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HomeMy WebLinkAbout210-05POLICY & PROCEDURE Subject: CASH CONTROL Index: Finance Number: 210-05 Effective Date: 10/31/2021 Supersedes: 8/1/85 & 4/14/2004 Page: 1 of 8 Staff Contact: Kari Roller Approved By: 1.0 PURPOSE: The purpose of this policy is for the City of Renton to establish consistent procedures and internal controls for the receipting, handling, and depositing of cash and checks received by city departments. 2.0 ORGANIZATIONS AFFECTED: All departments/divisions. 3.0 REFERENCES: City of Renton Policy & Procedure 210-07 - Investment Policy City of Renton Policy & Procedure 220-07 - Cardholder Information Security Program RCW 43.09.240 City of Renton Policy & Procedure 300-47 - Discipline 4.0 POLICY: 4.1 It is the policy of the City of Renton to facilitate customers doing business with the City of Renton. Prompt remittance of receipts and payments made to the City in the course of doing such business will be made with the Finance Department to ensure: A.Security for undeposited cash. B.Investment of cash to full potential. C.Compliance with RCW 43.09.240 which requires funds to be deposited within 24 hours of receipt or according to armored car pickup schedule as agreed to by Finance, as the City’s Treasurer. 4.2 City departments who receive funds on behalf of the City shall safeguard and account for funds accurately and timely. 210-05 Cash Control p. 2 4.3 No checks shall be cashed or written for more than the amount of the purchase. 4.4 A numbered receipt will be created for each transaction by the department who accepts the payment. 4.5 All new hires, promotions, and transfers into positions responsible for handling cash and/or financial transactions will be required to have a financial credit check done and reviewed as part of the backgrounding process. 5.0 DEFINITIONS: 5.1 Cash: The term “cash” includes items such as currency, checks, money orders, coins, and credit card receipts. 5.2 Cash Handling Location: A “Cash Handling Location” is any place that the City of Renton operates that has a point of sale system and accepts payments and provides a receipt to the customer. 5.3 Point of Sale (POS): A point of sale system is software that provides functions such as receipting cash, voiding and refunding transactions, and reconciling information. 5.4 Change Funds: Cash that is under supervisory control, for the sole purpose of providing change to individual cash drawers. Change will only be made from the change fund and not from other sources such as other cash drawers, petty cash, or an employee’s personal funds. 5.5 Over/Short: Any discrepancies noted between the physical count of daily cash receipts and the reconciliation to the amounts recorded by the POS system. Discrepancies will be reviewed by supervisors and the Finance Department. 5.6 Working Cash: Working cash is the funds kept on location is a safe each night to fill each cashier’s drawer with a minimum amount of change available to be made for any cash deposits made by customers. 6.0 RESPONSIBILITIES: 6.1 The City of Renton contracts armored car services for the purpose of depositing all cash receipts received. This armored car service provides next day delivery for all deposits and services at most cash handling locations within the City. 210-05 Cash Control p. 3 6.2 The Finance Department is responsible for reviewing cash handling procedures within the City and making recommendations for how they could be improved. They are also responsible for the administration of this policy including providing training related to cash handling, reconciling all City bank accounts used for cash receipts, reviewing deposits of cash to amounts recorded in financial records for accuracy, processing of returned checks, various billings of fees, service charges to the public, and the investing of cash according to the City Council approved Investment Policy (210-07). 6.3 Department supervisors are responsible for monitoring the ongoing over/short discrepancies of their employees, internal controls, ensuring the policy is being followed, and initiating additional training when required. 6.4 The Renton Police Department, in coordination with Human Resources and the Finance Department, is responsible for initiating action to be taken when theft of cash or any other criminal violation of this policy is discovered or suspected. 