CASH CONTROLS AT OSU Currency coin and cash

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 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 v Receiving v Depositing v Recording v 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