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Business Policy and Procedure Manual
University of Missouri-Columbia
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
March 2004
Chapter 2
FINANCE
Section: 2:040
Sale of Products and Services

Sale of Products and Services

Sales of products or services to the general public are secondary and incidental to the primary functions of the University.

Written Approval Required

No service involving sales to the general public shall be inaugurated without prior written approval by the Provost or designee in academic areas and the vice chancellor of Administration in all other areas.

Establishing or Providing a Service

The service must satisfy one or more of the following conditions:
  • The service is peculiar to the nature of the department or the University and is necessary to the conduct of its educational, research or service programs.
  • The University providing the service contributes primarily to the convenience, comfort, health, academic, social or recreational life of its students, faculty and staff or others participating in educational, research or service programs at the University.
  • Providing the service improves the efficiency and economy of operations.
  • The service is not otherwise available in the quantity or quality required or not conveniently available geographically.

Method of Payment

Where possible, sales of University products and/or services should be made with payment in advance or at the time the service is provided. For sales paid by credit card or on account, see the applicable sections below.

Credit Cards

Departments can accept payment by credit card through one of two means:
  • Contact the Cashiers Office to arrange for a ZON credit card processing machine.
  • Contact IAT Services to arrange for accepting credit card payments through the Internet.
    NOTE: Failure to follow established procedures for credit card processing may subject the department to fines and penalties.

Billing and Accounts Receivable

Departments must use the PeopleSoft Accounts Receivable/Billing (ARBI) when making sales on credit unless they meet the following criteria:
  • There is a documented business need for a specialized billing process that cannot feasibly be met through ARBI.
  • The department has established appropriate segregation of duties in the billing and collection functions.
For sales on credit, departments must establish polices/procedures, including follow-up on uncollected amounts and denial of credit where appropriate.
NOTE: Any employee extending credit without proper authorization will be held responsible for all accounts so incurred and may be subject to disciplinary action, up to and including termination.
NOTE: Accounting Services refers uncollected ARBI accounts to contracted collection agencies.

Sales Tax

Except for entities that are exempt from sales tax, the University is responsible for charging and collecting sales tax (2:050). Departments are responsible for ensuring that they charge applicable sales tax on taxable sales to non-exempt entities.

Cash Received

Deposit cash from the sales of products and services with the Cashier, 15 Jesse Hall, on a timely basis. Prepare a Cash Receipts Report (2:060) using the appropriate PeopleSoft account code. Do not send cash through campus mail.

Sales to Other University Units

When another University unit purchases the products or services, they should use an Internal Service Order Form (UM48) or other applicable form/process. Because the University is exempt from sales tax, the price should not include sales tax. Most sales to other University units are recorded on an Internal Service Entry (2:190) or processed through a feeder system. For more information on ordering from campus departments, see 3:040.

Refunds

Refunds should be made only in exceptional circumstances. The refund should be made via a non-PO voucher. The voucher should include the reason for the refund and should document the original sale.

Unrelated Business Income Tax

Some business operations are subject to unrelated business income tax. In these cases the unit is responsible for working with Division of Finance-Accounting to provide the necessary information for the tax return. The unit is responsible for all taxes due including any estimated payments.