::Policy Statement ::::Office of the Controller - Accounts Payable ::AMERICAN UNIVERSITY

ACCOUNTS PAYABLE - OFFICE OF THE CONTROLLER


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accounts payable policy statement

General Policy
Travel Policy & Procedures
MasterCard Travel Card Policy
Miscellaneous Cash Advances
Petty Cash Policy Personal Reimbursement Policy
Payments to Individual for Services
Payment to New Vendors
Miscellaneous

General Policy
The purpose of the Office of The Controller is to ensure that all university funds are disbursed and recorded in accordance with generally accepted accounting principles. The Office of The Controller therefore expects that all procedures are followed so as not to jeopardize the university. All expenses must be accurately recorded within 90 days of occurrence.

Travel Policy & Procedures

The University intends that all persons traveling on behalf of and with the authorization of the University will be reimbursed for their
reasonable out-of-pocket expenses incurred in connection with such travel upon presentation of a completed expenses report signed
by the traveler and approved by the appropriate dean, director, department chairperson, vice president, vice provost, etc. or
whomever is the supervisor of the traveler

Original Receipts are required for reimbursement. If original receipts are not available, please indicate by noting it on
the expense report or attach an explanation.

A. The University prefers that transportation tickets (plane, train, bus) be purchased through the official travel agencies
of American University:
Travel Plus
Marathon Travel
McNair Travel

Please pProvide the travel agent with your name, department, and budget account number.
You can request the travel reservation to be charged directly to your account, or use the University credit card

B. If expenses are incurred by the traveler on behalf of persons other that the traveler and reimbursements for such expense is
being requested, the names of the other persons and the business purpose of the expenditures must be documented.

C. If the expense are incurred by the traveler on behalf of persons not on University business (e.g. spouse), the University
portion of expenses must be clearly identified and original receipts must be submitted for the reimbursable portion. If original receipts
are not available, please indicate by noting it on the expense report, or attach an explanation.

D. When travel on University business is combined with personal or non-university related, business expenses must be allocated
accordingly and original receipts must be submitted for the reimbursable portion. If original receipts are not available, please
indicate by noting it on the expense report, or attach an explanation.

E. Air coach accommodations should be used. Whenever possible, the use of airport shuttles rather than taxis is encouraged.
Rental cars may be used when necessary and budget plans whenever possible. Use of moderately price rooms is encouraged
and spousal travel is not covered except if the spouse is on university business. If frequent flyer coupons are used on
university business, the traveler will not be reimbursed for the equivalent ticket cost. Also, frequent flyer coupons cannot
be submitted as part of the accounting for a travel advance. Passenger coupons for university business must always be
in the name of the traveler.

F. When a private automobile is used, the university will reimburse the traveler on a per-mile allowance basis in accordance
with current university guidelines; university rates are always the same as IRS published rates. .

G. A reasonable expense for valet services will be allowed if the traveler remains on university business in excess
of four (4) days and appropriate receipts must be submitted.

H. Charges for telephone calls made while on university business should be claimed only if such calls are directly
related to university business; personal telephone calls are not reimbursable. .

I. The university will not be reimbursing the traveler for expenses incurred for personal flight insurance, alcoholic beverages,
or any expense of a purely personal nature.

J. Travel performed as part of a project, which is sponsored by a grant, or contract is subject to such additional travel restrictions
as may be imposed by the terms of the grant or contract.

K. Travel advance may be obtained by full-time employees of the university traveling on behalf and with the authorization
of the university upon presentation of a completed travel advance/expense form, signed by the traveler and approved
by the appropriate supervisor.

L. Travel advance request should be submitted to the Office of the Controller at least one week prior to the date on which
the advance is required. In addition to the cash advance needed for incidentals or meals, any registration fees or either
items should be prepaid.

