2021 Statewide Accounts Receivable Report
Page 2
Introduction
The Statewide Accounts Receivable Report includes all receivables at June 30, 2021, reported to the Office
of the State Controller (OSC) by state agencies. As defined by the North Carolina General Statutes, a
receivable is an asset of the State of North Carolina (State) reflecting a debt that is owed to the State that
has not been received by the state agency servicing the debt. A state agency is defined by statute as any
department, institution, board, commission, committee, division, bureau, officer, official or any other entity
for which the State has oversight responsibility including any university. As prescribed by statute for the
Statewide Accounts Receivable Program, the term state agency does not include a community college, an
area mental health, developmental disabilities and substance abuse authority, or the General Court of
Justice.
The receivables disclosed in this report are based on generally accepted accounting principles (GAAP) and
reflect a snapshot of amounts owed to the State at June 30, the conclusion of the State’s fiscal year. This
report also discloses additional information about the State’s receivables at fiscal year-end such as: an aging
of receivables which indicates the degree to which receivables are past due and write-offs which are
receivables that agencies will not, or most likely will not, collect and have, therefore, deducted from their
accounting records.
How the State Collects Debt
State agencies invoice businesses and individuals for services rendered through many different billing and
receivable systems.
State policy provides that receivable systems of state agencies should:
• Bill accounts on a timely basis, whether the receivables are due from private entities, the federal
government, localities, or state agencies and institutions;
• Maintain an accurate record of receivables transactions;
• Effectively interface with other applicable agency-based accounting systems;
• Provide an aged trial balance of receivables;
• Provide information relative to specific collection efforts on each past-due account;
• Provide realistic estimates of, and properly account for, doubtful accounts;
• Properly account for receivables that are written off;
• Recognize and report receivables in accordance with generally accepted accounting principles
(GAAP);
• Comply with federal and other contractual regulations;
• Maintain a record of year-end receivable balances; and
• Provide for the accrual of interest and penalties as allowed or as required by law.
2021 Statewide Accounts Receivable Report
Page 3
Types of Receivables
Taxes - Primarily consists of individual income tax, sales and use tax, and local sales tax collections.
Accounts - Primarily consists of student, patient, and medical provider payments.
Intergovernmental - Primarily consists of funds due from federal and local governments.
Notes - Primarily consists of student loans, housing mortgage loans and EPA revolving loans that will be
collected on a predetermined contractual basis.
Interfund - Primarily consists of funds moving between different state fund types.
Other - Primarily consists of participant contributions to the health and pension plans and State Treasurer
investment earnings (distributions) owed to those funds (trust, special) that earn interest.
Aging of Receivables
An aging of receivables indicates the degree to which receivables are past-due. State agencies provide
OSC an aged trial balance of receivables each fiscal year-end.
The chart below summarizes past due receivable activity at year-end 2021.
(in thousands)
Accounts past-due at year-end 2021 total $4.0 billion of total receivables. The North Carolina Department
of Revenue (NCDOR), the North Carolina Department of Commerce (NCDOC), UNC Health Care System,
the Department of Health and Human Services (DHHS), State Education Assistance Authority (SEAA),
Housing Finance Agency (HFA), and the UNC System account for $3.8 billion, or 94 percent, of these past
due receivables. Each of these entities employs specific collection techniques to aggressively collect past
due accounts receivables. Appendix A details the aging amounts by agency for fiscal 2021.
2021 Statewide Accounts Receivable Report
Page 4
The chart below summarizes aging amounts for fiscal years 2021, 2020, 2019:
Year-end Amounts
The State’s Annual Comprehensive Financial Report (ACFR) disclosure of receivables includes both
estimated receivables and invoiced receivables, net of allowance for doubtful accounts as of June 30. The
chart below summarizes ACFR total receivables by type for fiscal years 2019-2021:
As shown in the table above, receivables totaled $12.0 billion for fiscal year 2021, $12.8 billion for fiscal year
2020 and $11.1 billion for fiscal year 2019. Total receivables for 2021 decreased by $825 million or 6.4%.
