Fund base accounting might have a flaw.
Most state universities have what is called “fund based accounting”. This is where a staff member or department applies for money by making a proposal. Sounds pretty straightforward and simple. Problem is this. There is no incentive to spend less money after the project is approved. Usually if less money is spent a dean or VP sweeps it up at the end of the fiscal year. Very few staff members will try to cut costs. Guess who gets to pay…