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Gadsden State Community College

Financial Services

Payment Request Requirements


INVOICES AND CREDIT MEMOS

    An original, itemized invoice is required by the Accounts Payable Office in order to make payment.  Invoices mailed to the College are hand mailed to the Budget Manager from the Accounts Payable Office.  Some vendors may provide an invoice when items are received by an employee of the College.  If you have not received an original, itemized invoice, please inform the vendor and request an original, itemized invoice.  The College is unable to pay by a copy or a fax of an invoice.  The College cannot pay by statements or packing slips--these items do not itemize items purchased and prices.

     It is preferred that vendors provide an invoice for each purchase order they receive from Gadsden State Community College.  Sometimes a vendor mails an invoice to the College listing multiple purchase order numbers.  The Accounts Payable Office will make a copy of the invoice for each purchase order and forward the invoice to the Budget Manager.  The invoice is paid when all purchase orders are received by the Accounts Payable Office approved for payment by the Budget Managers.

    Original, itemized invoices are to be held until it is verified that items listed on the invoice are received in good order.  Once this has been verified the invoices may be forwarded to the Accounts Payable Office for payment.

    When items received from a vendor are not in good order or it is discovered the incorrect items were ordered or received, items should be returned to the vendor.  In order to insure that the vendor has given credit to the College for the returned items, an original, itemized credit memo should be received.  The vendor may issue a credit memo at the time items are returned or they may mail a credit memo.  Credit memos mailed to the College are hand mailed to the Budget Manager from the Accounts Payable Office.

  Invoices for other items covered by the same purchase order that are received in good order, are to be forwarded to the Accounts Payable Office for payment along with the credit memo.  The invoices will be paid and the credit memo will be deducted.

    If a credit memo is received after invoices have been paid, the Budget Manager writes on the credit memo "Purchase order has been paid complete.  Apply this credit to budget number -------."  The Budget Manager provides the budget number used on the purchase order and signs the statement written on the credit memo.  The credit memo is forwarded to the Accounts Payable Office.  The credit is applied to the next payment made to the vendor.  When the credit is taken, the budget will receive the funds.


PURCHASE ORDER PAYMENT

    When submitting purchase orders for payment, either partial or complete payments of a purchase order can be made.  When all invoices to be covered by a purchase order are being submitted for payment at one time, a complete payment of a purchase order is made.  Once a complete payment of a purchase order is made, that purchase order cannot be used in the future to make further payments of invoices.

    When only part of what was ordered by a purchase order has been received and invoiced, a partial payment of a purchase order is made.  This will allow future payments to be made using the same purchase order.  This can be done as many times as necessary until you know the order is complete.

PARTIAL PAYMENT

    To submit an invoice(s) with a purchase order for partial payment to the Accounts Payable Office, please do the following:

  1. Make a copy of the receiving copy of the purchase order and write on the copy "Partial Payment" across the face of the purchase order.
  2. Staple the original, itemized invoice behind the copy of the purchase order.
  3. Cross-out the purchase order total and write the amount to be paid.
  4. The Budget Manager signs the materials receipt section of the purchase order to authorize payment.
  5. Forward the purchase order and invoice to the Accounts Payable Office for payment.
    When you have received and been invoiced for the complete order, send the invoice(s) with the purchase order for complete payment to the Accounts Payable Office as described next.

COMPLETE PAYMENT

    To submit an invoice(s) with a purchase order for complete payment to the Accounts Payable Office, please do the following:

  1. Write “complete payment” across the face of the receiving copy (yellow copy) of the purchase order.
  2. Staple the original, itemized invoice behind the purchase order.
  3. If the amount to be paid is different from the purchase order total, cross out the purchase order total on the face of the purchase order and write the amount to be paid.
  4. The Budget Manager signs the materials receipt section of the purchase order to authorize payment.
  5. Forward the purchase order and invoice to the Accounts Payable Office for payment.
PAYMENT ERROR

    All efforts are made to enter purchase order payments correctly, but sometimes purchase orders are marked complete when only a partial payment should have been made.  This can cause a problem because once a purchase order is marked complete, no further invoices can be paid by that purchase order.

    When a final invoice is received by the Budget Manager after the Accounts Payable Office has marked the purchase order complete, the Accounts Payable Office will pay that final invoice unencumbered if the budget allows.  The Accounts Payable Office will make a copy of the purchase order and note that the "Purchase order was marked complete in error."

