University of Minnesota
Controller's Office
http://controller.umn.edu/
612-624-1617 or controller@umn.edu

External Sales

The External Sales compliance office reviews and approves the External Sales Approval Form, the Business Proposal and initial rates for all new external sales activity. The Office works with units to identify and mitigate legal, insurance, and tax financial risks, to streamline the process for establishing external sales activity, to accurately accumulate all costs within identified segregated set of accounts, to establish rates based on total costs and to ensure that an external sale unit is self-supporting. University colleges and departments are encouraged to utilize academic expertise and institutional resources to generate additional sources of revenue from non-University (external) customers in a commercial and competitive manner.

Steps to obtain approval to conduct external sales activity

Is your activity an external sale?

Does it meet the following criteria?

  • The funds are in exchange for services performed by the University and any tangible goods produced as a result of such services, use of laboratory equipment, or a license to use information on University maintained databases;
  • The transaction is not a Sponsored Project, Gift, or an excluded transaction; and
  • The transaction is consistent with the scope, guiding principles, and criteria set forth in Board of Regents Policy: Direct Sales of Goods and Services. (pdf)

For definitions regarding Gifts, Sponsored Projects, & External Sales, see Appendix A (pdf) of the policy Selling Goods and Services to External Customers.

  • If additional clarification is needed regarding the classification of the activity, contact classification@umn.edu.
  • A transaction classification group with representatives from SPA, External Sales, and both University Foundations has been established to provide rapid input to faculty and administrators who are uncertain how to classify a given transaction. This group also has ready access to University counsel when needed.
  • To obtain input from this group, send a copy of the proposed statement of work, budget and performance dates, contact information for the person most knowledgeable about the proposed transaction, and any other background information the requestor feels is pertinent to: classification@umn.edu. A classification decision or a request to obtain clarifying information will be provided to the requestor within three working days.

Policy

Procedures

Risk Assessment

Take this risk assessment to assist in detemining where your risk level is.

Presentations

Forms

Job Aids

Most Common Audit Findings and Recommendations - External Sales

  1. Ensuring contracts are in place where appropriate to support external sales.
  2. Verifying sales tax collected and remitted are appropriate and accurate.
  3. Establishing policy and methodology for pricing of goods and services sold.
  4. Reporting external sales to External Sales Office.

Training

The External Sales training modules are highly recommended for RRC managers, business managers, and anyone in the department involved with the external sales activity. Each module takes about 30 minutes. After completion of each module, the "personal training records" of the individual will be updated to show that the course has been completed. These courses are in the U Learn system.

  • Course1 Overview of Policy Governing External Sales
  • Course2 Transacting External Sales and Rate Development Basics
  • Course 3 External Sales Rate Development Example

External sales approval and implementation checklist

Step 1 - Verify that the activity is an external sale. See "Is your activity an external sale?" information above.

Step 2 - Complete the Internal/External Sale Approval form and send to extsales@umn.edu for review. See Administrative Procedure: Obtaining Approval to Conduct External Sales Activity.

Step 3 - Complete the Internal/External Business Proposal Outline and sent to extsales@umn.edu for review. See Administrative Procedure: Obtaining Approval to Conduct External Sales Activity.

Step 4 - Complete a Rate Development Template and sent to extsales@umn.edu for review. See Administrative Procedure: Establishing External Sales Rates.

Step 5 - After the External Sales Compliance Office has completed review, obtain administrative approvals.

Step 6 - Establish an accounting structure. See Administrative Procedure: Establishing an External Sales Accounting Structure.

Step 7 - Complete activity and invoice.

Want a printable version of the checklist? Click here.