300.6 Accounting for Receivables

Owned by Chad
May 20, 2021
2 min read

RECEIVABLES ACCOUNTING SYSTEMS: PSU uses Banner SIS to account for student tuition and fee receivables and encourages the use of Banner SIS to account for all receivables.  Use of one centralized receivable system results in customers receiving only one series of billings and statements, and not having to administer and monitor multiple receivable systems.  The Vice President for Finance and Administration or designee must ensure that this financial policy is applied to all institution receivable systems. 

PSU is responsible for creating manuals explaining how each receivable accounting system works, the processes for entering data and operating each accounting system, and the requirements for following data conventions.  PSU may contract out the accounting, billing, and cash receipting for different types of notes receivable.  PSU must ensure that the work of the contractor follows all  receivable policies and is in compliance with federal and state laws and regulations.

INTERNAL CONTROLS OVER RECEIVABLE ACCOUNTING SYSTEMS: Sufficient internal controls must be in place over all receivable accounting systems.  Required internal controls include:

  • Restricting update access to the receivable records to receivable personnel.
  • Segregating duties to ensure that personnel updating the receivable records cannot also access cash receipts, request and process refunds or approve debt write-off.  When adequate segregation of duties is not possible, ensure that compensating controls are in place and working.
  • Having sufficient documentation to support all receivable transactions. 
  • Creating a series of receivable forms, ideally with a numbering series and use of pre-numbering to ensure that all receivable transactions are recorded and accounted for.
  • Having sufficient documentation to support all receivable transactions.
  • Performing ongoing (e.g., daily) reconciliations between the receivable subsidiary ledger and the control accounts in the general ledger. Frequent reconciliations are critical to detect out-of-balance conditions.