I. NATURE OF PETTY CASH FUNDS
II. PROPER CUSTODY AND CONTROL OF
PETTY CASH FUNDS
III. LIMITATIONS ON USE OF PETTY
CASH FUNDS
IV. SECURING OF PROPER RECEIPTS FOR
PETTY CASH EXPENDITURES
V. REIMBURSEMENT OF PETTY
CASH EXPENDITURES
VI. CASH OVERAGE AND SHORTAGE
I. NATURE OF PETTY CASH FUNDS
When the nature of certain departmental operations requires a
fund for frequent cash purchases of minor items, the Financial
Services Office will, upon proper justification, advance to the
Department Head a Petty Cash Fund to be maintained by the
Department on a custodial basis.
Such advances are not
chargeable to the department's operating account but are
reflected on the accounting records as an advance to the
Department Head, who is accountable for proper fiscal
and physical control of the fund.
Back to Top
II. PROPER CUSTODY AND CONTROL OF PETTY CASH
FUNDS
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 or Unit Head.
A. The Department Head must insure that
facilities for safekeeping of funds are available and must be
approved by the Financial Services Office.
B. Petty Cash Funds, other than advances used
in making change, must be kept separated from all other funds,
including personal funds, and not co-mingled.
C. The Petty Cash Funds are subjected to
audit and should frequently be balanced to insure that
the cash
plus paid receipts on hand equal the amount of the fund.
Back to Top
III. LIMITATIONS ON USE OF PETTY CASH
FUNDS
A. Office supplies and materials which are available through
other sources may not be purchased through the petty cash account
except in emergency situations.
If such a purchase is
necessary, an explanation must be attached to the voucher.
B.
Unless exceptions are specially
approved by the University Financial Services office, Petty Cash
should be used only when the purchase from one vendor is less
than twenty- five dollars ($25.00).
C.
As a state institution, the
University is exempt from the payment of City and State Sales Tax
and Federal Excise Taxes.
Exemption forms are available
from the Financial Services Office.
D. Loans or advances to employees for
personal use from Petty Cash Funds are forbidden.
No
checks may be
cashed from Departmental Petty Cash Funds.
Back to Top
IV.
SECURING OF PROPER RECEIPTS
FOR PETTY CASH EXPENDITURES
Receipts for Petty Cash expenditures must be obtained from the vendor and must meet the following requirements:
A.
All receipts must be originals.
B.
The receipts must provide a
complete description of the materials purchased or service
rendered.
If a cash register tape is
provided, write the description beside each item on the tape.
C.
The vendor's invoice must
clearly indicate that it has been paid either by being stamped
with the official "PAID" stamp of the firm and containing the
name of the firm; by being made out to "CASH SALE"; by having the
firm's cash register "CASH SALE".
D.
Receipts cannot be accepted for
reimbursement which show evidence of alteration.
Back to Top
V.
REIMBURSEMENT OF
PETTY CASH EXPENDITURES
Whenever the cash in the fund is depleted to
the extent requiring replenishment, or, in any event, at least
once each fiscal quarter, the paid invoices should be submitted
to the Financial Services Office
for reimbursement.
Back to Top
VI. CASH OVERAGE AND SHORTAGE
If at any time a department's petty cash fund
or daily receipts should be over or short, the overage or
shortage should be reported by telephone to the Financial
Services Office (X4212 or X4414) immediately.
If the amount of overage or
shortage is determined to be significant by the University
Financial Services Office, a written report regarding the
circumstances of the overage or shortage must be submitted to the
University Financial Services Office for a formal report to the
Vice President for Business and Finance and the Tennessee Board
of Regents and the State Comptroller's Office as required by law
(TCA 8-19-501).
Back to Top
Original effective date: April 9, 1982
Revised: October 1, 1987; October 16, 2000; February 22, 2010
Last review: October 2, 2003
Web page last updated 2/22/2010