Introduction of Revenue Processing Policy

Background: IU processed over 750,000 payments in 2005 totaling over $1billion.

Introduction of Revenue Processing Policy Background: Over 500 organizational units and 900 individuals were involved in processing these payments

Introduction of Revenue Processing Policy Background: Payments continue to increase in volume and dollar size

Introduction of Revenue Processing Policy Background: Payments have become riskier

Introduction of Revenue Processing Policy Background: Internal Audit of Revenue Processing at Indiana University

Introduction of Revenue Processing Policy Internal Audit Finding: “Existing financial institutional policies do not adequately limit the risks of accepting and depositing revenues, provide guidance on the best methods for accepting and depositing different types of revenues, establish responsibility for monitoring revenues, or establish treasury as an approval authority for revenue acceptance and deposit processes.”

Introduction of Revenue Processing Policy Internal Audit Finding: “Current policies do not establish collection guidelines for similar types of revenue processes. Several types of operations/revenue generating processes can be grouped (system- wide) and overall best practices suggested for each. The overall goal is to reduce or eliminate cash, check, and credit card handling in units. As mentioned above, for many (non-retail) units, an ideal first step is to implement a policy that restricts the acceptance of cash.”

Introduction of Revenue Processing Policy Internal Audit Recommendation: “Establishing guidelines for the use of available payment methods and a policy requiring Treasury’s review and approval of the collection methods…”

Introduction of Revenue Processing Policy Policy VI-120 Approved July 2006

Introduction of Revenue Processing Policy Policy Objectives: Exercise operational authority over the acceptance and deposit of all payments received by Indiana University including those received at the individual department level

Introduction of Revenue Processing Policy Policy Objectives: Deliver consistency in payment types across similar revenue processes

Introduction of Revenue Processing Policy Policy Objectives: Enable operational efficiency with an optimal cost structure

Introduction of Revenue Processing Policy Policy Objectives: Capitalize on the core competency of the Office of the Treasurer relative to banking services, working capital management, credit card processing, electronic payment options and developing technology

Introduction of Revenue Processing Policy Policy Objectives: Maintain the highest level of available operational controls to reduce the possibility of fraud, loss of assets and/or loss of sensitive university data

Introduction of Revenue Processing Policy Policy Statement: Treasury will review current and proposed revenue processing activities (after compliance with Policy I-450-Establishing and Generating Revenue Producing Activity) with Campus Administration and the department to discuss current activities, proposed changes and implementation timetables, if applicable.

Introduction of Revenue Processing Policy Policy Statement: Treasury, in consultation with Campus Administration, will recommend and approve the payment method(s) based on business need. Similar revenue generating activities should have similar revenue processes whenever possible. Business needs for exceptions will be approved by Treasury, in consultation with Campus Administration.

Introduction of Revenue Processing Policy Revenue Processing Options: Electronic Transmittal Point of Purchase (POP) Accounts Receivable Conversion (ARC) Remote Check Capture WEB Payments (ACH and Credit card) IUPay BEX Credit/debit cards

Introduction of Revenue Processing Policy Revenue Processing Options: Lockboxes FMS AR Departmental lockboxes Centralized credit/debit card system Drop Box

Introduction of Revenue Processing Policy Key Principles: Electronic processing is preferred Use of cash is discouraged Separation of Duties No copies of checks No storing complete account data

Introduction of Revenue Processing Policy Policy VI-120 will be phased in over several years Training sessions will be held in connection with implementation

Treasury Resources Web Page: Newsletters are published quarterly – archives available on web Payment Card Services (812) Money Movement Services (812) Cheryl L. Shifflett, AAP, CTP (812) Ruth A. Harpool, AAP, CTP (812) Kim L. Stuart, CTP (812) W. David Newsom (812)