| Fiscal Operations Policy & Procedures Manual |
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An invoice from the vendor must have the following to be processed by OSU:
If the documentation/vendor invoice has an individual’s name and home (or non-OSU) address, payment cannot be made directly to the vendor by OSU. The individual must pay for the product or service themselves, and then request reimbursement from OSU if it is a qualified business expense. This request for reimbursement is made using a Reimbursement Request Form with proof of payment attached.
Banner invoices will route through departmental level approval queues before routing to Business Affairs Accounts Payable office for final approval. Invoices are received, reviewed, and approved in the ordering department/unit. That department enters the information into the FAAINVE screen in Banner FIS. The invoice is then electronically routed to the following approval queues in this order:
Payments greater than $5,000 must have a P.O. attached with prior Purchasing approval.
Forward the payable document to the Business Affairs Accounts Payable office. The Business Affairs Accounts Payable office will audit for accuracy, compliance, allow ability, use of proper account code, payment amount, appropriate discounts taken, and correct vendor and payment address, and give final approval to generate a check. For expenditures on indexes connected with gifts, grants, and contracts, OPAA also reviews these documents for specific sponsor requirements, policies, or limitations. Banner invoices with errors will be disapproved on-line and routed back to the departmental queue for correction. The auditor will specify what needs to be corrected. There is a requirement for an additional signature (double signature), and special review/approvals when a check is >$100,000. No approvals are done in Business Affairs Accounts Payable office without the required invoice/documents (paperwork).
Travel reimbursements are input at the department level and electronically approved by OPAA and Business Affairs Accounts Payable office as appropriate. Exception: Moving Expenses, and travel reimbursements for those who had travel advances should be sent directly to Business Affairs Accounts Payable office without being entered into Banner.
When there is a trade-in of capital equipment, the invoice for the new asset must be processed for the full amount of the asset (including trade-in credit) even though the invoice from the vendor will probably be reduced by the value of the trade-in allowance. In order to pay the correct amount, a credit memo will be created in Banner for the amount of the trade-in allowance. Be sure to process the invoice and credit memo simultaneously (cross-referencing the document numbers in the text field of both). This allows the proper payment to the vendor.
The credit memo for the amount of the trade-in must be recorded/posted to fund 095880 (Asset-Undistributed Income Clearing) and Account Code B5801.
Banner has a feature that will “catch” duplicate payments to the same vendor if the same format is used for all payments. Banner looks for an exact match in the invoice number field, so even an extra space will make the number unique. The standards are listed below:
Guideline when Paying by Regular Invoice:
1. Enter invoice number exactly as provided by vendor without adding:
If the vendor has started recycling their invoice numbers, add the year following the invoice (Example 12345/02).
Guidelines when regular invoice numbers are not used:
Some vendor invoices do not have invoice numbers. When that is the case, another identifier that is unique and meaningful to the vendor must be referenced. The number can only be used once, and has a maximum length of 15 characters.
Types of identifiers that can be used:
Utility Payments
Telephone Payments
When entering an invoice into Banner and an error message is given that the invoice number is a duplicate:
Exceptions:
Vendors who recycle invoice numbers: Banner will identify these recycled numbers as duplicate payments. If you know this to be the case, verify the dates and amounts by using FAIVNDH or click on the icon at the end of the vendor invoice number field. After duplication of payment is ruled out, make the payment unique by using the vendor’s invoice number and add the year of payment. (Example12365/02)
Vendors who cannot identify payments by invoice number alone are:
Guideline when Paying By Statement:
See Section 1100, Banner Processes - FIS 1108 Approval Routing.
The signature represents the payment is an appropriate allowable expense within the current budgetary authority. Do not use signature stamps, if you have the authority, sign your own name. Signature stamps are not accepted in lieu of an original signature. Do not sign other people names; this is forgery. Remember the separation of duties still applies. Original signatures are required on reimbursement requests for both the claimant and the department approver. Faxed signatures are accepted from off-campus locations.
The person signing the label must be able to answer questions concerning the document. The Business Affairs Accounts Payable office will contact this person if additional information is required. The contact needs to be someone that knows or has access to the needed information.
