Local Checking Accounts

Transcription

1 Local Checking Accounts Business Office, Columbus Contents General Checking Account Information Receiving Money Spending Money 8/7/

2 General Checking Account Information Buying Tools Purchase Order PO, Requisition erequest Standard Purchasing Request Least Use Local Checking Account Rotary Account, Designated Account, Non-Appropriated Account, Field Office Bank Account Convenience Order PREP, FAS12, Payment Request erequest Type varies by CO# PCards Purchasing Card, Travel Card, Individual Card, Department Card, Service Center Card, TCard, ProCard, Procurement Card, GET Card erequest Purchasing Card Preferred Internal Orders 100w, IDB, Interdepartmental Billing, online orders, estore (Comm Tech), Registrations, Journals erequest Internal Order estores ibuy, eprocurement erequest estores 8/7/ Most Use 4

3 What is a local checking account? A place to deposit cash and other small dollar payments to Extension A convenient buying tool An account placed with a local bank based on the best value and location for each office. University funds University rules 5 Local Checking Account Basics Business Office Checking accounts belong to the University Policies come from the Ext. Bus. Office Business Office Rep can answer questions Training is available Extension Bus Ofc visits occur periodically University Rules Tax ID Report sales tax to the Univ Tax Ofc monthly Provide Reconciliation for Jun & Dec statements Name must reference Ohio State University University can audit at any time Local Info Savings, CD s and other investments aren t allowed Can t use as a pass through for affiliated groups Official audit documents remain in the local office Not permitted to have debit or credit cards on the acct Units should set internal controls to safeguard funds 6 8/7/2014 3

4 Account Requirements Segregation of duties At least two people must be housed in an office that wishes to have a bank account. A Unit Director is required for use of a bank account. Location The Unit must be located off of the Columbus campus in order to have a bank account. Tracking A receipt ledger, check ledger and two locked files are required for the tracking of these funds. The first locked file can be located in the front office where you get in and out of the money during the day to make change. The second locked file should be located somewhere else in the office where the money is moved to at night, preferably a safe that is bolted to the floor. This second file is also where check stock should be stored. Invoices and other backup documentation should be maintained according to University Records Retention schedules. 7 Unit Director Responsibilities Directors that need assistance after reviewing this training may contact the Business office for help. SET CONTROLS APPROVE MONITOR Establish who is allowed to approve and when Set up the signature authorizations at the bank Establish who is going to do what: Write checks Take money Deposit money Review deposit Reconcile account Approve most checks or transactions written against the account Review documentation supporting written checks Review unopened bank statement or print bank statement from web: - Look at all debits - Review all deposits and compare to receipt ledger - Look at total balances Review reconciliation of bank statement Periodically: 1. Check cash on hand and compare to ledger 2. Review that sales tax is correctly being collected & reported 3. Pick a program & look at attendee # s make sure you got all of the money you were expecting 4. Reconcile the bank account SET CONTROLS APPROVE MONITOR 8/7/

5 Segregation of Duties At least two people need to be involved in every transaction Typical Office Structure Receiving Money Writing Checks Reconciliation Initiator All staff receive money and record in ledger Support staff completes paperwork and writes out check Support staff reconciles statement to ledgers Approver Unit Approver reviews deposit vs. ledger before it goes to the bank Check reviewed and signed by the Unit Approver Approver reviews statement (received unopened) and approves reconciliation after it is complete 9 Accounting Systems Many offices use a pegboard system to account for their checking accounts. These systems are intended to reduce the amount of time spent on these tasks. Other online systems can be used, but the same level of detail (receipt ledger, check ledger and account balances) should be printed (or turned into a PDF and saved) and kept on file for the audit records on a monthly basis. The Business Office cannot provide technical support for these types of programs. You may purchase training help from private vendors as needed. The University also has an agreement with Lynda.com that has online Quickbooks and Quicken training. training videos lyndacom Note: because receipts have to be recorded as soon as they come in you will need a dedicated computer to use an online system instead of a paper receipt ledger. 8/7/

6 Accounting Systems Regardless of the accounting systems used, it is necessary to keep exact records of the inflows and outflows of all money. This involves the following standard procedures. Receipting Payments Ledgers Reconciling Receipt all funds taken in, show the amount, the source and the reason for the transaction. Always complete the entire receipt in the ledger. Pay all obligations by check, properly documented petty cash fund or electronic online payment (i.e. postage meters). Checks are supported by vouchers, usually vendor invoices to document this information. Ledgers need to be used and saved to record all income and expenses, this includes a fund balance. Generally the ledger is used to subdivide the transactions into classes of subaccounts (i.e. by program area). Reconciliation and review must happen monthly. This is done by comparing the ledger to the statements that are furnished by the bank to be sure items are properly recorded. 11 Checking accounts with more than $20,000 are not permitted. This is an average over the year, but most months accounts should be less than $20,000. Sending money to the University If over $20,000 you may need to send money to your designated fund (06xxxx) in Columbus to reduce your account. You may also want to send money down because there are expenses that aren t allowed in the checking but you have collected money there to pay for them example: Registration fees (checking) to pay for a Speaker (Designated fund). DEPOSIT TRANSMITTAL FORM and CHECK to the Business Office Deposit to ORG 5xxxx Fund 06xxxx Acct No backup required Working with OSU 8/7/