7.0 PROCEDURES: 7.1 General A. No single employee will be responsible for handling a cash transaction from beginning to end. Duties will be segregated between cash receipting, posting revenue to the general ledger, and reconciling the bank statements to the financial records. In the event staffing levels prohibit segregation of duties, compensating controls will be put into place to ensure proper controls of cash receipting. B. All cash receipts shall be identifiable by revenue type in either the POS or general ledger. C. Any documents evidencing prior payment of revenue (e.g. prepaid golf, member credit), or cash receipts which are manually prepared shall be pre-numbered and issued in numerical sequence. All of these forms must be kept in a secured area that is not readily accessible to the public or unauthorized employees. D. Departments will assign a custodian of the change fund or petty cash to account for their use and keep them independent from the cash receipting process. E. Fees charged for City services shall be preprinted, posted in locations visible to the public, or properly authorized schedules shall be readily available for inspection by the public when requested. 210-05 Cash Control p. 4 F. Access to cashiering and accounting systems shall be limited by password and by the users designated duties. G. All cash receipts shall be prepared daily and deposited within 24 hours or according to armored car pickup schedule as agreed to by Finance. H. A system generated receipt shall be immediately issued for each collection. In the event a manual receipt is required, a pre-printed and pre-numbered receipt shall include: i. Identification of the Payor ii. Amount received iii. Mode of payment (cash, check, credit card, other) iv. Purpose of payment v. Identification of employee who prepared receipt 7.2 Cash Collections – In Person A. There shall be as many cash drawers or cash registers as there are people who collect cash at any given time at any City site, except as otherwise approved by the Finance Administrator or his/her designee. At no time will a cash drawer be shared by more than one person. B. Cash handlers will be assigned to work out of their own drawer and will be held accountable for all transactions occurring within their drawer. i. If an employee has continued discrepancies more than $10 over/short three times during a six-month period additional training may be required. C. All supporting documents for a cash transaction received from the department shall be attached to the Finance Department revenue documentation form which is retained in the Finance Department. Each department issuing receipts shall be responsible for accounting for all backup documentation pertaining to their receipts. D. All cash received will be recorded immediately upon receipt. E. All cash register voids shall require the authorization and sign off from a supervisor along with a full description for the reason for the void. All receipts related to the void will be included with the daily backup provided to the Finance Department. 210-05 Cash Control p. 5 F. Restrictively endorse all checks, money orders, and bank drafts “For Deposit Only” immediately upon receipt. G. All bills worth $50 or more will be tested for counterfeit currency using a counterfeit detection pen. H. Collections must be balanced to receipts daily and bank deposit prepared by the supervisor or someone who is not performing cash receipting functions. 7.3 Cash Collections – Via Mail or Payment Box Receipt A. Billing forms and statements mailed to customers shall include a section that is to be returned with payment. This section will include a prompt to encourage the customer to indicate the amount being paid. These amounts must be reconciled daily to the actual receipts. B. Incoming mail containing payments will always be opened by more than one employee. C. Employees opening the incoming mail will restrictively endorse all checks “For Deposit Only” immediately upon receipt. D. If an employee other than a cashier receives a cash payment, the payment must be given to a cashier immediately. Do not keep cash or checks in desk drawers or file cabinets, and do not attempt to deposit the payments directly to the bank. 7.4 Limiting Access to Cash Receipts A. Maintain all cash and checks in a secure place with limited employee access. B. Direct physical access to cash held on City premises will be effectively limited by the use of locked drawers, safes, locked deposit bags, and similar types of protective equipment. Access to such security devices will be physically restricted to authorized personnel only and strictly enforced. Smaller office safes and drop boxes will be permanently bolted to the floor or wall. C. Limit keys to the building, deposit bags, and safe combinations to as few employees as possible, primarily supervisory staff. Safe combinations must be changed annually; locks and safe combinations as circumstances warrant (e.g., employee separation, loss of keys, etc.). 