    If invoices are expected to be received for that purchase order through the rest of the fiscal year, the Accounts Payable Office will request a new purchase order from the Purchasing Agent on the basis that the original purchase order was marked complete in error.  A new purchase order can be issued if the budget allows.  This new purchase order is sent to the Budget Manager with a note explaining why a new purchase order has been issued.


JUSTIFICATION FORMS

    Purchases not made according to the College's approved purchase procedures require approved justification before payment can be made.  There are three forms for this purpose--(1) Prior Year Purchase Justification Form, (2) Purchase Date Justification Form, (3) Purchase In Excess of Approved Amount Justification Form.

    If an item to be submitted to the Accounts Payable Office for payment requires justification, complete the appropriate form and attach it to the front of the item to be paid.  Forward it to the Budget Manager and to the Dean for approval.  The justification must be signed and approved for payment by the President before payment can be made.  If required justification is not submitted, the Accounts Payable Office will return the item in hand mail to you with the appropriate justification form attached.  This could delay items being paid.  Descriptions of the unapproved purchases requiring justification, and how to avoid them, are as follows:

PRIOR YEAR PURCHASE JUSTIFICATION FORM

    All purchases are to be paid for within the fiscal year in which the purchase took place (date goods received) or services were performed.  (The fiscal year of the College is October 1 - September 30.)  Any items sent for payment in the following fiscal year are considered a violation of Generally Accepted Accounting Principles; therefore, a completed justification form is required in order for payment to be made.

    This applies also to budgets of which the fiscal year differs from the fiscal year of the College.  For example:  a grant's budget year is September 1 to August 31.  That budget would need to submit invoices for items received in September for payment to the Accounts Payable Office within the month of September.  Invoices must be submitted early enough for payment to be made in the month of September.  All budgets must comply with the fiscal year policies of the College.

    In order to avoid this justification form, submit all items received within a fiscal year for payment within that same fiscal year.  If you know items received in the current fiscal year will not be invoiced until the next fiscal year, the Budget Manager should contact the Coordinator of Financial Services so that she may accrue the items.  A fund two budget can be accrued if it does not end on September 30.  A justification is not necessary if the purchase has been accrued.

PURCHASE MADE WITHOUT AN APPROVED PURCHASE ORDER JUSTIFICATION FORM

    Purchase orders are to be dated before, or the same date as, order dates or the date services take place.  Goods and services are to be purchased with an approved purchase order, work order, or petty cash voucher.   Purchases in violation of this policy are considered an unapproved purchase; therefore, a completed justification form is required in order for payment to be made.

    In order to avoid this justification form, do not order goods or services without an approved purchase order, work order, or petty cash voucher.  Purchase orders are considered approved on the date signed by the Purchasing Agent.

    To insure you will have a purchase order to cover annual invoices that arrive such as memberships, maintenance agreements, and subscriptions, request purchase orders for these annual expenses at the beginning of a fiscal year.  When entering the requisition, enter "do not mail."

    If somehow goods were ordered and received without proper approval, you may return the goods to the vendor.  Obtain a credit memo for the full amount of the purchase.  Request and receive the proper approval to order the items and receive the items with an order date after the date which approval was given.

    If you would like to order an item for preview, first request a purchase order.  When entering the requisition, enter "for preview-do not mail."  If you decide to keep the item, you have a purchase order to pay the invoice.  If you return the item, you can cancel the purchase order and the money will return to the budget.

PURCHASE AMOUNT EXCEEDS AMOUNT APPROVED JUSTIFICATION FORM

    An order is placed to a vendor by means of a purchase order, which is approved by the Purchasing Agent.  An overage of 10% of the purchase order amount is allowed.  This allowance is given to cover price increases and unexpected shipping or freight charges.  The allowance is not given in order to purchase additional items or services.  Any amount over the 10% allowance or any items purchased but not listed on the purchase order is considered an unapproved purchase; therefore, a completed justification form is required in order for payment to be made.

    In order to avoid this justification form, use current prices when requesting a purchase order.  If you must estimate cost, estimate high.  After the invoice is paid, any excess money that was encumbered will be returned to the budget.

    If your purchase exceeds the approved amount on the purchase order, you may return the item purchased to the vendor.  Obtain a credit memo for the full amount of the purchase.  Request the Purchasing Agent void the purchase order.  Request a purchase order be issued for the correct purchase amount.