7 Working with OSU Sometimes you spend money out of your checking account but the revenue for the expense is in a University fund. Reimbursing your checking account Example: You purchased food for a SNAP Ed presentation and the money needs to be reimbursed from your SNAP Ed Grant. Gather all of your documentation (more on this later). Scan in all of your documents to your computer. Note that reimbursements should not exceed $5,000 per fund on a quarterly basis. Complete an erequest Payment Reference your office as the vendor. List the items purchased and the reason why. Add the check numbers that were used to pay for the items somewhere on your erequest or documentation! Attach your scanned documentation. Choose the right chartfield. Submit the transaction for approval. Print a PDF copy of the transaction, staple your documentation to the back and mail to the appropriate office (OSP or the Business Office). More on erequests in the erequest job aids on the Business Office site General Checking Acct Info Summary Local Checking Accounts are among the least frequently used buying tools. Accounts require duties be split among multiple people in the office to prevent fraud. Checking accounts work in conjunction with your University funds numbers. Money is sent to the designated fund (06xxxx) for deposit. Refunds come from University funds via erequest. Unit Directors are responsible for setting internal controls, approving transactions and monitoring the accounts. Accounting Systems need to document receipts and payments in ledgers that allow for full reconciliation to the bank statement. 8/7/

8 Receiving Money Receiving Money Reminder: Money should be locked at all times. 1. Use pre-numbered receipts or logs for all incoming funds. 2. Receipt money as soon as it comes in. 3. Complete the entire receipt in the receipt ledger. 4. A sign stating that a charge, currently $30, shall be assessed against the maker of each returned check shall be posted at each check-acceptance unit. To print: 5. Grants, contracts, appropriation, and donations should never be put in the checking account. Complete a Deposit Transmittal form for these transactions Don t handle funds for other organizations. Only money being deposited in your checking account or in a University fund should be accepted. 7. Don t act as a pass through for other organizations. Example: taking registration money for the Farm and Dairy group event and then writing them a check for the proceeds later. 8. Sales tax should be charged for anything that requires tax. This includes publications, for sale items like bears and other items. If someone says they are tax exempt, check your Blanket Certificate of Exemption form file and make sure you have a form on file for them, then provide the exemption and record on the ledger /7/2014 8

9 Types of Money Cash You may wish to consider getting a counterfeit pen that can detect counterfeit bills. If you receive a counterfeit bill 1) keep it 2) alert the customer and 3) contact University Police and local law enforcement Checks All checks should be stamped For Deposit Only as soon as they come in. This stamp should also reference the bank account #. Unacceptable Checks: Counter check, Starter check, Third Party check, Foreign check More information on accepting checks is available here: Money Orders Money orders should be treated like cash. 17 Types of Revenue Allowable in Checking Account Registration fees Sales revenue (i.e. Publications) Speaking fees Payments for space use (i.e. renting out a meeting room) Sponsorships NOT Allowable in Checking Account Grant payments Contract payments Appropriation payments Checks to make change (i.e. acting like an ATM) Money for other organizations Donations (see next slide) 8/7/

10 What is a donation? Type Donation (Gift) Individual or group providing unrestricted money for a program or for the office. Sponsorship When an organization provides money to help pay for a program but receives some sort of advertising in return. What to do with it Deposit in the University Foundation via Development Fund (3xxxxx) or Endowment Fund (6xxxxx) Use Deposit Transmittal Form follow directions on the form to mail directly to the Development Office DON T record as a donation. Allowable to deposit into checking account. Description should be Sponsorship Other Someone giving you extra money with no expectations in return (no tax deduction, no advertising). Ex. keep the change DON T record as a donation. Allowable to deposit into checking account. Description should be overpayment or something similar 19 Deposits 1. All funds should be deposited in the form received. - Checks should not be cashed, bills should not be paid and refunds should not be made from the cash box. 2. The change box (or cash box) should always have the same amount of money in it at each deposit. 3. If you keep copies of deposited checks (recommended but not required), cover up the bank routing number and account number on the check before copying. 4. Add up all of the receipt columns, add up the cash box make sure they match. -Overages and shortages should be recorded at the time of deposit on the ledger 5. Have someone else review your deposit to the ledger and cash/checks before you take it to the bank. - They should initial on the ledger that they did this 6. Keep the deposit receipts that you get from the bank 7. Make frequent deposits. $1,000 or every three days, whichever comes first. 8/7/

