FMPM 890 Internal Charges

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To set out the requirements for establishing, levying and accounting for internal charges.



Responsibility of

Identification of the need for an internal charge

Head of Organisational Unit

Approval of the establishment/revision and level of an internal charge

Chief Financial Officer

Accounting for internal charges

Chief Financial Officer

Authority to commit an internal charge

Financial Delegate

Definitions (Related Glossary Terms)

Internal Charge

Accounting Period



  • An Internal Charge must only be applied where it is administratively justified and it can be shown that:
    • the administrative cost associated with the processing of the transaction (including handling costs of all Organisational Units of the University) does not exceed the total cost of the transaction;
    • it will encourage efficiency in the consumption of the goods or services (eg internet charging);
    • it is required to ensure the proper allocation of costs to activities or funds; and
    • it is required to enable the Organisational Unit to reflect the full cost of activities or use of funds.
  • An internal charge must be cost neutral with no profit element in the fee charged.
  • Charges set by the University's primary service provider must be the minimum used for the same supply of goods or services by all other sections (e.g. vehicles rates approved for the Estate Office vehicles must not be discounted by other areas of the University).
    • With the exception of the:
      • Marine Aquaculture and Research Facilities (MARFU);
      • Advanced Analytical Centre (AAC); and
      • Tropical Water & Ecosystems (TropWATER)
  • salary costs may not be on-charged for employees funded from Operating funds.
  • Charging for use of University space cannot be included in any internal charging arrangements.
  • Details of existing and proposed charges for the next year must include justification for any increase.
  • Under exceptional circumstances, increases or new charges may be approved by Chief Financial Officer at other times.
  • The Chief Financial Officer must establish and maintain systems of accounting which enable internal charges to be included in any financial management reports to the Organisational Units and to be eliminated in the preparation of statutory financial statements.
  • Internal Charges incurred in one accounting period must be processed by the end of the next accounting period. The onus is on the charging department to ensure these charges are processed within this timeframe. If this timeframe is not met, then the authority to charge the internal charge will lapse.
  • This policy is meant only to apply to internal charging by one Organisational Unit to another within the University for goods and services. Charges for use of University facilities or services to external parties must be charged at the appropriate commercial rate including University overhead costs.

Related documents and legislation

Financial and Performance Management Standard 2009 (s 18 – User charging)

For enquiries in relation to this Finance Committee Directive please contact


NOTE: Printed copies of this policy are uncontrolled, and currency can only be assured at the time of printing.

Approval Details

Policy Domain

University Management

Policy Sub-domain


Policy Custodian

Chief Financial Officer

Approval Authority

Vice Chancellor

Date for next Major Review


Revision History


Approval date

Implementation date





Reviewed – updated and removal of duplication.

Director, Financial & Business Services




Policy Sponsor and Approval Authority updated to reflect the approved Policy and Delegations Framework

Quality Standards and Policy Unit




Finance Committee (13/11/2012)