FOUNDATIONS IN UNIVERSITY FINANCE ACCOUNTS PAYABLE

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1 FOUNDATIONS IN UNIVERSITY FINANCE ACCOUNTS PAYABLE

2 Accounts Payable Charlie Sinex Director, Accounts Payable and Records Management Participant Outcomes Recognize Accounts Payable s role in the timely and accurate payment of authorized liability obligations for Indiana University Anticipate how your department s financial activities impact payments INDIANA UNIVERSITY 1

3 Agenda Getting to Know AP Purchasing & Accounts Payable Paying Our Vendors Purchase Orders & Invoices Disbursement Vouchers (DVs) the department is key Procurement Card multiple activities & roles INDIANA UNIVERSITY 2

4 Accounts Payable GETTING TO KNOW AP INDIANA UNIVERSITY 3

5 Getting to Know AP AP Organization Director - Accounts Payable and Records Management Supervisor - Accounts Payable Operations Manager - Accounts Payable Technical Operations Research Invoice Resolution Team Disbursement Voucher Team Electronic Document Processing Team Invoice Processing Team Records Management Technical Operations Support 4

6 Getting to Know AP AP supports the mission of FMS: to provide assurance that through stewardship of university resources the university s fiscal reputation is above reproach. More specifically AP provides timely and accurate payments of IU s liability obligations: with the help of department staff and academic staff, following standard operating procedure based on IU policy provisions INDIANA UNIVERSITY 5

7 Getting to Know AP AP performs the following basic functions: Administers IU s financial expenditure policies and procedures Issues payments to non-employees and vendors and reimbursements to employees, non-employees and vendors through various payment methods Monitors compliance with federal and state laws, rules, regulations, IU s policies and AP s procedures INDIANA UNIVERSITY 6

8 Getting to Know AP AP in Practice Processes timely and accurate payments Ensures all payments are properly supported with complete audit documentation Provides support and expertise to IU organizations and vendors regarding liability (outgoing) payments INDIANA UNIVERSITY 7

9 AP Authorized Liability Transactions Three (3) methods to pay vendors and reimburse employees: 1. Payment Request (PREQ) 1 a. Manual b. Electronic 1 Credit Memo (CM) Processing credits are issued by vendors to offset payment obligations 2. Disbursement Vouchers (DV) 3. Procurement Cards (PCDO) INDIANA UNIVERSITY 8

10 Pay Totals Fiscal Year 2016 Total Payment Requests (PREQ): 347,577 Total PREQ dollars: $ million Total Disbursement Vouchers (DV): 52,502 Total DV dollars: $ 97.4 million Total Procurement Card Documents (PCDO): 57,976 P-Cards: $ 21.6 million INDIANA UNIVERSITY 9

11 Accounts Payable PURCHASING & ACCOUNTS PAYABLE INDIANA UNIVERSITY 10

12 Purchasing & Accounts Payable Addressing a Common Misconception: AP is associated with but not part of Purchasing (Office of Procurement Services). INDIANA UNIVERSITY 11

13 Purchasing & Accounts Payable Procurement Policies that drive AP procedure: Purchasing Authority FIN-PUR-1.0 Responsibilities in Acquisition Process FIN-PUR-4.0 Restricted Purchases FIN-PUR-10.0 University Procurement Contracts FIN-PUR-20.0 INDIANA UNIVERSITY 12

14 Purchasing & Accounts Payable Financial Policies that drive AP procedure: Role of Fiscal Officer, Account Manager and Account Supervisor FIN-ACC-I-1 Fiscal Misconduct FIN-ACC-I-30 Allowable Hospitality Expenses FIN-ACC-I-50 Inappropriate Use of University Funds FIN-ACC-I-330 Disbursement Voucher Supporting Documentation FIN-ACC-I-420 Internal Controls FIN-ACC-I-470 Gifts to Employees or Non-Employees FIN-ACC-I-590 Reimbursement Under the Accountable Plan FIN-ACC-I-620 INDIANA UNIVERSITY 13

