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4:011 Cash Handling

 

Austin Peay State
University
Cash Handling


POLICIES
Issued:  March 8, 2017

Responsible Official:  Vice President for Finance and Administration

Responsible Office:  Bursar's Office
 

 


Policy Statement


The Bursar's Office is responsible for the collection and control of cash at the University. To accomodate University customers, the Bursar may delegate this responsibility to other areas. Only those departments with approved activities are authorized to collect or receive money from sales, services, gifts or other sources and/or to operate a change/petty cash/disbursement fund. Departments which are not authorized to receive cash should direct the payer to the Bursar’s Office. The use of an unauthorized checking or other account for depositing University cash is strictly prohibited.  Foundation funds are handled through the Office of University Advancement. 


Purpose


The Bursar’s Office controls cash activities, using the Cash Handling Guide to:

-Maximize the University’s cash position.
-Aid in preventing and/or detecting cash loss.
-Promote adherence to federal, state, and other regulations.
-Protect both the individuals handling funds and the University.


Contents


Definitions
-Cash
-Cash Handling Operations
-Cash Receipts
-Change Fund
-Disbursement/Petty Cash Fund
-PCI (Payment Card Industry) DSS

Procedures
-Overview
-Standard Cash Controls
-Cash Handling Activities
-Petty Cash/Disbursement Fund
-Cash Receipts

Links
-Guide to Cash Handling
-APSU Policy 4:019


Definitions


Cash Represents paper currency, coin, checks, credit card transactions, and electronic funds transfer. Cash and funds may be used interchangeably.


Cash Handling
Operations
Represents departments assigned a disbursement fund and/or a petty cash/change fund as well as authorized activities collecting or receiving money from sales, services, gifts or other sources.


Cash Receipts Represents all University-owned cash maintained for a specific operational purpose and consists of the value of the cash change fund as well as the value of cash and negotiable items received in the course of business that have not been deposited.  Examples of cash receipts may be items in cash bags, cash drawers, and vaults/safes.


Change Fund Represents an established fund for cash transferred from the Bursar to assist approved cash receipting/departmental activities with making change while handling cash receipting activities.


Disbursement/Petty
Cash Fund
Represents an established fund consisting of a small amount of cash transferred from the Bursar and held by departments to process small payments to suppliers.  This type of fund is only approved in rare circumstances.


PCI (Payment Card
Industry) DSS
The PCI Data Security Standard represents a common set of industry tools and measurements to help ensure the safe handling of sensitive information, including preventing, detecting and reacting to security incidents.


Procedures


Overview

The handling of University funds requires that certain basic procedures be followed precisely.  Procedures for the handling of University funds are designed to protect both employees and the University, and to provide accountability for University funds in accordance with accepted standards of internal control.  Departments wishing to collect money on behalf of the University or obtain a disbursement/petty cash fund must submit their request in writing, signed by the appropriate department head. The completion of the Cash Handling Authorization form will explain the need to handle cash, name the individuals responsible for the activity and describe the environment for cash handling

The Bursar will evaluate the requester’s Cash Handling Authorization form for proper cash handling controls. Cash handling controls are extremely important to the University, the cash handling area and the cash handler (employee). They protect each and assist them in being more effective and efficient in both performance and evaluation of economic activities. The loss of public confidence could be averted through a common understanding and practice of proper cash handling controls. The Bursar’s Office will evaluate the request and notify the requester of the status of request.

It is the responsibility of management to develop, practice and monitor efficient and effective internal cash handling controls for its operation. The basic goal of designing proper controls for any area is to separate authorization, custody and accounting. It is recognized that no one control model fits the needs of all cash handling areas at the University. Also, because the cost of controls may be significant, and the risk of loss varies according to the value of cash handled, some control procedures should be applied based on reasonable factors associated with each operation.

Specific procedures must be followed for reporting overages and shortages.  Cash handling employees are subject to the Performance Improvement Process, and employees both in the probationary period and afterward, are subject to immediate dismissal in accordance with applicable policies and procedures if certain infractions should occur.  More detailed explanations and guidelines of procedures and controls expected to be established and adhered to at each cash collection area may be found in the Cash Handling procedures available on the Bursar’s website. 

No cash receipting department should acquire a cash receipting system for their departmental use without prior review and approval of the Bursar’s Office.  It is expected that the contracted cashiering system used University-wide is to be used for all cashiering transactions.


Standard Cash Controls
  1. Individual responsibility and accountability should always exist in handling University cash. Specific person(s) should be delegated the authority to receive cash and/or operate a disbursement/petty cash fund. An accounting record should be established immediately upon receipt of cash. Cash handlers and applicable department management must attend annual training to review and evaluate cash handling operations.  
      
