Introduction to Accounts Payable

Introduction to Accounts Payable
Andre Simmons, Assistant Manager
Accounts Payable
Role of Accounts Payable
• Accounts Payable is responsible for examining all
accounts, claims, and demands against the
University of Georgia, and for making payment of
all the University’s legally incurred obligations for
materials and services other than payrolls.
• No payments are to be made unless there is
money in the Treasury legally allocated for such
payments, and until the Accounts Payable
Department has been presented with supporting
documents and invoices which have been
reviewed and found to be correct.
Regulating Entities
• Internal Revenue Service (1099
reporting, TIN matching/BNotices, Accountable Plan,
Contractor relationships)
• US Treasury Department (OFAC)maintains a Specially Designated
Nationals List that we must
• Sarbanes-Oxley-Requires
certification and attestation of a
public company’s internal
• Board of Regents (Delegates
Procurement function)
• State Accounting Office
• Department of Revenue
(Escheatment of Unclaimed
International Tax Coordinator,
Susan Caldwell
UGA must comply with Federal tax and
immigration regulations when processing
payments to foreign nationals.
• Phone: (706) 583-8193
• Fax: (706) 542-6779
• Email: [email protected]
• Website:
Fiscal Year 2012
• Accounts Payable disbursed
$635,222,995 in expenditures.
• AP paid 254,731 invoices
• AP issued 120,915 checks
• Initiated 1018 wires
• Processed 633 ACH transfers
Travel & Encumbrances
Elena Williams, Supervisor
• Administrative Functions
• Printing Checks Daily
• Approving & Encumbering Travel
• Vendor Creations in the Unified Vendor
• Review and assign appropriate object codes to
UGAMart requisitions and check requests
Vendor Creation/Additions/Revisions
• Accounts Payable and Procurement now function
from one unified vendor database.
• Vendor creation requires approval from both
Accounts Payable and Procurement before the
vendor will be available for use.
• Vendors now have the option to register online
• Original Vendor Profile form can still be
Purchase Requisitions and Check
• Two “vehicles” for procuring goods flow
through Travel & Encumbrances.
– Purchase Requisitions: Items that have to be
“procured” through the Procurement Office.
– Check Requests: “Charge” commitments
Purchase Requisitions
• Purchase requisitions come to Travel &
Encumbrances for 2 things:
– Review object code assigned by department and
modify if needed.
– Review free balance in account to verify funding
exists to support the purchase. Account/Budget
Check messages and warnings appear under the
history tab in UGAMart. Requisitions will not be
approved if funding does not exist.
Purchase Requisitions
• “Pre-encumbrances or commitments” are only
established if the requisition can be readily
identifiable as construction or is for a
purchase greater than $50,000. These
purchase types often require a lengthy bid
process. On status reports, these
commitments are identifiable by reference
numbers that start with PM.
Purchase Requests
• If no criteria exists to create a commitment,
the purchase requisition flows to Procurement
once approved by Travel & Encumbrances. If
the funding source is a restricted account and
one of the object codes that Contracts &
Grants needs to approve before a purchase
order is created, the requisition flows to C&G
prior to Procurement.
Purchase Requisitions
After Procurement processes the requisition, a
purchase order number will be generated. This
purchase order number will begin with “E” and the
funds for the purchase order will be obligated or
encumbered. An encumbrance sets the money for
that order aside from your account free balance.
The money is held until the goods/services are
received and payment is issued. On your status
report, these obligations will show under the
encumbrance section and will begin with a “PE.”
• The money obligated for a purchase order will remain
encumbered until a payment is processed for the order
or until action is taken by Procurement to relieve the
• If the end of the fiscal year comes and money is still
encumbered for a purchase order on a state account,
the money will roll into “Liability.” When a PO is
transferred into the liability account, a JV will appear
on your final fiscal year end account status report.
Once that JV is completed, this encumbrance will no
longer show on your status report. That does not
mean the encumbrance has been paid.
Object Codes
• Object codes are how we classify expenditures at
• Object codes allow us to report taxable payments
to the IRS.
• Object codes allow us to report travel
expenditures on the continuous audit for the
• Object codes allow UGA to query spending
information for open records requests and
inquiries from the Board of Regents and other
various entities.
