cash controls at osu. what is “cash”? currency, coin, and cash equivalents: checks traveler’s...
TRANSCRIPT
CASH CONTROLS AT OSU
WHAT IS “CASH”?
• Currency, coin, and cash equivalents:
ChecksTraveler’s checksCashier’s checks
Credit card records
EFTs: ACH and wire transfers
Items of cash value: ticket, gift cards/certificates
BEST PRACTICES
• For handling currency and coin:
• Be watchful for counterfeit bills• Count cash out of public view• Count cash in double custody• Always give a receipt• Store cash in secured locked receptacles• Deposit in person at the Cashiers Office
• For accepting checks:
• Endorse all items promptly upon receipt
• Store checks in secured locked receptacles
• Examine the legal line
• Deposit daily. Late deposits increase the risk of NSF or stop payment checks.
BEST PRACTICES
• Protect assets
• Protect reputation
• Protect employees
•Weaknesses in internal controls can result in substantial losses.
INTERNAL CONTROLS
• Physical safekeeping of assets
• Separation of duties
• Accountability
INTERNAL CONTROLS
• Cash processing areas are secured from entry by unauthorized people
• Cash is stored securely
• Cash is not left unattended
SAFEKEEPING OF ASSETS
• Frequency of cash revenue
•Nature of business
• The physical layout of the office
IMPACTING SAFEKEEPING
•No individual has control over the entire transaction cycle
Receiving
Depositing
Recording
Reconciling
SEGREGATION OF DUTIES
• Frequency of cash revenue
• Lack of staff
•Management trust
IMPACTING SEGREGATION OF DUTIES
•Who has access to cash and why
•Where an asset is at all times
•Where keys are at all times
• Transfers are documented
• All transactions can be traced
ACCOUNTABILITY
• Cash is deposited within 24 business hours of receipt
•Web departmental deposits• Deposits can be submitted electronically and
tracked.• Can be scanned w/backup and sent to:• [email protected]
DAILY DEPOSITS
• A documentation file containing processes that are clearly defined
• Cash handling procedures for your department• Copies of these procedures signed & dated by
the employees responsible for the execution of these procedures
• Documentation, including regular reconciliations and custody assignment, for the petty cash or change fund.
• Cash transfers are done in dual custody
DOCUMENT YOUR INTERNAL CONTROLS
• Verify employee’s employment history
• Perform background checks
• Make sure they have cash handling training
• Know your cash custodians
KNOW YOUR PEOPLE
MISSOURI STATE BOOKSTORE
MISSOURI STATE BOOKSTORE
“Converted checks from textbook companies to cash”
“ found $81,000 in cash in desk while manager was on vacation. . .”
“Admitted he embezzled more than $1.1 million over eight years. . .”
Missouri State Bookstore Manager:
• Trust your employees but verify their work. Regularly have someone oversee the work of employees handling financial transactions.
• Set the right tone so that all employees know that dishonesty won’t be tolerated.
• Use your understanding of the business to conduct investigations whenever actual results are different than you think they should be.
SOME ADVICE ON TRUST
One example:City of Dixon, Illinois
Rita Crundwell, Comptroller is in prison afterStealing $53 million in public funds.
City of Dixon, primary account holder, with a second account holder listed as RSCDA c/o Rita Crundwell.
. . .the biggest municipal embezzler in US history
“Rita Crundwell is a big asset to the city. She looks after every tax dollar as if it were her own.”
• But won’t the funds be missed?
• Not if there is little or no reconciliation going on!
• Must be able to show that you are reconciling:• Receipts to deposit• Deposit to Banner
RECONCILIATION
• Must be reconcilable. Custodian has the actual cash or a receipt for any cash not on hand.
• Custodian’s manager should verify that the fund balances periodically.
• Only the custodian should handle the fund.
Cash on Hand
Receipts on Hand
Recorded Amount of the Fund
PETTY CASH FUNDS
• They “disappear”
• They “grow” or “shrink”
• Custodians are changed without documentation
• Resolve these problems quickly, they are audit issues
PROBLEMS WITH PETTY CASH FUNDS
•Where the heck are they?
• Business Affairs—link to Business Center Resources
• FIS Manual: 1402-10
PETTY CASH FORMS
•Get Ready• Review your own office like an auditor• Document procedures• Separate the duties• Train employees• Deposit daily• Reconcile monthly
PREPARE A CHECKLIST
