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Accounts Payable Policy #301

Policy #301 Approved: February 17, 2011
UNIVERSITY OF NORTH CAROLINA SCHOOL OF THE ARTS
Accounts Payable Policy
Policy #301
Source of Authority: Office of State Budget and Management (OSBM) Budget Manual;
Office of the State Controller (OSC);
N.C.G.S. § 116-34(a);
UNC Code § 502(A)
Revision Authority: Chancellor
History: First Issued: February 17, 2011
Revised: August 18, 2011
Related Policies: OSBM Budget Manual;
Cash Management Policy #302;
Cashier Policy #303;
Honorarium Policy #305;
Independent Contractor Policy #306;
Purchasing Policy #308;
Travel Policy #310
Responsible Offices: Financial Services Department
Effective Date: February 17, 2011
PDF:

POLICY #301

Accounts Payable Policy & Procedures

I.  Purpose

This policy is to effectuate OSBM and OSC policies and procedures with respect to the management, processing, and disbursement of State money.

II.  Scope

This policy applies to all payments or goods and services received by UNCSA

III.  Definitions

A.  “Promotional Items” means items purchased for advertising purposes, typically bearing the name of a department or program with a message or telephone number.

B.  “State Appropriated Carry-Forward Funds” means State operating funds which have not been expended as of June 30th of a fiscal year and have been approved to “carry-forward” as budget in the next fiscal year.

IV.  Policy

A.  Disbursements

1.  Budgeted funds must be available before requisitions, purchase orders, p-card purchases or check requests are prepared.

2.  All vendors should send invoices directly to: University of North Carolina School of the Arts, Accounts Payable Office, PO Box 12189, Winston-Salem, North Carolina 27117-2189

3.  Required Documentation

a.  Disbursements must be from original source documentation (e.g. invoices, agreements, contracts, and requests) which sufficiently describes the purpose of the disbursement.

b.  Documentation must identify the payee’s name, address, and UNCSA’s purchase order number (if applicable).

c.  Documentation must be sent to Accounts Payable (AP).

d.  Under special circumstances when the original invoice is not sent directly to AP by the vendor, the campus department in receipt of the invoice must forward the invoice to AP in a timely manner and before the due date.

4.  Payment Approved

a.  Disbursements must be approved by authorized UNCSA personnel.

b.  Contract payments must be approved by the designated contract administrator or the Chief Financial Officer.

c.  In limited cases, items may be purchased with personal funds (i.e. credit card or cash) if approved by the Chief Financial Officer in advance of the purchase.

5.  Receipt of Goods and Services

Each department is responsible for receiving goods or services to demonstrate that the goods or services were actually recorded and counted by receipting the goods electronically through the Banner Receiving Email-box.

6.  Allowable and Eligible

A disbursement must be for an allowable activity per State regulations.

7.  Purchase and Contract Regulations

The disbursement must comply with State purchase and contract rules and regulations as listed in the State Purchasing Manual and UNCSA’s Purchasing Policies and Procedures.

B.  Tax Reporting Policy

The University is required to file a 1099-MISC form with the IRS (due February 28), the NC Department of Revenue and payee (due January 31) for each vendor (payee) paid the following amounts:

1.  Rents of $600.00 or more

2.  Any royalties of $10.00 or more

3.  Other income of $600.00 or more

4.  Non-employee compensation of $600.00 or more

C.  Basic Spending Guidelines by Fund Source

1.  All Sources of Funds

a.  Account Custodian Responsibilities

i.  The account custodian (individual responsible for the funds in an account) has the responsibility to ensure that proper documentation procedures are followed for accounts that he/she controls and that only authorized expenditures are charged to that account.

ii.  The account custodian is responsible for ensuring that any account he/she may control is reviewed at least monthly and any transactions which are incorrect or do not belong on an account are reported to the UNCSA Controller’s Office.

iii.  The account custodian is responsible for ensuring that he/she maintains a positive or zero cash balance on trust fund accounts unless specifically exempted from this requirement in writing by the Chief Financial Officer.

b.  Payments to Employees

i.  Regardless of funding source, payments to employees are limited to authorized reimbursements, authorized awards, or authorized salaries. Payments to employees for compensation for work must follow guidelines by the UNCSA Human Resources department and must be initiated through the payroll system.

ii.  Personal reimbursements for items such as supplies, travel, or meals to an employee must be approved by an individual at a higher level of authority in UNCSA and should be for emergencies only, not for the daily operational needs of the department.

c.  University Supplies, Equipment, Materials & State Vehicles

i.  Supplies, equipment, long distance phone calls, materials and state vehicles purchased for UNCSA use should be used or expended only in the exercise of official responsibilities on behalf of the University.

ii.  It is improper to use any UNCSA supply, equipment, or materials for personal use. Such acts may constitute a misuse of state property and could result in dismissal.

d.  Moving Expenses

i.  Authorized moving expenses for new employees must be paid from supplemental operating or Foundation funds unless pre-approved by OSBM.

ii.  Three vendor quotes are required for moving expenses under $5,000. Moving expenses costing over $5,000 must be handled on a purchase requisition or bid basis.