Common Object Codes for Purchase
• 71400-Cleaning items, food, educational items, single
book (not part of a set)
• 71410-General Office Supplies: Toner, Pens, Copy
Paper, File Folders
• 71430-Laboratory/Research Supplies & Materials:
Beakers, test tubes, chemicals, medical/hospital
supplies like gloves
• 71500-Maintenance
• 74300-Non-Inventoried Equipment with costs $100$2999.99: Furniture, file cabinets
• 74306-Computer & Peripherals with costs $100$499.99: Monitors, computers
More common object codes for
Purchase Requisitions
• 74328-Computer and Computer Peripherals
with costs $500.00-$4,999.99
• 74308-Equipment with costs of $3000$4,999.99: Furniture, freezers
• 74318-Electronic audio/visual equipment and
photographic apparatus costing $500.00$4,999.99
More common object codes for
Purchase Requisitions
• 84320-Equipment purchases for items over
• 84326-Computer and computer peripherals
with a cost of more than $5000.00 (servers,
Check Request
• The second “vehicle” that comes through Travel &
Encumbrances for object coding is the check request.
• Check requests are normally generated to cover an
expenditure that was established on a “charge” basis
with the vendor.
• Encumbrances are not generated from check request
• Procurement also reviews all CR’s over $10,000.00 and
all payments to individuals that include reimbursement
for an item over $99.99 (travel excluded)
Common Check Request Object Codes
• 71430-Laboratory/Research Supplies
• 71500-Repairs
• 72712-Conference & Workshop expenses
(expenditures in connection with holding a
conference/workshop.) Examples would be room
rental, audio visual charges
• 72714-Guest/Visitor travel: Travel for individuals not
employed by UGA or receiving a fee for services
rendered associated with the trip. Examples include
prospective employee travel, speaker travel expenses
when the speaker is not receiving a fee/payment.
Common Check Request Object Codes
• 72722-Dues & Memberships. Requests for
payment should be accompanied by a letter of
justification approved by the Department
Head/Director and the cognizant Dean or Vice
President or Senior Vice President.
• 72723-Subscriptions
• 72725-Registration Fees
• 72732-Freight or Express Shipments: All
payments to UPS and FedEx
Common Check Request Object Codes
• 72752-Tests & Analysis
• 72760-Other Services: Examples include
photographer, musician, proofreader, catering
services. These can be individuals or companies.
• 72763-Research Participant
• 74200-Printing: Bel-Jean, FedEx Kinkos
• 74201-Advertising
• 74203-Advertising-Job Postings
Common Check Request Object Codes
• 75210-Reimbursable expenses for nonemployees that did receive a fee for professional
services (architect, electrician, doctor,etc)
associated with their trip. Examples would be
lodging and meal expenses for a guest speaker
that received $500 for giving a lecture. His meal
and lodging expense would be coded 75210.
• 75215-Mileage reimbursement for nonemployees.
Common Check Request Object Codes
• 76910-Internet Service & Pager Service
• 76930-Land Lines, Long Distance Charges, Two
way radios
• 76932-Cellular charges
Purchase Order Payment Section
David Manley, Supervisor
• Once a purchase requisition works it’s way
through Procurement and a purchase order is
created and encumbered, the next phase will be
payment to the vendor once the goods/services
have been received.
• PO Payment Section Responsibilities:
Match/Review/Approve invoices for payment
within UGAMart.
• Review outstanding encumbrances and initiate
inquiries to determine if purchase order should
remain open or be closed.
When to Create a Receipt
• If your purchase order is set up to be delivered
to Central Receiving, you DO NOT have to
complete a receiving report.
• If your purchase order is set up to be delivered
direct to your department, you will need to
create a receiving report before payment can
be processed.
How to Create a Receiving
Report in UGAMart
• The comment feature is essential in UGAMart.
This feature allows all communication to be
documented and it effective for correspondence
when utilized correctly.
• Comments feature can be utilized to send
Accounts Payable copies of invoices that have
been received by the end user department
(sometimes invoices are included with
• Comments feature can be utilized to correspond
about PO balances, revisions needed,etc.
• When using the comment feature, you have to
indicate a recipient. You have the ability to
assign multiple recipients to your message.
