DESCRIPTION

Receivables from External Sources usually involve departmental sales and services made on a credit basis to sources outside of the University. The selling department is required to absorb any collection costs and the write-off of the receivable balance in case the amount is determined to be uncollectable.

Credit sales to persons or businesses outside the University should be limited to sales with a value of more than $25 and restricted to good credit risks only. The costs of preparing such billings, of mailing further billings and follow-ups if payment is not received, and of maintaining the account records are considerable so that they make the billing of lesser amounts uneconomical. Budgetary Units that believe that they must bill for smaller amounts should be prepared to bear the full cost of such credit sales. The use of the cash-sales-only policy for such small amounts is urged.

Delinquent accounts of outside sources are systematically turned over to collection agencies, and court proceedings are used if the collection efforts are not successful.