication occurrences. Through TDABC, universities can learn which activities drive what costs and prioritize activities that drive demand. They’ll be able to find a way to create a balanced, efficient budget during a time when state education spending is at its lowest in decades. A PDF version of Kaplan and Anderson’s paper on TDABC can be found at http://goo.gl/rdR52. —Troy Stovall Industry News Campus Management, a provider of enterprise software products and services, has announced a strategic alliance with EC Group, a professional services company specializing in financial aid management, regulatory compliance and institutional effectiveness. The Texas Partners Federal Credit Union has joined the pool of about 500 credit unions that offer Sallie Mae’s Smart Option Student Loan referral program. Higher One will soon be offering OneAccount Edge, a new type of bank account to its collegestudent customer base with a simplified approach: one fee and one fee only, $4.95 per month. Western Union Business Solutions is enabling participating universities to accept international students’ tuition payments and fees in Indian rupees. The service will facilitate the processing of foreign tuition invoices and student fees directly via students’ home country bank accounts. ‘Shopping Sheet’ Aims to Make College Costs Transparent The Department of Education, in collaboration with the Consumer Financial Protection Bureau, has released a new, standardized format for financial aid award letters. The “Financial Aid Shopping Sheet” offers students and families a graphic summary of the cost of attendance and aid available and can be customized by each institution. The form makes it easy to compare costs and aid offers, and provides an index of how comparable schools perform against one another. In a letter to college presidents, Secretary of Education Arne Duncan encouraged them to adopt the form as a way to clearly show prospective students the cost of their college education. “Our goal is that more students will arrive at school each fall less worried about how they will pay for college and more focused on how they will complete college,” Duncan wrote. The form can be seen at http://goo.gl/dXrNq. universitybusiness.com October 2012 | 59 http://goo.gl/rdR52 http://goo.gl/dXrNq http://www.universitybusiness.com

Table of Contents for the Digital Edition of University Business - October 2012

University Business - October 2012
Contents
Editor's Note
College Index
Ad Index
Behind the News
Viewpoint
Human Resources
Venue 365
Not Your Parents’ Campus Bookstore
CRM Grows Up
Where the Workers Are
The Payment Plan
Education Innovators
Money Matters
What's New
End Note

University Business - October 2012