Procedure No. 6100 Management Support I. Revenue Collection Revenues from Local, State and Federal Sources Collection of receipts shall be promptly recorded in the school district s point of sale (POS) receipting system. SPS schools and departments providing goods or services without prepayment shall follow the basic processes of accounts receivable, to include creating/recording the transaction, producing an invoice, receiving payments, collections and write offs: A. Goods and / or Services Provided by the District 1. Payment is due at the time goods or services are provided, whenever possible, to limit the creation of accounts receivable. When payment is not made at the time of service, an invoice will be sent to customers beginning with the first month of activity and continuing until the account is paid in full. 2. If payment is not received from the original invoice notification, accounts will be aged monthly and appropriate action will be taken on all accounts as follows: 0-60 Days past due: Billing statements sent. 61-90 Days past due: 1st demand letter sent: Customer is notified, payment plan is established. (Click here to view 1st demand letter.) http://www.spokaneschools.org/cms/lib/wa01000970/centricity/domain/607/_files/budget_acco unting/dishonored_check-_general_letter-enabled.pdf 91-120 Days past due: 2nd demand letter sent; holds placed on account activity. 120+ Days past due: Final demand letter sent. Contract payments negotiated for settlement amount. (Click here to view final demand letter.) http://www.spokaneschools.org/cms/lib/wa01000970/centricity/domain/607/_files/budget_acco unting/12-0004_dc-finalnotice.pdf If no response to final demand letter, small balance accounts are presented to the Chief Financial Officer for write-off status. Larger accounts are sent to outside collection agency. B. Dishonored Checks 1. Dishonored checks are checks returned by the drawee bank for which there are insufficient funds to cover the amount of the check. 2. All returned items are automatically resubmitted by the bank for deposit. 3. Checks returned to the bank of deposit for a second time are charged to the revolving account and sent to the cashier in accounting. A reasonable charge as established by procedure 3340 not to exceed the maximum allowed by law may be assessed for each instrument not accepted for payment by the drawee bank Page 1 of 6
designated on the instrument. The returned check fee may be waived by the Chief Financial Officer in the event the check was returned due to an error by the district or by proof of fraudulent activity on the maker s account. 4. The Accounting Department will charge the school/location/department's revenue account, if known, or the location principal's office for the returned item. i. The cashier(s) will notify the school/location/department of the returned item and the dollar amount charged. ii. The cashier(s) will send a photocopy of the item to the location. iii. The cashier(s) will keep the original returned item until the maker has paid the district for the returned item or the item is sent to a collection agency. iv. It is up to the school/location/department to coordinate collection efforts with the cashier(s). C. Controls to Reduce Loss Due to Dishonored Checks 1. Checks are to be deposited timely to minimize the risk of loss. 2. The central cashier will record dishonored checks and the applicable NSF fee in the POS cashiering system upon notification by the bank. All schools/locations can view outstanding items in the POS cashiering system. i. The returned item and associated fee becomes an outstanding fine until paid or cleared. ii. Payment by check should not be accepted from students or patrons with two or more dishonored checks outstanding. C. Collecting Funds on Dishonored Checks 1. The school/location/department will send the dishonored check letter (dishonored letter 1) to the makers of the dishonored checks. The letter will inform the maker of the outstanding fine to include the face amount of the check, the dishonored check fee, and ask that the check(s) be paid with cash, money order, or cashier's check within 15 days of the date of the letter. 2. Payment by the maker of a dishonored check: i. The maker may pay the face amount of the dishonored check and the applicable dishonored check fee at any school or district cashiering location. ii. Express payments are only accepted at the district cashier's office. iii. The Returned Check Collection Recovery Checklist (RCCRC) is used to record collection efforts for returned items. When payment is received at a school / department / location, the location cashier should record the payment on the RCCRC and send the completed checklist to the district cashier. The dishonored check fee will be posted to the dishonored check fee account (4296) in the general fund, and the dishonored check fee revenue will be recorded as revenue to the school / location/ department where the dishonored item originated. Page 2 of 6
iv. Upon notification from the school / location / department of the payment, the district cashier will clear the item from the POS. v. The district cashier will return a copy of the dishonored instrument to the maker upon request; otherwise it will be destroyed. vi. If payment is made at the district cashier s office, the individual s account will be updated in the POS system to reflect the payment. vii. Payment refunds due for other accounts may be applied to outstanding dishonored check fines. The district will notify the maker by receipt when an outstanding refund is applied to an outstanding NSF fine. 3. School / location / departments follow the steps in the RCCRC for the collection of dishonored items. If no payment is received after 30 days from the date of the letter, a second letter is sent. If payment is not received within 30 days of the second notice, the RCCRC and supporting documentation is sent to the district cashier for further collection processing. E. Past Due and Delinquent Accounts for Goods and/or Services Rendered F. Collection 1. The individual school / location / department is responsible for pursuing delinquent and past due accounts. 2. Accounts with unpaid balances from 1 to 90 days past the due date are considered past due. 3. School locations are to send a minimum of two Outstanding Fees / Fines Letters per school year to students with outstanding fees / fines. Follow-up letters shall be sent until full payment is received or until the student graduates or leaves SPS. 4. Other departments shall issue a minimum of two reminder notices between 30 and 90 days after the account becomes past due. These notices shall request immediate payment of the outstanding balance and notify the debtor of pending action if the debt is unpaid. 5. Accounts with balances more than 90 days past the due date are considered delinquent and are subject to collection procedures below. Once an account is 90 days or more past due and appropriate past due notices have been sent and the dollar amount is at least $100, outside collection may be pursued. The collection agency will add collection fees to the amount due to the district in accordance with the applicable fees in the collection agency's contract, and in accordance with state laws/regulations. If possible, account payments will be negotiated internally. It is advantageous to pursue collection in-house, thereby maximizing return. A lump-sum settlement or payment plan may be negotiated with the debtor and the district Chief Financial Officer, with any unpaid balance written off. G. Write Off Criteria Page 3 of 6
