Receipt before or after a Disbursement

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ckmcdonald
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Receipt before or after a Disbursement

Postby ckmcdonald » Wed Mar 16, 2011 10:11 pm

It is well understood that all disbursements require a receipt/invoice/bill. Does policy dictate if possession of the receipt/invoice/bill is required before the disbursement is made, or, is it allowable to obtain it within a few days after the disbursement?

In some cases, most notably the payment of FO housing payments under duress, obtaining the required invoice/bill before the disbursement is requested is sometimes overlooked and waiting to get it can in some cases jeopardize the recipients housing contract.

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Mikerowaved
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Postby Mikerowaved » Wed Mar 16, 2011 10:20 pm

I ran into a similar situation once where I had to mail out a Girls Camp reservation check and wait for them to mail me back a receipt. When I asked the auditor about this, he replied it wasn't important WHEN we got the receipt, as long as we got it and it was for the correct amount and purpose.

Hope this helps.
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Postby ckmcdonald » Wed Mar 16, 2011 10:39 pm

Mikerowaved wrote:I ran into a similar situation once where I had to mail out a Girls Camp reservation check and wait for them to mail me back a receipt. When I asked the auditor about this, he replied it wasn't important WHEN we got the receipt, as long as we got it and it was for the correct amount and purpose.


Thanks for the response. I try to avoid disbursements before invoices but they do happen occasionally. I'm pretty good about getting the documentation needed within a week or so after the disbursement. However, I was recently told that disbursements without the invoice prior is strictly against policy and we shouldn't do it. I'm just trying to determine if this is true.

Any second, third, ... opinions on this?

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Postby aebrown » Wed Mar 16, 2011 11:16 pm

ckmcdonald wrote: However, I was recently told that disbursements without the invoice prior is strictly against policy and we shouldn't do it. I'm just trying to determine if this is true.


I wonder if that interpretation of policy comes from a statement in Handbook 1, section 14.7.2, which says that expenditures must be approved by the stake presidency or bishopric before they are incurred. I don't think that this has to be taken literally to mean that a particular amount for a particular item paid to a specific payee has to be approved before anyone can incur an expense. Rather, it means that the presiding authority has to authorize the budget and the general activity.

There is also a statement in step 10 of the ward audit that asks: "Do both of the people signing the checks examine all the supporting documentation to make sure it is complete before signing the checks?"

I suppose someone could attempt to connect the dots and say that the documentation is not complete if it doesn't include the proper invoice. But if that inflexible interpretation were correct, then we could never issue an advance under any circumstances. And yet advances are specifically mentioned in steps 17 and 18 of the ward audit form.

So clearly it is acceptable to disburse money before the invoice or receipt has been obtained. The precise timing of the arrival of the documentation is not critical, as long as the bishop or stake president has authorized the expense.
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Postby crislapi » Thu Mar 17, 2011 12:18 am

ckmcdonald wrote:It is well understood that all disbursements require a receipt/invoice/bill. Does policy dictate if possession of the receipt/invoice/bill is required before the disbursement is made, or, is it allowable to obtain it within a few days after the disbursement?

In some cases, most notably the payment of FO housing payments under duress, obtaining the required invoice/bill before the disbursement is requested is sometimes overlooked and waiting to get it can in some cases jeopardize the recipients housing contract.

For a third opinion, I think it is generally preferable to obtain receipts/invoices before cutting the check, but this is not always feasible. I think exceptions should be rare, but allowed. The online training specifically mentions advances as being one such case.

My only concern comes from the same exceptional circumstances you mention. I have observed that when someone still requires the check, they are willing to provide the invoices, etc necessary to procure payment. However, I have had a beast of a time getting invoices from landlords once the check has already been delivered. The audit does allow for hand-written receipts when an official receipt cannot be obtained, and I see no need to put a member who is already in distress through more panic by holding off payment just for a receipt. The main rule to me is if the bishop/stake president approves it.

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Postby ckmcdonald » Thu Mar 17, 2011 9:07 am

crislapi wrote:My only concern comes from the same exceptional circumstances you mention. I have observed that when someone still requires the check, they are willing to provide the invoices, etc necessary to procure payment. However, I have had a beast of a time getting invoices from landlords once the check has already been delivered. The audit does allow for hand-written receipts when an official receipt cannot be obtained, and I see no need to put a member who is already in distress through more panic by holding off payment just for a receipt. The main rule to me is if the bishop/stake president approves it.


One method I have used with good success is to put a self addressed stamped envelope in with the disbursement check and ask for a receipt to be mail back to me.

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Postby jdlessley » Thu Mar 17, 2011 7:50 pm

I'll add in another opinion from the viewpoint of a former auditor. In performing an audit I looked at the purpose of documenting payments as a method of ensuring sacred funds were being properly used and that Church leaders were protected. The first thing I looked to see was that the bishop/branch president was approving all payments. Where the approval comes in the process of making the payment was not important as long as it was before a check was disbursed. The necessity for receipts, invoices or suitable substitutes is to provide proof of the purpose and amount. I seldom looked to see when the receipt or invoice was received in relation to the payment. There was a check to see correlation between the receipt/invoice amount and the amout disbursed. The use of suitable substitutes repeatedly, especially for the same same recipient, warranted further investigation and generally some additional training.

As you'll note that unless there is impropriety or embezzlement the most common consequenses of an audit exception are additional training and correcting documentation. Sometimes the correction of documentation is obtaining a receipt/invoice. This correction of documentation is most definitely after the payment.
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Postby daveywest » Sat Mar 19, 2011 8:00 pm

Realizing there may be situations like the previously mentioned FO housing payments, the clerks in our stake have been instructed to create a "pending" file for expenses still requiring paper documentation. Typically we ask that a member of the bishopric (or a clerk who is already aware of the confidential FO assistance) deliver the check so a receipt can be retrieved when the payment is actually made.
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Postby wrigjef » Fri Apr 01, 2011 8:54 am

As a stake financial clerk there have been occasions when I have recieved an email request from a stake leader requesting a check for a deposit or reservation. There is no invoice but the request includes a amount, address to send it to and usually some indication of what it is for so I can take the funds from the proper account. Since these are stake leaders making the request to both me and the Stake President, I have gone ahead and cut checks for the Stake President's signature then dropped them in the mail. Twice now we have gotten checks back because the vendor did not know know an account number or how to apply the payment. The Stake President now says that in the future he will not approve or issue that kind of check without an invoice which can be copied and included with the payment. FO payments would be a different story but we do not issue those at the stake level.

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Postby allenjpl » Fri Apr 01, 2011 9:31 am

wrigjef wrote:As a stake financial clerk there have been occasions when I have recieved an email request from a stake leader requesting a check for a deposit or reservation. There is no invoice but the request includes a amount, address to send it to and usually some indication of what it is for so I can take the funds from the proper account. Since these are stake leaders making the request to both me and the Stake President, I have gone ahead and cut checks for the Stake President's signature then dropped them in the mail. Twice now we have gotten checks back because the vendor did not know know an account number or how to apply the payment. The Stake President now says that in the future he will not approve or issue that kind of check without an invoice which can be copied and included with the payment. FO payments would be a different story but we do not issue those at the stake level.


Although that's certainly his call to make, perhaps a different option would be to give the advanced funds to the leader requesting them, instead of mailing the check directly to the payee. You could do that handing them the check, and having them deliver it.

EDIT: Of course, that won't work if the leader is, say, 100 miles from the stake center.


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