Policy in regards to request, replenishment, management, and closure of petty cash funds.
Petty Cash Funds should be used for the purchase of miscellaneous supplies and services. The procedures below were developed in an effort to provide a uniform and systematic method in the establishment and maintenance of Petty Cash Funds. Petty Cash Funds discussed in the procedures below only refer to Petty Cash Funds established for non-research incentive purposes.
Establishment of Petty Cash Funds
Written requests from the Account Sponsor for the establishment of Petty Cash Funds are to be sent to the Controller's Office for approval. Requests for these accounts are to contain:
1. Reason(s) for the fund.
2. Chartfield spread to be charged.
3. Amount requested.
4. Individual assigned responsibility (custodian) for the fund.
5. Complete, signed, notarized Form 3 and PeopleSoft Voucher Register (On-Demand Voucher).
1. Expenditures against Petty Cash Funds will not exceed the established authorized dollar limit.
2. Disbursements against Petty Cash Funds are restricted to miscellaneous small dollar expenditures for supplies and services which are of a nature that require immediate payment. No disbursements should be made for the following:
a. Utility bills, including telephone bills.
b. Travel reimbursement.
c. Vehicle maintenance.
d. Check cashing.
e. Loans to employees.
f. Purchase of stamps.
g. Catering services.
3. Advance payments cannot be made from Petty Cash Funds.
4. Petty Cash Funds should not be co-mingled with other cash funds.
5. Petty Cash Funds cannot be used to absorb cash overages and shortages of other cash receipting activities.
6. Duties of Petty Cash Funds custodians should not include responsibilities of other cash receipting activities.
7. Petty Cash Funds are subject to audit by Internal Auditing.
8. Surprise cash counts should be performed no less than quarterly by a person within management or their designee.
Cash Fund Counts Procedure and Cash Fund Reconciliation Form
Maintenance of Petty Cash Funds
Initiation of fund maintenance will begin with the receipt of the Petty Cash Fund proceeds from Financial Services. Funds received should be kept in a secure location, i.e., safe, locked desk, etc. Evidence of disbursements should be retained and kept with the fund as expenditures are incurred for the approved purpose. The fund must be reconciled monthly to provide an accounting of the amount authorized versus the cash on hand and the amount outstanding not reimbursed to-date.
Because State Agencies are exempt from paying sales tax, invoices for supplies and materials purchased should not reflect sales tax. Vendors are to be advised at the time of purchase that the purchase is for a tax exempt State Agency. If needed, the Health Sciences Center tax exempt letter can be obtained from the Purchasing website.
Reimbursement of expenditures of Petty Cash Funds should be made on a routine basis but no less frequently than monthly to ensure sufficient funds are available to pay appropriate petty cash purchases. Procedures to request reimbursement are as follows:
1. A voucher payable to the fund custodian must be created in the accounting system and forwarded to the Accounts Payable Section for reimbursement of expenditures made since the prior reimbursement was processed.
2. A signed Form 3 Claim payable to the fund custodian must be attached to the voucher including evidence of payments. The request for reimbursement should bring the Petty Cash Fund up to the authorized Petty Cash Fund limit.
Changing Custodians of Petty Cash Funds
When a change of custodian on a Petty Cash Fund is required, a memorandum referencing the specific Petty Cash Fund should be sent to to the Assistant Controller's Office within Financial Services, stating the name, phone number, and departmental mailing address of the new custodian. The memorandum should be signed by the individual assuming responsibility for the Petty Cash Fund. At the time the responsibility is assumed, the new custodian should count the Petty Cash Fund in the presence of the previous fund custodian or other appropriate departmental staff to insure the fund is intact.
Closing Petty Cash Funds
To close a Petty Cash Fund, process a deposit for the exact cash amount of the fund (GL Code 490900 should be used on the deposit). A memorandum stating your intention to close the fund along with a copy of deposit documentation should be sent to the Assistant Controller's Office within Financial Services.