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| If an institution does not separately budget and expense information technology resources, the costs associated with student services and operation and maintenance of plant will also be applied to this function. FASB institutions include actual or allocated costs for operation and maintenance of plant, interest and depreciation.
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Right. That's what I'm saying. If you read the fine print on how FASB (private universities) allocate expenses, you see that the expenses can be allocated to all the business units. We know that that they allocate operations and administration to their research grants. Mowing the lawn is allocated to the various schools. IT is budgeted and allocated to all the various schools. Every dollar of overhead that is allocated to the schools or research grants is taken out of the institutional support category.
That is not the case as the small liberal arts colleges. There's nowhere to "allocate" the expenses. You aren't comparing apples to apples if you include the full cost of the internet and computers for one school, but not for another.
The instructions also say to simply disregard all expenses related to housing and dorms, as if that doesn't count. OK, the unversity can do that. They just allocate x percent of all institutional expense to residential dorms and don't count it. There's no mechanism for that at a liberal arts college. There's one electric bill. One wireless budget. One lawn mowing and grounds crew. It's in the institutional support budget whether they are mowing around the chem labs or a dorm, whether a computer is purchased for the library or for the computer room in one of the dorms. A big screen TV is institutional support whether it is going in the student lounge next to the mail room or the common room of a dorm.
If you look at total spending for similarly endowed and similarly sized schools, you will see that they are nearly identical. In other words, Williams and Swarthmore spend virtually the same per student. They just put stuff in different accounting boxes.