300-32 Petty Cash Funds

 

Effective Date (revised): 5-1-05

Office of Origin: Controller's

I.     Purpose

This section outlines policy and procedures regarding establishment, use, replenishment and termination of petty cash funds.

II.      Definition

A.    Campus Cash Coordinator – The Senior Vice Chancellor – Finance & Administration or designee, who has responsibility for coordinating all cashiering operations on the campus.  The Campus Cash Coordinator as referred to in this document is housed in the Controller’s Office.

B.   Petty Cash Fund – A fixed fund used to make small payments without requiring the writing of a check or use of credit.  The total of unspent petty cash and the amount in receipts should equal the fixed amount of the fund.

C.   Custodian – The custodian is the person responsible for controlling and safeguarding the petty cash fund, and for ensuring that appropriate documentation is retained on each petty-cash transaction and fund reimbursement.

III.     Policy

A.    Purpose and use

                 1.      Authorization by the department head and the Campus Cash Coordinator is required for the establishment of a petty cash fund.

                 2.     The purpose of a petty cash fund is to provide a limited amount of cash, for the purchase of low-value supplies and services that are not practical to purchase under the low-value purchase authorization procedures and services for official University business.

                 3.     The fund must be used strictly in accordance with the purpose for which it was established and/or authorized.

a.    Written instruction detailing the procedures that must be followed in using petty cash funds will be provided to the custodian by the Campus Cash Coordinator.

b.    The department in which the fund resides shall be held financially responsible for any purchases that are not in compliance with University purchasing policies or with the terms of the petty cash fund authorization.

                 4.      Petty cash purchases may not exceed $100 per transaction, exclusive of sales tax, with any one vendor in a single day.

                 5.      Petty cash may not be used for the following:

a.    Entertainment, meals, or light refreshments (including approved caterers).

b.    Cashing of personal checks.

c.    Travel-related expenses, such as gasoline purchases, car rental fees, and per diem mileage.

d.    Purchase of services or materials available at a lower total cost through Campus Life Services.

e.    Purchase of supplies that is in conflict with Capital Projects and Facilities Management regulations.

f.      Restricted goods and services required to be purchased through Central Purchasing, including but not limited to firearms, explosives, ethyl alcohol, controlled substances, hazardous materials, unapproved caterers, and leases and rentals of vehicles and equipment.

g.    Loans to individuals or organizations for non-University transactions.

h.    Purchase of laboratory animals.

i.      Payroll payments.

j.      Services of an independent contractor.

k.    Inventorial equipment.

l.      Wine and liquor.

m.   Parking citations or driving citations.

n.    Other personal obligations.

                 6.     Per UC Regents Policy, bank accounts may not be established for Petty Cash Funds.

                 7.     Petty cash may be used for delivery charges, minor supplies, postage, and reimbursement for parking, bridge tolls, and business phone calls.

                 8.     Petty cash also may be used for payments to Human Research subjects from funds that have been set up specifically for that purpose and for which confidentiality is essential.  Payments to each individual should not exceed $100.  Payments over $100 should be made by preparation of a check request and submitted to Accounts Payable.  All petty cash disbursements must comply with all restrictions on the fund source. Petty Cash funds established for Human Research subjects are limited to payments to research subject expenditures.

B.   Physical security

Cash funds are particularly susceptible to theft, and it is the personal responsibility of fund custodians to take all reasonable precautions to safeguard the cash under their care.  In particular:  

1.     Each fund must be kept intact and not commingled with other funds.

2.    Only the custodian may have access to the fund.

3.     When not in use, the fund’s currency, coin, and receipts must be placed in a safe or locked receptacle kept in a properly secured drawer or file cabinet.  In the event of a theft, the loss must be reported to the UCSF Police Department and to the Campus Cash Coordinator.

