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Stop Payments and Reissue of Disbursement Checks (non-payroll)FIN-ACC-I-540

Scope

All Indiana University units and employees.

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Policy Statement

University departments may request that stop payment orders be placed on disbursement checks that have been lost, stolen or mutilated, and replacement checks be issued to the payee. Investment and Cash Management will be responsible for placing all stop payment orders on University disbursement checks at the appropriate bank. All requests for stop payment orders and check reissue must be accompanied by a Request for Stop payment, Form A-121-A.

In the event that, both the original check and the reissued check, are cashed by the payee, the initiating department will be responsible for pursuing reimbursement from the payee for the duplicate payment. Investment and Cash Management will be responsible for any related communications with banks and other financial institutions.

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Reason for Policy

To ensure that University financial records are updated in an accurate and timely manner for all transactions relating to the reissue of University disbursement checks that are lost, stolen or mutilated.

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Procedures

All stop payments will be placed electronically with the appropriate bank. After 24 to 48 hours a status inquiry is made. If the bank's system shows that a stop pay is in place, an authorization for a replacement check will be sent to Financial Management Services.

Stop payment requests received prior to the close of bank business operations (typically 2:30 p.m.) will be processed on the day the request is received. Stop payment request forms can be sent to Investment and Cash Management via facsimile transmission. Additional procedural direction will be provided by Investment and Cash Management.

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Definitions

Outstanding Check: A check issued by the University that has not been cashed or canceled.

Stop Payment Order: A directive given by the University to the bank on which a particular check is written, that calls for the bank not to honor the check when it is presented for payment.

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History

This policy was established on February 1, 1996.

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