welcome [] · 551. $1,136,002. count. total authorized amounts: temporary/research requests. 539:...

Custodian Funds TrainingCash Management • Accounting Services

Spring 2018

Welcome

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Presented by

Rochelle CushmanCash Management Supervisor

Sara DeMuriSenior Accountant

Custodian Funds Training

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Agenda

Introduction and Background

Types of Custodian Funds

Cash Management Updates & Reviews

Compliance

Reconciliations

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Resources in Packet

Custodian Funds Training PowerPoint

Count of Custodian Funds by Department

Summary of Types of Accounts and Glossary of Terms

Life Cycle of Custodian Funds

Updated Worksheets with Directions

Four Reconciliation Examples


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Introduction and Background


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Internal Control InitiativeOverarching Goal: Attain excellence in financial stewardship

APR Report on Cash Handling

http://www.bussvc.wisc.edu/acct/policy/ca/capol.html


UW System’s Internal Audit on Cash Handling

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AUDIT FINDINGS

Separation of Duties

Monitoring Training

Compliance



Response to Internal Audit Findings

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* MOUs = Memorandums of Understanding

MOUs will be required to be updated and signed annually

MOUs for Custodian Funds*

Monthly Reconciliations

Training

Cash MgmtReviews

UpdatedPolicies & Procedures



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Custodian Funds Life Cycle and Framework

Opening an Account

Maintaining an Account

Closing an Account


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Types of Custodian Funds


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Funds for Research Participant Studies

ReplenishableChecking Account

TemporaryFund

Other Bank Accounts

Contingent Checking Account

Target/Transaction Banking Account

(TBA)

Administrative Bank Account

Other Funds

Change Fund

Petty Cash

Which Types of Funds Do You Use?

These have bank accounts



Number of Bank Accounts(As of mid-August 2017)

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Type CountReplenishable/Research 60

Contingent 8TBA 15

Administrative 6TOTAL 89

Number of Other AccountsType Count

Temporary/Research 153Change Fund 25

Petty Cash 2TOTAL 180



FY2017 Data

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Count Total Amount of Replenishments

Replenishable/Research & Contingent Replenishments

551 $1,136,002

Count Total AuthorizedAmounts

Temporary/Research Requests 539 $778,535Bank Accounts Opened 7 $23,900Bank Accounts Closed 8 $58,750



Replenishable Bank AccountsChecking accounts used for Research Participant Studies

that are for more than one year.

Custodian Signers

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Reconciler

Memorandums of Understanding (MOUs) for:



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Role Definitions: Custodian

UW-Madison employee responsible for:

• Monitoring the cash advance for research participant studies.

Example: For bank accounts for research participant studies, a custodian would be an administrative resource for the study and would be independent of the signers and reconciler.



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Role Definitions: Signer

UW-Madison employee responsible for: • Writing and signing checks to the appropriate

recipient

• Ensuring all checks are logged and accounted for.

Example: For bank accounts for research participant studies, a signer would be the principal investigator (PI) or their research designee responsible for coordinating the participation of study participants independent of the custodian and reconciler.



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Role Definitions: Reconciler

UW-Madison employee responsible for:

• Performing and submitting monthly reconciliations

Example: For bank accounts for research participant studies, a reconciler would be an individual responsible for requesting replenishment funds for the account and would be independent of the custodian and signers.



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Replenishable Bank AccountsOPEN CLOSEMAINTAIN

Justification Letter (explaining purpose of study and how it is linked to the project)

Custodian Fund Request Form

Custodian Fund Agreement Form

Custodian Fund Budget Form

New Bank Acct Info Form Check Order Form Bank Acct Website Access

Form MOUs US Bank Signature Form

(Request from Cash Management.)


Custodian Fund Accounting Form

Research Participant Log (Ensure HIPAA information is not included.)



Check Shred Confirmation

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Temporary FundsTemporary Funds are used for research participant studies

that are for less than one year. Temporary Funds are opened for three months or less.

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An example:



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Temporary Funds OPEN CLOSEMAINTAIN

Custodian Fund Request Form (include justification of purpose of study and how it is linked to the project)




Review Account Code 6167



Personal check if full amount of Temporary Fund is not used

Documentation for closing the Temporary Fund is due to Cash Management within 30 days of the end of the Temporary Fund

Past Due Notices are sent if closing documentation is not received by Cash Management within the 30-day deadline.