4.     Funds must be protected using the Physical Security Guidelines in Policy 300-14 Cashiering.

C.   Proof of expenditures

When an expense is paid from the fund, a receipt must be obtained that contains the following:

                 1.      Date.

                 2.      Name of vendor or payee.

                 3.     Positive evidence that a payment was made, i.e. a cash register receipt or a handwritten receipt on which the word “PAID” appears.

                 4.      The amount paid.

                 5.     A description, on the face of the receipt, of the supplies or services purchased (entered by the vendor if a handwritten receipt is obtained or by the purchaser if a cash register tape receipt is issued).

                 6.     A signature indicating receipt of the supplies or services, on the face of the receipt by the person who received the supplies or services from the vendor. When the receipt is too small for signature, the receipt must be attached to a larger piece of paper and the receiver’s signature entered on the paper.

D.   Reimbursement of fund

Once a month, or more frequently when required, custodians shall request reimbursement of their fund by initiating a check request and forwarding it to the Campus Cash Coordinator in the Controller’s Office with the original receipts. The fund should always be reimbursed by the end of the fiscal year.

                 1.      Checks written to replenish the fund must be made payable to the custodian of the fund.

                 2.      The check request must indicate the account to be charged and must be approved by the appropriate department manager or delegate who is neither the fund custodian nor an employee reporting to the fund custodian.

                 3.      The encashment of petty-cash reimbursement checks can be accomplished at the drawee bank.  By virtue of a prior agreement between the University and the bank, there will be no charge to the payee.

E.   Relief from responsibility

                 1.     Custodians of funds terminating University employment or transferring to another position are responsible for notifying the Controller’s Office and returning their fund to the Campus Cash Coordinator with the Cash Fund Action Form.  

a.    If the fund consists of cash and un-reimbursed receipts, a reimbursement check should be requested as outlined in Section D, above.

b.    Any newly-assigned custodian must prepare a Cash Fund Action Form in addition to meeting the security requirements as outlined in Section H 1., Procedures for Requesting a Petty Cash Fund, below.  

                 2.      As an alternative to 1, as described above, the department may complete and send a Petty Cash Change of Custodian Form to the Controller’s Office. The purpose of this form is to document that the department head has approved the CHANGE of custodian, that the total of cash and the receipts equaled the specified amount of the fund, and that the new custodian is aware of the specific responsibilities related to the custody of the fund.

                 3.      Should a custodian terminate University employment or transfer to another position and neglect to return the petty cash fund or leave the petty cash fund in the department, the department head must deposit the petty cash fund and obtain a receipt in the custodian’s name. If the custodian does NOT leave the petty cash fund in the department, the Controller’s Office will charge the balance of the fund to the department, and it shall be the responsibility of the department to recover the amount of the fund from the former employee.

F.    Audits

A surprise cash count of each petty cash fund, including a review of the documents on hand, must be performed at least annually.

                 1.    The Campus Cash Coordinator or designee will perform surprise cash counts and review the documentation, and shall report any major discrepancies disclosed by the cash count to Audit Services.

                 2.     The Petty Cash Verification Letter should be sent to departments semi-annually with follow-up on discrepancies.  

G.   Off-campus departments  

      Departments located off the campus may be granted exceptions to these policies and procedures.  Arrangements should be made by direct communication with the Campus Cash Coordinator.  

H.   Procedures

The procedures for requesting, administering, and terminating Petty Cash Funds apply to all campus units and supersede all campus practices in existence prior to the effective dates.  

                1.      Procedures for Requesting a Petty Cash Fund.

                 2.      Procedures for Terminating a Petty Cash Fund.

IV.      Responsibility

         The General Accounting Department of the Controller’s Office is the campus authority for establishing and administering the Petty Cash         Funds procedure.

V.      Related policies

        None.

VI.      References

      Accounting Manual C-173-61

      Related Forms

Cash Fund Action Form

Request for Sensitive Employee Fingerprinting

Petty Cash Change of Custodian Form

Petty Cash Verification

Cash Settlement & Fund Termination Fund

     Procedures for Requesting a Petty Cash Fund

     Procedures for Terminating a Petty Cash Fund