Cash handling what is

Skip to main content. Office of the Controller. General Cash Handling Terminology and Principles. General Cash Handling Principles Stewardship The careful and responsible management of something entrusted to one's care.

As University employees, we are responsible to our stakeholders, to be good "stewards" of the public trust. Accountability One person has sole responsibility for a fund. Overlap with other roles will be allowed if necessary provided the assignments are in compliance with the role overlap restrictions described below. Audit Control: None.

Policy: Required Role We recommend that this person be someone different than any of the individuals in the roles. However, if no other option is available, it may be the same person as the Cash Collection Point Supervisor. Policy: Optional Role We recommend that this person be a different individual than any of the other roles.

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Your feedback will be reviewed. At a minimum, the safe's combination should be changed at least annually. The change should be documented to show the date and reason for the change. Especially in a main cashiering or sub-cashiering station, safety for both the employees and the cash is improved by having a second person present when the office is opened and again when it is closed for the day. A reconciliation is performed to verify the processing and recording of transactions.

If the answer to any of these questions is NO, perform additional research. This includes following-up on any differences or discrepancies. Therefore, the four critical policy activities for staff with these responsibilities differ from those of cashiers.

The information below highlights the critical control activities related to petty cash and change funds. The custodian can be held personally liable for losses due to the custodian's negligence. Separation of Duties Occasionally, the supervisor or someone other than the custodian, performs a surprise count of the fund. The supervisor, unit head, or designee reviews and approves all forms related to the operation of the fund.

This includes accepting responsibility for verifying the accuracy and appropriateness of supporting documentation and arithmetic totals, etc. This individual also ensures that the custodian manages the fund in accordance with established policies and procedures.

Reconciliation The custodian should regularly monthly or quarterly - based upon the amount of the fund ensure that the amount of the fund cash and receipts remains intact. Within 30 days of the ending reporting date, the fund custodian completes a reconciliation or verification as appropriate of the fund for General Accounting's review. Physical Security The fund should be locked up except when in use. Avoid S locks. Each fund is to be maintained and stored separately, for example, in it's own envelope, cash bag or cash box.

Unit supervisors and managers must ensure that all cash handlers are properly authorized to handle cash. Individual accountability for cash shall be maintained throughout all cashiering operations. One of the most important steps your unit can take to protect cash -- and you the cash handler -- is to separate cash handling duties among different people.

This way, no one person has control over the entire cash handling process. This principle is called Separation or Duties or Segregation of Duties. Practice - In separation of duties at least two people are involved in any cash handling transaction. Next we'll discuss a special application of the Separation of Duties principle, called Dual Custody.

Practice dual custody when transporting cash, counting large amounts of cash, and other risk critical actions. Watch police officers on patrol, Loomis guards transporting cash, or a grocery clerk depositing cash to a safe.

When working on high risk tasks, they always work in pairs. One person carries the cash and makes the deposit, the other monitors for safety and keeps the other partner in view. Involving two people in a critical cash handling task is a special application of Separation of Duties called Dual Custody. At UCSC, whether you are depositing cash to a drop box, counting cash, or engaging in any such critical task, having two people engaged in that activity together is an important practice.

You have just learned the two key pre-conditions for effective cash handling and control. Let's review them here:. Pre-condition 2: Maintain separation of duties and dual custody. Thousands of dollars exchange hands daily on campus, usually in the form of cash, checks and credit cards. Cash transactions are not things, but events that begin and end. Unless they're documented, there is no way to track the movement of money.

This has big consequences. A few campus units receive a large volume of payments by mail rather than in person. Separation of duties requires that at least 3 employees be involved in the processing of remittances. In this situation, when a receipt is not mailed to the payer, the payment is recorded to the appropriate account. In this situation the unit should photocopy the check, and proceed to process the check for inclusion in the unit's next deposit to a main cashiering station. Whenever you receive a check, you must endorse it on the back to prevent it from being negotiated inappropriately before depositing it with the main cashier's office or the bank.

Applying the principle of individual accountability , either the stamp needs to identify the individual cash handler with a unique number or letter or the cash handler can initial next to the endorsement. Since all monies become the responsibility of the Regents of the University of California you must stamp endorse all checks payable to: "Regents of the University of California" or to "UC Regents".

So far, you have endorsed the check s , given a receipt to the customer, and kept your cash in a locked and secure location. The next step is to complete the proper deposit slip. Staff working in a main cashiering unit, will complete the bank's deposit slip for Bank of America.

What would you do if someone walked in and said, "Stick'em up! Give me all your money! Of course it's hard to hand over money with your hands still in the air, but the robber won't quibble with you. The wise thing, of course, is for you to hand it over. But, why give more than you have to?

Keep just the minimum amount of cash at your station by making regular cash deposits to a main or sub-cashiering station or the night deposit. If using a cash register, remove extra accumulated cash and store it in a secure location until the deposit can be processed. If others don't know that you have cash, especially a lot of cash, they are less likely to be barging in demanding the money.

