ROWAN UNIVERSITY POLICY 

Title: AP General Payment Policy (previously called Invoice Processing and Disbursements)
Subject: Accounts Payable
Policy No: FIN: 2014:05
Applies: University-Wide
Issuing Authority: President
Responsible Officer: Senior Vice President for Finance and CFO
Adopted: 01/24/2010
Last Revision: 08/02/2016
Last Reviewed: 08/02/2016

I.  PURPOSE

This policy seeks to promote fiscal control, timely and accurate disbursement of funds for external purchases and reimbursements, and compliance with state and federal regulations.
This policy also provides guidance governing all payment and disbursements of University funds, except those for salaries and wages.

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This policy is applicable to all employees, students, vendors and guests seeking reimbursement for necessary and reasonable non-compensation business expenses. This policy also affects every individual who reviews, approves, or records financial transactions on behalf of the University.

IV.  DEFINITIONS

1. Allowable expense: A necessary, reasonable, and appropriate expense incurred for the primary benefit of University business and, therefore, permitted to be reimbursed or directly charged based on the permission of the University.
2. Approver: An individual responsible for confirming transactions are appropriate, compliant with policies, and approved in a timely manner.
3. Appropriate expense: An expense that is suitable or fitting for a particular valid business purpose.
4. Automated Clearing House (ACH): A Federal Reserve Bank or private financial institution acting as a clearinghouse for direct deposit or fund transfer transactions. Entries are received and transmitted by the ACH under the rules of the association.
5. Department Chair or Head: An individual who is a department chair, department head, or office head.
6. Generally Accepted Accounting Principles (GAAP): Fundamental principles of accounting that are used as guidance in the preparation of the University financial statements.
7. Independent contractor: For purposes of this policy, an independent contractor is an individual who provides services to Rowan University and is not an employee. Therefore, the worker should be paid under a 1099 (and not a W-2).
8. Invoice: A document that itemizes a transaction between the buyer and a seller, the document represents an asset of the issuer and a liability of the customer. For the purpose of this policy, Accounts Payable Department requires this document for payment.
9. Miscellaneous Disbursement Vouchers (MDV): MDV's are used to generate disbursements and reimbursements for minor out-of-pocket expenses (generally $500 or less). Examples of reimbursements made to employees / students: minor purchases, memberships, registrations, subscriptions and license renewals. Finance Division administrative payments are also authorized on this form. Additionally, all types of renewals up to $2,500 can be paid on the Miscellaneous Disbursement Voucher.
10. Necessary: Minimum purchase or service required to achieve a particular business objective.
11. Original Receipt: The original receipt or invoice issued by the supplier or service provider to document and substantiate the business transaction. If the paper receipt is missing and/or destroyed, a digital image of the original receipt may be allowable provided that it is legible.
12. Purchase Order: The University's preferred method of purchasing goods and services. A Purchase Order is a document issued by the University and serves as a commitment to purchase the goods or services. Purchase Orders are issued by buyers to sellers listing prices, quantities, and types of products or services looking to be purchased.
13. Reasonable Expense: An expense that is not extreme or excessive, but ordinary; it reflects a practical decision to incur the expense on behalf of University business.
14. Requisition: The electronic request for the purchase of goods and service; or an individual requesting payment of a transaction as permitted within this policy. These electronic requests are converted to purchase orders by the Contracting and Procurement department.
15. Substantiation: Incurred Requisitions, Miscellaneous Disbursement Vouchers and Travel Expenses must be substantiated with documentation to support the payment. All payments must include the original receipts, documentation of business purpose, names of attendees, and the appropriate expense report for the incurred cost.

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