UH-Victoria

Office of the Vice President for
Administration and Finance

SECTION: FISCAL INDEX: B-13

SUBJECT: BAD DEBT WRITE OFF

POLICY

Writing off bad debts is a non-routine function of this institution. Only after all avenues to collect the debt have been utilized will the bad debt be removed from the books as uncollectible.

PROCEDURE  FOR COLLECTION OF BAD DEBT

Student Criteria – Prior to writing off bad debts the student will be mailed a minimum of two collection notices via certified mail to his or her last known mailing address, each approximately thirty days apart.  The envelope must bear the notice, “Address Correction Service Requested”.  During this period, the debtor will be offered the option to complete a repayment plan agreement. If a repayment plan agreement is not arranged within this period, the debt will be turned over to the collection agency and the Bursar’s Office will apply the state hold.  The liability reported will include the original debt the student incurred plus any institutional late fees or penalties.  The liability reported will not include any fees imposed by third party collection agencies.   Additionally, should a student subsequently default on a repayment agreement, the student will immediately be placed on hold and the debt will be turned over to collections. 

Non-Student Criteria – Prior to writing off bad debts, the department holding the obligation should make reasonable efforts to collect the debt. Those efforts should include sending a letter (via certified mail return receipt requested) informing the individual that if the debt is not satisfied within fifteen calendar days from the date of the letter (hereinafter referred to as the “Due Date”), the debt will be treated as a delinquent debt and will be reported to the Comptroller.  If the debt is not satisfied by the debtor on or before the Due Date, the department will contact the Bursar’s Office who will then follow the proper procedures in applying the delinquent debt. The department will then send a second letter to the individual within 30 days after the Due Date, which will inform the individual that the debt has now been treated as a delinquent debt.  The second letter will also inform the individual that if he or she fails to satisfy the debt within 15 calendar days from the date of the second letter, the matter will be referred to the University’s legal department, the Office of the General Counsel. The second letter must be sent via certified mail and the envelope must bear the notice “Address Correction Service Requested.”  If the debt is not satisfied within 15 days from the date of the second letter, the department will send a copy of the two above-referenced letters and all supporting documentation regarding the debt and any correspondence with the debtor to the Office of the General Counsel for further handling. 

See UHV Policy A-7, Reporting Indebtedness to the State Comptroller,  http://www.uhv.edu/fin/policy/a/A-7.htm, for further information.

PROCEDURE FOR WRITE-OFF OF BAD DEBT

  • Under $100.00-Institution's comptroller has authority to write off any debt under $100.00.
  • Over $100.00-Write-offs of bad debts of $100.00 or more must be approved by the Vice President for Administration and Finance.

See the General Office Procedure Guide for the procedure for the “Write-Off of Bad Debt”.

The annual bad debt write-off amount is to be shown in the annual financial report. 

Approved by: 



Signature Obtained         05/15/2009
Tim Hudson, Ph.D.          Date
President

Next review date: May 2011
Origination: Finance Office

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