Petty Cash Custodian Workshop Research and Department Petty Cash Funds—from creation to close-out. A user’s guide. Cash and Controls Capital Accounting October 30, 2009 Controller’s Office

2 Introduction Overview Key Components Governance Ramifications INTRODUCTION

Controller’s Office 3 Overview Petty Cash funds are: Cost effective - high volume, low expense transactions (e.g. Research subject payments) can be processed with less overhead Timely – immediate purchases can be facilitated when time is of the essence Versatile – mixed items can be purchased from single source vs. ordering from different vendors via purchase orders Flexible - goods can be acquired without going through a formal procurement process INTRODUCTION

Controller’s Office 4 Key Components Petty Cash funds are intended for: Minor expenses that are –Allowed under BUS 49 and UCSF policy –Limited to $100 per vendor per transaction per day Payment to research subjects –as established by the Committee on Human Research (CHR) –and limited to $150 per subject INTRODUCTION

Controller’s Office 5 Governance The Controller’s Office: Reviews –requests for new funds and increases to existing funds –changes of responsibility –requests for reimbursement of expenses for compliance to policy Visits custodians periodically for surprise cash counts and fund review Sends out letters semi-annually for funds verification INTRODUCTION

Controller’s Office 6 Ramifications Requests for reimbursement not meeting required criteria will be returned to the custodian. Lack of response to verification letters could result in closure of fund which requires report to Internal Audit. Abuse of fund process may result in cancellation and possible sanctions or even disciplinary action. INTRODUCTION

Controller’s Office 7 Nuts and Bolts Mechanics –Set-up –Replenishment –Change of Custodian –Termination Auditing – Counts & Verification Letters Routing Do’s and Don’ts Policy Exception Common Errors References & Resources CONTENTS

Controller’s Office 8 Petty Cash Fund Set Up Approved Check Request (include physical address and vendor number) Cash Action Form UCPD Fingerprint Clearance Memo Online Course Confirmation Current CHR Letter (for research only) Note: Forms are located under Cash Handling and Deposits on the Controller’s Office Website at: MECHANICS Required Documents

Controller’s Office 9 Petty Cash Replenishment Submit before fund is 50% depleted Charge to same DPA and Fund Number as on request for establishing fund Replenishments guidelines: Receipts must be: Original Attached to 8.5” x 11” paper with total amount clearly stated on each page (if taped with Scotch tape, do not apply directly on top of information) Signed off by Department PI if payment is made to anonymous research subjects Receipts for the purchase of gift cards are not acceptable MECHANICS

Controller’s Office 10 Change of Custodian Change of Custodian Form –Forms are located under Cash Handling and Deposits on the Controller’s Office Website at: UCPD Fingerprint Clearance memo Confirmation of online course completion What’s needed: (Necessary even if change is temporary) MECHANICS

Controller’s Office 11 Termination Cash Settlement & Fund Termination Form –Forms are located under Cash Handling and Deposits on the Controller’s Office Website at: Original copies of receipts for money spent Copy of Cash Deposit Journal and Deposit Slip What’s needed: MECHANICS

Controller’s Office 12 Audit – Petty Cash Counts Periodic cash counts by departments are required. Frequency of counts depends on type of fund and total or limit of fund. Cash counts should be performed by department manager or assigned senior staff. Discrepancies should be reported to the Controller’s Office immediately! Unannounced random counts may be conducted by Controller’s Office at any time. MECHANICS

Controller’s Office 13 Audit – Verification Letters Manager verifies Petty Cash Fund balance in presence of custodian Custodian and department manager sign and return by due date shown –Termination of Petty Cash Fund may result if custodian does not meet the deadline Department follow up on all discrepancies are required AUDIT

Controller’s Office 14 Routing Custodian should forward all petty cash forms and documents to the Petty Cash Desk at Campus Box Petty Cash Desk will audit and submit payment check requests and notify custodian of receipt and status via . Petty Cash Desk will return to preparer requests with errors or discrepancies. ROUTING

Controller’s Office 15 Replenishment Request Routing ROUTING

Controller’s Office 16 Petty Cash – Do’s Only accessible by the Custodian Kept separate from other funds (must not be co- mingled) Placed in a safe and secure place when not in use Used only for the purpose in which it was established Replenished on same DPA and Fund used for fund establishment DO’S AND DON’TS Petty Cash should be:

Controller’s Office 17 Petty Cash – Don’ts Petty Cash cannot be used for: Staff entertainment, meals or light refreshments Staff gasoline or other commute expenses Nor can they: Exceed $100 per transaction per day Exceed $150 per payment per research subject Be deposited into a bank account Furthermore: Gift cards should not be purchased unless they are for certain to be disbursed Social security numbers of research participants should not be visible on receipts submitted to Controller’s Office DO’S AND DON’TS

Controller’s Office 18 Policy Exceptions Policy exceptions are always considered, rarely granted Contact Toni Sims to request exceptions POLICY EXCEPTIONS

Controller’s Office 19 Common Errors Incorrect NCA on replenishment requests Missing proper departmental approval on Cash Action Form ‘White-outs’ on Cash Action Form Copies of receipts submitted instead of originals Replenishment requests addressed to A/P Desk, not to Petty Cash Desk Calculation errors Unsigned receipts that need a signature COMMON ERRORS

Controller’s Office 20 References Governing Policies Organization/Flow Charts Glossary REFERENCES

Controller’s Office 21 Governing Policies Policy – Petty Cash Funds revised – Published UC Business and Finance Bulletin, Policy for Cash and Cash Equivalents Received (BUS 49) Note: Policies may be found under Cash Handling and Deposits on the Controller’s Office Website at: REFERENCES

Controller’s Office 22 Glossary CHR – Committee on Human Research Cash Action Form – required documentation for establishing or increasing a petty cash fund Cash Settlement Form – required documentation for terminating or decreasing a petty cash fund Verification letter – standardized form to confirm a custodian’s fund balance Research Fund – a petty cash fund set up specifically to pay research participants for a particular study Change Fund – a petty cash fund set up specifically for the purpose of making changes Miscellaneous Fund – a petty cash fund set up for minor office expenses such as postage and reimbursement for parking and bridge tolls REFERENCES

Controller’s Office 23 Where’s The Help? Petty Cash Custodian Training Workshop sessions held bi-monthly Manual and forms available through Controller’s Office website at: Cash & Control personnel RESOURCES

Controller’s Office 24 Refer to the Controller’s Office website at: Under Cash Handling and Deposits, go to the Contacts page. –Look for the appropriate contact. –Review the Cash & Controls Org Chart. RESOURCES Who Can I Call?