How to Add Comments in
Who handles which vendors?
A-E: Carol Kainz ([email protected])
F-M: Hall Gibson ([email protected])
N-S: Jing He ([email protected])
T-Z, Ikon/Ricoh, Sharp, Docuteam, Staples:
Kathleen Green ([email protected])
• Airgas, Bio-Rad, Dell, Sigma-Aldrich: Marilyn
Smith ([email protected])
Check Request Processing Section
Patricia Sims, Supervisor
• Review/Audit check requests payable to
individuals, research participants, travelers,
petty cash custodians, and companies.
• Verifies correct approvals obtained, proper
invoices and other documents are attached.
• Handles canceling and reissuing checks.
• Processes ACH and Wire Transfers
Payments to Individuals
SSN Removal
• Effective January 2013, the eCheck/eTravel
System will no longer use social security
• Rather than using SSNs, each record will be
identified by a unique vendor number (VN)
maintained within the Unified Vendor
• VN’s will only be used within procurement and
payables processes.
Types of Payments to Individuals:
• Refunds for money paid into a revenue account.
Example would be a non-employee that paid for a
registration to a conference that UGA was
hosting. If the attendee had to cancel and we
needed to refund their registration money, this
would be a refund. Refund object codes should
begin with 4. There is no supporting
documentation required to accompany the check
request. Adequate description of the expense
should be detailed in the description section of
the check request.
Types of Payments to Individuals:
Cash Reimbursements
• To reimburse an individual for a purchase made
on behalf of the University. Receipts are required
to document the expense and any purchase for
an item over $99.99 requires Procurement review
and approval. An example would be an employee
that purchases ziploc bags to be used in a
research lab. AP would require a check request
with the receipt from where the ziplocs were
purchased as supporting documentation.
Adequate description of the charge should be
detailed in the description section of the check
Types of Payments to Individuals:
Entertainment Charges
• On occasion, an employee will pay for university
related entertainment charges/meals (activities
that support the underlying University purpose
such as promoting good will, donor cultivation,
etc.) and seek reimbursement. Alcohol cannot be
purchased using a University account. These
check requests for reimbursement should be
accompanied by a completed University Related
Business Entertainment Form and an itemized
receipt. Utilize the Food Reference Chart on Ask
UGA to determine appropriate funding sources.
Object code should be 71401.
Types of Payments to Individuals:
Honoraria Payments
• A honoraria is a payment to a non-employee in
recognition of acts, awards, or fees and/or
expenses for services rendered to the university.
• Examples include guest lecturers, consultants (for
agreements under $5000), and reimbursable
travel expenses
• Honoraria form must contain original signature of
recipient if there is not an invoice to accompany
the request. Date of service(s), current address,
and social security number must be included on
the form.
Types of Payments to Individuals:
Research Participants
• Classified into two groups. Payments $100 and under and payments over
$100. Payments $100 or under do not require collection of the individuals
social security number. Payments over $100 do require the participants
social to be collected and provided to Accounts Payable.
• Research Participant Payment forms should accompany the check request.
– Payments $100 and under:
– Payments over $100:
• Research Participant Incentive Payment Procedure:
• Research participant payments should utilize the object code 72763
regardless of dollar value.
Payments to Companies
• Original invoices should accompany check
requests to support the expenditure. Invoices
should be readable.
• UGA will remit payment to the company’s
legal business name.
Electronic Check Request System
Travel Policy
• Changes to the UGA travel policy become
effective November 1, 2012.
• Travel policy must be adhered to by both
employees AND non-employees (this is part of
our accountable plan that keeps travel nontaxable)
• New policy is located at:
Who governs Travel?
• State Accounting Office and the Office of
Planning and Budget are responsible for
establishing the Statewide Travel Regulations.
This responsibility was assigned to these
organizations through House Bill 293, which
was passed into law during the 2005
legislative session.
New changes
• Travelers should submit travel expenses for
reimbursement within 45 days of completion of
travel. Previously, the requirement was 60 days.
• In relation to air travel, if there is a charge for
checking luggage, reimbursement will be limited
to 1 piece of checked luggage. In the event
additional bags are needed for business
purposes, requests for reimbursement should
include a written explanation.
