Finance 201: Departmental Cash Receipts

Purpose

To identify department responsibilities and standards for handling cash receipts

Reference

Statewide Accounting Manual Procedures P-08, P-09

Definitions

Cash: For the purposes of this policy, cash refers to coin, currency, checks, and credit card receipts. Counter Checks: Personal checks that have no name and address information on the check and, therefore, may have questionable validity.

Policy

Authority

The approval for new cash receipt activity must be obtained from the Associate Vice Chancellor for Budget & Finance. Departments or individuals are not permitted to collect money from students unless specifically authorized.
Deposit RequirementsFunds received for the benefit of, or on behalf of, UAA must be deposited with UAA Cashiering. These funds must be deposited to bank accounts authorized by the Vice President for Finance.
ResponsibilitiesThe administrator of each department that collects cash must monitor compliance with this policy to ensure that no member of the faculty, staff, or student body realize a personal gain through the handling of university funds. Procedures unique to a department must be reflected in a “desk manual.” The following standard cash receipt controls must be observed:
Hiring and Training

• Consider a background check during the hiring process if the employee will be handling receipts in excess of $1000 per week. Consult with Human Resources before taking this action.
• Provide new employees with adequate training to ensure that they understand the importance of following proper receipt handling procedures. The training must include a review of this policy, Finance Policy 203, and the Statewide Accounting Manual Procedures referenced in this document. Personnel from Cashiering are available to assist departments with training and information.
• Review the receipt handling procedures with each employee annually.

Physical Security

• Funds in excess of $200 of currency or $500 in checks must be deposited daily. Lesser amounts may be deposited weekly. Exceptions may be authorized for departments that receive cash after hours, are not conveniently located to make daily deposits and have a secure safe in which to store the cash.
• Place the cash in a safe, or secure it in a strong lockable cash box placed in a locking desk or cabinet. Keep a record of anyone issued a key or given knowledge of the combination. Keep the number of people with this access to a minimum. Change safe combinations or locks to files periodically and at each personnel change. Keep the safe locked between deposits during business hours.
• If the overnight storage of cash in excess of $500 is frequently necessary, a safe that can be bolted to a wall or floor is recommended.

Processing Controls

• Issue prenumbered receipts for all payments if cash register receipts or tickets are not provided.
• Keep all copies of voided or canceled cash receipts for reconciliation purposes.
• Restrictively endorse checks immediately upon receipt. An approved endorsement stamp may be obtained from Cashiering.
• Require supervisor approval of “counter” checks before acceptance.
• Do not accept check for amounts in excess of the purchase or originating transaction.
• Do not cash personal checks, make employee loans, or make purchases from cash funds.
• Do not provide cash as change for a credit card charge transaction. Refunds must be processed as a credit back to the credit card that was used to make the original charge.
• Maintain a log of each cash item received in mail. Record the name and amount as the mail is opened.

Cash Register Controls

• Use cash register equipment that has an internal tape (Z tape) that may be used for reconciliation purposes.
• Ensure the cashier does not have access to the audit tape nor to the programming key and/or programming function.
• Provide supervisor review and approval of all void sales, refunds, corrections, and no-sale entries either concurrently or at the end-of-day closeout. Retain void sales slips and refund documentation. Document the approvals.
• Reconcile (by an employee other than a cashier) cumulative cash register control totals with deposits.
• Ensure that a deposit exists for each sequential Z tape.
• Obtain a customer signature on a log to document all refunds and voids.
• Validate all applicable forms in the register.
• Restrict each cash drawer to only one employee.
• Ensure each customer receives a cash register receipt.
• Remove all cash from the cash registers and secure it in a safe place at the end of the business day.
• Use a standard reconciliation form to balance out each till.
• Attach the register tape and supporting documents to the daily reconciliation form.
• Ensure the cashier and a reviewer sign the reconciliation form.

Reconciliation

• If a cash register is used, it must be balanced daily unless cash receipts are less than $200 per day (departments may use the Cash Reconciliation & Transmittal Form for this purpose). The cash drawer must be reconciled to the prenumbered receipts or the internal cash register tape whichever is appropriate. Attach the prenumbered receipts or the register tape to the reconciliation report and file appropriately.
• Someone not responsible for receiving payments should review the reconciliation records in detail.
• Keep a log of any unexplained overages/shortages found when reconciling. A small overage/shortage is defined as the greater of $20 or ½ of one percent of total receipts up to $10,000, and ¼ percent of the total receipts over $10,000. Periodically review the log for any patterns of regular losses.
• Notify Accounting Services immediately if any shortages, greater than the limits set above, occur.
• The reconciliation form and supporting documents must be retained for a period of three years from the date prepared.

Separation of Duties

• Keep petty cash fund duties separate from cash receipting responsibilities.
• Assign separate cash drawers or lockable cash boxes to each cashier or ensure that all transfers of cash between individuals, within the department or between departments, are documented and signed by both individuals.
• Assign the opening and logging of mail receipts to someone independent of the cashier function.
• Assign safe access and responsibility to someone other than a cashier.

Deposit Transmittals

• Ensure that the deposits are adequately safeguarded while in transit.
• Use the depository drop that is located at the University Center.
• Campus units with large deposits can make arrangements with Campus Police to deliver bags to the depository at the University Center. Off-campus units can utilize Loomis Services to transfer funds.
• While in transit, the cash and transmittal documents must be secured in a cloth or poly depository bags.
• Each deposit must contain a Cash Reconciliation & Transmittal Form.
• Attach two adding machine tapes showing equal totals for deposits of five or more checks.
• Place the coins in rolls. Coin rolls may be obtained from Cashiering at no charge.

Deposit Verification

• Review monthly computer reports to verify the proper posting of deposit amounts. To the extent practical, persons verifying the postings should not also be involved with the actual handling of the receipts.

Related UAA Policies: Finance 203: Change Funds

Effective: 07/10/2005