Procedure Number: 5.3.8-P
Current Effective Date: 06/01/2018
Original Effective Date: 07/01/2009
Revision Dates: 07/01/2009, 07/01/2013, 09/01/2017
Revision Number: 3
Responsible Official: System Director of Treasury Management
To provide guidance on accounts receivable.
This procedure applies to all KCTCS business units.
Receivables are maintained in two separate PeopleSoft modules (Student Financials and Accounts Receivable) and an external module that interfaces with the General Ledger (Campus CE).
- Anytime a service is rendered and payment is not received for that service, accounts receivable should be utilized.
- Student Financials is for student tuition and fees.
- Accounts Receivables is used for non-student items such as facility rental, catering or services for businesses.
- Campus CE is used for non-credit and community courses.
When the receivables modules are used, accounts receivable is debited and a revenue account is credited.
- When payment is received, cash is debited and the receivable is credited.
Due to segregation of duties, the individuals who do the billing cannot perform collection processes.
- See Business Procedure 5.3.7-P (Revenue Invoicing) and 5.1.7-P (Internal Controls).
Collections of accounts receivable are the responsibility of the unit that issues the invoice.
- Diligent efforts should be made to collect payment.
- The college business office should run the aging report to review and verify unpaid amounts.
- The aging report should be compared to the general ledger balance monthly to ensure the module is in balance.
- A reconciliation between Campus CE and the general ledger should be prepared monthly and emailed to KCTCS Financial Services.
4. Aging of Receivables
At December 31 and June 30 of each year, receivables that are 180 days past due are considered uncollectible.
An entry is recorded to debit bad debt expense and credit the allowance for doubtful accounts.
Uncollected receivables are written off after one year.
An additional entry is made by KCTCS Office of General Accounting Services at 6/30 to align the bad debt expense and allowance for doubtful accounts using a three-year history average.
After attempting to collect a receivable that is more than 90 days old, each college decides whether to forward the receivable to a collection agency.
- See Business Procedure 5.7.4-P (Collection of Accounts Receivable) for additional information.
- 12000 Accounts Receivable (Non-Student)
- 12010 Workforce Solutions Accounts Rec
- 12100 Student Receivables
- 12300 Allowance for Doubtful Accounts (System Office use only)
- 12305 Allow Doubt Acct – new method (System Office use only)
- 12310 Allowance Doubt Acct-Non-Student (System Office use only)
- 51022 Bad Debt Expense – Student (System Office use only)
- 51023 Bad Debt Expense – Non-Student (System Office use only)
- 51024 Bad Debt Expense – new method (System Office use only)