See Notes Below

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Unique Circumstances: Research Studies in Foreign Countries

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Department is asked to:1) Contact Cash Management well in advance to determine a solution.2) Prepare a procedure document to explain separation of duties.3) Meet with Cash Management to review/discuss procedure document.



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Other Bank Accounts

Contingent Checking Account

Target/Transaction Banking Account

(TBA)

Administrative Bank Account

Other Funds

Change Fund

Petty Cash

Other Custodian Funds

These have bank accounts



Contingent Checking AccountContingent Checking Accounts are used to pay authorized

vendors by check when the purchasing card cannot be used and when the Accounts Payable process is not an option.

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Memorandums of Understanding (MOUs) for:

Custodian Signers Reconciler



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Contingent Checking AccountOPEN CLOSEMAINTAIN

Justification Letter (explaining purpose of account)




New Bank Acct Info Form Check Order Form Bank Acct Access Website

Form MOUs US Bank Signature Form

(Request from Cash Management.)



Expense Log

Invoices


Expense Log

Check Shred Confirmation

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Target/Transaction Balance Account (TBA)A deposit bank account for tracking specific department

deposits. The deposits are transferred to UW-Madison’s main deposit account at the end of each day.

Memorandum of Understanding (MOU)

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ReconcilerCustodian

I’m responsible for signing the US Bank

Signature Form.

Departments must request US Bank Signature form from Cash Management.



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Target/Transaction Balance Account (TBA)OPEN CLOSEMAINTAIN

Justification Letter (explaining purpose of account)



Bank Deposit Slip Order Form

New Bank Acct Info Form

Bank Acct Website Access Form

MOU US Bank Signature

Form (Request from Cash Management.)


Contact Cash Management

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Administrative Bank AccountAdministrative Bank Accounts are used by departments within Business Services. For example, UW-Madison’s main deposit bank account is considered an Administrative Bank Account.

Memorandums of Understanding (MOUs)

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Custodian Signer Reconciler

Note: If you need UW-Madison’s bank account information for incoming wires or ACHs, contact Cash Management via e-mail at [email protected].


mailto:[email protected]


Change FundChange Funds are used to operate retail operations

and cash registers.

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Change FundOPEN CLOSEMAINTAIN

Justification Letter (explaining purpose of change fund)



Bank Deposit Slip Order Form

MOU

Perform daily reconciliations by reconciling to the authorized advanced level.

Document reconciliations.

Follow the coin request procedures to replenish.



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Petty CashPetty Cash is set up for handling small purchases that cannot

be effectively handled by a purchasing card or check.

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Cash Management will review Petty Cash Funds at least annually.



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Petty Cash OPEN CLOSEMAINTAIN

Justification Letter (explaining purpose of petty cash)



MOU

Complete weekly reconciliations

Complete replenishments



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Only include the last five (5) digits of a US Bank account number on forms and any e-mail correspondence.

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Reminder

Account Number Example: XXXXXXX33322


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Cash Management Updates and Reviews


Improvements/Changes

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Late Notice Procedure for Monthly Reconciliations for Replenishable

Bank Accounts and Contingent Bank Accounts

NR Number Generator

Periodic Reviews Conducted by Cash Management Departments may receive questions

based on reviews

Updated Policies, Procedures, and

Forms



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Previous NR Number• NR followed by a maximum of 7 digits (letters or

numbers)• Identifier for all types of Custodian Funds• Created by each department

NEW – Current NR Number• NR followed by 7 numbers• Unique identifier for all types of Custodian Funds• NR Number Generator for campus departments

NR Number



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• To be used for all Custodian Fund requests• Campus departments need to generate a NR number to be

used on all paperwork for opening any type of Custodian Fund.The generated NR number will then be used on all paperwork

for the Custodian Fund type that is opened.

• Link for NR Number Generatorhttps://www.busserv.wisc.edu/custfundsys/NR-Numbers

NR Number Generator


https://www.busserv.wisc.edu/custfundsys/NR-Numbers


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On the NR Numbers page, click Create NR Number

Select Department from drop down

NR Number Generator



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You can start typing the department ID when you have the drop down selected, so you don’t have to scroll through the entire list.

If the UDDS is not listed, please contact Cash Management via [email protected] and ask us to add the UDDS to the Custodian Funds System.