11 Sample Cash Receipts Journal sales tax rate example 6.5% Bank Transit No. $ Checks $ Cash Tax Date Name Description Rec d By Bal Fwd Receipt Number $ /9/12 Sarah Smith MG class CB Note: total $6.25 $0.41 4/10/12 Sandy Simmons 4-H cats publication WM collected $ $ Exempt 4/11/12 Jolly Jumpers 4-H Club 4-H pubs for club JB $ /13/12 Ohio Health Speaking fee BM ($0.75) Cash drawer shortage CB Deposit for $ on 4/13/2012, completed by CB, Reviewed by BM (DEPOSIT NOT MADE IN TIMELY MANNER!) $ /23/12 John Doe Personal copies LM $ /24/12 Various see receipt list attached from workshop Cloverbud Camp fees collected at workshop 3527 Deposit for $90.60 on 4/27/12, Completed by LM, Reviewed by BM 9 LM Deposits are made every three days or when you reach $1,000 whichever comes first. OSU State of Ohio Sales Tax Reporting Form Multi County 8/7/

12 Sales Tax Help OSUE Business Office Info: Sales Tax Job Aid: OSU Info: Departmental State of Ohio Sales Tax Reporting Form: Sales Tax Manual: Sales Tax to monthly form: State of Ohio Info: 23 Invoicing Customer in person charges This is when a customer comes in and pays for the item right away. Billed charges from the Unit Units are responsible for doing the billings (creating invoices) for amounts that are due to their offices when a customer doesn t pay directly These billings should be tracked to make sure payment is received Includes billing for grants and contracts that don t run through OSP Grant money must be deposited in a fund at the University not in the local checking account. Invoice template: 8/7/

13 Receiving Money Summary Money should be locked at all times. Don t deposit Grants, contracts, appropriations, or donations in your checking account. Deposits need to be made when $1,000 has accumulated or every three days whichever comes first. Charge sales tax and report monthly. Don t handle Funds for other organizations. Don t act as a pass through to another account. Have someone else review your deposits. Keep copies of your invoices. 25 Spending Money 8/7/

14 Spending Money Tax: Items purchased using the checking account are Tax exempt. Provide vendors with the Tax Exemption Certificate when making purchases. Documentation: Each transaction requires detailed documentation. This can be done in a variety of ways, but the documentation MUST be available for auditors if you are asked. There is a Local Checking Account Tools document on the Business Office Website which has a sample documentation form, and forms for commonly mis-documented transactions. General documentation form, Refunds, Checks for making change Use this as a guide when preparing documentation Documentation consists of an original invoice or original itemized receipt. The receipt must list what was purchased. Always complete all of the fields on a check including the check memo. 27 Spending Money Required on a Purchase Order Treat the account as if it was your personal money. Would you leave a personal check lying open on the front counter? When in doubt, ask your Business Office representative. It is better to be conservative with the use of the checking account! If it is a restricted item and requires a PO it cannot be done from the Checking account. AIR CONDITIONERS AIRCRAFT AUDITOR OR ACCOUNTING SERVICE VEHICLES SECURITY SYSTEMS AND SERVICE BUILDING MAINTENANCE AND REPAIR PAINTING AND CONTRACTING SERVICES FIRE SAFETY SUPPLIES AND SERVICE GAS LEGAL SERVICES LETTERHEAD AND MAILING LABELS COPIERS OFFICE SPACE RENTAL WEAPONS AND AMMUNITION CHEMICALS AND RADIOACTIVE PRODUCTS RADIO & SATELLITE EQUIPMENT SIGNAGE TELEPHONES AND SERVICE VENDING VIDEO PRODUCTION 28 8/7/

