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The University Trademark Licensing process includes important requirements for purchasing branded merchandise, including using licensed vendors, documenting purchases, and understanding rebate eligibility. The accompanying PowerPoint provides background information and context for these requirements.
For UNL Business Center staff responsible for processing transactions, follow the coding guidance and instructions outlined in the steps below to ensure eligible branded merchandise purchases are coded correctly and departments receive the applicable licensing royalty rebate.
Steps for purchasing branded merchandise
1. Purchase: Buy branded merchandise only from authorized vendors.
When buying branded merchandise for University business use (not for resale), select a vendor who is authorized to use Nebraska trademarks. Prior to product being made or provided, double check that the vendor is authorized.
2. GL Coding: Code qualifying branded merchandise purchases to GL 521590.
If a royalty fee is separately stated on the invoice, code the entire fee to GL 521590 AND ensure that the line-item text clearly states "FEE"
If a fee is not separately stated on the invoice, code only the branded merchandise to GL 521590. Code all other items on the invoice to the appropriate GL.
Coding to GL 521590 facilitates a credit to be issued to University purchasers of branded merchandise used for business purposes.
3. Documentation: Attach documentation to support the purchase
Highly encouraged: Attach a picture of the branded product in the SAP transaction. This helps support the appropriate classification and facilitates Athletics' review of transactions posted to GL 521590.
4. Athletics financial staff reviews transactions posted to GL 521590 throughout the fiscal year.
Athletics may contact you with questions about specific purposes.
Providing documentation (e.g., picture of the branded product) helps expedite their review.
5. Rebate Calculation: The rebate is calculated and posted at fiscal year end.
The branding fees charged on eligible purchases made in FYXX will be received back to the original cost object in the form of a rebate posted in Period 13 of the same fiscal year. The exact timing will be announced in the fiscal year-end calendar.
6. Recap Important Points
Purchases must be made for University business use only -- not for resale.
Use licensed vendors only.
Code to GL 521590 following the guidelines.
Attach a picture -- it makes a difference!
Rebate posted in Period 13 of the same fiscal year that the purchase was made.
Example Invoices
Example Invoice #1
A licensed vendor provides an invoice with two line items -- the first line is for 5 grey men's quarter-zip pullovers at a total cost of $422.50; line two is for 2 grey women's quarter-zip pullovers. The invoice does not include tax and the royalty fee is not separated out from the item cost. The total cost of the invoice is for $591.50
GL Coding and Rebate
The full invoice amount of $591.50 should be coded to GL 521590 because the vendor has included the University royalty fee in the price of the branded merchandise.
At the end of the fiscal year, the $70.98 royalty fee will be credited to the cost object originally charged. The royalty fee is calculated at the University's 12% royalty rate by multiplying the total branded merchandise cost of $591.50 by 12%.
Example Invoice #2
A licensed vendor provides an invoice with two lines of merchandise at a cost of $306.00 (36 white mugs and 36 black mugs), a line charging a $50 setup charge, and a line charging $94.44 for shipping and handling. Additionally, there is a line separate from the merchandise lines that charges a royalty fee of $42.72.
GL Coding and Rebate
In this instance, each line item needs to be individually coded with an appropriate GL and the royalty line must be marked with the word "fee."
The merchandise cost of $306.00, the $50 setup fee and the $94.44 (which is a sum of $450.44) is be coded to GL 521500 - Publishing/Printing/Photography.
The separate line for the $42.72 royalty fee should be coded to GL 521590 - Branded Merchandise. Very importantly, the text in SAP must include the word "fee" (not case sensitive). The inclusion of the word "fee" allows the rebate calculations to identify the entire $42.72 as a branding fee that should be credited back to the original cost object that was used for the purchase. If the word "fee" is not included, the credit will be calculated as $42.72 multiplied by 12%, or $5.13.
