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NUMBER: FINA 4.13 (NEW)
SECTION: Administration and Finance
SUBJECT: Allowance for Doubtful Accounts
DATE: May 11, 2015
Policy for: All Campuses
Procedure for: All Campuses
Authorized by: Leslie Brunelli
Issued by: University Finance – Bursar’s Office
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I. Policy
In order to accurately recognize revenues on the University Financial Statements, the University
must provide for the possibility that some present and future revenues may not be collectible.
This policy will facilitate an accurate forecast of this allowance based on actual experience and
relevant data.
This policy applies to the recording of all revenue in the University’s financial records.
This policy sets forth the university system wide procedures for establishing an allowance to
handle removing uncollectable debts from university accounts. This policy also establishes the
calendar for writing off this bad debt during the fiscal year.
A. Definitions
1. In this instance “Doubtful Accounts” are defined as monies owed to the university
with low probability of repayment. This category may include, but is not limited
to tuition, fees, other charges, advances, etc.
2. The “Allowance” is a budgeted operating expense created by a
campus/department with the expectation that some doubtful accounts exist in that
department’s ledger. The required threshold for establishing an allowance is
documented below.
3. The University department/campus responsible for the billing and administration
of the accounts is the “Responsible Party” for the allowance for known or
potentially uncollectible accounts.
II. Procedure
A. The university shall calculate an allowance of non-collectability for any revenues for
which uncertainty exists about future collections. All campuses or University
departments are required to allow for the non-collectability of revenues when the