M. The university has instituted a per diem allowance.

5. Per diems - University employees may choose either to file for actual expense reimbursements or a per diem rate. A per diem is given to a traveler to cover lodging, meals, and incidental expenses in connection with the performance of services for the University. Travelers may not request actual expenses reimbursements for one portion of their trip and per diem for the remainder of the trip, except and only in the instance where meals are already included in a trip or part of a trip. Travelers who use per diem allowances do not have to substantiate each lodging and meal expense, but they must demonstrate that the trip occurred by providing an airline or hotel receipt. The following per diem rates are used for lodging, meals, and incidental expenses:

http://www.gsa.gov/Portal/gsa/ep/contentView.do?contentType=GSA_BASIC&contentId=17943

These rates cover both hotel and meals and are set by the Internal Revenue Service. Per diems may not exceed the federal per diem rate the the specific location and duration of the trip. Independent contractors, alumni and other non-employees who perform services for the University may not use per diems except by prior written approval by the Controller of the University who only approves in rare cases.

Travelers may choose to claim a combined per diem for lodging and meals or the per diem for meals and incidental expenses only. If the total actual lodging and/or meals are incidental expenses incurred for the duration of the trip are less than the total State department per diems for the same trip, travelers may claim a lower per diem rate and therefore, do not have to substantiate nor submit receipts for these expenses. When attending conferences or business meetings and events where meals are included as part of the registration or the program, travelers may not request a per diem reimbursement for those days but show actual expenses for non-covered meals.

Travelers who have and use the university's One Card for travel expenses may not charge their lodging and meals and incidental expenses to the One Card if requesting a per diem reimbursement.

N. Expenses which are prepaid by or charged directly to the university on behalf of the traveler (e.g. airline tickets, hotel accommodations) must be itemized on the travel expense form, with the notation "prepaid" in the amount column. Original receipts (if they are not available, please make a note on the travel expense form or attach an explanation), invoices, passenger coupons, etc. for expenses which were prepaid or charged directly to the university on behalf of the traveler must be submitted with the travel expense form. Amounts prepaid by or charged directly to the university on behalf of the traveler must not be reflected in the expenses claimed by the traveler.

O. Expenses for all travel activity should be charges to the travel object code, even if the expense was for food, airline tickets, or conference registration.

P. The signature of the traveler is required for all advances.

Q. All travel that is funded by federal grants or other restricted grant monies, may be subject to additional restrictions as noted in the contract.

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Miscellaneous Cash Advances
1. Miscellaneous cash advances are used for university events which may require cash for a specified purpose and is subject to all the policy and procedures stated above.

Petty Cash Policy (1-10)

1. Petty cash funds are established for departments of the university to enable the departments to pay minor business expenditures or for expenses not available through the Purchasing Office or Campus Store.

2. Petty cash is to be used for small supplies not available through university services; small items such as postage, local transportation; or other small reasonable disbursements relevant to the department�s function and subject to the custodian's discretion.

3. Petty cash is not to be used for personal loans, borrowing, check cashing, payment for services rendered, salary advances or travel advances.

4. To prevent access by anyone except the custodian, the fund should be kept in a locked box in a desk, file cabinet or safe that is also locked whenever the custodian is absent.

5. Any shortages within the fund should be brought to the attention of the Office of The Controller and the department head immediately.

6. In case of theft of petty cash, the custodian must notify the campus security police, file a report on the incident and send a copy of the theft report to the Controller's Office

7. If a department has only small infrequent charges to petty cash the department may not need its own petty cash fund. The use of the cashier services of the student accounts office will be appropriate.

8. During the absence or vacation of the custodian, a temporary custodian may be appointed by doing and inventory of the cash box, completing the �Change in Petty Cash Custodian� form listing the receipts and any other pertinent information. These items must total the authorized petty cash fund. If they do not, The Office of The Controller must be notified immediately. The form must indicate that the change is only temporary. If the fund is to reimburse while the regular custodian is absent, a memo must accompany the Disbursement Request and identify the temporary custodian.

9. A department head may change the custodian by following the instructions above and notifying The Office of The Controller of the effective date of the change. The petty cash fund must be balanced and reconciled before the transfer to a new custodian. The previous custodian, the department heads or designate must act in the capacity of the previous custodian to balance the amount before it is transferred to the new custodian.