1. If, after nine months, the collection agency is unsuccessful in their efforts to collect the account, the account will be considered uncollectible and a recommendation to the district for write off will be proposed. 2. Receivables may be written off when the following criteria have been satisfied in conjunction with collection procedures. i. The debtor or the debtor's assets cannot be located; ii. The debtor has no assets and no expectations of having any in the future; iii. The debt is disputed and the district has insufficient documentation to pursue collection efforts; iv. The debt is discharged in bankruptcy and there is no guarantor or successor; v. The debtor has died and there is no successor or guarantor; vi. The amount of the debt is insufficient to justify additional collection efforts. 3. Management will review all write offs in accordance with the following guidelines. The review will include the collection procedures followed and the reasons the accounts are considered not collectible. This procedure is done annually, after yearend close. i. Under $100: The department director will review. The Chief Financial Officer will have final approval; ii. From $100 - $2000: The department director will review. The Chief Financial Officer will approve and route to the Associate Superintendent, School Support Services for final approval; iii. Over $2000: The department director will review and provide list to the Chief Financial Officer, who will approve and route to the Associate Superintendent, School Support Services for approval, who will submit a consent agenda item to the School Board for final approval. The consent agenda item will also include an information report on administrative write-offs approved during the year. 4. After Administrative approval, the district cashier clears the item from POS cashiering system and enters a write-off notation in the customer s account. Subsequent collection on account write-offs will be recorded as miscellaneous revenue. 5. After board approval, the district cashier writes off uncollectible receivables against the applicable income account. II. Federal Title I Program Controls: A. All Title I funded purchases and expenditures will be directly related to allowable Title I activities and services that are necessary to effectively carry out the objectives of the current program, and for the benefit of eligible participants; Page 4 of 6
B. Title I purchases and expenditures will be restricted to those incurred by persons with direct Title 1 duties and responsibilities and/or which benefit only eligible Title I participants; C. Title I funded in-service trainings will be directly related to specific Title I program activities and provided only to persons with Title 1 program responsibilities and duties; and D. Appropriate documentation of all Title I purchases and expenditures incurred will be maintained for accountability and audit purposes. III. Federal Impact Funds (Indian Education) Program Controls At a board meeting preceding the submission of the P.L. 81-874 application, the board will review the application and input provided by tribal officials and the parents of Indian children. Notice of the meeting location, time and topic(s) related to the district's P.L. 81-874 application will be printed in the local newspaper. The district will form a parent-teacher task force to involve tribal officials and parents of Indian children in the planning and development of education programs assisted with the district's P.L. 81-874 funds. The task force will also assess the efficacy of the district's efforts to obtain meaningful input from tribal officials and parents of Indian children, and the responsiveness of the district in modifying its policies and procedures following input. The task force will report its findings and recommendations to the board at a public hearing at least once per year. Following a conclusion by the board that such an action is necessary, the district will form an ad hoc task force to recommend to the board a modified educational program to ensure the equal participation of Indian children. The task force will report its recommendations to the board in a public hearing. The district will also conduct planning and information sessions during the year. All parents of Indian students and representatives of the tribal council will be invited to attend these meetings. At these sessions, the district may: A. Review the annual descriptive guide of the district; B. Explain how Indian students gain access to and are served by the district's education programs, and how educational programs are modified to ensure equal opportunity and participation by Indian students; C. Review the identified needs of the district with particular attention directed towards assessing the needs of Indian students; and D. Discuss proposed programs and services, as recommended by the task force, which are being considered to satisfy the stated needs and the extent to which Indian students are expected to be served. Parents of Indian students and members of the tribal council will be advised of the Federal Impact Funds policy and procedure. Expressions of concerns and/or suggestions regarding the policies/procedures of the district are welcome. Any parent of Indian students or a member of the council may file a complaint regarding the application of P.L.81-874 funds with the district. Said complaint should be submitted in writing to the superintendent of schools. Any complaint not satisfactorily resolved may be submitted in writing to the board of directors of the district. The board may elect to respond in writing to the complaint or hold an Page 5 of 6
informal hearing with the complainant(s). A decision will be rendered within twenty (20) working days following submittal of the complaint to the board. Legal references: RCW 62A.3 Negotiable Instruments Adopted: 12/17/2014 Amended: Superintendent Dr. Shelley K. Redinger Page 6 of 6