AVERT Policies and Procedures 1203
1.0 PURPOSE 2.1 IMPREST FUND - A separate amount of money set aside where, by policy, the cash available to disburse plus the supporting vouchers for money already disbursed must equal an authorized fixed amount (known as the "impress" amount). Note that all the funds described below are operated in AVERT as "impress" funds. 2.2 PETTY CASH FUND - An amount of cash available for small purchases relating to normal operations. 2.3 CHANGE FUND - An amount of cash available to provide change for over-the-counter cash receipts from users. 2.4 IMPREST CHECKING ACCOUNT - An amount of cash available in an established commercial bank for purposes similar to petty cash funds, but which is generally established in larger impress amounts. 2.5 OPERATING CHECKING ACCOUNT - Similar to an imprest checking account, but generally established in larger impress accounts and restricted to serve a specific operating need. 2.6 ZERO-AMOUNT IMPREST CHECKING ACCOUNT - Similar to Operating checking account but reimbursed by the Treasurer rather than by a general warrant from the Auditor; reimbursed when disbursed amounts bring the impress balance down to zero. 3.0 PROCEDURE TO ESTABLISH AN IMPREST FUND: 3.1 The requesting organization should submit a letter to the Auditor addressing the information indicated in 3.1.1 through 3.1.6 below. After a review for propriety and internal controls, the Auditor will make a recommendation to the Board regarding implementation. 3.1.1 a brief statement describing the need for the fund, the purpose of the fund, and an indication as to which type of fund it is (see 2.0 above); 3.1.2 who the custodian or cashier will be; 3.1.3 the recommended impress amount; 3.1.4 a brief statement describing the internal controls relating to the operation of the fund, for example: the number and names of authorized checking account signers, who will reconcile the bank statement and review that reconciliation, how funds will be secured, who will review the reimbursement requests, and any other pertinent information; 3.1.5 the budgetary line item to which reimbursements will be charged; 3.1.6 the total annual dollar volume that is anticipated to be spent from the fund, and an estimation as to how often reimbursement requests will be submitted to the Auditor once the fund is operating; 3.2 If the request is approved by the Board, the Auditor will issue a general warrant in the "imprest" amount, payable to the custodian or cashier in order to initiate funding for the account. 3.3 All accounts established as checking accounts should be interest accounts. Prior to opening an account with a commercial bank, the custodian shall contact the Treasurer, who may wish to sign on the account, and who may provide guidance regarding which bank to use. 4.0 OPERATION OF THE FUND: 4.1 There is to be one person directly responsible for each fund (the Custodian), who is held accountable for the integrity of the amount and operation of the fund. 4.2 Cash on hand must be retained in a secure location in accordance with other AVERT policies on cash controls. 4.3 Wherever possible, the custodian should be independent of control over any operating cash receipts. 4.4 Petty Cash and Change Funds should not be used to cash checks of any type. Employee check-cashing service is offered by the Treasurer. Employees at locations remote from the Treasurer should use outside institutions who provide this service. 4.5 Disbursements from petty cash and other impress accounts are for the purpose of covering over-the-counter, cash purchases under the specified limit (see Section 7.0). For these types of transactions the items purchased should be paid for at the time of the transaction. NO purchases are to be "charged" with a vendor to AVERT organizations. To do otherwise is in conflict with the purpose of this policy and is considered to be credit fraud. 4.6 The operation of the fund should be reviewed closely by the custodian's immediate supervisor or someone at an appropriate level of authority as designated by the AVERT Board. Each reimbursement request must be signed by the custodian, and should be reviewed, and signed by the reviewer. It is understood that the custodian's and reviewer's signatures on the request indicates that the operation of the fund is proper and the funds are properly accounted for. 4.7 The reimbursement request should be submitted to the Treasurer in accordance with existing procedures to process "payments". Generally the amount requested should provide adequate funds for a month of operations for the fund. If a greater amount is consistently needed to avoid depleting the fund, the organization should consider requesting an increase in the authorized impress amount. A request to increase the impress amount should be sent to the Auditor. After a review of the operations of the account for propriety, the Auditor will forward a recommendation to the Treasurer and the Board. If approved, a general warrant will be issued for the amount of increase and sent to the custodian. 4.8 Occasionally items already disbursed are denied reimbursement by the Auditor because the transaction appears not to be authorized by this policy. A form letter from the Auditor explaining any such denials will accompany the reimbursement when returned to the organization. The custodian may submit a letter of justification which, if approved, would be the basis for reimbursement with the next reimbursement request. If the item is not approved, however, it must be reimbursed by the individual(s) responsible for the unauthorized disbursement. Reimbursement is necessary in order to bring the fund to the impress amount. Such matters should be resolved timely. Mitigating circumstances may be explained in a letter to the Board. The Auditor will reimburse the account for any "denied" items if authorized by the Board through this procedure. 