15 Accounts Payable PAYING OUR VENDORS PURCHASE ORDERS & INVOICES INDIANA UNIVERSITY 14

16 Financial Doc Lifecycles Purchasing & Accounts Payable Purchasing Accounts Payable Requisition Purchase Order Payment Request Credit Memo (REQS) (PO) (PREQ) (CM) Initiated by the department Upon submission, creates APO or routes to Purchasing to open PO Generated from Requisition documents Managed by Purchasing Created by AP from vendor submitted invoice Routed to department for review and approval Created by AP from vendor submitted credit memo Routed to department as an FYI document INDIANA UNIVERSITY 15

17 Whom should IU pay? SMALL GROUP ACTIVITY Review the following invoices. Which vendor should be paid? 1. Invoice : ElectriCom LLC 2. Invoice 95700: Hilton San Diego Bayfront, PO Vendor: Hilton Hotels Corporation

18 Inv# : Whom should be paid? Use your clicker to submit your answer: 100% A. Electricom LLC B. Electricom Networks LLC 0% A. B. INDIANA UNIVERSITY 17

19 Invoice discussion points You are correct: Electricom LLC should be paid. However: 1. The requisition opened to The PO was not received by PO then ed to vendor per department request. 4. Payment processed to (ACH deposit). 5. IU notified payment returned, PO amended, payment reprocessed to INDIANA UNIVERSITY 18

20 Inv# 95700: Whom should be paid? Use your clicker to submit your answer: A. Hilton Hotels Corp 100% B. Hilton Hotels Corporation C. PHF Ruby LLC D. Sunstone Park Lessee, LLC E. None of the above 0% 0% 0% 0% A. B. C. D. E. INDIANA UNIVERSITY 19

21 Invoice discussion points Correct answer is D. Sunstone Park Lessee, LLC ( ) should be paid. How would you know? 1. The invoice does not provide sufficient information to connect to Sunstone Park Lessee, LLC. 2. It is necessary to call the provider and ask for their FEIN number to confirm with whom IU is working and to whom IU should pay. INDIANA UNIVERSITY 20

22 Your Role in Getting Your Vendors Paid Communicate with your vendors about Requisitions (REQS) / Purchase Orders (POs): Ensure accuracy of the vendor record via tax ID confirmation Confirm accuracy of cost of goods and services Provide PO document or PO# to vendor Review Requisitions / Purchase Orders for: Vendor Selection Funding estimated orders and quoted orders have unique payment processing rules Accounting PO accounting drives GL expense Itemization PO and invoice itemization match provides an internal control INDIANA UNIVERSITY 21

23 Your Role in Getting Your Vendors Paid Communicate with your vendors about invoices: Provide link to Ideal Invoice to new vendors Ensure your vendor bills with intended PO# on the invoice Do not resubmit invoices, use KFS lookup and / or contact AP instead Vendors have a disbursement lookup available Set appropriate expectations for payment timeline Review Payment Requests for: Amount (overpayments, underpayments, short payments) Duplicates INDIANA UNIVERSITY 22

24 Your Role in Getting Your Vendors Paid Fiscal approval of Payment Requests represents: The proper vendor and amount are being paid The GL entries are as intended or will be corrected per intention There has been receipt of satisfactory goods / services INDIANA UNIVERSITY 23

25 Accounts Payable DISBURSEMENT VOUCHERS THE DEPARTMENT IS THE KEY INDIANA UNIVERSITY 24

26 Top 3 Challenges with DVs 1. Supporting documentation 2. Route logs 3. Notes and note notification INDIANA UNIVERSITY 25

27 Disbursement Voucher (DV) Lifecycle KFS user initiates and submits DV DV routes to Image Attachment Node KFS User uploads DV Supporting Documentation AP attaches Supporting Documentation DV routes through workflow for approval DV routes to Travel or AP for final Compliance review DV reaches final approval DV payment is generated Contact FMSDVHLP if: You are experiencing issues with the AP Upload Tool Your DV is awaiting approval from AP Disbursement Manager Group You uploaded documents, but those documents haven t been attached to the DV four days later. Do not contact FMSDVHLP if: Your DV is awaiting approval from a non-ap org Your DV hasn t routed and you haven t uploaded supporting documentation You need a check from a DV cancelled 26

28 Who can resolve this route node? Use your clicker to submit your answer: A. Initiating department B. Accounts Payable C. Travel Management D. A and B E. None of the above 100% 0% 0% 0% 0% A. B. C. D. E. INDIANA UNIVERSITY 27