10. The internal audit department will audit the petty cash funds each fiscal year.

Personal ReimbursementPolicy(Disbursement Request & Receipts)
1. Personal reimbursement can be issued to faculty, staff and student who have used their own funds in order to obtain small items not available through university services or through the purchasing office e.g. mileage, metro fare reimbursement etc. Personal reimbursement checks should be requested for amounts larger than $100. Amounts smaller than $100, should be handled by the petty cash custodian or the cashier's office.

Payments to Individual For Services (Disbursement Request & Contract Required)

1. The university may obtain the services of a speaker or independent contractor and must follow some very strict guidelines in order to pay that individual. The definition of independent contractor, is one who is responsible for payment of his/her self-employment taxes; who is not subject to the control of another as to the means and methods for accomplishing the work, but only as to the results; who engages in the pursuit of independent practice to the public; who pays their own expenses.

2. University employees are not authorized to enter into contracts with individuals without a contract signed by the authorized officer of the university in The Finance Office.

3. Payment to individuals for services performed must be through The Payroll Office or The Accounts Payable Department. It must be paid through The Payroll Office if the individual is currently being paid by the Payroll Office or has been paid through The Payroll Office during the current calendar year. Payment for all other services performed by individuals must be through The Accounts Payable Department and submitted on a Disbursement Request form. If the individual is a speaker, the appropriate object code of 51210 (non-employee compensation) must be used. If the individual is an independent contractor (as defined by IRS), a Disbursement Request must be accompanied with a valid contract which has been signed by the Assistant VP Finance (signing for the administrative part of the university) or the Dean of Facilities (signing for the faculty and research contractors) and the appropriate object code 51208 must be used.

Payment to New Vendors

American University is required to meet the regulations of the Internal Revenue Service in regards for payments to individuals. In order to do so, it will be necessary that all new vendors must have proper documentation ( W9 Form) on file and be entered in Datatel before requisitions can be entered into the system.
Datatel will reject all requsisitions without a vendor code effective September 11, 2006. Reimbursements, direct payments and PSA's will also have the same requirement. Accounts Payable will be unable to process any payments without the proper documentation.

A requisition is a request for goods and services. All requests over $500.00 should be entered into Datatel before the purchase. All items under $500.00 can be purchase by the AU One Card or by sending the approved invoice with the department's General Ledger Account Number to Accounts Payable after verifying that the vendor has been added into Datatel.

ALL VENDORS WHO SUBMIT INVOICES FOR PAYMENT MUST SUPPLY THE UNIVERSITY WITH A COMPLETED W9 FORM.

Miscellaneous

1. Since the university is currently exempt for paying sales taxes for MD, DC and VA. The Office of The Controller will not pay any sales taxes from these states which may appear on invoices or on personal reimbursement.

2. The Office of the Controller does not pay statements that are issued by vendors. It is the policy to pay only on original invoices which easily identify the goods or services sold to the university as well as the requesting departments.

3. Due to Sarbanes-Oxley requirements regarding quarterly accuracy of figures on the ledgers, journal entry corrections will NOT be made for items over 90 days old.

4. In our effort to adhere to the requirements of Sarbanes-Oxley, Accounts Payable must have all invoices, expense reports, and disbursement requests submitted as soon as they are approved for payment. This is especially crucial at the end of our fiscal year, April 30. Invoices must come directly to Accounts Payable. If we do not receive the invoices directly, we may be unaware of outstanding payables, which becomes a significant problem with our external auditors during the annual audit of the University's financial statements. If goods or services were received by April 30, the university is required to report them in the current fiscal year. If goods and services have been received prior to April 30th but not invoice by this date, please contact Accounts Payable so the proper accounting entry can be made.


contact: accountspayable@american.edu	4400 Massachusetts Avenue, NW * Washington, DC * 20016-8020 202.885.2840 * Fax 202.885.2839
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