Establishing Change and Miscellaneous Payment Funds
Responsible University Officer(s):
- Chief Investment Officer
- Chief Investment Officer
The University authorizes the use of cash in departments for two reasons; (1) Change Funds, and (2) Miscellaneous Payment Funds. Change Funds are used by departments to make change for cash business transactions. Miscellaneous Payment Funds are rare, and used in situations when cash is necessary to pay miscellaneous expenses.
To minimize the handling of cash, the University Treasurer considers approval of these funds only when a department demonstrates that standard payment methods established by the University, will not meet the unit's business needs. If approved, units must manage these funds in accordance with the procedures and guidelines in this policy.
These funds are managed and monitored at a University-wide level by the Office of Investment and Banking, Disbursement Services, and Treasury Accounting. These funds are NOT authorized, or issued, from campus level business offices. The Treasurer will periodically review all authorized departmental cash, to determine if there continues to be a legitimate need for cash.
REASON FOR POLICY
Cash is a liquid asset of the University, and must be handled diligently by University staff. Documented incidents of departmental loss, and misuse, of cash indicates the need for strong controls. Excess and unnecessary cash in departments has an impact on the University's Risk Management deductibles and premiums. Cash in departments increases the risk of loss, fraud and embezzlement.
Recent changes, and improvements in purchasing and payment methods, banking regulations, international payments, and electronic technology virtually eliminate the need for petty cash in departments, and non-travel cash advances to employees.
Adherence to this policy will:
- Reduce unnecessary cash in departments.
- Increase cash available for daily investments.
- Increase income earned by University investments.
- Satisfy audit requirements regarding the accounting for, and verification of, cash on hand in departments.
- Satisfy financial reporting requirements of Federal and State regulatory units.
|Primary Contact(s)||Stacy Hebdonfirstname.lastname@example.org|
|Document Processing||Disbursement Servicesemail@example.com|
|Accounting||Treasury Accounting||Katia Wieber
|Audits||Office of Internal Audit||612-625-5898||612-625-1512
|Disbursing Cash||Bursar Office - TC||612-625-7535||612-626-0387|
|Cashier - Duluthfirstname.lastname@example.org|
|Cashier - Crookston||218-281-8326|
|Cashier - Morris||320-589-6005|
|Theft of Cash||University Policeemail@example.com|
- Cash Reconciliation Log (CRL)
- Transaction log, on which departments, with a miscellaneous Payment Fund, record all cash transactions.
- Change Fund
- Cash issued to departments for one of two reasons; (1). The department's primary function is to sell goods or services on behalf of the University of Minnesota (e.g., Internal Sales Organization, Auxiliaries, Sales and Support of Educational Activities); (2). A department is hosting, or sponsoring, an event that requires making change for the cash transactions of the event. Cash is not used to reimburse departmental or employee expenditures, or pay invoices. Departments return cash when it ceases operations. Requirements for handling these funds are specified in the appendix of this policy.
- Miscellaneous Payment Fund
- Cash issued to departments, in rare instances, when miscellaneous expenses cannot be paid using standard University processes. Cash is only used for University related business expenses. Requirements for handling these funds are specified in the appendix of this policy.
- Office of Investments and Banking
- Procurement Card (formerly Purchasing Card)
- A University approved charge card used by employees to pay for certain authorized purchases up to $999 on sponsored funds and up to $2000 on non-sponsored funds.
- Treasury Accounting
- Provide departments with accounting, and financial reporting assistance. Prepare University's financial reporting.
- Dean or Department Head
- Ensure compliance with this policy. Establish and develop departmental procedures to adhere to all requirements for handling cash as specified in the appendix of this policy. Oversee and monitor those departmental procedures. Review CRL. Authorized signer on cash requests.
- Office of Internal Audit
- Conduct routine audits of cash handling procedures during normal audit process. Conduct special reviews or investigations at the request of University departments or others with concerns or allegations.
- Bursar/Cashier Office
- Provide check cashing services for departments with approved requests.
- Investigate all standard University purchasing and payment methods before requesting cash. Initiate and prepare request. Obtain required approvals. Maintain CRL and submit it as part of the replenishment process. Adhere to all requirements for handling cash as specified in the appendix of this policy.
- Disbursement Services
- Process documents. Monitor database of outstanding cash advances. Advise departments on standard University purchasing and payment methods. Administer the Purchasing Card Program.
- Office of Investments and Banking (OIB)
- Manage and update policy. Review and approve cash requests. Monitor banking regulations, purchasing methods, and technology changes that impact the need for, and use of, cash. Advise departments regarding this policy. Correspond with departments regarding the outcome of cash request reviews.
- Determine the University-wide philosophy regarding the use of cash.
- University Police
- Respond to departments reporting theft of cash. Assist departments with completing an official theft report. Provide department with a official copy of the theft report. Investigate the theft to find and prosecute responsible individual(s).
- Board of Regents Policy: Reservation and Delegation of Authority
- Disbursement Services Procedures
- Administrative Policy: Accepting and Depositing University Revenue
- Administrative Policy: Hospitality and Special Expense
- Administrative Policy: Selling to External Customers
- Administrative Policy: Traveling on University Business
- Administrative Policy: Using the University Purchasing Card
- Administrative Policy: Utilizing University of Minnesota Bank Accounts
- Chart of Accounts Training Materials
- March 2007 - Updated and clarified definitions and responsibilities sections.
- February 2003 - Corrected bad links in Related Information section. General Delegations policy now superceded by Reservation and Delegation of Authority.
- September 1997 - Added Cash Reconciliation Log to Forms section.
- June 1997 - Added Chart of Accounts to Related Information section. Added Cash Reconciliation Log Instruction Sheet to Forms section. Updated phone numbers in Contacts section. Clarified Definitions, and Responsibilities sections. Clarified all procedures.
- April 1997
- 01/95 Temporary Advance Procedures
01/93 Permanent Advance Procedures
11/91 Permanent Advances, Financial Policy Section