New changes continued
• Travelers can upgrade from coach to business
class on international flights where the portion of
the flight that is non-stop exceeds 10 hours in
duration. Written pre-trip approval for the
additional expense is required. The 10 hour
duration does not include any time spent in
between flights during a connection.
• Changes to meal per diems as we will outline in a
few slides.
Instate or Out-Of-State Travel?
• Travel more than 50 miles from the state line
of Georgia is considered out-of-state travel
and requires a travel authorization (travel
authority) to be submitted to the Travel &
Encumbrances office prior to the trip taking
place. International travel requires the
approval of the Office of International
Education additionally. Programming has
been established in the electronic check
request system to obtain these approvals.
Travel Authorities
• Travel authorizations are required for out-of-state
travel for insurance purposes. This authorization
provides the University with documentation that
this is a pre-approved business trip. The TA also
allows funding to be obligated (or encumbered)
and set aside from an account so the traveler will
have funding to cover his/her reimbursable
• On a status report, travel encumbrances for
employees will start with a T followed by 7
numeric digits.
Travel Authorities
• Travel authorities can also be submitted for nonemployees but only for the amount of airfare
that is being direct billed to UGA by one of
UGA’s preferred travel agencies. All other nonemployee expenses must be handled through the
reimbursement process via honoraria.
• On a status report, travel encumbrances for nonemployees will start with a H followed by 7
numeric digits.
Instate Travel for Employees
• Object code 64100-All travel expenses except
for mileage.
• Object code 64150-Mileage only! No parking,
• Mileage should be entered as a second line on
the account breakdown page in the e check
• Departure and return times must be
documented on the travel expense statement!
Instate meal per diems
• Instate meal per diems remain at $28/day (non-high
cost areas) and $36/day (high cost areas). For nonovernight trips, travelers will receive 75% of the
allowable per diem if the travel is more than 50 miles
from home or headquarters and the traveler is on
travel status for more than 12 hours. For regular travel
within Georgia, this would become a $21 per diem
amount. For high cost areas, this would be a $27 per
• For overnight trips within Georgia, travelers will receive
75% of the allowable per diem on the day of departure
and day of return.
• UGA employee leaves Athens at 8:15 and travels to
Dahlonega, GA for work. The employee returns to the
Athens campus at 4:30 the same day. Employee is not
eligible to be paid a per diem since he/she was not
traveling 12 or more hours.
• UGA employee leaves Athens at 10:00am and travels to
Hinesville, GA. Employee returns home the same day
at 10:45pm. The employee is eligible to be reimbursed
for a meal per diem (traveled 50+ miles and gone for
12+ hours). The meal allowance would be $21.
Computed by multiplying the daily rate of $28 by 75%.
High Cost Areas in Georgia
• Chatham, Clayton, Cobb, Coweta, DeKalb,
Fayette, Fulton, Glynn, Gwinnett, and Richmond
Counties. The daily per diem rate for high cost
areas in Georgia is $36.
• If there is no overnight lodging associated with
the trip, the traveler is only eligible for 75% of the
per diem. That equates to $27. ($36 x 75%=
• If overnight lodging is involved, the traveler is
only eligible for 75% of the per diem on day of
departure and day of return.
Meal Expenses Associated with Travel
Outside of Georgia-EFFECTIVE 11/1/12
• Employees traveling outside of Georgia may receive
meal per diem amounts up to the federal per diem
rates including the incidental expenses amount. GSA
site for per diems is:
• Employees traveling overnight are generally eligible for
per diem amounts designed to cover all days on travel
status other than the day of departure and day of
return. Employees are only eligible for 75% of the
allowable per diem on the day of departure and day of
return. The 75% amount can be located by viewing the
meals and incidental expenses breakdown on the GSA
• Employee leaves from Athens on a Saturday. She
flies from Atlanta to Boston, MA. The traveler is
in Boston on Sunday, Monday, and Tuesday and
returns to Athens on Wednesday. Traveler should
be reimbursed a meal per diem of $319.50. The
meals and incidental expenses daily rate for
Boston is $71. The traveler is eligible for $71 on
Sunday, Monday, and Tuesday. Saturday and
Wednesday, the traveler is eligible for 75% of the
allowable rate. This would equate to $53.25.
