Revised: February 12, 2013

I. Background

When damage to UW System property occurs, institutions may receive reimbursement for their losses from the State Self-Funded Property Program (SSPP). In case of subrogation, reimbursement may also come from responsible parties and/or their insurers. Fund 999 was established to account for the receipt and disbursement of proceeds from losses without the need to encumber regular departmental operating budgets. This policy establishes guidelines for the operation of fund 999, use of the revenue and associated accounting and reporting procedures.

II. Policy

Reimbursements from SSPP and other sources and all disbursements of such receipts, shall be accounted for through fund 999.

An individual at each institution, generally the Institution Risk Manager (IRM), shall maintain a record of the proceeds and expenditures for each claim and periodically reconcile fund balances.

After an evaluation of the loss, the IRM must establish an expenditure limit based on anticipated recovery less applicable deductibles from the SSPP or recovery from the responsible party. The recovery process should proceed as expeditiously as possible.

The department that incurred the loss may then begin making replacement expenditures from fund 999 up to the amount of the expenditure limit. Expenditures, which must be approved by the IRM, must be for items that are identical or similar in nature to the lost property and/or services needed to restore it to its original use.

UW System Risk Management shall maintain an Uninsured Loss Fund (ULF) to fund losses for which other reimbursement is not available and to support loss control programs.

III. Compliance

It is the responsibility of the IRM to monitor the activity of each loss account on a regular basis. If no additional expenditures are required to restore the loss, or the institution decides not to replace the item(s), the amount of unused proceeds shall be transferred to System Administration’s 999 fund.

The institution shall prepare a Loss Reconciliation Report xls and submit it along with a transfer for appropriate balances through the Institution Controller to System Risk Management by October 1st of each year.