  2. All cash transactions must be established through proper documentation.All cash should be immediately recorded upon receipt. The recordings must be made using one of the following University approved methods: cash receipting system, cash register, pre-numbered receipt forms/tickets, or on a hand-written log. Checks should be made payable to Austin Peay State University and should be restrictively endorsed immediately upon receipt. All transfers of cash accountability should be documented. Documentation should include amount transferred, date, and cash custodian signatures. 
  1. Cash funds must be properly balanced and reconciled.Cash handling units must maintain written cash balancing procedures. Each cashier should balance their business at the end of their shift by comparing cash receipting records to funds on hand, as described in the Cash Handling Guide Procedures. Monthly balancing is accomplished by comparing monthly reports from Accounting to deposits.
  1. Cash handlers must operate in a secure environment at all times.Access to cash should be restricted at all times to the person accountable for the funds. The degree of security provided by the storage facility should be commensurate with the amounts being stored. 
  1. Cash funds must be deposited in a timely manner. Deposits should be made daily to maximize cash flow and safeguard assets. If an event falls on the weekend, the funds should be deposited the next business day. Weekly deposits are allowed in the case of collections of less than $500.  Collections should be deposited intact (no expenditures should ever be made from a collection).
  2. Management should monitor cash operations.Management should perform periodic unannounced cash counts and do a periodic review of the internal controls in place to determine that these controls are:
    1. Sufficient to safeguard cash collected;
    2. Understood by staff;
    3. Carefully followed by all staff.

The Bursar’s Office will conduct required annual cash counts.

Cash Handling Activities

These procedures address three cash handling situations: 

  1. Activities using cash provided by the Bursar’s Office for a disbursement/petty cash fund.
  2. Activities collecting money that have access to a change fund provided by the Bursar’s Office.
  3. Activities authorized to collect money without the use of a permanent change fund provided by the Bursar’s Office. The last two examples are similar and specific procedures will be discussed in the Cash Receipts section.

The fund (change or disbursement) provided by the Bursar may not be used for both a change and a disbursement fund. Separate funds should be requested if both types of cash funds are warranted.

Departments requesting wire transfers to a University bank account must notify the Bursar’s Office in advance of each expected transfer and provide the amount and account number to be credited.

Petty Cash/Disbursement
Fund

A petty cash/disbursement fund is a set amount of cash provided by the Bursar for frequent small dollar purchases. With the availability of the University’s Purchasing Card, the need for a disbursement fund is rare. The requester should only apply for a disbursement fund if their needs cannot be satisfied with a University issued purchasing card.

The Bursar has also made provisions to reimburse departments directly for authorized expenses. The individual requesting reimbursement should not have access to a disbursement fund or a University’s Purchasing Card. The procedures for these transactions are outlined in the Reimbursements of Personal Funds for Authorized University-Related Expenses section below. Meals, food, flowers, travel, personal services, contractor services, employee gifts and dues or subscriptions cannot be reimbursed by the department’s disbursement fund or directly by the Bursar.

Cash Receipts

Departments wishing to receipt money must complete a Cash Handling Authorization form. The requester may have to provide more detailed procedures, depending on the volume of funds and complexity of operations. Under no circumstances should a department accept funds without approval from the Bursar. Fees to be collected by departments must be approved in advance in accordance with University Fees and Charges Policy. Generally, there are three methods of receipting funds remitted to the University. The first method is a manual receipting process utilizing the University official pre-numbered receipt books, pre-numbered tickets, cash registers or other devices to establish accountability for money received. The second method is the University-approved cash receipting system for departments with higher volume of receipting. As a third alternative, the Bursar may recommend the use of the University's online storefront payment application in cases where money is being receipted for activities such as conferences, seminars and events.  The complexity of the operations and needs of the users define which method will work best. It is the responsibility of the requester with the assistance of the Bursar to develop, implement and monitor proper receipting activities.

All cash receipting personnel and supervisors must attend annual cashiering training provided by the Bursar's Office.

The Bursar’s credit card handling policy requires that each unit be certified as a credit card processing site and the method of processing credit transactions must be approved by the Bursar. This certification will include, but is not limited to, the site becoming PCI compliant, the secure handling of charge card numbers, data collection, system security, physical security, disaster recovery, reporting, reconciliation, privacy policies and continuing audit results.

The privilege to handle University funds will be removed from any area that does not adhere to the policies, procedures and guidelines.


Links


Cash Handling Guide

http://www.apsu.edu/bursar

APSU Policy 4:019

http://www.apsu.edu/policy/disposal-surplus-personal-property-4019


Revision Dates


APSU Policy 4:011 (previously 4:012) – Rev: March 8, 2017
APSU Policy 4:011 – Rev: February 22, 2016
APSU Policy 4:011 – Rev.: December 2, 2005
APSU Policy 4:011 – Issued: May 16, 1988


Subject Areas: 


Academic Finance General Human
Resources 
Information
Technology 
Student
Affairs 
  X        

 


Approved


President: signature on file