Stop Payment General Procedures


The first part of this process verifies the check status, there is no penalty for requesting a stop payment on a check that is presumed lost or needs cancellation and is found to have cleared when attempting to place the stop.

Reissue

University checks, which are lost, stolen, mutilated or over 6 months old (stale) will be replaced when authorized by Cash Control.
Steps are as follows

The Stop Payment WorkFlow replaces both the cancel and reissue forms. It also replaces the check return form. The return form is only needed when returning undeliverable, stale, and/or previously stopped checks.

Cash Control verifies that the check is outstanding and places a stop payment (bank) request on the check.

If the check is stale the check has been cancelled by the bank and it will be reissued out of a clearing account via DV. For checks that are not stale Customer Service cancels the check (internal) and reissues a new disbursement.

Operations flags the reissued disbursement as special handling and manually routes the check to the updated address. PDP information remains static and the reissued check will print with the original address.

If a check is paid, and is no longer outstanding, the check cannot be reissued. A copy of the cashed check will be forwarded to the department for review. If forgery is suspected contact Cash Control immediately. See I-550 Check Forgery of University Checks.

For specific policies related to payroll checks refer to the Paycheck Mailing and Reissue Process.
Related Accounting Policies:
I-540 Stop Payments and Reissue of Disbursement Checks (non-payroll)
I-541 Stop Payment and Reissue of University Payroll Checks

Cancel

A check cannot be cancelled if payment is due. If you are unable to locate the payee mail the unclaimed check to FMS Customer Service. A cancel is required if a check is payable to the wrong payee, misspelled, or is the wrong amount. After six months checks are considered stale and are cancelled by the disbursement banks. The liability remains outstanding within Unclaimed Property.
Steps are as follows

 The Stop Payment WorkFlow replaces both the cancel and reissue forms. It also replaces the check return form. The return form is only needed when returning undeliverable, stale, and/or previously stopped checks.

 Cash Control verifies that the check is outstanding and places a stop payment (bank) request on the check. If the check is stale the check has been cancelled the funds will be moved out of a clearing account via DI.

Customer Service cancels the check (internal) and the funds are refunded to the original account and object code.

If a check is paid, and is no longer outstanding, the check cannot be cancelled. A copy of the cashed check will be forwarded to the department for review. It is the department's responsibility to recover the funds and if forgery is suspected contact Cash Control immediately. See I-550 Check Forgery of University Checks.

For specific policies related to payroll checks refer to the Overpayment Procedures.
Related Accounting Policies
I-520 Cancellation of University Checks (non-payroll)

Stale checks

Stale Checks
Outstanding checks over six months old are considered stale and are cancelled automatically by the bank. The procedures remain the same except all disbursements are entered by Cash Control through DVs (reissues) and DIs (cancels).
A check cannot be cancelled because it is stale and the reason for the payment is unknown. Funds will be held by FMS until a proper reason for reissue or cancellation can be identified or until the dormancy period has expired.
Visit the Check FAQ for more information.

NOTE: Checks are not cancelled at exact six month intervals. A check remains outstanding sometimes throughout the whole month. Internal controls do not allow for cancellation and reissues of checks after EXACTLY six months and if Cash Control alerts your department of this situation you will have to cash the original check or wait until the following month for reissue or cancellation.

 

Related Accounting Policies:
I-530 Write-Off of Outstanding University Checks