Effective: November 2009
Overview
Petty Cash Purchases
An employee who makes an authorized purchase on behalf of the Institute may be reimbursed for the purchase from a petty cash fund. This policy and procedure will detail the authorized use of petty cash funds and restrictions on purchases.
Petty Cash Fund
A petty cash fund is used by campus departments to reimburse employees for petty cash purchases. Funds may generally be classified into one of two types:
Departmental Petty Cash Funds or Change Funds - Departments may request approval to establish departmental petty cash funds to reimburse petty cash expenditures. Change Funds are used to give change to customers when they are paying for goods or services. Please refer to Procedure 1.5.3 for specific information regarding departmental petty cash procedures or Procedure 1.5.4 for specific information regarding petty cash checking account procedures.
Bursar's Office Petty Cash Fund - Departments that do not have their own petty cash funds may use the Bursar's Office petty cash fund for reimbursement of petty cash purchases. Please refer to Procedure 1.5.2 for specific information regarding the use of the Bursar's Office petty cash fund.
Allowable Transactions
The following are allowable petty cash transactions:
Purchases for small dollar needs
Purchases for which the goods are received at the time of purchase
Typical allowable transaction types include office supplies, lab supplies, telephone reimbursements, local parking reimbursements, mailing services, copy and photo services.
No single transaction is to exceed $250.00.
Unallowable Transactions
The following transactions and purchases may not be processed with petty cash funds (Agency Fund reimbursements are allowable for any purchase type):
Items covered by State or Institute contracts (see Institute Purchasing procedures)
Entertainment
Travel reimbursements (meals, lodging, taxi, airfare)
Per diem and fees and other service payments
Gifts, awards, prizes
Memberships
Personal check cashing and loans
Food, beverages, catering (unless funded by Continuing Education or other participant cost funding source)
Items that may not be purchased by the Institute's Purchasing department, for example, alcoholic beverages, may not be purchased with petty cash funds. Also, items that are required to be purchased through the Purchasing department may not be purchased with petty cash funds even if the shipment of the item has been delayed or it is out of stock. Violations of petty cash policy may result in non-reimbursement or fund closure.
Security Guidelines
Petty cash custodians must use the following guidelines in protecting the integrity of the petty cash fund:
Petty cash must be held in a locked cash drawer or locked cash box. (Security recommends a smooth metal finish box for fingerprinting purposes.) A primary key to the drawer or box must be held by the custodian while a secondary key should be held by the department head or delegate for emergency purposes.
In the event the fund custodian has a scheduled absence, a temporary custodian can be assigned by the department head. The funds must be counted in the presence of the authorized custodian before the leave period begins and again once the custodian returns. This procedure is used when the petty cash fund is greater than $200.
In the event the fund custodian has an unscheduled absence, a temporary custodian can be assigned by the department head. The funds must be counted in the presence of the department head or his designee before the funds are used. A similar cash count must be performed upon the return of the regular fund custodian. The department should maintain the cash count verifications until the next cash count is performed. This procedure is used when the petty cash fund is greater than $200.
The total amount of the petty cash fund should always equal the cash on hand plus any unreimbursed amounts. If the Department Head or Financial Services feel it is warranted based on circumstances surrounding a shortage, Internal Auditing may be contacted for investigation. Internal Auditing will notify Risk Management. If Internal Auditing determines the custodian was negligent in their duty to safeguard the petty cash, the custodian may be held liable for replacement of uninsured losses. Shortages exceeding $200.00 should always be reported to Internal Auditing.
Unannounced cash counts should be performed quarterly by someone other than the custodian. The individual should be selected by the Department Head, preferably not the same person each quarter. The cash count should be recorded on the Cash Count Form . The completed forms should be retained in a Departmental file. Unannounced cash counts may be performed by Internal Audit. Account balance verification will be performed at year-end by the Controller's Office.
Department petty cash "change funds" should be counted daily.
Petty cash funds should always be kept separate from other cash receipts. To discourage thefts, avoid dispensing money from the petty cash box in the presence of the person requesting money.
Where possible, keep locked box in limited access locked drawer, safe or file cabinet. Funds must be secured each time the custodian leaves the office. The keys to the box and file cabinet, safe, or drawer should be kept in the possession of the custodian, not left in desks or in the office overnight. The custodian and department head may be held jointly liable for uninsured losses that occur as a result of negligence.
In the event of a theft of petty cash funds, the custodian should immediately notify the Georgia Tech Police Department and the Internal Audit Department. Police Department incident reports will be distributed within three days of the theft to the Department Head, Risk Management, the Controller's Office, and Internal Auditing. The Internal Audit Department will communicate to the Controller's Office whether loss is insured or loss is a result of negligence.
Upon departure/termination of custodian or department head, keys to secured petty cash area must be returned to the appropriate departmental authority. A change of custodian requires submission of a new Petty Cash Fund Request/Maintenance Form . A final count and submission for replenishment should occur prior to the new custodian assuming responsibility. The new custodian receipts the cash at the Bursar's Office and signs Section Five of the new Petty Cash Fund Request/Maintenance Form.
Reimbursement Requirements
Please see Procedure 1.5.2 (Petty Cash Procedures) , Procedure 1.5.3 (Departmental Petty Cash Procedures) , or Procedure 1.5.4 (Petty Cash Checking Account Procedures) for reimbursement requirements.