At the end of the workday, secure all funds and leave the register's cash drawer open so that it is obvious that the register contains no cash. There will be times when your cash and receipt amounts will be different and won't balance the first time.

This is very common and most often due to clerical errors. As a cash handler, you must investigate the differences to determine its source. You must account even for small cash differences, because over time they add up to large losses for the University. Though most cash differences can be traced to clerical errors, be especially alert to mysterious losses or patterns of loss.

In this course, we intended to raise your awareness of important cash handling principles and practices to support UCSC's core values of Ethics and Integrity. We discussed your fiduciary responsibility , i. We outlined the Five Cash Handling and Control phases:. For each phase, we provided simple, but key control tasks for you to accomplish. A list of contacts is available under Campus Resources. These tasks are summarized in the chart on the next page which you can use for reference. Therefore, the campus has created a process that allows a campus unit to request an exception.

Include the following information in a request for an exception:. Cash handlers are not to exchange checks for currency to make change for each other. Nor are employees of a cashiering station to cash checks for themselves or for co-workers. Also, it is not appropriate to replace any portion of a deposit with a personal check. Audits of cash handling processes and controls may periodically be performed by either Internal Audit or staff from Accounting or the Cashier's office.

You have now completed the Basic Cash Control Training. We hope that as a result of this training you don't feel like this runner looks. Please send your comments - both positive and negative to controller ucsc. This page location is:. Sign In. Financial Affairs Sign In. Cash Handling Guide Page Content. View in Web Browser. Selected Step. Containing Section. Entire Guide. What is Cash? Where to get Help. Cash Handling Contacts. Introduction Cashier Training. Staffing Only competent, qualified staff may handle cash.

Refer to Cash Handler Proficiency at the bottom of the section for more information. Ensure personal safety. Refer to Safe Cash Handling at the bottom of the section for more information. Ensure that a cash handling duty does not conflict with other duties. Refer to Separation of Duties at the bottom of the section for more information. Maintain accountability by ensuring identity of the cashier handling each transaction can always be determined.

Asset Protection Safeguard cash. Keep the cash register drawer closed except when processing a transaction. Never exchange cash between cash registers, cash boxes, cash bags, etc. Store undeposited cash in a locked, secure place when vacating the cash handling work area.

Excess amounts of cash accumulated during the day should be removed, counted, and placed in a secure location by a supervisor. Refer to Securing Currency, Coin, and Checks at the bottom of the section for more information about securing cash.

Risk Management Failure to follow the cash handling procedures described in this guide will result in the affected department being fully responsible for any lost revenue and any banking-related fees incurred Continued failure to comply with the procedures will result in the revocation of the department's authority to handle cash.

Some campus units have unit-specific cash handling practices. Contact Staff Human Resources to obtain the information needed to arrange for a background check.

If the prospective employee has access to large amounts of cash, a hiring department may conduct other procedures, such as a credit history check, to ensure the bondability of the cash handler.

If a prospective employee's employment history or background check reveals felonies, misdemeanours, or judgements due to a fraud related to cash, stocks, bonds, or any other financial transaction, the hiring unit must obtain a satisfactory explanation before hiring the employee No Conflicting Duties: An individual involved in the cash handling process must not be assigned conflicting duties.

Refer to Cash Handling Separation of Duties below for more information on this topic. Proper Training: The individual involved in cash handling must receive the support and training necessary to successfully perform their job duties. Cash handling training is required when an employee begins employment.

Additionally, cash handlers are required to have cash handling training on an annual basis. If a unit does not have a training program, Financial Affairs provides a self-paced training guide here. Also, the quiz is available here. Safe Cash Handling. This category of duties includes the physical handling of cash at any point in the process.

Booking transactions to the general ledger, subledgers, and journals. This category of duties involves recording financial transactions associated with the collection and depositing of cash. Different, qualified employees are expected to handle each of the following key responsibilities associated with cash handling and change fund management: Cash receiving or cashiering and counting cash as part of the cash drawer closing process.

Ensure that the lock is not of the S type, which is commonly found throughout the campus. The campus locksmith can install a different, less common lock. Beginning of the Day Checklist Ensure a sufficient amount of change in the appropriate denominations is readily available.

Count the amount of currency and coin in the cash drawer or fund, noting the amount for use in balancing cash at the end of the day. Arrange currency in the cash drawer so that the top of each bill faces left. During the Day Checklist Remove the band or wrapper from a bundle of strapped currency before issuing bills from it.

Removing any bills without removing the rubber band or wrapper will result in an incorrect count and will prevent you from balancing your cash at day's end. Provide the customer with one of the following types of receipts for each transaction: Cash register receipt Handwritten receipt issued from a prenumbered receipt book. Each receipt book contains duplicate prenumbered receipts allowing for the retention of a copy of each receipt issued.

The amounts indicated on receipts are added up at the end of the day and used to reconcile the beginning of the day cash balance in cash drawer or receptacle to the end of the day cash balance.

