Funds Handling (Cash Receipts)
Overview
Departments should avoid cash receipts and associated funds handling when possible. It is recommended that Departments explore the option of utilizing the University’s Accounts Receivable system in lieu of handling cash. It is the policy of Virginia Tech that the billing and collection of all receivables are processed through the University’s central Accounts Receivable System managed by the Office of the University Bursar, unless an exception is granted by the University Bursar. The following policies and procedures must be present in areas that handle funds.
- Areas accepting funds on a regular basis (three or more days per week) are required to obtain written approval from the Office of the University Bursar before becoming a cash collection point. To begin this process, please submit a ‘Funds Handling Plan’ request form, which can be found on the Office of the University Bursar’s website. For those departments collecting funds on a regular basis, deposits must be made daily.
- Those areas with casual collections of funds (i.e. occasional refunds, reimbursements, rebates, etc.) are not required to obtain prior approval; however, they must follow University Funds Handling (Cash Receipts) Guidelines and Procedures. It is considered a best practice for departments to deposit all accumulated cash daily. Collection points that accept funds on a casual or one-time basis must deposit no later than five (5) business days after initial receipt or when accumulated funds total $500.00.
- Ensuring that a system is in place to record and safeguard all cash receipts properly until they are deposited. This is generally documented in the Funds Handling Plan.
- Ensuring that all cash receipts are deposited in a timely fashion (within 24 hours of receipt).
- Departments should avoid retaining cash receipts over nights, weekends, and holidays if large sums of money are involved or if the facilities do not provide adequate physical security.
- Ensuring employees who are assigned cash handling duties are trained adequately in the appropriate procedures (the funds handling written procedures should be available to these employees).
- Ensuring the department manager or designee reviews the funds handling procedures on a periodic basis to ascertain compliance.
- Ensuring the appropriate sales tax is collected for all taxable transactions, and state sales tax returns are completed and mailed to the Controller’s Office in a timely manner (by the 10th day of the month following the period covered by the return).
- Bank accounts may not be established at the department level in the University’s name (i.e. Virginia Tech, Virginia Polytechnic Institute and State University, etc.) or any derivative thereof.
- Establish, review, and update written departmental funds handling procedures and ensure compliance with the University Funds Handling Guidelines.
- Ensure adequate reconciliation procedures are performed to verify that all cash received was properly deposited and recorded in the Banner Finance system.
- Establish appropriate segregation of duties between the different roles in the funds handling process
- Department Head, Director, or Manager
- Implement and maintain good business practices (internal controls) over cash receipts. This is accomplished by establishing written departmental and unit procedures and periodically monitoring staff performance to ensure compliance with these procedures.
- Cash Handler
- Receives the funds and records the payment. Payments are recorded by the use of a mail log, multiple copy pre-numbered receipts, or cash register. The original receipt must be given to each customer for in-person transactions. The department retains receipt copies or cash register journal tapes with the daily receipt documentation.
- Depositor
- Responsible for verifying/re-adding the funds, receipts and/or source documents and comparing the amounts to the ‘Cashier Log.’
- Reconciler
- Responsible to perform monthly departmental. Reconciliations are performed by someone other than the person receiving the funds and the person preparing the deposit.
- Accurately following and enforcing the specific steps required by each role listed above.
- Departments should use university security personnel to transport large deposits.
- Departments should seek to not engage in regular funds handling unless necessitated by the nature of the area.
- Department Head, Director, or Manager