Policy
FIACCT 05-02_00 Payments – Proper review and approval of FINET payments
Effective: May 1, 2010
Revised: July 1, 2018
Reviewed: July 1, 2018
Purpose
This policy outlines the responsibilities of those who review and approve FINET payments.
Policy
The proper review and approval of FINET payments plays a critical role in the internal control procedures
designed to safeguard funds expended by state agencies.
State agencies are responsible to ensure that any payments they make are:
For goods or services that have been properly authorized and received by the State;
Properly accounted for in FINET;
Properly coded;
In accordance with State Purchasing rules and policies;
Paid to the correct vendor or individual;
Paid for the correct amount.
Procedures
A. Open up the document in FINET and look at the information online. Don’t rely on the hard copy of the document as the information in the online version may have changed since the hard copy was printed.
B. Make sure the supporting documentation for each payment includes an original receipt/invoice detailing the name and address of the vendor, items purchased, unit and total cost, and date of purchase. If the purchase is made online or if the vendor does not provide a paper invoice, a printout of an electronic or faxed invoice or an electronic file of the invoice should be used. For purposes of this policy, ‘original receipt/invoice’ includes any hardcopy original, or a faxed or scanned receipt/invoice received directly from a vendor. When departments scan their supporting documents and then destroy those documents, departmental policy should be clear that only original receipts/invoices are scanned.
C. Verify that purchasing policies were followed to procure the goods or services and, if paying under a contract, verify that the correct contract number is referenced on either a PRC or a GMA payment document.
D. Verify that the goods or services were actually received. The receiving document (e.g. packing slip provided by the vendor, invoice, or other supporting documentation) should be signed and dated indicating when the goods or services are received.
E. Appropriate agency staff should indicate in writing that the bill is ready for payment.
F. When paying bills close to fiscal year end, make sure the expenditure is recorded in the fiscal year that the goods or services were received.
G. Verify that a miscellaneous vendor number is not used unless absolutely necessary. Using a miscellaneous vendor number increases the risk that the payment will go to an incorrect vendor, that an invoice could be paid twice, or that the vendor’s taxable income will not be properly reported to the IRS.
H. Verify that the vendor name and address agree to the information on the vendor invoice. Verify that the vendor invoice number, including the vendor invoice line number, is correct and matches the actual invoice. If this information is entered correctly, FINET will display an alert if the invoice has already been paid.
I. Make sure the payment document does NOT include PII in the description line unless it is absolutely
needed by the vendor to post the payment properly. PII is: (1) any information that can be used to
distinguish or trace an individual’s identity, such as name, social security number, date and place of birth,
mother’s maiden name, or biometric records; and (2) any other information that is linked or linkable to an
individual, such as medical, educational, financial (i.e. bank account number, tax identification number,
credit card number, etc.), employment information, address, date of birth, and driver’s license number,
etc.
J. Verify the correct invoice date is entered.
K. Verify that the proper handling code is used to ensure adequate separation of duties and that the payment is safeguarded and properly routed to the payee.
A handling code of “blank” or 1 means the payment will be sent directly from State Finance to the payee.
A handling code of 2 means that the payment will be held for your agency to pick up from State Finance.
A handling code of 3 means that the payment will be sent to the originating agency for disbursement.
Other handling codes may be available, call the FINET Help Desk for more information.
L. Verify the dollar amount being paid agrees to the invoice or other supporting documentation.
M. Verify that the coding block is correct for each line including fund, department, appropriation, object, taxability, etc.
N. Verify that each invoice was entered on a separate line.