Number: 
03-140-104
Type: 
Rule
Policy Steward: 
Sr Payment & Systems Manager
Format Updated: 
University Policy & Standards Converted: 
Status: 
Current
Revision Date: 
Friday, March 11, 2016

This information replaces FIS 406-08 Interest Penalty on Overdue Accounts Payable

 

Allow time for approval routing and check processing. Vendors deserve to be paid promptly.

Many vendors are billing finance charges on unpaid bills after 30 days.  Interest penalty (finance charges) billed to OSU should be reviewed for validity and permissibility.  In most cases, these charges are computer generated and the vendors will forgive them.  However, if the invoice is paid over 45 days late, and the vendor demands payment of the finance charge, count the 45 day period from the date the invoice was received by OSU to the date the check was issued in payment of the original claim.  Interest may begin to accrue on the 46th day.

Late payment charges are limited to 2/3 of 1% per month, not to exceed 8% per year, and cannot exceed the usual charge assessed by the vendor.  Date all invoices when received by the unit to establish the received date.  Do not construe this procedure to mean there are 45 days to initiate the payment process.