29 Reading a DV Route Log: See activity handout. You will be asked: Who is last (final) to review and approve? Who is next to review and approve? Whose review and approval is complete? INDIANA UNIVERSITY 28

30 Who is last (final) to review and approve? Use your clicker to submit your answer: 100% A. MDEP ALL B. Tax C. Disbursement manager BL D. Moneymover E. All of the above 0% 0% 0% 0% A. B. C. D. E. INDIANA UNIVERSITY 29

31 Who is next to review and approve? 100% Use your clicker to submit your answer: A. Joanna Wall B. MDEP ALL C. MONEYMOVER D. All of the above E. None of the above 0% 0% 0% 0% A. B. C. D. E. INDIANA UNIVERSITY 30

32 Whose review and approval is complete? 100% Use your clicker to submit your answer: A. Jennifer Moore B. KFS C. Trisha Clark D. All of the above E. Joanna Wall 0% 0% 0% 0% A. B. C. D. E. INDIANA UNIVERSITY 31

33 DV notes to individuals EXAMPLE: Note not yet acted upon EXAMPLE: Note has been acted upon INDIANA UNIVERSITY 32

34 DV notes to team group names EXAMPLE: Team note not yet acted upon EXAMPLE: Team note has been acted upon INDIANA UNIVERSITY 33

35 Your Role in Successful DV Processing GENERAL USAGE GUIDELINES Understand when REQS/PO is required. Utilize reimbursement DV for emergency purchases. Utilize standard procurement methods at all other times. INDIANA UNIVERSITY 34

36 Your Role in Successful DV Processing SUPPORTING DOCUMENTATION Upload supporting documentation with critical data redacted i.e. SSN, credit card numbers. Contact fmsdvhlp 4 days after upload if DV is still at KFS ImageAttachment node. Include proof of payment documentation for reimbursement DVs. Send note notification to the individual or team of whom you expect action. INDIANA UNIVERSITY 35

37 Accounts Payable PROCUREMENT CARDS MULTIPLE ACTIVITIES AND ROLES INDIANA UNIVERSITY 36

38 Procurement Card Document (PCDO) Lifecycle Purchasing Departments request P-card from purchasing for use in their department Purchasing manages policies regarding allowable uses of university P-cards US Bank US Bank pays the vendor at the time of credit card purchase US Bank sends billing files for previous week s purchases to IU KFS US Bank submits transaction detail electronically to IU overnight This information + KFS default account is used to create PCDO documents PCDO documents automatically route to departments for review AP AP pays US Bank weekly through billing files for previous week s purchases AP audits departmental submission of statements and receipts for compliance with university policy and procedure INDIANA UNIVERSITY 37

39 A PCDO has routed to fiscal review with a fraudulent charge. What action(s) should the department take? Use your clicker to submit your answer: 100% A. Disapprove the PCDO document. B. Report the fraud to the P-card Manager and US Bank. C. Document the statement submission with details that the transaction is fraudulent. D. All of the above E. A and B F. B and C 0% 0% 0% 0% 0% A. B. C. D. E. F. INDIANA UNIVERSITY 38

40 Keeping Up with Your Procurement Card Communicate with your org about your Procurement Card (Pcard): Use only for IU purchases Gather receipts as soon as they are available Submit your Procurement Card documentation: Organize your receipts in they order they appear on your statement Review and submit Exception to Policy and Hospitality Approvals as needed Submit to AP in a timely manner INDIANA UNIVERSITY 39

41 When You Need Help ACCOUNTS PAYABLE WEBSITE: PAYMENT REQUESTS AND PROCUREMENT CARDS Research Invoice Resolution Team (RIRT) (812) DISBURSEMENT VOUCHERS AND DV VENDOR DOCUMENTS Disbursement Voucher Team (812) INDIANA UNIVERSITY 40

42 Takeaways What we hope you learned today: Timely and accurate payments of authorized liability obligations enhances trust and reliability Your role in ensuring timely and accurate payments Accounts Payable is a resource center of professionals who are here to help! INDIANA UNIVERSITY 41

43 Questions? INDIANA UNIVERSITY 42