AR Credit Invoice Approvals
Cluster Director Meeting
February 28, 2012
Overview
What is a Credit Invoice?
Invoices are created in EFS when goods or services are sold and payment is
not collected at the time of the sale. If an invoice contains errors or goods are
returned, a credit must be completed in the financial system.
Why do Credit Invoices need Approval?
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Credit invoices are considered non-cash adjustments; they reduce the money
owed to the University.
An Internal Audit recommendation states an approval should be required on all
non-cash adjustments.
By requiring review and approval for all significant financial transactions in the
financial system, the University can ensure it’s guiding principles are followed
and enforced.
Credit Adjustment - Actions
• Credit Only Adjustment
• Credit and Rebill Adjustment
• Chartstring Correction
Credit Adjustment - Actions
• Credit Only Adjustment
– A credit only adjustment is created when a
customer should receive a full credit and
no rebill will be created.
An example would be if the customer
received a duplicate invoice.
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Note: Adjustments related to payment issues (i.e., write-offs) should be handled
by AR Services and should not be credited through this process.
Credit Adjustment - Actions
• Credit and Rebill Adjustment
– Customer invoices that are in error or need
to be partially credited should be credited
in their entirety and rebilled with the
corrected/updated information.
Examples would be incorrect pricing or
returned/damaged merchandise.
Credit Adjustment - Actions
• Chartstring Correction
– Invoices that are in error due to incorrect
Chartstrings should be credited in their
entirety and rebilled with the corrected
Chartstring. This procedure should be
followed regardless if the original invoice
has been paid.
Credit Adjustment - Process
Credit Adjustment - Entry
The Billing Specialist enters the credit invoice and assigns an
approver using the Adjust Entire Bill page in EFS.
Approval Process
Once the Billing Specialist has entered the Credit Invoice and
corresponding Rebill (if applicable) in Pending Status, an email is sent
to the Approver
Approval Process
The approver:
• Retrieves the transaction
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Reviews any attachments
Reviews justification on credit invoice
Reviews rebill if applicable
Approves the transaction
Roll-Out Strategy
AR Services
• Work with Training Services to
– Develop on-line Approver Training Course
– Develop Approver Job Aid
– Update Billing Specialist Job Aid
– Update Create Bills Manual
• Communicate change to Billing Specialists
• Create Credit Request Form and have it added to the Forms
Library
• Add Credit Invoice Approver Role to EFS Access Request form
Roll-Out Strategy
Cluster Directors
• Determine approver(s) in each cluster
• Communicate change to Billing Specialists and Department
Initiators
Approvers
• Take Approver training and complete assessment by April 20th
Revised Date – April 19th
(training is scheduled to be available 04/01) Revised DateMarch 30th
• Complete EFS Access Request Form to gain access to Credit
Invoice Approver Role Revised – for initial roll-out no Access
Request Form is necessary, forward names to Michelle Howard
at howar073@umn.edu
Who should Approve the Credit Invoice
Transaction?
Recommendation:
– Cluster Director should act as designated approver of the
transaction within EFS, but require that the Credit/Credit
Rebill Request Form be completed and attached. The Credit
Request Form should include the departmental approver’s
signature.
Rationale
– This will allow the Cluster Director visibility into the number
of credits and the reason for credits created within their
cluster. It will help the Cluster Director assess where there
may underlying problems related to invoicing.
Questions?