Total is computed $53.25 + $71 + $71 + $71 +
$53.25= $319.50.
• Employees who travel more than 50 miles from
their home/office/residence/or headquarters
may be reimbursed for lodging expenses
associated with overnight travel. All lodging
claims must be documented by receipts and must
be at a business that offers lodging to the general
public. Any lodging expense that exceeds GSA
rates by more than 25% should be explained and
justified on the travel expense statement.
• GSA Per Diem Rates:
Foreign Travel
Foreign travel per diem rates have also been
established and can be viewed at:
Taxes Associated with Lodging
• Should not be charged county, municipal, or
occupancy tax on lodging in Georgia.
• Employees are required to submit a copy of the
hotel/motel tax exemption form when they
register at a hotel. It is located at:
• Employees are required to pay state/local sales
and use taxes. (UGA is only exempt from sales
tax when paying by University funds.)
Mileage Reimbursements
• When it is determined that a personal motor vehicle is
the most advantageous form of travel, the employee
will be reimbursed for business miles at $.555 per mile.
• If a government owned vehicle or a rental vehicle is
determined to be the most advantageous mode of
travel, but a personal motor vehicle is used, the
employee will be reimbursed at $.23 per mile.
• Actual odometer readings are not reported on the
travel expense statement. To calculate mileage,
travelers can use MapQuest, Google Maps, GPS
devices, or personal odometer readings, whichever is
most appropriate for the circumstances.
Business Miles Traveled
• Employees may be reimbursed for the mileage
incurred from the point of departure to the
travel destination. If an employee departs
from headquarters, mileage is calculated from
headquarters to the destination point. If the
employee departs from his/her residence,
mileage is calculated from the residence to
the destination point, with a reduction for
normal one-way commute miles. The same
rules apply for the return trip.
Exceptions to Deducting Normal
Commute Miles
• The initial point of departure is on the
weekend or a holiday.
• If an employee does not regularly travel to an
office outside of their residence, the
requirement to deduct normal commute miles
does not apply.
Business Miles Traveled
• Employees may also be reimbursed for
business miles traveled as follows:
– Miles traveled to pick up additional passengers
– Miles traveled to obtain meals for which employee
is eligible for reimbursement.
– Miles traveled to multiple work sites
Examples of Business Miles Traveled
• Ex. 1: Employee resides in Duluth, works in
Athens. Normal commute mileage is 60 miles
roundtrip. The employee leaves in the morning
from her house to go to a meeting in Gwinnett
and returns to her residence after the meeting.
Total distance traveled is 30 miles. Since the
employee would normally travel 60 miles in her
daily commute, the State does not reimburse her
for mileage since her business traveled miles are
less than her normal commute miles.
• Ex. 2. Employee drives from home in Jefferson to
his UGA office. At 10:00 am, he leaves campus
and drives to a meeting at Georgia Tech. After
the meeting concludes at Tech, he returns to his
residence. The trip between Jefferson and UGA is
personal commuting and not reimbursed. The
travel from UGA to Tech and the return trip to the
residence is reimbursed, less the amount equal to
the normal one way commute miles (What he
normally would have traveled from UGA to
Jefferson for his return trip home.)
Air Transportation
• Airfare can be direct billed to UGA using one of UGA’s authorized
travel agencies.
• In general, it is the State policy that state officials or employees
traveling by commercial air carrier travel in the most cost-effective
manner and utilize the lowest possible coach fares.
• Employees will not be reimbursed for the portion of non-coach
(first class, business class, etc) airfare that exceeds the cost of the
lowest, available airfare on the same flight unless:
– No other space on the needed flight
– Licensed medical practitioner certifies that because of a person’s
mental or physical condition specific air travel arrangements are
– Commissioner of Public Safety certifies that specific air travel
arrangements are necessary for security reason.
Fly America Act
• Requires international flights to be US flag carriers when available.
The Fly America Act is available at
• Compliance with the Fly America Act is satisfied when the US flag
carrier’s designator code is present in the area next to the flight
numbers on the airline ticket, boarding pass, or on the e-ticket.
