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Accounts Receivable Policy

  • Related Documents:  Accounts Receivable Guidelines
  • Owner: Financial Services
  • Approver:  Chief Financial Officer
  • Approval Dates:  January 2004, August 2007

I.    Purpose

The purpose of this policy is:

1.     To ensure Toronto Metropolitan University's (the "University") financial statements correctly reflect all amounts owed to the University;

2.    To establish guidelines by which credit is extended to University customers on a consistent basis;

3.    To manage the extension of credit by the University’s various departments;

4.    To minimize the cost of collecting accounts receivable; and

5.    To maximize cash flow.

The objective of the central accounts receivable system is threefold: first, to lessen the requirements for departmental record keeping; second, to consolidate all charges to a single billing; and finally, to promote the standardization in the reporting of accounts receivable in the University’s financial records.

II.    Policy

All University departments that provide goods and/or services to customers on a credit basis or are involved with invoicing sales, services and assessments are required to utilize the central system under the administration of Financial Services.  Customers are directed to send all payments directly to the Accounting and Treasury unit of Financial Services.  All revenues from billing are credited to the originating department upon issue of the invoice.

In the event payment is mistakenly sent to the department providing the good or service, it should be forwarded immediately for proper processing and receipting.

III.    Scope

This policy applies to any sale of goods or services (with the exception of fees and miscellaneous charges associated with student registration) provided by any department of the University.  In addition, this policy recognizes that from time to time certain activities may require the University to extend special credit privileges and/or arrangements to a customer.

IV.    Jurisdiction

This policy is under the jurisdiction of the Vice President, Administration and Finance and is administered by the Chief Financial Officer.