4.9 Any unaccounted-for funds (shortages) should be investigated immediately. The custodian, after appropriate investigation, may be required to personally replenish the shortage, depending on the circumstances. If the shortage appears to relate to a theft, it should be reported in accordance with AVERT Policy #1304 - Discovery and Reporting of Thefts. Any shortages not resolved immediately should be explained in a letter to the Board. The Auditor will reimburse requests to replenish accounts resulting from shortages if authorized by the Board through this procedure. 4.10 Any overages would normally represent just an administrative error and should be investigated and resolved immediately. Any amount of unresolved overage should be brought to the Auditor and will be due-billed as miscellaneous revenue to AVERT. 4.11 Petty cash vouchers (or other appropriate supporting documents for other types of funds) are to be used for each disbursement from the fund. The following paragraphs describe the detail procedures for the operation of a petty cash fund. Similar procedures are to be followed for the other types of funds to accomplish the same purposes; however, the specific terminology may differ. 4.11.1 Vouchers are to be filled in completely, prior to releasing any cash. The voucher should be dated and the reason for the expenditure explained. The total amount released to the individual receiving the cash (the payee) should be recorded. It should be signed by the payee and approved by the custodian. 4.11.2 Sales receipts, invoices, etc. received at the time of the purchase are to be returned to the custodian along with any "change" (unspent money) from the transaction. When receipts are not available (which should be a rare exception), a written "certification" from the payee should be provided explaining the expenditure, the amount and why no receipt is available. The receipt (or certification) should be attached to the voucher for supporting documentation. 4.11.3 A Control listing is to be kept, identifying in numerical order the voucher number, the date of each disbursement, the name of the vendor from whom purchased. the payee, and the amount spent. The listing is to be submitted along with the vouchers as an integral part of the reimbursement request described in 4.7 above. 4.11.4 The listing should be signed by the custodian, and submitted to the Custodian's Supervisor or other authorized signatory before forwarding the reimbursement request to the Auditor. 4.12 General warrants reimbursing the fund will be made payable to the custodian. At least ten working days should be allowed between submission to the Auditor and issuance of the warrant. 4.13 Any fund covered under this policy is subject to surprise counts or internal audit by the Auditor at any time. The custodian is personally responsible for the impress amount to be intact at all times. 5.0 CUSTODIAN CONTROLS AND CLOSING A FUND: 5.1 Designating a custodian, and any subsequent changes of custodians, should be processed by completing the "Request for Custody/Change in Custody" form. 5.2 To close out a fund no longer in use, the entire amount in cash and vouchers, with a reimbursement request, should be delivered to the Auditor. A receipt for the return of the fund will be issued by the Auditor. 6.0 PROPRIETY OF FUND TRANSACTIONS: 6.1 Except as provided in Section 7.0 of this policy, any purchase is appropriate from impress funds as long as it is a legal, ordinary and necessary purchase to conduct legitimate AVERT business, and has been contemplated in the appropriations for that organization. Accounts established with restrictions for specific operating purposes (e.g., training classes, etc.) should be limited to those purposes. Responsibility for determining "propriety" rests first with those processing and approving the transaction, and, of course, ultimately with the Board Director or Team Leader under whose supervision the account is operated. 7.0 TRANSACTIONS PROHIBITED UNDER THIS POLICY TO BE PAID FROM IMPREST ACCOUNTS: 7.1 Disbursements over the existing authorized amount per transaction (currently $50.00). The only exception to this provision is for "operating checking accounts" and "zero-amount impress checking accounts" which are established for specific operating needs and (at the time they are initiated) contemplate disbursements in excess of the "petty cash" limit. 7.2 Items covered under other AVERT policies in which the policy states petty cash is not to be used, or where separate Board approval is required. Note that food or meals may be purchased from petty cash and other impress accounts; however, such purchases are subject to the provisions of Paragraph 6.1 above. 7.3 Transactions covered under other established financial systems in which funds are disbursed, the nature of which is in conflict with the purpose of petty cash and impress accounts, for example: 7.3.1 payments for purchases under the credit of the AVERT organization, which are processed by accounts payable procedures; 7.3.2 payments which represent compensation to employees or volunteers, which are subject to payroll taxes; 7.3.3 payments for utilities (phone, water, gas and electric services), which are centrally paid by the Treasurer; 7.3.4 Any other payments which are specified as inappropriate and not related to the purpose of this policy, which may be added to this list from time-to-time. 7.4 Items of a personal nature to reward, compensate or express sympathy to an AVERT employee, employee's family members or volunteer. Items purchased primarily to "celebrate" festive occasions, such as holidays. 7.5 An exception to this exclusion is a one-time expression of sympathy to employees or volunteers who have been injured in the line of duty, at the discretion of the Director of the employee's/volunteer's organization. |