Internal loans are provided on a limited basis to departments with a delayed source of funding available for specific purchases. In the approval of an internal loan, the department signs an irrevocable commitment to fund the total cost, plus actual interest, over a time period not to exceed 4 years.
Application for an internal loan does not guarantee the loan. Approval will require the signature of the department head as well as the approval of the Senior Vice President for Business Services. This process is described in detail in the established Business Practice & Procedure.
- Procurement Services creates a final proposal for the requisitioned item(s)
- The Memorandum of Understanding which serves as an application for the internal loan is completed and submitted to the Commodity Specialist in Procurement Services
- Procurement Services will review for compliance with Sourcing expectations
- The Office of Treasury Operations will calculate the down payment and preliminary amortization
- The Senior Vice President for Business Services and Assistant Treasurer will approve or deny the MOU
- The Office of Treasury Operations will finalize the calculations
- Department should create a cart in SRM for purchase of the equipment from supplier. The cart will route to Procurement Services for review and release of the PO.
- Accounting Services will process the documents for the down payment and establish the funds and recurring journals to pay the loan.
- The Office of Treasury Operations will submit annual statements in January and will apply the net balance of the loan in the final payment.
Procurement Questions? Click here to go to Procurement Services website (http://www.purdue.edu/purchasing/BPM/Showcase/Copy-Print/)