University of Minnesota Medical School
Handbook
For Medical School Accountants
Income Verification
Last Date Reviewed: 12/11/17

The income verification process happens after the end of each fiscal year to ensure our compliance with the Regent’s policy of the University of Minnesota: “Private Practice Plan – University of Minnesota Medical School Twin Cities”. There are two parts to this compliance:

  1. When the Medical School determined that it would have private practice fundssupplement faculty salaries, the University wanted to put controls on how we determined the salary for full-time clinical faculty(67% time and above). It was established that the total compensation should not exceed 80th percentile of the AAMC Midwest faculty salary report unless the Dean approved an exception.This includes both clinical and University salary. Though the benchmark has changed for some departments (for example, Pediatrics uses the AAAP report), the 80th percentile is still the limit.There is a one year lag between the AAMC reports and the fiscal year for Income Verification.
  2. All clinical income must go through UMP unlessthere is approval from both the Dean and UMPthat the activity can be outside of UMP. Even though these clinical activities are not part of UMP, they are part of the income verification. Faculty with this arrangement must submit the amount of salary earned by this activity to their department so it can be taken into account when determining their salary compared to the benchmark. See SOP Supplemental – Outside salary request email example

Departmental steps in the process:

  • Receive file (See SOP supplemental – IV Sample) from Dean’s office. All changes to this file must be highlighted and returned to the Dean’s office for correction in the master file.
  • Check that all the data such as jobcode, sub-specialty, gender and degree are correct.
  • Salaries
  • The salaries used for this process comefrom the University payroll system (this includes the common paymaster for UMP salaries) for the year being verified. Bonuses for one year but paid in another year will be counted in the year they are paid out, not the year they are earned.
  • Enter end date for any faculty that have left
  • Percent appointment
  • The Dean’s office uses the faculty’s current percent time. Make corrections if the faculty’s percent time for the majority of the year was different.
  • Faculty who have clinical income outside of UMP
  • Per the Clinical Practice policy, full time faculty (67% or more FTE) should report any clinical income outside of UMP. Departments should obtain salary amounts from faculty for the fiscal year or they can use the yearly salary that is on their W-2
  • Faculty over the 80th Percentile
  • Check to see if a letter permitting the exception has been submitted and approved by the Dean. Departments should be asking for pre-approval for faculty with salaries that are going to be over the 80th percentile during the Compensation Plan process. A good practice is to check mid-year to see how salaries are compared to the benchmark. It is possible that the Dean could deny a request and we would have to ask that any salary over the 80th percentile be returned to the department.
  • If no letter has been done, have the chair prepare a letter and submit it to the Dean’s Office. They will submit it to the Dean for his approval.
  • General Timeline
  • Dean’s office sends out preliminary Income Verification to departments around October 1st
  • Departments have until November 30th to make changes
  • Final report to CFO on December15th

Benchmarks

The AAMC produces the benchmarks based on a Faculty Salary Survey that is submitted in October. The data is compiled, summarized and published in December. The Dean’s Office asks the AAMC to send us a custom report, which includes the 80th percentile. All of the tables are then sent out to Department Heads, Center Directors and Finance Directors around the beginning of February.

If faculty are working less than a 1.0 FTE, or have only worked a portion of the year, salaries are annualized. The annualized salaries are then compared to the full benchmark for ease in reporting.