Division of Administration & Finance

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Internal Controls

Cash Control Procedure

Introduction

This procedure provides basic guidance and standards for all funds collected on the behalf of SUNY New Paltz and are to be deposited to the credit of State funds i.e.. General State funds, Income Fund Reimbursable and the Dormitory Income Fund Reimbursable. These guidelines supplement and/or amplify procedures set forth in the State Controller’s Rules and Regulations. Cash receipts includes receipts from all sources included but not limited to, fees for use of the facilities, tuition, fees for credit and non-credit continuing education courses, box office receipts, conference registration fees, program fees, service fees, etc. The term cash includes checks, currency, coin, money orders, credit cards, etc.

Any system of recording cash receipts must provide controls and safeguards to reasonably assure that all cash collected is accurately recorded and deposited promptly. Someone who will have no further control over cash handling or accounting must make this record. This record establishes accountability and provides the basis for comparison of amounts actually deposited. Managers must ensure the development and use of control systems and safeguards that will meet their particular needs. Adequate procedures must avoid losses in the handling of cash and establish verifiable practices that will aid in establishing security and accountability. To establish an internal check over the various cash accounts, accounting functions should be divided among several employees so that the work of one employee complements and acts as a check on the work of another, using the principle of 'separation of duties'.

Accountability for cash funds relies on the principle that the custodian of a fund is responsible for the security of the fund and that the discharge of such responsibility is reviewed periodically. The designation of specific responsibilities for cash funds is important and should be controlled through organization charts, procedure manuals, position duty statements, etc. The appraisal of the related procedures constitutes one of the essential elements of the internal control structure.


The following steps or segregated duties are necessary to assure proper internal control over receipts:

  • Record cash immediately using pre-numbered receipt. (These receipts can be obtained in the Accounting Office located in HAB 302)
  • Deposit each day’s receipts intact. Refunds and small cash purchases must be made through established procedures for those purposes, and cannot be made from cash receipts.
  • Handling of cash must be separate from record keeping: one person may not handle the cash transaction from beginning to end. (Cashier should not have access to the accounting records).
  1. The Bank or SUNY New Paltz accounts should be reconciled by an employee   independent of both the cashiering and the bookkeeping functions.
  2.   It is also important for the reconciliation to be made as soon as possible after receiving the bank statement. Timeliness helps in identifying improprieties quickly before they become extensive.
  3. The receipt of cash should be centralized as much as possible. Employees who open              the mail and establish initial accountability for cash receipts should record them immediately and should not have other cash recording duties.
  4. 4.         The inventory of financial stationery (checks, cash receipts, licenses, permits or tickets) should be maintained by personnel independent of related accounting functions.

Use of pre-numbered receipts:

Indicate on the receipt:

  • Name of Remitter
  • Identification Number
  • Date
  • Account number and names
  • Amount of payment
  • Form of payment

If by check, make sure name, address, telephone number and identification numbers are listed on the face of the check; all checks must be restrictively endorsed (“SUNY New Paltz - For Deposit Only”) with the Account Number written. Stamps are available from the Accounting Office upon written request.
Note: Counter checks are not to be accepted as valid payment (checks that are not encoded with an account number).

  • Signature of employee receiving the payment

 

Distribution of receipt copies:

Original (white) to the individual payer (if payment is made by mail, the original receipt should be sent to the remitter).

Student Accounts/Accounting copy (pink) to Student Account’s Office, HAB 210—to accompany deposit.

Audit copy (yellow) - retain for your records.

Signs must be prominently posted advising the remitter to request a receipt.

All monies received must be deposited directly to the Student Account’s Office, HAB 210, on a daily basis. If Daily deposit is not feasible due to location or if amount of collections is minimal and not in the form of cash, deposits may be made less frequently (BUT IN NO CASE LESS FREQUENTLY THAN ONCE A WEEK). Approval for transmittal on such a basis must be obtained in writing in advance from the Director of Accounting Services. Undeposited receipts must be kept in a safe place, such as a vault or a locked file cabinet. Vaults, safes, lock boxes, etc. must lock automatically upon closure. Cash collected on behalf of SUNY New Paltz should never leave the campus with the exception of bank deposits.

Each deposit must be accompanied by the pink Student Account’s copy of the pre-numbered receipts and a separate adding machine tape for checks and other types of cash included in the deposit. Deposit slips generated by computerized accounting programs must provide at a minimum the above stated receipt information.

Upon receipt and verification, The Student Account Office will write one receipt for the total amount of that day’s deposit. The Student Accounting system generates a receipt, which will be given to you or your designee and will indicate your beginning and ending pre-numbered receipts.

If it should be necessary to void or cancel a receipt, the originals should be clearly marked “Void” in such a manor that it cannot be re-used and should be attached to the copies. A strict accounting of all forms is necessary for the system of pre-numbered receipts to be effective. All forms must be kept in a secure location.

These records should be retained in your office for use in monitoring revenue, and be available for SUNY New Paltz, State University of New York – System Administration or New York State Comptroller’s Office audit.

CHECKS RETURNED BY THE BANK FOR INSUFFICIENT FUNDS (NG CHECKS):

Checks deposited into the State Revenue Account from the IFR accounts and subsequently returned to the Accounting Office for insufficient funds; uncollected funds, stop payment or other reasons for non-payment will result in a debit to the depositing IFR’s account. Collection of the NG check is the responsibility of the individual IFR. Upon receipt of the returned check, the Accounting Office will debit the IFR account for the amount of the check and send the NG check to the IFR, along with a letter of explanation.  It is then the responsibility of the IFR to collect payment from the maker of the check.  The IFR has the right to collect an additional fee of $20 for the NG check.