Taxes Receivables decreased due to the due date for taxes reverting to April 15. Due to COVID-19, 2020
taxes were due during Fiscal Year 2021. Accounts Receivable grew due to a rate increase for reprocessing
health benefit claims and an increase in overpayments of unemployment benefits due to the expansion of
claims as a result of the pandemic. Intergovernmental Receivables decreased mainly due to fewer
outstanding billings. Notes Receivables decreased due an audit adjustment which reclassified current Notes
Receivables to noncurrent Notes Receivable. Interfund Receivables decreased $302 million due to the
payback of a portion of a $390 million advance to the Highway Trust Fund. The decrease is also attributed
to a high prior year balance due to amounts provided to component units and outside entities not being spent
before the end of Fiscal Year 2020. Contributions, Premiums and Other Receivables increased by $117
million mainly due to more employer taxes being paid than the prior Fiscal Year. Interest Receivables
decreased due to a decline in interest rates.
2021 Statewide Accounts Receivable Report
Page 5
Write-offs
Write-offs are receivables that agencies will not, or most likely will not, collect and have been deducted
from their accounting records. Write-offs are caused by bad debt adjustments (unsuccessful collection
efforts), contractual adjustments or indigent care adjustments. Write-offs for year-end 2021 totaled $8.1
billion consisting of $332 million for bad debt, $7 billion for contractual adjustments and $760 million for
indigent care. Total write-offs for 2020 were $7.8 billion.
UNC Health Care System, including Rex Healthcare, Chatham Hospital, High Point Hospital, Caldwell
Hospital and UNC Physicians Network, reported write-offs of $6.8 billion of receivables based on Medicare
and Medicaid adjustments, indigent care provider adjustments, and managed care contractual adjustments.
UNC Chapel Hill (UNC-CH) and East Carolina University (ECU) reported write-offs of $724 million and $214
million respectively.
NC Department of Commerce reported a decrease of $113 million for fiscal year 2021. This is primarily due
to Senate Bill 704, which occurred during fiscal year 2020. Senate Bill 704 gave all employers a tax credit
for what they owed for 1
st
Quarter 2020 taxes, resulting in a $109 million increase from fiscal year 2019 to
2020.
Appendix A details total agency write-offs during fiscal 2021. The chart below summarizes agency write-
offs by type for fiscal years 2019-2021.
Contractual Adjustments - The differences between revenue at established rates and the amounts
realizable from third-party payers under contractual agreements. These adjustments are made to
customer, patient, or business accounts as the result of a contractual agreement to provide certain
services or products at a previously negotiated price. The contractual adjustment is the difference
between the value assigned by the state provider/supplier of the product or service and the predetermined
price as negotiated with a third-party payer (example: insurance company).
Indigent Care Adjustments - The differences between revenue at established rates and the amounts
realizable from the financially responsible party for those receiving the state product or service. In this
instance, the write-off is the result of the financially responsible party being unable to meet the financial
obligations due to poverty or a lack of subsistence.
Bad Debt Adjustments - All write-offs of bad debts other than those for contractual or indigent care
reasons.
2021 Statewide Accounts Receivable Report
Page 6
Cost of Collection
State agencies, excluding NCDOR, reported collection activity costs totaling over $103 million during 2021.
Agencies also reported a total of 962 full-time equivalent (FTE) state employees dedicated to receivable
activities during 2021. This is an increase of $5 million in collection costs and an increase in 50 FTE from
2020. This is primarily due to UNC Health Care reporting higher amounts in Patients Accounts than 2020.
Appendix B details by agency the collection costs and the FTE of state employees dedicated to collection
activities.
Collection Activity – Attorney General
State agencies are required by G.S. 147-86.11(e)(4) to forward unpaid billings to the Department of Justice
(DOJ) for collection. Statewide policy specifies the unpaid billings are to be submitted to the DOJ after the
billings are more than 60 days past due. The DOJ then sends a letter to debtors demanding payment. If
payment is not made within 30 days, the Department recommends to agencies that unpaid billings be
submitted to a state contracted collection agency. As of July 1, 2021, DOJ has contracts with twenty-one
collection agencies.
There was no Collection Activity during fiscal year 2021. On March 26, 2020, the Attorney General’s Office
suspended its collection efforts of State’s debts, due to the COVID-19 Pandemic. The Attorney General’s
office resumed their activity on July 6, 2021.
