(1) The University of Queensland (UQ) supplies services to external customers in return for payment. This Procedure outlines the process and requirements for credit management, activities prior to billing, and the collection of overdue debt for services that are supplied by UQ to external customers on credit terms. (2) This Procedure applies to all UQ staff that provide services to external customers (“UQ service providers”) in return for payment to UQ and/or perform the following financial management functions at UQ: (3) This Procedure does not apply to student related billing or collections (refer to the Student Fees Policy and the Incidental Student Fees and Charges Procedure) or to services provided to internal UQ Organisational Units. (4) UQ staff intending to provide a service to an external customer (UQ service provider) in return for payment on credit terms that is greater than $1,000 must contact Accounts Receivable in the Finance and Business Services Division (ar@fbs.uq.edu.au) prior to: (5) Accounts Receivable will assess the customer’s credit risk to UQ and notify the UQ service provider on the outcome of the credit assessment. (6) Credit approval is required from Accounts Receivable prior to commencing the provision of services to the customer or continuing to provide services to the customer on new credit terms. (7) Accounts Receivable will create new customer accounts in UniFi (UQ’s Finance system) following credit approval and notify the UQ service provider’s relevant Finance Professional Services Team. (8) The relevant Finance Professional Services Team is responsible for billing external customers for the provision of services. All billing must be processed through UniFi. (9) To manage overdue debts payable to UQ, Accounts Receivable will monitor the credit risk of external customers and perform debt collection activities as required. (10) Unrecoverable debts are declared bad and will be written off against the relevant Organisational Unit. A bad debt write off may only be approved by UQ officers that have the relevant financial sub-delegation as per University Financial Delegations. (11) UQ service providers intending to provide an external customer with trade or research services on credit terms must contact Accounts Receivable (ar@fbs.uq.edu.au) before committing UQ to the transaction. Services to external customers on credit terms must not be provided without prior credit approval and validation of the customer from Accounts Receivable. (12) Accounts Receivable will conduct due diligence on the customer and assess the credit risk to UQ by undertaking the following activities: (13) Accounts Receivable will undertake the credit risk assessment and customer validation process in a timely fashion to minimise disruption of the provision of services to UQ customers. (14) Where the credit assessment of an external customer indicates an unacceptable level of financial, reputational or other risk to UQ, Accounts Receivable may not approve the customer for credit and will notify the UQ service provider of the decision. (15) Where the credit risk has been deemed unacceptable to UQ, Accounts Receivable will recommend not to approve a new credit exposure or to discontinue supply of goods or services to an existing debtor account. Before making a recommendation not to approve a credit exposure, Accounts Receivable will consult the relevant UQ service provider, Office of Sponsored Research or Head of School. (16) Accounts Receivable will also monitor existing customers and may recommend declining continuing trade if there is an unacceptable level of financial, reputational or other risk to UQ. For example, if a customer has not paid an overdue debt, Accounts Receivable may recommend that continued trading with the customer be ceased. (17) For a credit approved and validated customer, Accounts Receivable will create a new customer account in UniFi and notify the relevant Finance Professional Services Team that billing may commence. (18) The Finance Professional Services Team is responsible for the billing process in UniFi. Instructions on the UniFi billing procedure are available in the UniFi Training module in Blackboard. (19) Accounts Receivable will perform the following activities to manage overdue trade debts payable to UQ: (20) For research debt management and recovery refer to the Contract Research and Grants Financial Management Procedure. (21) Unrecoverable debts are declared bad and will be written off (against the provision for bad and doubtful debts) against the Organisational Unit. Reasons for writing off unrecoverable debt may include: (22) The Chief Financial Officer is responsible for: (23) Accounts Receivable, within the Finance and Business Services Division, manages UQ’s credit risk assessment and debt collection activities, and is responsible for: (24) Finance Professional Services Teams are responsible for: (25) UQ staff providing external customers with trade or research services in return for payment to UQ (UQ service providers) are responsible for: (26) Credit monitoring will be performed by Accounts Receivable for all debtor accounts in UniFi with overdue balances in order to mitigate bad debt loss to UQ. (27) Accounts Receivable will assess compliance with this Procedure via a range of mechanisms including: (28) Accounts Receivable will review this Procedure periodically to ensure that it is current and relevant, and that it provides for efficient and effective credit management, billing and debt collection processes at UQ. (29) Accounts Receivable will provide data and trend reports to monitor overdue debt collection. Reports will be provided as follows:Credit, Pre-billing and Collection Procedure
Section 1 - Purpose and Scope
Section 2 - Process and Key Controls
Section 3 - Key Requirements
Credit Risk Assessment and Approval
Credit Risk Monitoring
Prior to Billing
Management of Overdue Debt
Debt Write-off
Top of PageSection 4 - Roles, Responsibilities and Accountabilities
Chief Financial Officer
Accounts Receivable
Finance Professional Services Teams
UQ Staff
Top of PageSection 5 - Monitoring, Review and Assurance
Section 6 - Recording and Reporting
Top of PageSection 7 - Appendix
Definitions
Term
Definition
Credit
The ability for a customer to obtain goods or services before payment.
Debt
A sum of money that is owed or due.
Provision (services)
Providing or supplying goods or services for use.
Provision (debt)
An amount set aside in an organisation’s account for a known liability.
Staff
Continuing, fixed-term, research (contingent funded) and casual staff members.
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