Credit Account Agreements and Prepaid Agreements
The first step in the accounts receivable process is to obtain a Credit Account Agreement or Prepaid Account Agreement form. It is essential to obtain an updated application at the beginning of each year to maintain accurate user accounts, and be able to collect payment.
The store manager must determine the type of account being requested.
- Use a Credit Account Agreement when an account contact/customer wants to provide payment after transactions have occurred.
- Use a Prepaid Account Agreement account for scholarships or personal major accounts where a parent or vendor wants to provide a set payment upfront for the customer to draw on at a later date.
Government Account Exceptions: Any documented support (email, letter, etc.) from a government agency can be used rather than the Credit Account Agreement. However, all data required on the Credit Account Agreement must be gathered.
Have the account contact/customer complete the agreement and return it to the store manager. It is important that all requested information on the form is filled out. This includes full contact information, tax exempt status, start/end sales date, account restrictions, credit limits, agreement in payment methods/terms, etc. If any information is missing, return to the account contact/customer to complete.
The store manager uses the agreement to create the major account and customer accounts in Centralized Accounts Receivable Process (CARP), which is a separate system from CARRR.
Third Party Accounts: The group vice president must review and approve new third party major accounts with a credit limit of $250,000 or greater. The information on the major account must be communicated to the home office via email at ARDept@follett.com.
Account Agreements must be signed and dated by the applicant (account contact/customer) on the behalf of the entity or individual, and the store manager (and regional manager, if applicable).
Major Account Setup
Major accounts must be set up by term or on an annual basis. Exceptions on rollover accounts can only be for campus cards or integrated accounts due to the difficulty in the integration changes with the campus.
Credit limits are set at the customer level within a major account. Store managers are required to use the information from the Account Agreement.
- If a credit limit is provided by the account contact/customer by customer, the account must be set up in accordance to the provided information.
- If a credit limit is provided by the account contact/customer as an estimate for the overall major account, allocate equally across all customers.
- If no credit limit is provided, use prior year activity to set the limits or use a best practice of $500 or less per term.
Agreements should be renewed every Academic/Fiscal Year, four weeks prior to the first day of class.
Each term, the information on the application should be verbally verified as correct and a notation should be made on the application.
- If an account is not stable, the application should be signed each term.
In addition, the store manager and regional manager must have a discussion to determine if an account freeze should be put on the applicable major accounts. Notes on the major account should be kept in the major account's folder.
- Stores can use existing applications, but the customer representative must re-sign and date the application as well as the regional manager, if required on the initial application.