COMPTROLLER'S SEAL STATE OF CONNECTICUT

STATE OF CONNECTICUT

NANCY WYMAN
COMPTROLLER
OFFICE OF THE STATE COMPTROLLER
55 ELM STREET
HARTFORD, CONNECTICUT 06106-1775
MARK OJAKIAN
DEPUTY COMPTROLLER

MEMORANDUM NO. 2008-25

July 21, 2008

TO THE HEADS OF ALL AGENCIES

Attention: Chief Administrative Officers, Fiscal Officers, and Business Managers
Subject: Proper Procedures for the Issuance and Handling of Checks Returned to an Agency

I. AUTHORITY

Sections 3-112 "Powers and duties" and 3-117 "Claims against the state" of the Connecticut General Statutes prescribe that upon the settlement of any claim against the state, under procedures adopted by the comptroller, the comptroller will draw an order on the treasurer for its payment.

II. PURPOSE

Establish procedures for checks returned to an agency.

III. AGENCY RESPONSIBILITIES

A. Processing Procedures:

Proper internal accounting controls require the immediate mailing of checks. Payment schedules containing Payment Handling Code "RA" are restricted to checks returned to agencies requiring special handling for the following reasons:

1. Checks requiring additional hard copy documentation from the agency (e.g., remittance statements, subscription orders, utility charges, etc.) that will identify the payment and help the vendors reconcile their receivables.
 
2. Releases required before transferring the check to the vendor (e.g., condemnation of property, real estate purchases, litigation involving the Office of The Attorney General, etc.).
 
3. Foreign mail.

B. Mailing of Checks Returned To An Agency:

It is the agency's responsibility in all instances to mail checks immediately to vendors. No check is to be held by an agency pending completion of the vendor's contractual obligation.

C. Tracking Returned Checks:

All agencies are required to keep a monthly log of every check returned to the agency. The log must contain the check number, check date, payee name, payment amount, and the reason why the check was returned to the agency. At the beginning of each month the previous month's log must be sent by e-mail to osc.apdpa@po.state.ct.us.

IV. CONCLUSION

Improper use of Payment Handling Code "RA" is a reportable audit finding. The Accounts Payable Division will follow-up on all conditions found. Non-compliance by State agencies will result in OSC citing agencies for lack of internal accounting controls. The Office of the State Comptroller is committed to safeguarding funds and expediting vendor payments.

V. QUESTIONS

Questions should be addressed to the Accounts Payable Division at (860) 702-3395.

NANCY WYMAN
STATE COMPTROLLER

NW:MKA

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