Wire Transfers and Foreign Drafts Cash Management, October 2014

What Is the Difference between a Wire and a Draft? A wire sends money electronically to the payee’s bank account. These funds can be in U.S. or foreign currencies. Bank drafts are checks payable in a foreign currency and are mailed to the payee.

Why Does UT Austin Use Wires and Drafts? To pay a vendor per the vendor’s invoice or a contractual agreement. Cash Management transfers funds on a daily basis for current operating requirements.

Drafts

What Does a Department Need to Do in Order to Pay a Vendor by a Draft? Complete a manual State of Texas Purchase Voucher (STPV). Attach payment documentation such as invoices, APS forms, RTA forms, and any correspondence from the vendor. Two authorized signers on the department’s account must sign the STPV if the payment is $500 or more. Send the STPV and documentation to Cash Management via campus mail K5300, Attn: Maria Gettier or Steven Hollifield

What Steps Does Cash Management Take to Process a Department’s Draft Request? Verify the availability of funds on *DEFINE. If a 26-account is to be charged, then the accountant must initial the STPV. If an Authorization for Individual Services form is involved, the Office of Accounting travel section must initial the STPV. Verify departmental signatures on STPV. Review the attached invoices and/or correspondence. Obtain two authorized signatures for the UT Austin bank account. Forward the request to the banking representative for processing.

Wires

What Are the Benefits of Sending a Wire? Speed Domestic wires are received the same day the funds are sent. Foreign wires usually take between 48 and 72 hours. Relatively low cost

What Are the Different Types of Wires That Cash Management Sends? Domestic wires - paid in U.S. dollars and the destination is a U.S. bank. Foreign wires - paid in either U.S. dollars or a foreign currency and the destination is a bank located in a foreign country (outside the 50 states).

What Does a Department Need to Do in Order to Pay a Vendor by A Wire? Complete a State of Texas Purchase Voucher (STPV). Attach payment documentation such as invoices, APS forms, RTA forms and any correspondence from the vendor. Complete a Wire Transfer Instruction Form or include wire instruction documentation. Two authorized signers on the department’s account must sign the STPV if the payment is $500 or more. Send the voucher and documentation to Cash Management via campus mail K5300, Attn: Maria Gettier or Steven Hollifield.

What Information Should Be Included In the Wire Instructions? Bank name and address. For domestic wires, the ABA or routing transit number. For foreign wires, the SWIFT CODE. The vendor’s or payee’s bank account number. The vendor’s or payee’s name as it appears on the bank account. For wires to Mexico, a CLABE and Sucursal number. For wires to Brazil, contact Cash Management at for additional instructions.

What Steps Does Cash Management Do to Process a Department’s Wire Request? Verify the availability of funds on *DEFINE. If a 26-account is to be charged, then the 26 accountant must initial the STPV. If an APS form is involved, then Office of Accounting travel section must initial the STPV. Verify departmental signatures on voucher. Review the attached invoices and/or correspondence. Review the wire transfer form for pertinent wire information. Obtain two authorized signatures for the UT bank account. Forward the request to the banking desk.

What Happens After the Local Bank Accountant Receives the Wire Request? Verify the wire instructions. Determine if the wire is domestic or foreign. The wire is relayed to the bank by authorized cash management personnel. A secondary approval is required by a signer on the bank account before the bank can release it. A confirmation number is given as a reference once the bank has released the wire. This can take two-six hours.

Foreign Bank Wires Per the bank’s wire instructions, our account will be debited and the funds will be sent via SWIFT or CHIPS to the receiver’s bank. SWIFT stands for The Society for Worldwide Interbank Financial Telecommunications. It is a private electronic message transfer system. CHIPS stands for Clearing House Inter-Bank Payment System and is a computerized network for the transfer of international money. The receiver’s bank will credit the receiver’s account and send a credit advice to notify the receiver about the wire credit.

How Long Does It Take to Process a Wire After the Request is Received? The initial process of the wire is done within 48 hours of delivery to Cash Management. After the initial process, the wire request is sent to the bank within 24 hours. Note: A domestic wire is credited to the receiver’s account the same day. A foreign wire can take up to three business days. After the wire is sent by the bank, the VC1 is created and approved within 48 hours.

Rejected Wires Reasons for rejection can range from incorrect information provided for bank to the payee rejecting the wire. The bank will charge a rejection fee which varies from bank to bank. Our bank will charge a fee of $5.00. There is a cost that varies from $5.00 to $15.00 to resend the wire as when it was originally submitted (foreign or domestic). Rejected wires could end up costing your department over $ related to currency conversions and fees.

Getting It Done Helpful information for both wires and drafts.

State of Texas Purchase Order Form Forms are available on the Office of Accounting web site. Listed as the State of Texas Purchase Order Form and Wire Transfer Information Form.

UT EIDs A UT EID must be provided when submitting a wire or draft request for the individual/vendor receiving the funds. To create an EID, a GGV request should be submitted in *DEFINE. Vendor requests normally have a 24-hour turnaround time. Any questions regarding vendor numbers, contact Ramona Williams,

Object Codes It is very important to use the correct object code. Go to the GO7 screen in *DEFINE for object codes allowed on the account being charged. Use object codes authorized for a type C voucher.

Authorized Signers Any wire or draft $ or more must have two authorized signers. The signatures must be original. Use the GB1 screen in *DEFINE to determine who is an authorized signer. This screen should also be used to verify the available funds.

What Document is Done on *DEFINE to Record the Wire Transfer or Draft? After the wire is sent, a VC1 document is created by Cash Management to charge the department’s account The department’s account is charged a wire fee. Domestic wire - $9.00 Foreign wire - $15.00 Fees for Foreign Drafts are: $0-$2,999 Fee is $11.00 $3,000-$9,999 Fee is $26.00 $10,000 and over Fee is $51.00

Completed Wires & Drafts The department contact will receive an FYI copy of the VC1 document. The original records will be submitted for imaging and will be available on the system. Cash Management retains a copy of all wire/draft requests for three months or until verified on the imaging system.

Questions If you have any questions regarding wire transfers or bank drafts, please contact Cash Management. Maria Gettier Steven Hollifield