Cash Handling Procedure

Overview

Many units receive cash on behalf of the University for the sale of goods and services (cash sales). Payment by currency (bank notes & coin), cheques, bank drafts, money orders, and credit and debit card are all possible forms of acceptable payment. Strong internal controls must be in place to ensure cash proceeds are adequately safeguarded and deposited, and accurately reflected in the University’s General Ledger. It is imperative that units opting to conduct cash transactions fully understand and accept the related cash handling responsibilities.

Purpose

To state the responsibilities and required procedures related to the safeguarding of cash, segregation of duties involving cash handling, the processing of cash proceeds, and ensuring the completeness of cash transactions.

PROCEDURE

1. SAFEGUARDING CASH

All cash received in a unit is the responsibility of that unit until it is deposited with Financial Services’ Cashier or directly with the bank.

All cash must be kept in a secure location. Particular attention needs to be paid to the security of cash overnight and during the day. Cash must not be left unattended during the day. Cash should be stored overnight (or during the day while unattended) in a cash box within a locked cabinet or safe to which there is restricted access.

Under no circumstances are cash proceeds to be used for making loans, advances, or to pay for University expenditures. All cash proceeds must be properly deposited (see ‘Processing Procedures’ section below).

2. SEGREGATION OF DUTIES

Critical controls such as segregation of duties, limited access, and regular reconciliation are important in handling cash.

The number of individuals authorized to receive and handle the cash should be limited. The individual who receives cash should prepare a listing of all incoming cash.

Each unit should ensure that the responsibility for receiving cash is segregated from the responsibility for depositing the cash. No one person should be permitted to handle a transaction from beginning to end.

A supervisor should compare the record of the initial receipt of cash to the amount deposited. Specifically, the Deposit Form, which reflects both the amount deposited and the General Ledger entry, should equal cash register totals or receipt book totals for the same period.

3. PROCESSING PROCEDURES

All cash proceeds must be receipted immediately with either pre-numbered official University of Alberta receipts or approved cash register receipts. All receipts must include the University of Alberta Receipt No., items sold, and GST Registration No. (the receipt should not be confused with POS terminal debit or credit card sales drafts, or manual credit card sales drafts, which include transaction information only). It is good practice to record the form of payment received on the receipt (i.e. currency, debit card, cheque, type of credit card). See the University’s Cash Receipting Procedure for specific details.

Refer to Tender Types & Related Procedure for required payment-by-cheque related procedure.

All cash proceeds must be regularly deposited into an authorized University of Alberta bank account. See Cash Deposit Procedure for specific timelines for depositing cash proceeds

Units must ensure cash proceeds are correctly coded to unit/departmental accounts and the GST collected is properly recorded. All deposits require Internal Control approval to ensure accuracy of coding. See Cash Deposit Procedure for additional details

4. COMPLETENESS OF CASH TRANSACTIONS

Cash transactions must be reviewed and reconciled to General Ledger accounts on a monthly basis at minimum to ensure they have been correctly recorded. Accounting adjustments to the General Ledger must also be made on a monthly basis.

Units will be required to periodically account for the sequentially numbered Deposit Forms issued to them. See Cash Deposit Procedure for additional details.

The overall completeness of revenue for each unit should be evaluated by comparing actual revenue recorded in the General Ledger to budget or forecast amounts.

DEFINITIONS

FORMS

RELATED LINKS

Banking Policy (University of Alberta)

PUBLISHED PROCEDURES OF THE PARENT POLICY