THE UNIVERSITY OF MANCHESTER

CREDIT CONTROL PROCEDURAL MANAGEMENT

INTRODUCTION
The University of Manchester is becoming increasingly dependant on diversifying its
income sources and thus a credit control policy of effective procedures within a clear
procedural framework is required to prevent unauthorised risks being taken with the
University’s resources.
Overseas opportunities have provided an area of expansion for the University over the
last few years. It is important that University staff are aware and are capable of managing
the risk associated with trading in overseas markets.
Effective credit control maximises the cash flows from each area of the business and
minimises the risk to the University of bad debt. It is vital that all decision makers in the
organisation are aware of the importance of cash management and fully co-operate with
Finance Directorate staff who manage the administrative process.

1. GENERAL INFORMATION
1.1. Payment Methods
1.1.1. The following payment methods are available:
• Cash
• Cheque (made payable to The University of Manchester)
• Bank Transfer
• By instalments via a direct debit
• Credit Card
• Debit Card
• Travellers Cheques
• Postal Orders
• International Money Orders
• Student Loan Company
1.2. University standard terms and conditions apply. Invoices are due for payment on
or before 30 days after the invoice date.
1.3. All forms relating to the credit control process are available electronically on
request from the Commercial Credit Control Office (room G18) in the John
Owens building on Oxford Road (extension 52451).

2. SOLICITORS
2.1. As part of our rigorous procedures we have engaged specialist debt collection
solicitors to pursue old debts on our behalf. The University reserves the right to
pass matters into their hands when debts hit a certain age and all other issues
have been taken into account as determined by this paper. Their remit is to use
the legal system to contact debtors and pursue enforcement.

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3. NEW ACCOUNTS
3.1. Prior to submission of a new customer account request the Faculty / School must
contact the Commercial Credit Control Team to ensure the customer does not
already exist on the system. All new customers of the University must have
relevant credit checks carried out prior to contracts being signed and work being
undertaken by University staff. These forms are available electronically from the
Commercial Credit Control Team (see point 1.3 above).
3.2. If any part of the credit application process is incomplete the credit authorisation
form will be returned to the originating Faculty / School for correction and re-
submission – the account will not be set up until all relevant documents have
been correctly submitted. Once all the relevant documentation has been
completed correctly and received in Finance this will then form the basis of the
credit checks carried out within the Directorate. Finance staff will provide a
go/no go advice based on evidence obtained within 48 hours of receipt of the
completed documentation.

4. INVOICING
4.1. Sales invoices should not be raised until the work contracted has been completed,
unless the contract allows otherwise.
4.2. Any invoice that has been raised without compliance to the University’s new
accounts process (see 3 above) and remains unpaid after it becomes 150 days
overdue will be charged back to the Faculty / School who raised the original
invoice.

5. TERMS OF TRADE
5.1. The University’s standard terms and conditions state that payment terms for all
invoices is on or before 30 days after invoice date. Exceptions to this must be
agreed in writing in advance with the University’s Director of Finance via the
Exchequer Accountant.
5.2. The Commercial Credit Control Team chase debts on behalf of the University
with reference to the normal collection and follow up cycle which prompts
controllers to phone and write to customers in line with predetermined credit
timetables.
5.3. Sending reminders to commercial debtors is the sole responsibility of the
Commercial Credit Control Team within the Directorate of Finance. This will
consist of a time defined dunning process and responses from the individual
debtor.
5.4. In exceptional circumstances individual arrangements for repayment of debt
might be allowed. This must be agreed in writing with the University’s Director
of Finance via the Exchequer Accountant.

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6. DEBT WRITE OFF AUTHORITY LIMITS
6.1. The limits for write off of The University’s debt are as follows;
6.1.1. Invoices up to £50.00 Exchequer Accountant.
6.1.2. Invoices £50.01 to £500.00 Assistant Director of Finance.
6.1.3. Invoices £500.01 to £5000.00 Director of Finance.
6.1.4. Invoices over £5000.01 Finance Committee.

7. CATEGORIES OF DEBT
7.1. This will include debts arising in respect of:
• commercial debt (excluding research)
• research
• sponsored students
• self funded students
• conferences activity
7.2. Due care should be taken when entering into contracts with external bodies -
advice and support with negotiation can be provided by the University’s
Corporate Services Division.

8. RESEARCH
8.1. There are exceptions to the above rules in respect of research projects. If a new
project is identified by the research teams and a contract / grant is put in place
then all the paperwork is passed to the Research Office who will open the
research nominal code - this will then be passed to the Research Accountant in
the Faculty Liaison Team for inclusion within the accounting system.
8.2. The nature of some of the contracts relating to research will by default give rise
to circumstances where the standard University payment terms are not applicable
as the terms of the contract will lay down the collection timetables depending on
the project and sponsor. The main types of settlement for research projects are as
follows:
8.2.1. Standard claims – the sponsor will pay set amounts on specified dates that
could be quarterly, half yearly or even annually
8.2.2. Profiled payments – standard payments will be made quarterly and full
settlement will be paid at the end of the contract when the University will
prepare and submit a reconciliation of the project costs
8.2.3. Milestone payments – the University will receive funds when certain
“milestones” have been reached e.g. in clinical trials where X number of
patients have been treated
8.3. Please note that ALL research related debtor referrals must in the first instance be
reviewed by the Central Research Accountant based in the Finance Directorate.
These debts will then be followed up by credit control in line with any
recommendations received from the Central Research Accountant.

