Policy FN01 PROCESSING CASH REVENUES

Policy Steward:  Office of the Corporate Controller

Contents:

  • Purpose
  • Recording Transactions
  • Reporting Cash Received
  • Depositing Cash
  • At University Park
  • At Non-University Park Locations
  • Checks Received
  • Check Endorsement
  • Depositing Check Drawn on Foreign Banks
  • Restrictions
  • Safeguarding Cash
  • Cash Over or Cash Short
  • Reporting Wire, EFTs and ACH Payments
  • Further Information

  • PURPOSE:

    To assure that the University's cash revenues (coin, currency, checks, money orders, credit cards, wires, EFTs and ACH payments, etc.) are properly accounted for, safeguarded, deposited, and reported in a timely manner. Other forms of revenue such as interest on University deposits, and proceeds from other University investments are beyond the scope of this policy.

    RECORDING TRANSACTIONS:

    All transactions resulting in cash revenue to the University from the sale of products and materials, from the collection of a fee for a service (including tuition), or from monetary gifts must be documented in a manner as follows:

    Supporting documents and procedures must be used which minimize the risk of misappropriated or misplaced cash revenue, ensure the timely deposit of those revenues, and ensure the timely and accurate reporting of those deposits to University budget records. Revenues must be fully traceable from the point of transaction to their appearance in University budget records and depository accounts. It is the responsibility of the Financial Officer of each area to determine the adequacy of documentation and local procedures based upon the constraints of this policy.

    Refer to Financial Guideline No. 03 for additional general information. Refer to Policy FN03 and Financial Guideline No. 1 for specific information for processing gifts of cash and grants from non-governmental sources. Refer to FN02 for specific information regarding charge sales. Refer to FN07 for specific information regarding credit card sales.

    REPORTING CASH RECEIVED:

    All cash received by any department or area of the University must be deposited as quickly as possible with a Bursar-designated depository bank (or with the Bursar for student account and Bursar Accounts Receivable payments), and reported in a timely manner. For deposits directly affecting a student account receivable, the entry to the student account via the Integrated Student Information System (ISIS - both credit and non-credit activity) is sufficient notification at University Park. For ISIS deposits at non-University Park locations, a copy of the bank-validated copy of the deposit slip must be forwarded to the Financial Reporting department within three business days after the end of the month. In all other deposit situations, a Report of Cash Receipts (ROCR) must be prepared in accordance with the appropriate instructions. For additional details, see Procedure #CR2005 "Depositing Cash Revenues."

    Under no circumstance is cash revenue to be forwarded via interoffice mail. Adequate transfer of accountability must be recorded (name, date, and deposit amount) if the deposit is not made directly by the person preparing the Report of Cash Receipts and/or the person making entry to the Integrated Student Information System. Refer to procedure #CR2004 "Accountability for Transfer of Items of Value (Except Equipment)" for the proper methods of transfer.

    At University Park, cash revenue received in payment of previous charge sales (invoiced through the Bursar's Office) must be immediately forwarded to the Office of the Bursar so that the customer's account may be credited. No transaction records or acknowledgment are made, nor is a Report of Cash Receipts prepared by the initial recipient of the payment (the Bursar's Office shall be responsible for the reporting of the revenue). Refer to Policy FN02.

    At non-University Park locations, cash revenue received in payment of previous charge sales (invoiced through the location's Finance/Business Office) must be immediately forwarded to that Finance/Business Office so that the customer's account may be credited. No transaction records or acknowledgment are made, nor is a Report of Cash Receipts prepared by the initial recipient of the payment (the Finance/Business Office shall be responsible for the reporting of the revenue). Refer to Policy FN02.

    DEPOSITING CASH:

    All cash revenue must be deposited daily when $500.00 or more has been collected, however, not less frequently than once a week regardless of the amount collected. Revenue must be deposited either (1) in person at a bank with which the University transacts business, or (2) utilizing the University’s service administered by the Corporate Controller’s Office. Revenue must be deposited at a bank before the end of the second business day that total revenues warrant a deposit. Weekly revenue should be deposited on Friday and not held over a weekend.

    - At University Park, departments may make deposits by (1) taking them to the Office of the Bursar, (2) taking them to a Bursar-designated bank, or (3) utilizing the Bank Deposit Bag Tracking System.

    1. Bursar Deposits
      The Bursar will not count bank deposits for departments, but may temporarily hold a deposit bag for delivery directly to the designated depository. Secure deposit bags may be purchased from General Stores for the proper depository. Deposit slips are available from the Bursar. Responsibility for and transfer of the bags is traced through signatures on an Accountability Transfer Form, or an established log. The validated deposit slip is returned to the depositing departments via U. S. mail.

    2. Bank Deposits
      Deposits made in person to one of the Bursar-designated depositories will be made with a deposit slip provided by the respective area's Financial Officer. The deposit slip must identify the campus or department making the deposit. A bank-validated copy of the deposit slip notated with the IBIS document number of the corresponding "ROCR" (Report of Cash Receipts) on which the deposit was reported must be retained in the departmental files for the current fiscal year plus two years. Reference the procedure "Depositing Cash Revenues" (#CR2005).

