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Cash and Check Handling

Overview

It is important to establish effective internal controls for handling cash and checks that are received.  Internal controls are in place to ensure an organization is reaching their objectives in the most effective and efficient way possible.

Below is guidance to help ensure effective internal controls and separation of duties for the cash and check handling process.  This guidance is not intended to be prescriptive in nature, but provide best practices for units.

Separation of Duties – Key Control Steps

To ensure separation of duties, each of the following steps should ideally be performed by different individuals who are authorized to perform the respective duty:

  • Receiver ≠ Depositor
  • Depositor ≠ Performing reconciliation
  • Receiver ≠ Responsible for billing
  • Tier 2 and 3 Additional Review if Receiver is also reconciling/balancing funds
  • Tier 2 and 3 Additional Review of deposit ChartField allocations if the Depositor is also reconciling

The Cash and Check Process Flowchart provides an illustration of how this might look.

Procedures

Document procedures that clearly outline which positions are authorized to receive funds, perform deposits, and issue refunds.  In addition, provide details of any procedures for cash receiving and depositing, as well as documentation detailing reconciliation procedures and responsibilities

Keep departmental records of who is authorized to receive and deposit funds, ensuring that the records are updated if staffing or duties change

Funds Received

This is when cash/checks are received due to being owed (i.e. goods/services provided, receivables, etc.)

  1. Determine who is authorized to receive funds
  2. Ensure cash handlers are properly trained
  3. Guarantee money is counted/verified
  4. The individual in charge must update the daily transaction log.  That, or a pre-numbered receipt must be issued for all funds received and a copy of the receipt must be retained
  5. Cash and checks should be stored in a secure place (i.e. safe or locked cash box). There should be limited employees with access to the cash and checks

Deposits

This is when funds received are deposited to the University Cashier’s Office in Criser Hall.  See Cash and Check Movement and Remission of Deposits for more information.

  1. Determine who is authorized to deposit funds
  2. Ensure depositors are properly trained
  3. Balance funds received
  4. Complete deposit ticket/record all deposits
  5. Safeguard deposits
  6. Deposit all funds within (5) business days of receipt.  If collections exceed $1,000 they must be deposited within (1) business day of receipt
  7. A record of all deposits and deposit information should be maintained for reconciliation

Reconciling

This is ensuring that deposits are reflected on the Monthly Financial Reports.  See Monthly Reconciliation for more information.

  1. Tier 1 will reconcile and ensure deposit was posted to the appropriate ChartField(s)
  2. Tier 2 will review the reconciliation
  3. Tier 3 will approve the reconciliation and spot-check to ensure proper receipting and posting of deposits

Last Revised

6/20/2019: reviewed content

Training

PRO303 – Internal Controls at UF

PST130 – Reconciliation

Contacts

University Controller’s Office: (352) 392-1321

Treasury Management: (352) 392-9057