210-05 Cash Control p. 6 D. Secure all cash when not attended during the day by locking cash registers, locking cash drawers, logging off computers, and keeping safes and vault doors closed and locked. E. Count cash before storing overnight; verify by signature the amount and source of funds. i. When cash that has not been verified and secured is retrieved from a vault, it will be counted and verified by signature for the amount and source of the funds. F. At the start of each day the working cash for each register should be counted to verify the beginning balance as its removed from the safe. G. Employees shall not be required to transport cash deposits as the City contracts an armored car service to perform that function. i. In the case that an armored car pickup is not provided, only personnel designated by manager or supervisor may transport cash deposits. H. Locations within the City that do not receive armored car services shall remit all collections to the Finance Department no less than once per week or at any time when cash on hand exceeds $100. Remittances shall be delivered in a tamper-evident bag and include: i. All cash and checks collected. ii. Copies of each individual receipt written. iii. Copies of all voided receipts. iv. A summary detailing how much money has been collected for each purpose and the account number to be credited. I. When change is needed by cashiers, it shall be obtained from the designated change fund custodian, recorded on a log sheet, and the log sheet signed off by the custodian, verifying the transaction. J. Similarly, excess funds of $500 over beginning working cash in a cash drawer shall be transferred to a safe, recorded on a log sheet, and the log sheet signed off by the cashier to verify the transaction. 210-05 Cash Control p. 7 7.5 Credit Card Payments A. In order for the City of Renton to accept credit card payments we must certify annually that the City is compliant with PCI Data Security Standards as noted in the Cardholder Information Security Program Policy (220-07). i. All cashiers are required to sign the Cardholder Information Security Agreement. B. Credit card numbers must never be written down or stored unless encrypted by software approved by the City of Renton IT Division. C. Credit card payments shall not be taken over the phone. 7.6 Prohibited Transactions A. Cash that is collected at City locations may not be used to pay vendors, employees, instructors, umpires, referees, contractors, reimbursements, or other expenses of any kind. B. City staff is not authorized to cash checks, payroll checks, money orders, or any other similar instruments with cash collected at a City location, change funds or petty cash. C. Loans or borrowing from cash collected at City locations is prohibited. D. Instructors who conduct classes through City programs are not authorized to accept payments directly from people who are enrolled in the programs and classes. Payment for class enrollment must be made directly to the Department responsible for the City program. 7.7 Reporting Theft, Robbery, or Fraud A. In the event of a robbery of any kind, employees should not attempt to physically interrupt or otherwise resist the perpetrator. B. Employees should follow all instructions and secure the building immediately after the perpetrator has left to ensure safety and preserve crime scene. 210-05 Cash Control p. 8 C. Immediately following a robbery or robbery attempt, employees must notify the Police Department, their supervisor, and their Department Head. The supervisor or Department Head shall subsequently notify the Finance Department of any amounts lost due to the robbery. D. Immediately following the discovery of missing cash, employees must notify the supervisor or Department Head. The Department Head shall notify the Police Department and the Finance Administrator. Written notice describing all the details of the theft shall be given to the Police Department and the Finance Administrator no later than twenty-four (24) hours after the discovery. 7.8 Reconciling Revenues A. Cash received after the end of business day reconciliation will be counted, signed for, and stored in a safe until the following day’s deposit. B. A designated person other than the cashiers shall initiate the daily cash summary program (or its equivalent) no later than the following business day. The computer cash out totals shall be reconciled to the cash receipts to be deposited, and a cash reconciliation form that has been approved by the Finance Department shall be prepared. C. The Cash Reconciliation form shall be signed by both the cashier responsible for the cash drawer and the individual completing the reconciliation explained above confirming the amounts reported are accurate. 7.9 Reconciling Bank Accounts and Financial Records A. Bank statements shall be directly routed unopened to the Finance Department and shall be opened and reviewed for reasonableness by someone not involved in cash handling. B. All bank reconciliations will be performed by someone who is not involved in cash handling and reviewed and approved by an appropriate supervisor. 7.10 Cash Handling Training A. Cash handling training shall be required upon onboarding for all positions that handle cash and employees must verify completion of the training by signature. 210-05 Cash Control p. 9 B. Employees shall be required to take an annual refresher course of the training and sign off that it was completed.