Setoff Debt Collection Program Activity
The NC Department of Revenue (NCDOR) continues to administer the State’s Setoff Debt Collection
Program that requires NCDOR and state agencies to cooperate in identifying debtors who owe money to
the State and who qualify for refunds from the NCDOR. The procedure for setting off against any refund
the sum of any debt owed to the State resulted in $42.3 million of net refunds to claimant agencies during
the 2021 calendar year for the 2020 tax year.
G.S. 105A, the Setoff Debt Collection Act, requires all claimant agencies and the NCDOR to cooperate in
identifying debtors who owe money to the State through its various agencies and who qualify for refunds
from the NCDOR. It further requires that procedures be established for setting off against any refund the
sum of any debt owed to the State.
Effective January 1, 2000, G.S. 105A expanded the list of claimant agencies to include all state agencies.
The Office of the State Controller requested that the NCDOR provide summary debt setoff information for
the last five tax years to be included in the annual Statewide Accounts Receivable Report.
2021 Statewide Accounts Receivable Report
Page 7
Summary data from NCDOR for the prior five tax years is reflected below (whole dollars).
• Effective for the calendar year 2000, the cost of collecting child support debts is not charged against the
taxpayer’s refund. Instead, the gross amount of the refund is applied to the debt and the NCDOR
receives a collection assistance fee for these debts from individual income tax collections. For the
calendar year 2021, collection assistance fees for child support debts collected through setoff were
$88,425.00 bringing the total collection assistance fees received by the NCDOR to $967,545.00.
• Effective for the calendar year 2005, the 2004 Law Changes were amended to impose a flat collection
assistance fee of $5.00 for each debt collected through setoff. The subsection was also amended to
delete the provision that required the NCDOR to set the amount of the collection assistance fee based
on the actual cost of collection ($15.00) maximum for the immediate preceding year.
Agency Compliance with Statewide Accounts Receivable Program
OSC requires each state agency to complete an attestation document signed by the agency’s chief executive
officer and chief financial officer. All state agencies must return a completed DocuSign form stating that:
• Management is responsible for complying, and has complied, with requirements of Article 6B of
Chapter 147 and Chapter 105A of the North Carolina General Statutes.
• Management is responsible for establishing and maintaining, and has established and maintained,
effective internal control over compliance with the requirements of Article 6B of Chapter 147 and
Chapter 105A of the North Carolina General Statutes.
• Information submitted to OSC for preparation of the Statewide Accounts Receivable Report is
materially correct and verifiable to agency records.
The ability to charge interest and penalty on past due accounts receivable is a manual process that is not
supported by some billing and accounts receivable systems currently operating within state government.
Future business infrastructure projects should incorporate the ability to calculate interest and penalty on past
due accounts.
2021 Statewide Accounts Receivable Report
Page 8
Vendor Attachment
OSC and NCDOR administer a vendor attachment program for state agencies using the North Carolina
Accounting System (NCAS). The program is authorized by G.S. 105-242(b) and G.S. 147-86.25. The
program identifies vendor payments for attachment due to uncollected taxes. Due to the COVID-19
pandemic, the Vendor Attachment program was suspended from April to June 2020. The Vendor
Attachment program resumed in July 2020.
As of December 31, 2021, the program has collected approximately $20.9 million in unpaid taxes due to the
state. For additional information regarding the Vendor Attachment Program, contact NCDOR at 1-877-252-
3052.
