Please visit Collection Procedures for Student Receivables Procedures to review the procedures. Further questions may be directed to the Bursar’s Office at 501-916-3450.
|University of Arkansas at Little Rock|
|Policy Name: Collections, Write-Offs, and Allowance of Accounts Receivables|
|Policy Number: 303.7|
|Effective Date: April 1, 2021|
|Most Recent Review Date: April 1, 2021|
POLICY STATEMENT: This policy provides guidance for the collection, write-off, and allowance of receivables and applies to the University’s portfolio of student accounts and non-student miscellaneous receivables. Grant receivables are not addressed in this policy.
UA Little Rock Administration Policy – Collections, Write-offs, and Allowance of Accounts Receivables – establishes guidelines for the collection of receivables/debt owed to the University. Such receivables arise from circumstances including, but not limited to, educational expenses such as tuition and fees, campus living charges, or miscellaneous charges (health services, tickets, fines, bookstore charges, etc.). This university policy supplements, but does not supersede, the University of Arkansas System Policy 360.1 “Delinquent Accounts and Collections” found at the following link: UASP 360.1, Delinquent Accounts and Collections.
A receivable becomes past due if payment is not received by the payment due date. A concerted effort should be made to collect accounts, including the current amount due applicable to installment payments. Collection actions may include but are not limited to: sending additional notices, making phone calls, and referring the account to an outside collection agency and/or State of Arkansas Individual Income Tax Setoff Program (Debt Set-Off). Any efforts to collect overdue accounts receivable performed by University employees must be documented. These efforts must be conducted according to the provisions of the Federal Fair Debt Collection Practices Act.
If a student debt arises, standard collection practices of the Bursar’s Office will be followed. Please see the accompanying “Collection Procedures for Student Receivables.”
Write-Offs of Uncollectible Accounts
While routinely executing collection procedures, some receivables will be determined to be uncollectible. Accounts deemed uncollectible must be submitted to the Chief Fiscal Officer of the State (Arkansas Department of Finance and Administration) for abatement pursuant to Ark. Code Ann. § 19-2-306.
The State’s Chief Fiscal Officer will notify the University in writing when the request for abatement is approved. Upon approval from the State, the balance owed is removed from the debtor’s account, and the account will be flagged with a “Doubtful” hold.
Bad Debt and Allowance for Doubtful Accounts
The process of calculating the estimate for uncollectible balances requires a rational estimate that follows Generally Accepted Accounting Principles (GAAP). At the end of each fiscal year, an allowance for doubtful accounts will be calculated based on various percentage rates of aged receivables. The calculation will be evaluated each year by the Vice Chancellor of Finance and Administration, Associate Vice Chancellor of Finance and Administration, Bursar, and the Director of Financial Services to ensure the calculation method produces a “net receivable” balance that is deemed collectible. The formula used in the calculation will be adjusted, when needed, to assure accountable amounts are included in the university’s financial statements.
Source: UA System Policy 360.1
Approved By: Christina Drale, Chancellor
Originator: Vice Chancellor for Finance and Administration
Custodian: Bursar’s Office