This University Policy provides for the establishment and use of petty cash funds and change funds and addresses the issues of accountability, security, replenishment, and appropriate uses of petty cash funds and change funds.
The University may establish Petty Cash Funds or Change Funds upon request with sufficient justification, as set forth in this Policy.
Custodian: A Petty Cash Fund Custodian or a Change Fund Custodian.
Petty Cash Fund: A supply of cash necessary to make immediate payments for the purchase of authorized items. This fund requires replenishment.
Change Fund: A specific amount of money placed in the custody of an individual for the purpose of making change while conducting University business. The amount on hand should remain the same at all times; therefore these Change Funds do not require replenishment.
Petty Cash/Change Fund Officer: A staff member in the University Controller’s Office who has the authority to disburse Petty Cash/Change Funds and administer the funds according to the policies and procedures established by the University. This officer must approve issuance of all Petty Cash/Change Funds.
Petty Cash Fund Custodian: A full-time permanent employee of the University responsible for maintaining the security, accountability, and replenishment of a petty cash fund.
Change Fund Custodian: An employee of the University responsible for maintaining the security and accountability of the Change Fund.
III. Uses of Funds
A. Petty Cash
Use of Petty Cash Funds is encouraged for purchases of low-priced items from local vendors where the costs of establishing a purchase order, processing an invoice, and writing a check would substantially increase the cost of the transaction. The maximum limit for purchases from petty cash funds is $100 per purchase unless the Purchasing Department provides prior written approval. Petty Cash Funds may not be used to avoid other established purchasing procedures, nor may total orders be split into smaller increments to avoid this $100 limit. As with all expenditures, Petty Cash may only be used to obtain goods and services necessary to carry out official University functions. Petty Cash transactions must follow University disbursement policies and procedures. Petty Cash Funds may not be used to:
- Cash checks
- Make loans
- Make advances
- Reimburse travel-related expenditures or to make travel advances
- Pay wages for students or temporary employees, or pay overtime for any employee
- Pay expenses relating to the use of private motor vehicles, including mileage and fuel
- Provide floral tributes, small gifts and other tokens of appreciation, or prizes and awards
- Make purchases that would not be approved under normal policies and procedures
Failure to adhere to these policies will result in the Petty Cash Fund being recalled.
B. Change Funds
Change Funds are used to accommodate departmental sales.
IV. Establishing Funds
Departments wishing to establish an initial Petty Cash Fund or Change Fund should complete the appropriate request form. The Petty Cash Fund Request Form can be found on the Controller’s Office web page. The Change Fund Request Form can be found on the Controller’s Office web page. The form is to be submitted to the Petty Cash/Change Fund Officer, Reese 255A Building. Following receipt and approval of the form, the Petty Cash/Change Fund Officer will request a check made payable to the person listed as the Custodian of the fund. With Photo ID, the Custodian may pick up the check and cash it at the Cashiers’ Office and must hold the Petty Cash Fund or Change Fund in a secure location at the University.
V. Securing Funds
Petty Cash Funds and Change Funds must be secured at all times. The funds must remain on the premises of the University in a locked box and in a locked location (desk drawer, file cabinet, vault, etc.). Petty Cash Funds and Change Funds may not be placed in a bank account, or kept in the Custodian’s wallet or purse, or otherwise commingled with personal funds. Departmental Change Funds may not be used to cash checks or to make loans or advances. It is the direct responsibility of the Custodian and the Custodian’s supervisor to ensure that proper safeguards are established. Repeated overages and shortages will result in the loss of Petty Cash Fund or Change Fund privileges.
VI. Replenishing Petty Cash Funds
Reimbursements for Petty Cash Funds should be requested as needed, but no later than the 15th of each month. The Petty Cash Fund Custodian must complete the Petty Cash Reimbursement Form and sign, date, and attach all receipts (originals only) to the request for reimbursement. This form can be found on the Controller’s Office web page.
VII. Increasing/Decreasing/Closing Funds
The Custodian’s supervisor may request an increase to, or decrease or close a Petty Cash Fund or Change Fund by completing the appropriate section of the Petty Cash Fund Request Form or the Change Fund Request Form. The Custodian’s supervisor may decrease or close a Petty Cash Fund or Change Fund by depositing the appropriate amount of cash at the Cashiers’ Office.
VIII. Periodic Reviews
All Petty Cash Funds and Change Funds are subject to unannounced audits and/or cash counts by the internal auditors. The Custodian must have the Petty Cash Fund or Change Fund available at all times. These periodic reviews are performed to determine whether the department is in compliance with the University’s Petty Cash Fund/Change Fund rules and regulations. The review will be performed with the Custodian present. When a representative of Internal Audit arrives for review, the Custodian should request to see proper University identification. The Custodian should contact the Petty Cash/Change Fund Officer for verification if the internal auditor does not have proper photo identification. Internal Audit will notify the Petty Cash/Change Fund Officer of any discrepancies that are found.
All employees are obliged to comply with the procedures supplemental to this Policy. The Vice Chancellor for Business Affairs is responsible for establishing and enforcing such supplemental procedures related to Petty Cash and Change Funds, available from the Controller’s Office or online.