HomeMy WebLinkAbout4.04 WriteOffUncollActRecFile 300-10
CITY CLERK
AGENDA STATEMENT
CITY COUNCZL MEETTNG DATE: OctoberT, 2003
SUBJECT:
Write-off of Uncollectible Accounts Receivable
(Prepared By: Carole A. Perry, Administrative Services Director
and Fred W. Marsh, Finance Manager)
ATTACHMENTS: 1. Current PoliCy On Receivables
2. Resolution
3. Budget Adjustment
RECOMMENDATION.'~~~Adopt ReSolution and Approve Budget Change'
FINANCIAL STATEMENT:
Approval of this resolution would result in a decrease in the
estimated year-end contribution to the General Fund balance by
$26,485.
DESCRIPTION
In 1993, the City Council adopted ResOlution No. 93-93, which authorized the write-off of receivables
exceeding $500, based upon the recommendation of Staff and with the approval of City Council. Staff
has made a reasonable effort to obtain payment on all of the receivable accounts listed below. In some
cases the amounts may relate to monies owed from apPlicants who have filed bankruptcy. As noted, in all
cases the amounts under consideration were generated more than a year ago.
Listed below are the accounts that Staff recommends be written off; all of which relate to work performed
processing development projects in prior years.
Account Number
Date of Last Work
Performed On Account
Amount of
Receivable
to Write-off
001-333-303 Augu~ 1995 $5,196.62
001-333-485 March 2000 560.09
001-333-522 May2001 14,491.94
001-333-544 May2001 4,123.59
001-333-543 September2001 2,112.45
Total Developer Processing Receivables to Write-off
$26,484.69
It should be noted that when compared to the total revenues collected over the past six years for
Development Processing, the amount for write off comprises a very small percentage. Since the balances
currently under consideration have been generated in prior years, Staff recommends that the City Council
adopt a budget amendment; the write-off will be recorded in a non-departmental account.
COPIES TO:
l ~0~-~ ITEMNO. ~
GSFinance StaffxFredLa, genda Writeoff 02-03.doc
REVIEW OF CURRENT PROCEDURES REGARDING WRITEOFF OF RECEIVABLES
The current policy was last updated in 1993. Due to the many changes in the type and volume of activity
that have occurred since that time, staff is proposing to come back at a future date with recommended
changes to these procedures. The proposed changes would be based upon the City's current internal
procedures and surveys of nearby cities as to their practices. This process would include establishing
revised threshold amounts for uncollectible receivables that can be written off by the Administrative
Services Director, City Manager and Council.
RECOMMENDATION
Staff recommends that the City Council adopt the attached resolution and budget change form, which will
allow Staff to proceed with recording the appropriate write-off.
RESOLUTION NO. 93 - 93
A RESOLUTION OF TPIE'CITY COUNCIL
OF THE CITY OF DUBLIN
Establishing Procedures For Write-Off of
Uncollectible Accounts Receivable
WHEREAS, it is Prudent for the City to have established procedures to
purge stale accounts receivable items from the financial records; and
WHEREAS, in accordance with financial policies it shall be the intent
of the City to undertake reasonable efforts to secure payment of
outstanding debts; and
WHEREAS, accounts may become uncollectible due to circumstances such
as, but not limited to: the statute of limitations for a legal proceeding
has been exceeded; bankruptcy has been filed; the City is unsuccessful in
locating the debtor; the cost of collection exceeds the amount owed, etc.;
and
WHEREAS, to reduce the potential number of accounts which become
.uncollectible, the City Council has authorized the use of a collection
)ency;
WHEREAS, it'is desirous to .have procedures, which allow City Staff to
administratively dispose of accounts, which are less than $500; and
WHEREAS, City Council approval would be required for all amounts over
$500, which are proposed to be written off.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Dublin
does hereby adopt the following procedures for the handling of accounts
receivable which are deemed by City Staff to be uncollectible:
PROCF.~URE
These procedures establish the approval required to write - off
uncollectible accounts from the City's financial records. A reasonable
effort shall be made by the City to obtain payment prior to writing off
past due amounts. City Staff shall maintain records'of such efforts.
1. Individual accounts of $200 and tess may be written off upon approval
of the Assistant City Manager/Administrative Services Director.
2. Individual accounts of more than $200 and less than $500, may be
written off based upon the recommendation of the Assistant City Manager/
ADministrative Services Director, and-with the approval of the City
~anager.
3. Individual accounts over $500 may be written off based upon the
recommendation of Staff and with the approval of the City Council.
PASSED, APPROVED AND ADOPTED this 26th day of July, 1993.
AYES: Councilmembers Burton, Houston, Howard, Moffatt; and
Mayor Snyder
... ..... ATTACHMENT 1
NOES: None
RESOLUTION NO. - 03
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
APPROVING THE WRITE-OFF OF
UNCOLLECTIBLE ACCOUNTS RECEIVABLE FOR THE
FISCAL YEAR ENDED JUNE 30, 2003
WHEREAS; the City of Dublin has certain delinquent receivable accounts where collection efforts have
been exhausted; and
WHEREAS; accounts may become uncollectible due to circumstances such as, but not limited to; the
statute of limitations for a legal proceeding has been exceeded; bankruptcy has been filed; the City is
unsuccessful in locating the debtor; the cost of collection exceeds the amount owed, etc.; and
WHEREAS; it would appear appropriate for these receivable accounts to be written off; and
WHEREAS; the above-described action within the City accounting records does not constitute a release
of any debtor from liability for payment of any amount; and
NOW, THEREFORE BE IT RESOLVED that the City Manager is hereby authorized to writeoff
uncollectible receivable accounts, as described in a Staff Report presented October 7, 2003, and to record
this amount as a bad debt expense.
PASSED, APPROVED AND ADOPTED this 7th day of October, 2003.
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
Mayor
City Clerk
G: lFinance StaffiFredlresolution writeoff, doc
ATTACHMENT 2
CITY OF DUBLIN
f BUDGET CHANGE FORM - FISCAL YEAR 2002-2003
CltANGE FORM #
New Appropriations (City Council Approval Required): Budget Transfers: '
__x From Unappropriated Reserl~es From Budgeted Contingent Reserve (10800-799.000)
(If Other than General Fund, Fund No - Within Same Department Activity
-From New Revenues Between Departments (.City Council Approval Requi~ed).
Other
Name: Name: General Fund -Non Departmental - $26,485
Miscellaneous
Account #:
· Account #:001-10800-798-000
Name: Name:
Account #: ' Account #:
Name: Name:
Account #: · Account #: ~
:Name: Name:
Account #: Account #:
Name: Name:
Account #: Account #:
ASD/Fin Mgr
Signature
REASON FOR BUDGET CHANGE ENTRY: The City has reviewed uncollectible balances, and in
accordance with adopted policies the City Council may authorize the writeoff of balances in excess of $500.
The balances proposed to be written offWere incurred prior to Fiscal Year 2002-2003.
City Manager: D ate:
Signature
As approved at the City Council Meeting on: Date:
Mayor: Date:
Posted By:
G:%Finance &afflFr~d~budg~t change writeoff, doc
Signature
Date:
Signature
ATTACHMENT 3