McMASTER UNIVERSITY

Complete Policy Title: PREPAYMENT POLICY FOR NON-TRAVEL RELATED EXPENSES
Policy Number (if applicable): P-150
Approved by: COG
Date of Most Recent Approval: October, 1996
Revision Date(s):
Position Responsible for Developing
and Maintaining the Policy:		 Director, Purchasing Resources
Contact Department:PURCHASING RESOURCES
DISCLAIMER: If there is a discrepancy between this electronic policy and the written copy held by the Policy owner, the written copy prevails.
  1. POLICY

    It is the policy of the Purchasing Department to process prepayments only if it is proven necessary to secure goods and/or services required to facilitate the University's day-to-day operations.

  2. SCOPE

    This procedure applies to all Purchasing Resources employees.

  3. GENERAL

    Occasionally, a supplier may require a prepayment or a downpayment for a number of different reasons, eg. first-time supplier, goods being shipped from another country, supplier's cash flow requirement, etc. Since the University may be losing interest income by processing prepayments, these situations should be the exception and therefore should be avoided if possible. Prepayments can be processed for a purchase order via a cheque requisition in accordance with the cheque requisition policy. For further information, refer to "Cheque Requisition Policy AP-030".

  4. PROCEDURE

    Prepayments via cheque requisitions must be initiated by the originator of the cheque requisition and in accordance with the "Cheque Requisition Policy AP-030".

    Prepayments covering a purchase order must be processed via a cheque requisition that is initiated and authorised by the applicable Purchasing Officer within his/her delegated signing authority.

    In order to process a prepayment, the purchase order and the cheque requisition must be accompanied by: an original invoice, a proforma invoice, or the original order list.