Consecutively numbered ticket from a roll of tickets or a series of permits. For control purposes, keep track of beginning and ending ticket numbers or use a double ticket roll, which enables retention of a copy of each ticket issued. Your supervisor must approve all voids and refunds at the time of occurrence if practical, but no later than the end of the day; attach all relevant documentation. Obtain approval of all voids and refunds from your supervisor if this has not already been done at the time of occurrence.

Close out the cash drawer The cashier is responsible for counting cash. If the cash collected does not agree to the recorded total, perform the following steps: Re-count the cash. If the cash collected still does not balance, if possible, have a second cashier count the cash.

If the cash collected still does not balance, if possible, have a third cashier count the cash. If the cash still does not balance, the supervisor should discuss with the cashier responsible for the cash drawer any unusual transactions that may be the cause of the imbalance.

After counting and balancing cash, a supervisor is responsible for securing the cash drawer in a secure location, such as a safe. Currency and Coin Practice good cash handling habits. Minimize disputes over the amount being paid by a customer by leaving currency on the cash register ledge or other secure area visible to the customer until the transaction is completed. Check for large-denomination counterfeit bills. Use a counterfeit bill detector pen, which may be purchased at most office supply stores.

Count change back to the customer. Make sure the currency, coin, or check from a transaction is placed in the cash drawer or other secure container or location before handling the next transaction. Payments made in non-US currency cannot be accepted. Follow these steps to handle a transaction involving a check: Ensure the check meets all of the following criteria: Properly filled-out and all information provided is legible Payable in U. The department bears all risks and costs associated with accepting this kind of check.

Handling Checks Drawn on a Foreign Bank Follow this step in addition to those described in the sections above: Ensure the check is acceptable at face value by UC's bank Contact the campus cashier's office for further guidance before processing the check.

Important information to know: Be aware of the types of credit cards your department accepts. Do not accept a traveler's check that does not have the signature that is supposed to be provided at the time of its purchase. Refer to Completing a Cash Deposit Form at the bottom of the section for information on how to complete this form: The blue and white copies accompany the cash deposit.

The yellow copy is retained by the department for reference and ledger transaction review purposes. If it is too late in the day to make a deposit, store the deposit in a secure location, such as a safe.

This multi-part form may be purchased from the Baytree Bookstore. Provide the following information in the specified sections: Record sales tax collected to the left of 'Sales Tax Payable.

Collecting Office Enter name of campus unit. Cash Collection Dates Enter beginning and ending dates on which these funds were collected. For Sections A through D, enter dollar amounts in the far right column Section A If your unit uses a cash register s , complete this section. Section B If your unit issues manual receipts, complete this section. Manual Receipt Totals issued in sequential order , and dollar total. Section C If you had any voids, overrings or credit card collections, complete this section.

Section D Record total cash collections. Cash over or short is the difference between cash collected and the amount actually deposited to the Main Cashier. Section G Record the amount of currency, coin, checks, and total amount cash and checks only deposited to the Main Cashier.

Do not include credit card amounts. Retain the yellow copy of the form for departmental use; this copy may be used by the general ledger transaction reviewer. Retain the pink copy of the form, attach supporting documentation, such as cash register or adding machine tapes and send this material to: Accounting Office, Attention: General Accounting.

In addition, a reference number will be provided. Retain the blue and yellow copies of the deposit form for two 2 years from the date of the deposit. The blue copy is used by your department's budget analyst when reconciling the unit's general ledger.

Important things to know: A change fund is used only to make change; the balance in the fund never changes unless increased or reduced. A change fund cannot be used to make purchases or reimburse out-of-pocket expenses; use a petty cash fund for these purposes. To minimize the risk of theft and to maximize University investment income, the amount of a change fund is to be kept to a minimum.

A change fund may be temporary or permanent. Departments with on-going cash sales activities need a permanent change fund. Departments with one-time or seasonal sales events need a temporary change fund. Examples include conferences, special events, festivals, and seasonal operations, such as college coffee shops. A prospective change fund custodian must possess the following qualifications: Basic knowledge of University cash handling policies and procedures.

Information on background checks is available from the Staff Human Resources Office. A departmental change fund is subject to unannounced cash counts conducted by either Financial Affairs or the Office of Internal Audit.

The change fund custodian is responsible for the following: Maintaining the quantities of currency and coin needed to maintain an effective cash handling operation. Storing the change fund in an appropriate, secure receptacle when not in use. Refer to Securing Currency, Coin, and Checks for more information about securing change funds.

Keeping the change fund physically separate from a petty cash fund, if one exists. Regularly reconciling the change fund and certifying the wholeness of the fund. Reporting the loss or theft of change funds to the appropriate authorities.

The change fund custodian may be held personally liable for losses caused by negligence or malfeasance. As an example, prior to signing i. Obtain the approval i. Submit the form to the Accounting Office. After the request is approved, a check, payable to the fund custodian, will be issued. Make permanent note of your fund custodian reference number which is provided on the accompanying transmittal memo.