• What does this mean to you? If you are traveling internationally on
federal funds, you must ensure your flight is scheduled on a US flag
carrier or on a foreign air carrier that code shares with a US flag air
• More info on our travel site:
Upgrades to Non-Coach Travel
• Employees may use frequent flyer miles or similar
programs to upgrade to non-coach travel.
Nothing in our policy precludes an employee
from personally paying for an upgrade to noncoach travel.
• Travelers can upgrade to business class for
international flights that exceed 10 hours in
duration. Pre-trip approval for the additional
expense is required. This does not include any
time spent in between flights during a
Rental of Motor Vehicles
• State contract is with Enterprise. This contract
is mandatory for use by State employees.
• Employees traveling on State business in a
rented motor vehicle are covered by the
State’s liability policy; therefore, liability
coverage should be declined when renting a
motor vehicle. Loss Damage Waiver/Collision
Damage Waiver insurance is included in the
statewide contract at no additional cost.
Unallowable Expenses
Laundry Services (when trip is under 7 days)
Tipping for maid services
Valet services when self parking is available
Alcoholic Beverages
Bank charges for ATM withdrawls.
Required Documentation
• Employees should submit their requests for
reimbursement of travel expenses via a signed
and approved travel expense form at
• Travel expense form and required receipts should
be attached to an electronic check request.
• For out of state travel, make sure to reference the
travel authorization in the appropriate field on
the e check request.
Required Receipts
Meals purchased in lieu of those provided at conference/training (does not apply
to normal per diem allowances-only when at a conference and a meal is provided
and the traveler does not participate but goes somewhere else to purchase a
Automobile Rental
Gas for Auto Rental
Registration Fees
Laundry Services (when trip exceeds 7 days)
Visa/Passport Fees
Travel reimbursement requests should be filed within 45 days from conclusion of
the trip. Reimbursement requests over 45 days can be classified as taxable
VAT Taxes
• Value Added Tax (VAT) is a national sales tax that
is levied by many countries around the world.
Most business/official related expenses including
travel expenses, do qualify for VAT refund.
• UGA uses Universal VAT Services to recover
allowable Value Added Tax commonly charged on
expenses associated with traveling abroad.
• Original invoices are required to be submitted to
Universal VAT Services for VAT reclamation.
VAT Taxes Continued
• Departments should print the VAT cover sheet at
t_coversheet.pdf for directions on submitting
invoices to UVS.
• Possibilities: Travel receipts, invoices for travel
that are being wired, p-card travel expenses.
• More info on the UGA Travel Site:
Travel Website
• Travel website has info on parking options for
ATL airport (so far only one vendor)
• Pocket guide for employee travel:
Who handles travel processing?
• Supervisor: Patricia Sims ([email protected])
• Out-of-state travel reimbursements: Westley
Bargo ([email protected])
• Instate travel reimbursements: Michelle
Green ([email protected])
Group Travel
Group Travel
• Group travel exists when a third party is being
paid for travel expenses of an employee or a paid
non-employee on official UGA business. The
documentation required to process group travel
provides the Accounts Payable and Accounting
departments with the necessary information to
complete the reporting requirements of the
• Reference Chart of Required Documentation:
Are we done yet?
A few more things!
Food Purchases
• Reference Chart for Food Purchases:
• Policy for Purchasing Food and Business Related
• Reference chart documents what funding sources
should be utilized for each purchase. If you are
purchasing food, make sure it fits into one of
these categories!
Wire Transfers
• For International Payments Only
– Bank name & address
– Account number
– Account name
– Swift code or ABA#
– Type of currency (foreign or US Dollars)
Employee/Independent Contractor
• The IRS dictates that if an individual is performing work
for UGA that is defined as an employee/employer
relationship, UGA must pay that person through Payroll
and withhold the proper taxes.
• Decision Tree:
• Call Payroll or Accounts Payable if you need assistance
with making the decision.
• If the individual has been employed at UGA before,
more than likely, they will have to be paid through
Relocation Expenses
• Training being offered on December 4th.
Contact T&D to enroll
• These expenses have the potential for
negative press if proper policy & procedure is
not adhered to.
• For questions about relocation, contact Gina
Kurtz in Accounts Payable at [email protected]
Contact Us!
• AP Website:
• Contact list of who does what:
• Accounts Payable Office:
– Phone: 706-542-2786