Roles & Responsibilities – Accounts Receivable

Roles and Responsibilities

A payment due to NC State University from an extramurally funded sponsored agency in support of a sponsored program activity is considered an accounts receivable. All payments are expected as per the initial contractual agreement. Delinquencies will be collected and pursued consistently, following documented collection practices, utilizing various University resources when appropriate. If at any time it is determined that a sponsor’s failure to pay is due to a contract dispute the University Office of General Counsel will become involved in the effort.

The following Roles and Responsibilities are being distributed to campus stakeholders to improve collection efforts, create transparency into the invoicing and collection process in Contracts and Grants, distribute information so informed decisions can be made regarding doing business with our external sponsors and to minimize loss to the University.


Department/Principal Investigator Responsibilities

  • The Principal Investigator and the head of the unit receiving the award are responsible for ensuring that all expenses charged are appropriate for the award and consistent with the terms and conditions of the sponsored agreement.
  • The Principal Investigator will be responsible for completion of all required project work. The Principal Investigator is also responsible for submitting all required technical reports and deliverables to the sponsor within prescribed agreement terms.
  • When an outstanding receivable is delinquent by more than 60 days it may be beneficial for the Principal Investigator to contact his/her Program Manager at the sponsor to determine when payment is expected.

College/Division Business Office Responsibilities

Due to the financial risk a delinquent sponsor presents to the College/Division and/or Department a monthly campus report is generated of all invoices greater than 60 days old. The report is sorted by College/Division and by the 6-digit OUC. Within the OUC the invoices are sorted by the age of the receivable. This report is distributed to the College Research Office and the College Business Officer to:

  • Monitor the fiscal status of all projects and assist the Principal Investigator and/or Department in resolving issues related to the project.
  • Review the ‘Accounts Receivable for Sponsored Project Invoices Greater than 60 days old’ report on a monthly basis.
  • Follow-up with Principal Investigator if the Fiscal Manager follow-up notes indicates the payment is delinquent due to late deliverables or technical reporting.
  • Evaluate risk of continuing project work with a sponsor who is delinquent paying invoices. If the College/Division determines that the risk is too great, the College/Division must work with Office of Sponsored Programs and Regulatory Compliance Services to renegotiate more aggressive payment terms or to appropriately terminate the project according to agreement guidelines.
  • If after 6 months from the project end-date the project invoices remain unpaid the College/Division will provide suitable project number to write-off the unreimbursed direct charges.

Sponsored Programs and Regulatory Compliance Services (SPARCS) Responsibilities

  • For all standard project agreements initiated and written by SPARCS, new language has been added to the payment clause:
    Payment received after 30 days of invoice shall be deemed late and may be subject to collections and attorney’s fees. University reserves the right, pursuant to the provisions of Article 10, Termination, described herein, should payment be delayed, without cause, by more than 60 days from the date of invoice.
  • Negotiators in SPARCS have also been advised to strengthen on-time reimbursement of costs in agreements initiated and written by our sponsors. When other terms of an agreement require negotiation the payment provisions will also be modified to include language that captures the following expectation:
    Payment received after 30 days of invoice shall be deemed late and may be subject to collections and attorney’s fees. University reserves the right to immediately terminate or suspend this agreement should payment be delayed, without just reason and mutual understanding of the parties by more than 60 days from the date of invoice.
  • Upon recommendation of the Director of Contracts and Grants and review by the Associate Vice Chancellor for Research Administration, SPARCS will restrict further sponsored project activity with a sponsor that is delinquent by more than 90 days on any one sponsored project agreement.

Office of Contracts and Grants Responsibilities

On a periodic basis, no less frequently than monthly, NC State University, Office of Contracts and Grants, generates an internal report of all invoices that have not been paid in full. The follow-up performed by the Office of Contracts and Grants is conducted in accordance with the office’s internal accounts receivable follow-up policy. Additional follow-up is prioritized by the number of outstanding days (i.e. follow-up begins with oldest invoice). However, other criteria for prioritization are considered, such as the invoice amount (i.e., greater priority to high dollar invoices) and sponsor (i.e., follow-up with sponsors who have a history of delinquent payment should start early).

During the performance period of an award Contracts and Grants will not invoice the sponsor for any cost reimbursable awards in an overdraft position. A hold is placed on billing the award until the department clears the overdraft. Once the overdraft is cleared, billing will commence in the month following the clearance of the overdraft. It is essential to clear overdrafts within 30 days. Any costs incurred since the prior period billed will not be invoiced until the overdraft is cleared. The only time Contracts and Grants will invoice a cost reimbursable award in an overdraft position is when preparing a final bill as part of the close out process. To ensure the correct expenditure categories are recorded on the final bill, Contracts and Grants requires the electronic close out form be completed by the College/Division representative.

  • Fiscal Manager: The Fiscal Manager is responsible for generating and submitting all invoices and financial reports relating to sponsored projects, monitoring invoice payments, and sending late payment notification letters to sponsors with outstanding invoices according to the Contracts and Grant Internal Accounts Receivable Follow-up Policy.
  • Assistant Director: The Assistant Director maintains the Accounts Receivable Aging Database, discusses and enters the Fiscal Manager’s follow-up notes for invoices older than 60 days and generates reports for campus stakeholders.
  • Director: The Director has primary responsibility for monitoring and managing the Accounts Receivable process with respect to sponsored projects. The Director notifies campus on a monthly basis of those invoices that are aged 60 days or older. When an industry sponsor continues to be delinquent the Director coordinates with the Office of Sponsored Programs and Regulatory Compliance Services to remove the sponsor from the sponsor list used to enter proposals.

The Office of Contracts and Grants is responsible for sponsor follow-up regarding payment and for documenting the progress toward resolution which may include negotiations of an acceptable payment plan. Failure to reach an acceptable payment schedule/payment plan may result in the debt being referred to the Office of the State Attorney General.


Uncollectible Accounts

The following details the accounting treatment of amounts identified as uncollectible:

Charged to the College:

  • Uncollectible extramurally-funded awards arising from:
    • Non-performance issues, including the failure of the Principal Investigator (PI) to prepare interim and final reports or overspending by the PI;
    • Late ledger entries/adjustments resulting in late or inaccurate billing.
  • Uncollectible extramurally funded awards, where the University has met all its contractual requirements. The nonpayment may arise from the third party having insufficient funds to meet its commitment or for other reasons resulting in the University not being reimbursed for amounts due UNLESS the sponsor has filed for bankruptcy.
  • If after 6 months from the project end-date the project invoices remain unpaid the College/Division will provide suitable project number to write-off the unreimbursed direct charges. These projects will be identified during the College’s monthly review of the aged accounts receivable report.

Charged to Central Administration:

  • Uncollectible extramurally-funded awards arising from non-performance issues by Contracts and Grants including the failure to prepare invoices in a timely and accurate manner, failure to follow-up according to the Contracts and Grant Internal Accounts Receivable Follow-up Policy.
  • It is inevitable that we will have sponsors declare bankruptcy. In the event we receive a notice, regarding a sponsor, from the Bankruptcy Court the Associate Vice Chancellor of Finance and Resource Management will review the uncollectible debt and recommend action to the Vice Chancellor for Finance and Business and Vice Chancellor for Research and Innovation.