Budget and Finance Policy and Procedure Office
A Division of The Office of Budget and Finance
A Division of The Office of Budget and Finance
This procedure establishes the Research Accounting–specific requirements for managing receivables arising from sponsored awards.
Policy FN02 Billing and Accounts Receivable governs all University billing and accounts receivable activities. This procedure supplements FN02 by defining:
In the event of a conflict, Policy FN02 Billing and Accounts Receivable governs.
Applies exclusively to receivables arising from:
Non-student, non-sponsored receivables are governed by Procedure FN2065 Non-Student Accounts Receivable.
Departments are not authorized to independently maintain sponsored receivable accounts.
All sponsored receivables must be processed through the University financial system (SIMBA).
All terms used in this procedure follow the definitions established in Policy FN02 Billing and Accounts Receivable. This procedure does not create, modify, or interpret definitions.
In the event of any inconsistency, ambiguity, or conflict between this procedure and policy, the policy prevails.
Authorized to manage sponsored award receivables, including:
In addition to Policy FN02 Billing and Accounts Receivable requirements, sponsored billing must:
Research Accounting verifies invoice completeness prior to issuance.
Typical sponsor invoices include:
Billing timelines may differ from standard University receivables due to sponsor terms.
Research Accounting manages collection activities for overdue sponsor invoices.
Typical collection progression:
Collection timelines may vary due to federal payment cycles or award closeout requirements.
Collection activities must comply with applicable laws and internal control standards.
Accounts may be written off only after collection efforts are exhausted.
Approval thresholds:
Write-off approvals follow research administration authority structures and must be documented.
Research Accounting maintains an allowance for doubtful accounts consistent with GAAP and University financial reporting standards.
Allowance methodology considers:
Allowance balances are reviewed at least quarterly.
Sponsors must report billing disputes within 30 days of invoice date unless otherwise specified.
Research Accounting will:
Invoice adjustments must be processed through invoice reversal or credit memo with required approvals.
Sponsored receivable activities must comply with:
Internal controls must include:
Suspected fraud must be reported to the Director of Research Accounting.
Research Accounting performs:
Research Accounting coordinates with Internal Audit and external auditors regarding sponsored receivables.
Returned checks must be processed according to Procedure FN2002 Processing Returned Checks.
Failure to comply with this procedure may result in:
Intentional misuse may result in disciplinary action under applicable University policies.
Violations of University policy should be reported to the appropriate supervisor, unit manager, Human Resources representative, or the office responsible for the relevant policy or procedure. If these channels are insufficient or unavailable, individuals may submit an anonymous report through the Penn State University Hotline, accessible via the Reporting at Penn State website
University Records retention must be managed in accordance with Policy AD35 University Archives and Records Management, and Records Retention Schedules.
Additional questions may be directed to the Office of Records Management.
There are no exhibits associated with this document.
For questions, additional details, or to request changes to this procedure please contact Research Accounting.
May 14, 2026