Vendor Rebates

[Procedure] Last Updated: December 2015

Business enterprises and vendors selling goods and services to the university periodically provide rebates and other incentives to promote customer loyalty, branding and purchase volume. Rebates in the form of checks are normally processed by the Accounting Office with credits applied to the originating department. Recently, some vendors have changed business practices resulting in rebate check programs being replaced with alternative cash equivalent and non-cash incentives including rebate cash cards; debit cards; point award systems where points can be redeemed for merchandise; hotel accommodations; conference registrations; gift cards; and other incentives. These incentives directed at department personnel may influence purchasing decisions and may not comply with applicable procurement and income reporting policies. When such transactions occur at the department level and are not coordinated with the Accounting or Procurement offices, they may lack proper accounting controls and may result in misstatement of the actual costs of goods and services to the university.

It is the policy of Northern Illinois University, the Accounting Office, and Procurement Services to discourage participation in such program incentives. Instead, the lowest possible purchase price should be achieved in coordination with Procurement Services. When vendors offer such incentives or rebates, persons acting on behalf of the university should request the cash value of the incentive be sent directly to the university Accounting Office in the form of a check. Any such rebates received by departments should be transmitted to the Accounting Office. Individual employees are prohibited from personally soliciting or accepting cash equivalent rebates or non-cash gifts in accordance with the State Officials and Employees Ethics Act. Similarly, individuals may not solicit nor accept cash or non-cash gifts in the name of the university or one of its departments without the review and establishment of proper and effective accounting controls. Where alternative cash equivalent and non-cash incentive programs exist with vendors (such as those described above), persons are required to contact the Accounting Office to ensure that the provisions of this policy have been met.

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