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FISCAL MANAGEMENT OPERATIONS GUIDE

Write-Off of Accounts Receivable

Student Loan Receivables

UTSA offers two short-term 90-day loan programs: 1) Tuition & fees and 2) a $300 cash loan.  Each year an allowance for doubtful accounts is recorded for loans deemed likely to remain unpaid. Based on a five-year average of allowances to actual write-offs, the proper allowance has been determined to approximate 65% of all loan principal greater than one year past due.

Additionally, each year UTSA will write-off those delinquent loans which are greater than two years past due and have had no payments for at least six months. While a hold will remain on the student's account, these written-off loans will no longer be carried as a UTSA accounts receivable.

Payment received for written-off loans must have interest and late fees calculated manually. Principal payments are applied to the appropriate account using the write-off object code (7277), rather than the loans-paid object code (5345).

Student Tuition and Fee Receivables

Student tuition and fees balances are recorded on the UTSA student information system, BANNER, at the time of registration. Annually, those tuition and fees receivables that are past due greater than two years and whose accounts have had no activity for six months are written-off.  While a hold will remain on the student's account, these written-off tuition and fees will no longer be carried as a UTSA accounts receivable.

The allowance is recorded by calculating the percentage written off against the total accounts receivable balance from the prior year.  The prior year is the basis for the write-off amounts in the current year. That percentage is then applied against the current year's receivable balance per the aging report. The amount calculated is the amount of the allowance, allocated to the different funds based on the allocation of the mandatory fees for that fiscal year.

Allowance for bad debt (by fund) = CY AR balance after WO x (CY WO / PY AR Bal after WO)

Payment received for written-off tuition and fees are applied to the student account by use of a single Banner detail code that posts to the A/R Write-off Clearing Account and is allocated monthly to the allowance accounts in the same percentage as was used on that year’s write-off.

Student 3rd Party Receivables

Students whose tuition and fees are to be paid by a third party sponsor should submit the proper authorization documentation to the Office of Fiscal Services and University Bursar after registration is complete. Office of Fiscal Services and University Bursar will apply the approved amounts to the student's tuition and fee balance and submit a bill to the sponsor designated on the documentation.

Rather than a direct write-off from the 3rd party receivable account, balances unpaid by the sponsor at the end of the long semester following the billing semester are transferred to the affected student's BANNER account and, if unpaid, are then written-off in accordance with the Tuition and Fees Receivable write-off procedures.

Miscellaneous Invoice Receivables

The Office of Financial Services and University Bursar receives requests from various departments within the University to invoice individuals and businesses. The requests include charges for Facility Reservations, Auxiliary Services, or other miscellaneous services provided by the University.

Miscellaneous invoices that do not have any activity over one year as of August 31st are written off and recorded in DEFINE by Accounting Services. The invoices are written off against the allowance account.  If an invoice begins having activity after it is written-off, then the write-off is reversed.

Every year, the allowance is adjusted based on a calculation. The current year's allowance is calculated by estimating the total outstanding amount for the next year that will be written-off.  The adjustment to the allowance is then recorded in DEFINE.  The calculation of the allowance for bad debt is based on the following formula: 

Allowance for bad debt (by fund) = CY AR balance after WO x (CY WO / PY AR Bal after WO)