Price discrepancies requiring alteration of the vendor’s invoice must be documented with a Notice of Invoice Change Form. Common errors include extensions, overcharges on quotes, freight charges on FOB Destination, short shipments, returned merchandise, or damaged goods on FOB Destination orders. Notice of Invoice Change should be submitted with 2 copies of the corrected invoice to the Business Affairs Accounts Payable office. It is mailed with the check to the vendor.
Credit memos are issued by the vendor to adjust a previous invoice; to refund an overpayment or adjust for returned merchandise.
The credit memo must be matched with the original invoice to determine whether the credit should be processed. When a credit is due for a previously paid invoice, process in the same manner as an invoice. Click on the Null Credit Memo field, otherwise a check will result instead of a credit being taken. A cross-reference to the original invoice must be noted in the text section on the BANNER invoice form. If a credit memo involves a previously discounted invoice, the credit memo should be reduced to reflect the original amount paid.
Many vendors submit credit memos to balance their accounts receivable, and the credit memo is for information only and should be retained in department files.
Equipment credits must have the word “credit” in the commodity description.
The credit memo will be posted to the department’s operating ledger immediately (the offsetting entry resides on the fund balance sheet as a reduction of accounts payable liability, until new invoices from the same vendor satisfy the credit memo.)
If the vendor has not assigned a number to the credit memo, use the original invoice number with the letters CM, otherwise the BANNER system will consider it a duplicate invoice.
Discount terms are usually counted from the date the invoice or the merchandise is received, whichever is later. Check each invoice and purchase order for discount terms and take the larger discount if there is a difference. Take the discount only on items purchased, not on shipping or handling charges. Discounted invoices should be given priority processing. If a vendor disallows a discount already taken, verify with the original documents and BANNER system information. Create a BANNER invoice for the disallowed amount. Use the original vendor invoice number with a suffix DD. Explain in text the reason for the payment.
Interest Penalty on Overdue Accounts Payable
Many vendors are billing finance charges on unpaid bills after 30 days. Interest penalty (finance charges) billed to OSU should be reviewed for validity and permissibility per ORS 293.462. In most cases, these charges are computer generated and the vendors will forgive them. However, if the invoice is over 45 days late, and the vendor demands payment of the finance charge, count the 45 day period from the date the invoice was received to the date the check was issued in payment of the original claim. Interest may begin to accrue on the 46th day. Late payment charges are limited to 2/3 of 1% per month, not to exceed 8% per year, and cannot exceed the usual charge assessed by the vendor. Date all invoices when received by the department to establish the received date. Do not construe this to mean there are 45 days to initiate the payment process. Allow time for approval routing and check processing. Vendors deserve to be paid promptly.
Some vendors require advance payment before providing goods or services. All prepayments require documentation for audit purposes and clear communication to the vendor. Documentation may be provided by one or more of the following:
State of Oregon agencies are exempt from paying federal taxes on purchases of gasoline, oil, etc. If an employee paid for a product and is seeking reimbursement, or if the product was purchased and possession is taken in another state, taxes may be paid. The appropriate account code is 28703. These are taxes related to the operation of the University. Agencies are exempt from paying State, city or county taxes in some instances. OUS is subject to real and personal property taxes on property owned but not used for institutional purposes, such as miscellaneous rentals. See FASOM Section 13.01: Purchasing - Purchasing and Accounts Payable.
The Payment Due Date default on FAAINVE has been set to NET 30 Days. The Discount code shows "03"; this is Net 30. This discount code tells the computer to automatically calculate the Payment Due Date as 25 days after the vendor invoice date. DO NOT CHANGE this default unless the vendor requires their payment within a specific time period or there is a discount.
Notify the Business Affairs Accounts Payable office if a vendor contacts your department to report checks that may be lost or stolen. The Business Affairs Accounts Payable office will instruct the department to send a "Request for Replacement Check" form to the vendor for signature. When the signed form has been returned to the Office of Business Affairs, a replacement check can be issued. The Business Affairs Accounts Payable office will work with the department to reenter the invoice and issue a replacement check.
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