BALANCES SHEET PAYMENTS AND REVENUE REFUNDS

    Payments made with money deposited into a specific balance sheet code and refunds paid from a revenue code are not made with purchase orders.  The payment or refund is made from the balance sheet code or revenue code.

    To request payment from a balance sheet code or a refund from a revenue code, provide the Accounts Payable Office with the following information that applies to the situation:

  1. From whom was the money collected.
  2. When was the money collected.
  3. For what purpose was the money collected.
  4. What transaction code was used while collecting money.
  5. For what period of time is the payment to cover.
  6. What was the total amount collected and what is the total amount to be paid.
  7. To what vendor is payment to be made.  Provide the vendor name, address, and vendor number.
  8. What balance sheet code or revenue code is payment to be made from.
The Budget Manager signs the paperwork in order to authorize payment.  The paperwork can be sent to the Accounts Payable Office for payment.

    If paperwork is to be mailed with the check, paper clip the paperwork to the face of the request when forwarding it to the Accounts Payable Office for payment.  The paperwork will be forwarded to the Secretary to the Dean of Financial and Administrative Services who will mail the paperwork with the check.

    Complete documentation is required to insure that the Accounts Payable Office has required documentation for payments made.  If you frequently request payments from balance sheet codes or revenue codes, you may request the Accounts Payable Office make a form personalized for your use.  When completed, the form will provide all the needed documentation.

REVIEW ITEMS

    Items submitted to the Accounts Payable Office for payment should be reviewed to see that everything required is present.  If any required documentation or signatures are missing, the Accounts Payable Office will return the item in handmail to you with a note attached explaining the problem.  This could delay items being paid.  Items to watch for are:

  1. The Budget Manager signs the materials receipt section of the purchase order in order to authorize the payment of the invoice.  When a purchase order is not used (such as in the case of petty cash vouchers and travel vouchers), the Budget Manager signs the item in order to authorize payment.  The Budget Manager insures that there is money available in the budget to cover the expenditure.
  2. Only itemized, original invoices can be paid.  No copies or faxes of invoices can be accepted.  The College cannot pay by statements or packing slips--these items do not itemize items purchased and prices.
  3. When an item is printed for the college, an original sample of the item is required to be attached to the purchase order when it is submitted for payment.  Items printed for the college are newspaper ads, publications, books, calendars, rubber stamps, etc.  In the first four examples given, the actual item is to be attached to the purchase order.  If an ad is placed in a newspaper and the same ad runs twenty-five times during one month, an affidavit is acceptable as an original sample.  The affidavit is be an original document signed and notarized.  One original sample of the ad is attached to the affidavit.  The affidavit lists all dates the ad was printed and these dates agree with the dates the College is billed for.  An original sample of a rubber stamp would be the original invoice stamped by the rubber stamp purchased.
  4. Request for payments of radio broadcasts should be original and itemized.  The dates and times of broadcasts are listed.  An affidavit of services rendered is to be printed on the invoice.  The affidavit is to be signed and notarized.
  5. Original invoices for hotel bills are to itemize fees charged.  Lodging taxes are payable.   The College is unable to pay for movies and non-business related phone calls.
  6. Original itemized invoices for meals are required to include the following information:  the name and location of the restaurant; the names of the people served (this may be attached); the date and amount of the meal; the business purpose and either minutes or agenda of the meeting.  Alcoholic beverages are not paid for by the College.  Gratuities are paid.  Sales tax added to the cost of meals is not paid unless reimbursement is requested on an out-of-state travel reimbursement form.
  7. The College is an institution of the State of Alabama and does not pay late charges, sales tax or any minimum fees and charges of this type.  If a vendor lists such a charge on an invoice or statement, the charge is deducted.  A letter is mailed to the vendor from the Accounts Payable Office to inform them.
  8. Submit invoices that allow discounts in a timely manner so that the College may take advantage of the discount offered.
  9. Shipping and installation are usually not charged on invoices when items are purchased through a bid.  (The bid number is specified on the purchase order.)  If the vendor lists shipping or installation charges on an invoice, highlight the charges.  They may be deducted from the invoice and the remaining amount paid.  If charges are deducted, a letter is mailed to the vendor from the Accounts Payable Office to inform them.
  10. The value of moveable equipment and/or furniture is $500.00 or more per item.  These items are charged to object code 710 or 782--inventory.  Materials and Supplies costing less than $500.00 are charged to object code 641 or 643--materials and supplies.
  11. Independent contractors are to be paid through the accounts payable system.  Employees are to be paid through the payroll system.