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Business and Financial Policies and Procedures

10.4.2 Handle Returned Checks (Approved Units Only)

Policy Statement

In order to assume responsibility for returned check handling, a unit must first be a Cash Handling Unit. This procedure does not apply if University Bursar handles the unit's returned checks.

Reason for the Policy

To ensure approved Cash Handling Units comply with University of Illinois policy and procedures as it relates to processing returned checks.

Applicability of the Policy

This policy applies to all University of Illinois Cash Handling Units that are approved to handle internally-returned checks.


To handle checks returned to the unit, follow the procedure below.

University Bursar

University Bursar charges the unit’s C-FOAPAL for the check total and sends a notification via Protected Email Attachment Application (PEAR). This will include the journal voucher (JV) number and a copy of the check.

Approved Cash Handling Unit

  1. Transfer the amount of the unredeemed check from the original C-FOAPAL to the unit's General Ledger NSF Clearing Fund C-FOAPAL (for more information about creating a C-FOAPAL please reach out to University Accounting and Financial Reporting).
  2. Comply with University of Illinois System policy and established internal procedures for charging debtor with a $25 administrative fee or assuming a $25 administrative fee to the unit.
  3. Follow any approved written internal procedures to recover the amount of the returned check and the $25 administrative service fee.
  4. Submit the replacement funds, when recovered, to University Bursar on the appropriate Report of Cash Sales, Report of Money Received, or online Department Deposit form. Keep a copy for unit records. Use the NSF Clearing Fund C-FOAPAL, and the C-FOAPAL charged in Step #1 and #2.


If the replacement funds are not recovered within six months of occurrence, units may submit a special collection request to University Bursar Student Loans and Collections (312) 413-0303 or University Bursar may send it to an external collection agency for action. University Bursar will not accept requests that are older than six months.

Forms Used in this Procedure

Department Deposit
Instructions for using the Online Department Deposit Form

Paper form:
    Report of Cash Sales (item #11485880) (available for purchase from the Urbana university iStores)

Related Policies and Procedures

10.4.1 Obtain Approval to Handle Returned Checks
10.2.1 Accept Checks as Payment

Additional Resources

University Bursar office locations and hours:

First Published: February 2008 | Last Updated: March 2023 | Last Reviewed: March 2023

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