    3. Bank Deposit Bag Tracking System
      Auxiliary & Business Services (ABS), in conjunction with the Corporate Controller’s Office, has established a daily courier service to transport cash deposits. This service utilizes a deposit bag tracking system. Approved depositors are provided with a supply of prenumbered, barcoded deposit bags. This procedure is to assure that the University’s cash receipts are properly safeguarded and deposited in a timely manner. For details, refer to the procedure "Bank Deposit Bag Tracking" (#CR2007)

    - At non-University Park locations, the deposit is made with the bank deposit slip to the regular University depository account for that location. The deposit slip must identify the campus or department making the deposit.

    CHECKS RECEIVED:

    All checks and money orders received in payment of goods or services must be made payable to THE PENNSYLVANIA STATE UNIVERSITY and not to the area selling the materials or services. All checks, money orders and travelers checks must be restrictively endorsed immediately upon receipt to further limit the negotiability of the items.

    Also, it is the department's responsibility to collect amounts due the University whenever checks accepted by the department are returned by the bank. Therefore, it is required that the department to which the check will be credited identify itself on the back of the check as part of its endorsement. Reference the procedure "Processing Returned Checks" (#CR2002).

    CHECK ENDORSEMENT:

    The check endorsement must include the following:

    1. The verbiage "DEPOSIT ONLY - THE PENNSYLVANIA STATE UNIVERSITY," (or "Penn State University").
    2. The name of the designated depository bank,
    3. University's General Ledger Code for the Bank,
    4. The University's account number with the designated depository bank,
    5. The department number and fund number of the department to which the check will be credited. This information is necessary for the processing of returned checks. If the payment will be credited to multiple budgets, select a single budget to which a returned check may be charged.
    6. The USER ID of the employee making the deposit should also be included on the back of the check.

    Acceptable Samples

    scanned instance of acceptable endorsement stamps

    Endorsement stamps must be obtained through your Financial Officer, and must incorporate the 5 items listed above.

    Reference the procedure "Depositing Cash Revenues" (#CR2005).

    DEPOSITING CHECKS DRAWN ON FOREIGN BANKS:

    Checks which are payable in foreign currency require special consideration and may not be deposited in the same manner as checks drawn on U. S. banks. Such checks must be converted from the foreign currency to U. S. dollars.

    Note that conversion costs are expensive and if the foreign check is for less than $50 U. S. dollars, it may be better to return the check and request payment in U. S. funds. Please see Procedure #CR2005 for full details.

    RESTRICTIONS:

    Cash receipts are not to be withheld from deposits in order to create change or petty cash funds for sales operations. If such funds are needed, they are to be requested in accordance with University Policy FN04, and the instructions contained in GURU.

    Cash receipts are not to be intermingled with petty cash funds, nor are they to be used for making purchases normally made from petty cash funds (see Policy FN04). Also, cash receipts are not to be used for making personal cash advances to employees, or for cashing checks.

    SAFEGUARDING CASH:

    It is the responsibility of each department or non-University Park location to make whatever provisions are necessary to properly safeguard the cash receipts of their area.

    Any amount of cash on hand that exceeds $1,000 must be maintained in an approved safe (fireproof, bolted to the floor or immovable). Amounts of $1,000 and under must be maintained in a file safe or reinforced file cabinet with a pad lock and bar that secures all drawers. Cash should not be retained in desk drawers or standard file cabinets since they are easily accessed with nominal forcing or readily available keys.

    CASH OVER OR CASH SHORT:

    FOR NON-ISIS DEPOSITS -

    Cash over or cash short must be reported on a Report of Cash Receipts. In addition, if the overage or shortage exceeds $20.00, the ROCR must be approved by the budget executive or budget administrator. See the "ROCR" documentation.

    FOR ISIS DEPOSITS -

    Cash over or short must be reconciled by preparing a JVDP, Journal Voucher - Departmental (Financial) that debits 0752 (Over/Short account) and credits the Bank for shortages -OR- debits the bank and credits 0752 for overages. If the overage or shortage exceeds $20.00, the JVDP must be approved by the budget executive or budget administrator.

    REPORTING WIRE, EFT AND ACH PAYMENTS:

    It is the responsibility of the area that receives payments by wire, EFT or ACH to assure the payment is recorded to the General Ledger (debiting the appropriate depository bank and crediting the appropriate buget/fund). Wire, EFT and ACH payments must be reported on a Report of Cash Receipts (ROCR) or through the appropriate Integrated Student Information System (ISIS) reporting channels.

    FURTHER INFORMATION:

    For questions, additional detail, or to request changes to this policy, please contact the Office of the Corporate Controller.


    Effective Date: September 28, 2015
    Date Approved: August 19, 2015
    Date Published: September 28, 2015

    Most recent changes:

    Revision History (and effective dates):

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