Post in Securing Payment from External Users Prior to Services Provided: Core Administrators Network Forum: ABRF Discussion Forums

OMB Applicability: OMB circulars do not apply when dealing with external for-profit entities, they apply to treatment of federally funded investigators within your institution, and are designed to ensure that those federally funded customers receive the lowest prices, that are strictly based upon allowable costs, for the goods/services provided. Limiting future risk: For our cores/service centers We analyze all external customers prior to initiating work and assign them a credit limit based on their assigned level of risk (low/medium/high). Based on this risk category they are given a credit limit against which they can request work. Once they reach that credit limit no further jobs are accepted from them until they pay down the Accounts Receivable with us. This enables us to limit our losses while also providing customers with some flexibility in their cash flows. We currently assign all international customers the highest risk value and require them to prepay for any and all goods services prior to providing them. This policy can be combined with the 50/40/10 billing schema that others have recommended so that those companies with lower risk profiles are still limited to a fixed amount of credit at any given time, which again will limit your exposure to losses. Collecting current accounts receivable: I highly recommend that you contact your office of general counsel, or whatever your legal department is called at your institution. The accounts receivable that you have may not be memorialized in a legal document such as a written contract, but nonetheless trade receivables are legally enforceable claims against your customer. In the past we have had to work through our general counsel when we have had large balances of receivables outstanding. We recently had to work with one customers as they went through receivership and ultimately bankruptcy, but we recovered most of the balance due, thanks to the help of our general counsel. I hope that this helps. Best, Noah Curtis, MAcc Research Business Analyst, Core Facilities Phone: (520) 621-1085 | Fax: (520) 621-7507