2.  Miscellaneous State Budget Code Rules

a.  Membership Dues

i.  Dues may not be paid for individual employees or for the benefit of an individual employee.

ii.  Membership dues paid from State funds must be for the benefit of the University and not the individual. If UNCSA is to benefit from an individual’s membership in an organization, that benefit should derive not because of the individual, but because of the individual’s position with the University, regardless of who is in the position.

iii.  Although a membership may be in the name of an individual, his/her membership terminates at the same time he/she terminates employment with the University or moves to another department or position.

b.  Moving Expenses 

      UNCSA employees may not receive moving expenses from State funds.

c.  Payment of Awards to Employees for the State’s Employee Suggestion System 

      State funds may be used for payments of awards under the Employee Suggestion System.

d.  Immigration and Naturalization (INS) Fees

i.  Payment of INS fees is allowable if the fees are for paperwork required of the employer and not the employee.

ii.  Payment for processing forms required of prospective employees is not allowable.

iii.  The expediting fee for an HIB Visa may be paid from State funds if the salary source is State funds.

e.  Scholarships

Scholarships may be paid from State funds only if they are part of a legislatively approved and separately budgeted scholarship program.

f.  Promotional Items

Promotional items paid for with state funds should be of minimal value and should be charged to the appropriate account.

3.  Unallowable Purchases from State Budget Codes

       The following is a non-exclusive list of items which cannot be purchased with State funds:

a.  Alcoholic beverages and “setups”.

b.  Items for personal use, except under UNCSA’s Travel Policy.

c.  Medications (pain relievers, aspirin, etc.) and/or medical supplies for staff/employees, other than as may be required by federal or State regulations or for   emergency or first aid personnel.

d.  Microwave ovens, coffee pots, refrigerators, or related items for personal office use.

e.  Plants or flowers (live or artificial) for decorative use in an office, except for purchases by the Facilities Department as part of campus maintenance.

f.  Purchase or framing of pictures, art, diplomas, etc. for use in a personal office.

g.  Party items or other decorative items to decorate an office for a holiday, party, or general decorative use.

h.  Picnic tables (except when for use by the entire campus).

i.  Picnic items (paper plates, cups, napkins, forks, spoons, etc.) for office/employee use.

j.  The rental of portable water dispensers and the purchase of bottled water from State funds are not normally allowable; however, a portable water dispenser can be rented or bottled water purchased with State funds only if there is a health/safety reason for the purchase.

k.  The purchase of gifts or flowers or cards (sympathy, get well, Christmas, etc) for an employee or non-employee.

l.  The purchase of personal clothing items or t-shirts, which are not part of required uniforms, safety related, or program related.

4.  State Appropriated Carry-Forward Funds

a.  Expenditures of these funds follow the same guidelines as normal State appropriated operating funds except that, with the approval of the Executive Council and inclusion in the budget flexibility plan, funds may be transferred to capital improvement codes and used for repair and renovation projects.

b.  Once transferred to a capital improvement code, the carry-forward funds cannot be transferred back to an operating code.

5.  Institutional Trust Funds

State funds expenditure guidelines must be followed for all expenditures from Institutional Trust Fund accounts when the funds are used for staffing an office, carrying on activities that are similar to State funded activities, or as outlined below:

a.  Food Services

i.  State funding guidelines must be used for administrative related operations for UNCSA employees.

ii.  Items falling outside the state funding guidelines may be purchased for costs directly relating to the food operation service or for decorating dining facilities, and for costs related to enhancing or expanding the food service activities of the University.

iii.  Alcoholic beverages may be purchased in the event they are part of a recipe used in the Food Service catering operations.

b.  Health Services

i.  State funding guidelines must be used for administrative related operations for University employees.

ii.  Items falling outside the state fund guidelines may be purchased for program activities relating to Health Service.

c.  Wellness Center

i.  State funding guidelines must be used for administrative related operations for University employees.

ii.  Items falling outside the State funding guidelines may be used for program activities relating to the Wellness Center.

d.  Housing Services

i.  State funding guidelines must be used for administrative related operations for University employees.

ii.  Items falling outside the state funding guidelines may be purchased for program activities relating to the housing program

e.  Campus Store

i.  State funding guidelines must be used for administrative related operations for University employees.

ii.  Items falling outside the state funding guidelines may be purchased for seasonal retail display items used to enhance or promote products and for promotional giveaways used exclusively for the intended customer base (i.e. students, faculty, and staff).

f.  Mail Center

    State funding guidelines must be used for all expenditures.

g.  Vending

i.  State funding guidelines must be used for administrative related operations for University employees.

ii. Items falling outside of the State funding guidelines may be purchased for activities relating to the support of the vending program.

iii. The net proceeds from the vending programs are spent on scholarships and other direct student financial aid programs per North Carolina General Statutes.

h.  Campus Parking

i. State funding guidelines must be used for administrative related operations for University employees.

