University Procurement and Logistics

I.   General
II.  Procedures

• Purchase Order
• Immediate Payment Process
• Wire Transfers

I. General

The Finance System is used to process supplier invoices and payments for all items obtained by purchase orders (POs). All invoices are required to be sent to Accounts Payable for scanning and inclusion in the Finance System.

II. Procedures

Purchase Order

Upon receipt of a supplier invoice, Accounts Payable (AP) will enter the invoice into the Finance System. The invoice will then be audited against the corresponding purchase order.

Documents determined to be at variance with the terms of the purchase order are forwarded to Procurement.

All variances must be resolved. This may require one of the following actions:

• a change to the original purchase order, or
• adjustment of the invoice to conform to the purchase order terms, or
• return of the invoice to the supplier for resolution.

Once the payment request (PREQ) is approved by AP, it will be forwarded to the department for review or auto-approved for the scheduled payment. AP schedules payments by the contracted payment terms or per MSU's standard payment terms Net 30 days.

Upon receipt of the PREQ, the ordering department should verify receipt of materials or services covered by the supplier invoice.

• If the materials or services have been satisfactorily received, the fiscal officer may approve the PREQ or allow auto approve to occur. No further action is required. The invoice will be paid just prior to the scheduled due date.
• If payment should not be made (damaged goods, incomplete shipment, etc.), the department must immediately put the PREQ on hold to stop the check creation process. To resolve the supplier issue, contact the buyer named on the purchase order.
• AP will only hold the payment until the scheduled due date unless the buyer confirms the hold payment.

There are transactions that generate a “Positive Approval,” which is can be requested by the buyer when the purchase order is created. Payment transactions generating this type of action are not scheduled for payment until all approvals are complete.

Checks are processed for all PREQs in the system that are due to the supplier on each payment date.

Immediate Payment Processing ($15 charge)

The immediate payment process is a request to AP to process the transaction at the highest of priorities. AP cannot guarantee a check the same day as other parties are needed to complete the transaction. For an existing payment in the financial system, contact the AP auditor listed on the PREQ to initiate the request at (517) 353-2011. If all approvals are completed, payment process will create the payment and follow stated processing notes concerning delivery of payment.

For a new transaction, once the PO is in open status and the invoice is received, AP will enter the invoice into the financial system. Contact will be made via phone or email that the process has been through AP review and the next approver needed is “enter name of person needing to approve or the next node approval needed." Once full approval is completed, the payment process will create the payment and follow stated processing notes concerning delivery of payment.

Wire Transfers

AP works closely with the Office of the Controller to process wire transactions and ACH payments for supplier payments. AP processes payments to foreign suppliers using wire transfers. There is a $25 processing fee for wire transfers.