2021 Statewide Accounts Receivable Report
Page 9
Appendix A
Past Due Receivable Summary Aging Report
Fiscal Year Ended June 30, 2021
(Whole Dollars)
Past Due Receivables by
Department/Institution
1-60 Days
Past Due
61-120 Days
Over 120 Days
Total
Past Due
Total
Write-offs
Administration
4,762
4,336
1,084
10,182
5
Agriculture
215
126
91
432
4
Board of Barber Examiners
11
—
20
31
—
Board of Elections
51
10
395
456
—
Commerce
155,602
40,638
240,577
436,817
5,961
Cultural Resources
—
—
2
2
—
DEQ
473
143
858
1,474
3
DHHS
262,404
26,870
455,072
744,346
336,029
Economic Development Partnership of NC
2
1
—
3
—
Education Lottery
149
28
652
829
19
Gateway University Research Park
29
14
10
53
2
General Assembly
1
—
—
1
—
Global TransPark
70
186
2
258
—
Governor’s Office
—
61
—
61
—
Housing Finance Agency
15,443
22,476
4,669
42,588
43
Insurance
4,285
2,673
25,757
32,715
—
ITS
7,342
1,322
6,115
14,779
—
Justice
68
781
910
1,759
—
Labor
1,326
794
10,380
12,500
979
North Carolina Biotechnology Center
94
55
—
149
94
North Carolina Board of Cosmetic Arts
7
4
18
29
—
North Carolina Board of Nursing
—
1
7
8
11
North Carolina Ports Authority
7,123
1,300
541
8,964
116
Office of the State Auditor
96
1
—
97
—
Office of the State Controller
12
10
11
33
—
Public Instruction
—
—
55
55
—
Public Safety
2,800
641
5,397
8,838
28
Revenue
65,220
106,838
1,487,316
1,659,374
19,152
Secretary of State
35
32
35
102
30
State Education Assistance Authority
120,800
27,605
17,124
165,529
1,200
State Treasurer
7,137
2,288
43,035
52,460
—
Transportation
13,781
10,311
65,431
89,523
4,026
UNC Hospitals
275,056
122,978
143,220
541,254
6,790,473
Wildlife
—
1
153
154
3
Appalachian State Univ
858
281
3,383
4,522
890
East Carolina Univ
6,553
2,144
8,948
17,645
214,433
Elizabeth City State Univ
238
24
519
781
730
Fayetteville State Univ
683
36
656
1,375
854
NC A & T State Univ
463
110
1,550
2,123
630
North Carolina School of the Arts
(22)
22
—
—
—
North Carolina State Univ
25,253
9,287
11,274
45,814
101
UNC – Asheville
224
188
2,726
3,138
143
UNC – Chapel Hill
46,093
22,468
40,534
109,095
723,989
UNC – Charlotte
2,682
331
1,835
4,848
1,351
UNC – Greensboro
215
247
3,390
3,852
810
UNC – Pembroke
939
9
313
1,261
255
UNC – Wilmington
687
48
2,303
3,038
188
Western Carolina Univ
848
475
3,303
4,626
9
Winston-Salem State Univ
2,316
434
3,506
6,256
298
$1,033,353
$408,974
$2,610,463
$4,052,790
$8,102,859
2021 Statewide Accounts Receivable Report
Page 10
Appendix B
Collection
Agency
Collection Unit
Cost
# FTE
Administration
Accounts Receivable Department
5,682
—
Agriculture
Accounts Receivable Department
173,481
4
Agriculture
Agency/Division Budget/Fiscal Office
6,511
1
Agriculture
Payroll Section
2,163
—
Board of Barber Examiners
Accounts Receivable Department
3,040
—
Commerce
Tax Department
1,389,901
15
Commerce
Other
289,394
4
DEQ
Agency/Division Budget/Fiscal Office
567,375
3
DHHS
Accounts Receivable Department
1,130,501
25
DHHS
Other
1,652,223
27
Education Lottery
Collection Agency/Outsourced
1,345
—
Education Lottery
Accounts Receivable Department
90,942
—
Gateway University Research Park
Accounts Receivable Department
1,045
—
General Assembly
Accounts Receivable Department
800
—
Global TransPark
Accounts Receivable Department
644
—
Governor’s Office
Agency/Division Budget/Fiscal Office
37,596
1
Housing Finance Agency
Agency/Division Budget/Fiscal Office
55,000
—
Insurance
Collection Agency/Outsourced
185,813
3
Insurance
Agency/Division Budget/Fiscal Office
15,549
—
ITS
Accounts Receivable Department
62,766
2
Justice
Accounts Receivable Department
73,835
1
Labor
Collection Agency/Outsourced
103,988
—
Labor
Accounts Receivable Department
385,768
6
Labor
Agency/Division Budget/Fiscal Office
255,747
2
Labor
Other
475,623
5
Natural and Cultural Resources
Other
5,140
1
NC Biotechnology Center
Accounts Receivable Department
30,000
1
NC Ports Authority
Accounts Receivable Department
26,000
—
NC Ports Authority
Agency/Division Budget/Fiscal Office
2,000
—
North Carolina Board of Cosmetic Arts