NR Number Generator




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Click the Create NR Number button

Unique NR Number will be generated

NR Number Generator


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Compliance


Compliance

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Tax

W-9 Form - Request for Taxpayer Identification Number (TIN) and

Certification

Policy & Procedure: 601 – Tax Compliance, Reporting, and Withholding on Non-Salary

Payments

W-9 Compliance Requirements

Policy 103: Payments to Research Participants

HIPAA

https://compliance.wisc.edu/hipaa/


http://www.bussvc.wisc.edu/acct/policy/tax/taxpro.html

http://www.bussvc.wisc.edu/acct/tax/W9IMPLEMENTATION_COMPLIANCE2009.pdf

http://www.bussvc.wisc.edu/acct/policy/human_subjects/humanpol.html

https://compliance.wisc.edu/hipaa/

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Custodian Funds Support

Websites

Contacts

Email [email protected]

Rochelle Cushman, [email protected]

Cash Managementhttp://www.bussvc.wisc.edu/acct/cashmgt.html

Policy 301 – Custodian Fundshttp://www.bussvc.wisc.edu/acct/policy/ca/capol.html

Sara DeMuri, [email protected]



http://www.bussvc.wisc.edu/acct/cashmgt.html



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What questions do you have about Custodian Funds?

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Custodian Funds Annual Certification

_____ Complete training

_____ Receive follow-up email withlink to final assessment

_____ Complete final assessmentwithin two weeks

_____ Receive electronic certificate

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Thank you for your participation.

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Reconciliations


Monthly Reconciliations:Replenishable Bank Accounts & Contingent Funds

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February 2018 reconciliations will be due by March 30, 2018

Within 30 Days from Month’s End



New Late Notice Procedures:Replenishable Bank Accounts & Contingent Funds

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If reconciliation has not been received, Cash Management will send out:

First Notice

Second Notice

Sent at the beginning of the month after the monthly reconciliation is due.

Sent in the middle of the month after the monthly reconciliation is due. It will indicate that the account will be closed if the reconciliation is not received by the end of the month.

Note: Generally, late notices will be sent to the custodian, reconciler and your Business Office.



Example of Late Notice Procedure: Replenishable Bank Accounts & Contingent Funds

June 2017 Reconciliations:

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Due Date

First Notice

Second Notice




Updated Bank Reconciliation Worksheet

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Updated Check Register Worksheet

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Four Reconciliation Examples

Replenishable Bank Accounts and Contingent Checking Accounts

Examples use updated • Bank Reconciliation Worksheet • Check Register Worksheet


Reconciliation Example #1 April 2017 Reconciliation

Replenishable Bank Account for Research Fund

Authorized Balance = $2,000

Total of 6 checks written in March & April for a total of $150

1 of the checks for $20 from March cleared

1 of the checks for $30 from April cleared

None of the checks have been replenished by Cash Management.

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Reconciliation Example #1

Completed Check Register Worksheet

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Reconciliation Example #1Completed Bank Reconciliation Worksheet

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Reconciliation Example #2 February 2017 Reconciliation



Check written in January 2017 for $140

Check written in March 2017 for $130

The check written in January 2017 cleared


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Reconciliation Example #2Completed Bank Reconciliation Worksheet – What’s Incorrect?

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Reconciliation Example #3 February 2017 Reconciliation



One check was written per month for $24 from January 2017 to March 2017.

The check that was written in January 2017 cleared.

The check that was written in February 2017 was voided.


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December 2016 Reconciliation Contingent Checking Account Authorized Balance = $5,000 4 checks written in November & December for a total of 8

checks, each for $50. 2 checks written in November cleared. 1 check written in December cleared. 2 checks written in December had stopped payments

placed on them. None of the checks have been replenished by Cash

Management.

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Reconciliation Example #4Completed Check Register Worksheet

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Custodian Funds Support

Websites

Contacts

Email [email protected]

Rochelle Cushman, [email protected]

Cash Managementhttp://www.bussvc.wisc.edu/acct/cashmgt.html

Policy 301 – Custodian Fundshttp://www.bussvc.wisc.edu/acct/policy/ca/capol.html

Sara DeMuri, [email protected]



http://www.bussvc.wisc.edu/acct/cashmgt.html



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What questions do you have about Custodian Funds?

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Custodian Funds Annual Certification

_____ Complete training

_____ Receive follow-up email withlink to final assessment

_____ Complete final assessmentwithin two weeks

_____ Receive electronic certificate

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Thank you againfor your participation.

welcome [] · 551. $1,136,002. count. total authorized amounts: temporary/research requests. 539:...

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