ii. Items falling outside the state funding guidelines may be purchased for program activities relating to campus parking.

i.  One Card Administration

    State funding guidelines must be used for all expenditures.

j.  Student Activities

i.  College and High School must use State funding guidelines for administrative related operations for University employees.

ii. Items falling outside the State funding guidelines may be purchased for student & program activities relating to student activities.

iii. Expenditures for alcoholic beverages are prohibited.

iv. The funds may not be used to fund activities for the UNCSA staff or staff offices which could not be purchased from State funds.

v. No extra benefits, compensations, food, gifts, or any other items which could not be paid from State funds may be provided to an employee except where food is incidentally served to employees attending a student function.

k.  Hanes Commons

i.  State funding guidelines must be used for administrative related operations for University employees.

ii. Items falling outside the state funding guidelines may be purchased for student & program activities relating to student activities.

iii. Expenditures for alcoholic beverages are prohibited.

l.  Transportation

    State funding guidelines must be used for all expenditures.

m.  Student Life Special Projects

i.  State funding guidelines must be used for administrative related operations for University employees.

ii. Items falling outside the State funding guidelines may be purchased for student & program activities relating to student life special projects.

iii. Expenditures for alcoholic beverages are prohibited.

n.  Student Orientation Fee

i.  Orientation fees are fees paid by students to fund the students’ orientation program.

ii. The fees may be used for payment of normal orientation expenses including, but not limited to, food and refreshments for student orientees, orientation training (includes training retreats), and other expenses as necessary to provide a full orientation experience for students.

iii. Expenditures for alcoholic beverages are prohibited.

iv. The funds may not be used for refreshments for University staff or other business, which is outside the confines of the retreat, orientation training programs, or orientation program.

o.  Student Applause

     State funding guidelines must be used for all expenditures.

p.  Gift Accounts

i. Expenditures from gifts must be made prudently with the intent of the donor in mind and follow the restrictions set by the donor.

ii. The primary purpose of expenditures must be for the benefit of the University and therefore not for the direct benefit of an employee.

q.  Supplemental Operating Trust Funds

i.  Each expenditure of these funds must be for a valid University purpose.

ii. These expenditures must be accompanied by appropriate documentation including receipts, stated purpose of the expenditure, date, location, names of persons involved, and the approval to pay signature of the person responsible for the account.

iii. The very flexibility associated with these funds means that determining the propriety of some expenditures will require judgment. In these cases, the prudent person test applies. The individual making the decision about the expenditure must be comfortable with the prospect that the specific expenditure would come under the scrutiny of individuals outside the University.

iv. Expenditures that confer a personal benefit upon the individual authorizing the expenditures are not allowable.

v. Expenditures for items such as a retirement gift or an employee award that are authorized by one individual to be received by another are allowable.

vi. Use of these funds for donations or contributions to non-profit organizations is not permitted unless a substantial University purpose can be demonstrated and the receipt of the donation by the organization does not threaten the tax-exempt status of the University or its foundations.

vii. The purchase of gifts or flowers for an employee or non employee is prohibited.

r.  Interest Account

     The unallocated interest income account uses the same guidelines as Supplemental Operating Trust Funds.

s.  Emergency Student Loan Fund

     Funds are recorded as receivables to be paid back by student.  No other expenditure may be allowed.

t.  Scholarship Fund.

    Funds for scholarships from either State or private sources.  No other expenditures may be recorded.

D.  Funds on Deposit with Private Banks

1.  Board of Trustees of the Endowment Fund

a. Must use state funding guidelines for administrative related operations for University employees.

b. May purchase items falling outside the state funding guidelines for entertainment and travel with Chief Financial Officer.

c. The primary purpose of the expenditure must be for the benefit of the University and not for the direct benefit of an employee.

2.  Agency

a. Funds may be held by the University as fiscal agent for student, faculty, and staff organizations where it has been deemed in the best interests of the University to provide an accounting service.

b. These funds do not belong to the University and the University does not determine what they can be spent for except:

i. The University requires a formal process to ensure, to the extent possible, that funds in these accounts are not misused.

ii. The funds should not be spent for any purpose, which would be detrimental to the image of the University.

V.  Revision History

A. February 17, 2011 – Adopted by Board of Trustees as part of UNCSA Policy Manual


UNIVERSITY OF NORTH CAROLINA SCHOOL OF THE ARTS

Accounts Payable Procedures

Procedure #301

I.  Accounts Payable Policy Manual

A.  Financial Services will establish and maintain an Accounts Payable Policy Manual which will contain more information and procedures for implementing the Accounts Payable Policy.

B.  The Accounts Payable Policy Manual is available at http://www.uncsa.edu/mysa/faculty-staff/working-at-uncsa/financial-services/docs/accounts-payable-policy-procedures.pdf

C.  The Basic Spending Guidelines By Fund Source are available at http://www.uncsa.edu/mysa/faculty-staff/faculty-resources/faculty_docs/2015%20UNCSA%20Spending%20Gudielines.pdf.