Accounts Receivable Department
18,628
—
Office of Administrative Hearings
Other
7
—
Office of the State Auditor
Agency/Division Budget/Fiscal Office
453
—
Office of the State Controller
Accounts Receivable Department
106,575
1
Public Instruction
Accounts Receivable Department
1,995
—
Public Safety
Accounts Receivable Department
114,217
2
Public Safety
Payroll Section
48,357
1
Revenue
Agency/Division Budget/Fiscal Office
19,354,737
266
Secretary of State
Collection Agency/Outsourced
46,086
1
State Auditor
Agency/Division Budget/Fiscal Office
453
—
State Board of Elections
Accounts Receivable Department
942
—
State Education Assistance Authority
Student Loans
580,507
—
State Education Assistance Authority
Other
6,848,111
—
State Treasurer
Other
117,163
2
Transportation
Collection Agency/Outsourced
9,683,120
50
Transportation
Accounts Receivable Department
749,012
10
UNC Health Care System
Collection Agency/Outsourced
16,621,924
142
Appalachian State University
Collection Agency/Outsourced
95,605
—
Appalachian State University
Student Loans
25,667
—
Appalachian State University
Student Accounts
120,267
2
2021 Statewide Accounts Receivable Report
Page 11
Appalachian State University
Grants Office
62,824
1
East Carolina University
Collection Agency/Outsourced
921,651
—
East Carolina University
Accounts Receivable Department
967,975
15
East Carolina University
Patient Accounts
6,691,196
75
East Carolina University
Student Loans
153,300
2
East Carolina University
Student Accounts
956,308
14
East Carolina University
Grants Office
176,290
2
East Carolina University
Payroll Section
33,651
1
East Carolina University
Other
200,565
—
Elizabeth City State University
Collection Agency/Outsourced
2,399
—
Fayetteville State University
Collection Agency/Outsourced
34,488
1
Fayetteville State University
Student Loans
8,000
—
Fayetteville State University
Student Accounts
8,000
—
NC A & T State University
Collection Agency/Outsourced
30,886
—
NC A & T State University
Student Loans
95,754
—
NC A & T State University
Student Accounts
60,488
1
NC School of the Arts
Accounts Receivable Department
643
—
NC School of Science & Math
Other
1,547
—
North Carolina Central University
Collection Agency/Outsourced
493,689
10
North Carolina Central University
Student Accounts
36,000
1
North Carolina State University
Collection Agency/Outsourced
105,020
—
North Carolina State University
Accounts Receivable Department
71,134
1
North Carolina State University
Agency/Division Budget/Fiscal Office
206,772
3
North Carolina State University
Student Loans
94,341
2
North Carolina State University
Student Accounts
94,341
2
North Carolina State University
Grants Office
57,131
1
UNC – Asheville
Student Loans
9,100
—
UNC – Asheville
Student Accounts
9,150
—
UNC – Chapel Hill
Collection Agency/Outsourced
16,753
—
UNC – Chapel Hill
Accounts Receivable Department
850
—
UNC – Chapel Hill
Patient Accounts
29,284,454
236
UNC – Chapel Hill
Student Loans
262,224
2
UNC – Chapel Hill
Student Accounts
138,699
2
UNC – Charlotte
Collection Agency/Outsourced
162,978
—
UNC – Charlotte
Student Loans
56,149
1
UNC – Charlotte
Student Accounts
97,067
1
UNC – Charlotte
Grants Office
79,488
1
UNC – Charlotte
Payroll Section
23,777
—
UNC – Charlotte
Other
3,474
—
UNC – Greensboro
Collection Agency/Outsourced
38,472
—
UNC – Greensboro
Student Loans
70,074
1
UNC – Greensboro
Student Accounts
33,878
1
UNC – Greensboro
Grants Office
81,224
1
UNC – Pembroke
Accounts Receivable Department
4,015
—
UNC – Wilmington
Collection Agency/Outsourced
92,523
—
UNC – Wilmington
Accounts Receivable Department
8,738
—
UNC – Wilmington
Student Loans
46,160
1
UNC – Wilmington
Student Accounts
76,664
1
UNC – Wilmington
Other
1,625
—
UNC System Office
Accounts Receivable Department
4,505
—
Western Carolina University
Student Loans
72,627
2
Western Carolina University
Student Accounts
24,774
—
Winston-Salem State University
Student Accounts
17,498
—
Total
103,878,290
962
# FTE – Full Time Equivalent positions utilized by an entity of collections