CASH CONTROLS
AT OSU
• Currency, coin, and cash equivalents:
Checks
Traveler’s checks
Cashier’s checks
Credit card records
EFTs: ACH and wire transfers
Items of cash value: ticket, gift cards/certificates
WHAT IS “CASH”?
• 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
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BEST PRACTICES
• 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:
• Departmental.deposits@oregonstate.edu
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 Manager:
“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
• 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 after
Stealing $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.
Cash on
Hand
Receipts
on Hand
Recorded
Amount of
the Fund
• Custodian’s manager should verify that the fund
balances periodically.
• Only the custodian should handle 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