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 8.4. Research debt that remains unpaid because it has been invoiced without due
regard to contractual obligations will be cancelled and charged back to the
original research code.

9. STUDENT DEBT
9.1. Tuition Fees
9.1.1. The Policy for individual students details the arrangements for the payment
of fees and the sanctions, which may be applied in the event of non-payment
of fees by the due date. The Policy is designed to ensure that all students are
treated in a fair and equitable manner with respect to the payment of fees.
9.1.2. The Policy applies to all students – including part-time, full-time,
undergraduate, postgraduate, home and overseas students.
9.1.3. ‘Students’ are defined as persons registered or enrolled at the University to
follow a programme of study, which may or may not lead to an award or
qualification. If a student leaves the University with outstanding debts, then
the University reserves the right to pursue payment of the outstanding debt.
9.1.4. Students are responsible for paying all fees incurred whilst studying at the
University.

10. INVOICING
10.1. All invoicing of student tuition fees will be done by the Student Services Centre
or Manchester Business School. All required student details will be taken at
registration and invoices will be raised before 1st December. The payment
methods available to the students are:
10.1.1. Pay in full at registration – this will entitle them to a discount.
10.1.2. Sponsorships – an external sponsor has agreed to pay tuition fees on behalf
of a student.
10.1.3. Instalments – if students decide to pay by instalment then the fees invoice
will be split into three with predefined payment criteria attached to each
element. The first instalment MUST be paid at registration the remaining
two payments MUST be set up on direct debit to be collected at the
beginning of December and the beginning of the following March; this
direct debit should remain in place for the entire programme of study.
Students who default on instalment payments will be invited to interview by
the Student Debt Collection Team – The University reserves the right to
demand immediate payment of all outstanding money owed. In exceptional
circumstances individual arrangements for repayment of debt might be
allowed. This must be agreed in writing with the University’s Director of
Finance via the Exchequer Accountant.
10.1.4. Payment by the Student Loan Company.

11. FOLLOW UP

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 11.1. Once an invoice has been raised the collection of the debt becomes the
responsibility of the Finance Directorate. Student credit control services are
provided by the Student Debt Collection Team.
11.2. Late payment of fee instalments will incur a charge of £25. If the instalment
remains outstanding after 1 month this will rise to £50.
11.3. Limited hardship funds are available and the Student Services Centre provides
financial advice and counselling to students with difficulties. Non payment of
fees will see the student included on a stop list which will prevent re-registration
and / or graduation until the outstanding balance is settled.

12. PAYMENT BY A SPONSOR

12.1. Some students have agreements with a sponsor to pay their tuition fees. In the
event that a sponsor defaults on payment, the student will not normally be
entitled to complete the course of study unless an alternative source of funding is
identified. The individual student will be encouraged to discuss the issue with the
Student Services Centre. However the Executive may waive this sanction if they
agree that extenuating circumstances apply.

13. EARLY WITHDRAWAL FROM THE UNIVERSITY

13.1. In the event of a student withdrawing themselves from a programme of study; the
date of withdrawal will be the date from which the student formally advises the
University in writing that they are no longer attending their course of study. This
date MUST be confirmed in writing by the relevant School to Student Services.
13.2. The calculation for any reduction in fees is done on a number of day’s basis with
reference to the actual days a student has been at the University against the total
days allocated to the course. This applies to all students and their sponsors.

14. STUDENT ACCOMODATION DEBT

14.1. This is dealt with in the same way as the student fee debt except that the support
here is given by the Halls staff who will be the first point of contact for students
that may have financial difficulties. The Hall staff will monitor report on and
keep the finance Student Debt Collection Team informed of all actions taken.
The debt will be passed to the Student Debt Collection Team for collection if it
becomes 150 days overdue.
14.2. The implementation of the new finance system (1st June 2006) will assist the
student credit control process as it is intended to have one customer record for a
student in order to allow staff to see the total debt owed by a student on one
system; this will allow the Student Debt Collection Team to have a greater
degree of control over the total student debt.

15. MANCHESTER CONFERENCE CENTRE

15.1. When a new customer wants to book a conference the Manchester Conference
Centre send out a contract and credit application form that the client completes

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 and returns to the Commercial Credit Control office. The Commercial Team will
credit check the application and make a decision on the credit worthiness of the
client – this will form the basis of the client invoice / payment arrangements. If
the client passes credit check then they will be invoiced by Manchester
Conference Centre for the event and will pay in line with the University’s normal
terms and conditions. If they fail the check then all monies will be required to be
paid prior to the event taking place.
15.2. All private events held at the Manchester Conference Centre, for example
weddings, must be paid in full prior to the date of the booking.

Issued by: Steve Scott 1st February 2006