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Policy & Procedure
Policy Title :
Acceptance & Administration of Cash Policy
Policy Number :
IV.A-12
Responsible Party :
Financial Affairs
Effective Date :
28/11/2013
Revised Date :
_______________________

Purpose

This policy sets out the guidelines for the acceptance and administration of cash.

Statement :
Procedure :

Accepting and Transmitting Cash

  • All payments received on behalf of the university must be promptly deposited to the credit of the university account within 2-3 days. All monies received must be deposited intact and inclusive of all receipts on hand. No expenditures may be made from cash receipts, and no receipts may be retained within a department for departmental use.
  • All areas receipting funds daily should deposit or transmit to the Budget & Accounting Dept such funds daily. University funds received less frequently than daily should not remain in any unit longer than three business days prior to deposit or transmittal.
  • Departments receiving monies on behalf of the University are responsible for maintaining the same degree of security when transferring a deposit from one location to another as is required when monies are handled by employees at their regular places of employment.
  • Each employee handling cash should ensure that:
    • Deposits are not mailed through inter-office mail.
    • Security of cash is maintained at a maximum when extra large sums are handled.
    • Adequate security is provided when transferring cash to other offices or banks.
    • Bags containing cash are never be left open in vaults or safes.
  • No organizational unit, department, or administrative office has authority to open an account and deposit university funds in a commercial bank, or any other financial organization, except when specifically authorized, in writing, by the Director of Financial Affairs, Rector and Chair of Board of Trustees.

Receipting and Depositing

  • All departments or activities regularly receiving cash in routine operations must record each transaction in a pre-numbered receipt book, a receipt log, or record the transaction on a cash register in the presence of the customer or payer. A receipt must be delivered to the payer. When payment is received by mail, a receipt is not returned. This procedure may vary within departments. Receipts (other than from a cash register) should include the name of the payer, date of receipt, amount of payment, purpose of payment, account number to be credited, initials of the person receipting monies, and the form of payment (currency, coin, check, or credit card).
    • Funds received by departments should be taken to the Budget & Accounting Dept accompanied by a transmittal report. When funds are deposited, the transmittal report should include:
    • Date the transmittal report is prepared.
    • Name of the department making the deposit.
    • Name of the person making the deposit.
    • Account number to which the funds are to be credited.
    • Amount of currency and coin to be deposited.
    • Receipt numbers included in the deposit.
    • List of checks if appropriate.
    • Amount of each transaction.
    • Signature of the person verifying the correctness of the transmittal.
  • All checks representing a payment to the University should be made payable to Prince Mohammad Bin Fahd University. Checks should not be made payable to departments, department heads, or any university official or employee. Checks should be restrictively endorsed immediately upon receipt for deposit or transmittal.
  • No separate funds (other than official petty cash funds) may be maintained in any department.

Petty Cash (see separate Petty Cash Policy)

  • Advances of petty cash will not be granted, nor will expenditures be reimbursed, unless the advance is officially requested and approved and reimbursements submitted in accordance with university regulations. Department heads should ensure that all individuals in his or her department using petty cash or involved in processing reimbursement requests are thoroughly familiar with the relevant university regulations.
  • A petty cash fund is designed to meet the needs of certain departmental operations for off campus cash purchases of emergency minor items and/or change funds. A written request to establish a petty cash fund must be submitted by the department head to the Budget & Accounting Dept. The request must include proper justification for establishing the fund, the amount needed, and the department or unit head who is responsible and accountable for proper fiscal and physical control of the fund.
  • The custody and control of petty cash funds may be delegated to appropriate personnel. However, accountability and responsibility for proper use and care of the funds remain with the designated department head. Upon this person’s termination of employment with the university or the department, the funds should be transferred or returned to the Budget & Accounting Dept. The funds should be verified prior to the exit of the fund’s custodian or department head. The new department head should notify the Budget & Accounting Dept in writing of his or her intent to assume responsibility for the departmental petty cash fund, indicating the amount of the fund.
  • No organizational unit, department, or administrative office has authority to establish a petty cash fund, except when specifically authorized, in writing, by the Director of Financial Affairs and University Rector.

Accounts Receivable (see separate Accounts Receivable Policy)

  • Departments which regularly have outstanding accounts receivable must keep adequate documentation. Individual account balances must be maintained, as well as a control system for determining current totals and for balancing individual accounts.
  • To effectively control and reduce the amount of outstanding accounts receivable once all collection efforts have been exhausted, an itemized list of uncollectible accounts deemed appropriate for write-off can be submitted for approval to the Director of Financial Affairs.