15 Checking Account expense documentation is held to the same standards as all other documentation including the erequest and Travel documents you Contents send to the Business Office. Tell the Story Who Who is making the purchase in your office? What What are the exact items or services you are buying? Ex. Not just Food instead use Boxed lunches Where Where are you buying the items or services? Vendor s name. When What is the date on the invoice or receipt, or the date you received the good or service? Why Why do you need the items or services? Ex. Lunches for the Ext. Advisory Committee because there was not time to leave for lunch. How How do you plan to pay for it? Ex. 4-H Camp revenue 29 Additional Documentation Food & Beverage Attendee list Itemized receipt Business purpose OSU Employee status of the attendees Refunds Original receipt number associated with payment Reason for refund Gifts, shirts, Gift Cards and other personal items Recipient list Itemized receipt Business purpose OSU Employee status of the recipients Checks to make change Person responsible Reason needed Date needed After Redeposit receipt number Shipped or online Items Packing slips Order confirmation Approver Expenses that could be seen as personal. (i.e. prof memberships, lunches) Pre-approval of supervisor one level higher than that approver. ok. Exceptions Pre-approval or reason for not having pre-approval Itemized receipt Business purpose Reason for exception Equipment (more later) Non capital equipment log For items that leave the office: - Sign-out Form - Agree for Assign. of Univ. Property Form 30 8/7/

16 Types of Payments Note: Payments should never come from the cash in the cash box. Checks Checks are usually prepared by a support person in the office using a check and a check ledger. This check and related documentation is then reviewed & signed by the office approver (Most often the Unit Director). Electronic Payments Can be made when the vendor has a preference for this. Ex. postage meter replenishment. The documentation and authorization for this is the same as any check. The approver should review the request before it is submitted for processing. A transaction documentation form can help. See Local Checking Account Tools on the Forms page. Petty Cash (not the cash box, this is separate) Petty cash is rare most units do not have a petty cash fund that they use to pay for items. It is not recommended. If you currently have one, see the Petty cash policies: 31 Sample Cash Disbursement Journal 8/7/

17 Allowable Expenses Allowable in Checking Account Small dollar, non-restricted items Subscriptions Membership fees Postage Payments to OSU accounts Download one page Job Aid of restrictions here: 33 Not Allowable Expenses GENERAL PURCHASES Any purchase over $1,000 Exceptions: 1. any payment to OSU 2. Postage 3. Camp fees Donations to other organizations/people Letterhead, business cards, envelopes Personal expenses (even if you intend to repay ) Support of political activities Loans of any kind Cash to make purchases Savings bonds for gifts Gift Cards to use as cash Note: Gift cards for gifts or tokens of appreciation are allowable 8/7/

18 Not Allowable Expenses PAYMENTS ON CONTRACTS Charters or any vehicle rental Example: bus, van, boat Recurring monthly service contracts - Example monthly lease agreements, monthly maintenance Exception that is allowable: One time contracts that are less than $1,000 for allowable items Contracts should be received signed from the University before payment is made Allowable Examples: Facility use agreements, one time equipment rentals Units should NEVER sign contracts on their own. Send contract to the Business Office with a CONTRACT FORM and indicate Local Checking Account payment Not Allowable Expenses PAYMENTS TO PEOPLE Scholarships Honoraria Payroll: including summer interns and temporary help Travel reimbursements, expenses and cash advances People should generally not be paid from this account Exceptions that are allowable: 1. Refunds are permitted to individuals, who have paid for books/registration fees, etc. and return the item or do not attend meeting 2. Reimbursements are permitted to individuals for the purchase of office supplies or other goods for less than $ Note that if the person is an authorized check signer they may not get reimbursement from the checking account at any dollar amount 8/7/

19 Not Allowable Expenses PAYMENTS FOR SERVICES Parking charges at home office sites or OSU annual parking decals for individual employees Insurance (see exception below) Allowable Exception: American Income Life Insurance can be purchased from the checking account as long as the amounts are tracked and reported to the Business Office when prompted each year. Repair, renovation and construction of a building Payments to individuals for services Example: Speakers, bus drivers, nurses, entertainers, photographers, cleaning, moving, vending, painting, equipment repair. Catering (served meals, buffet meals, etc.) Allowable Exception: general food items for presentations, small non-catered lunches, refreshments are not considered catering and are ok 37 Not Allowable Expenses EQUIPMENT Not Allowable: copiers, radios, alarm systems, computers, satellite dishes/antennas, security alarm systems, telephones and telephone equipment (i.e. blue tooth headsets) Allowable: fax machines, desktop printers, & moveable items that are less than $1,000 ADDITIONAL DOCUMENTATION FOR EQUIPMENT New purchases must be added to the Non Cap Equipment Log If equipment will be removed from the office, the following documents must be attached to the original receipt: Assigned Equipment assigned to an individual. Agreement for Assignment of University Equipment form: Upon resignation or termination all items must be returned to the office. Shared Items that everyone in the office will have access to. Create a Sign in/sign out Sheet: The equipment coordinator should evaluate the piece of equipment to be sure it was returned in good condition. 8/7/

20 Spending Money Summary Every transaction requires complete documentation. Who What Where When Why How Don t sign contracts Equipment requires additional documentation and so do some other things Don t pay for: Reimbursements over $100 Check signer reimbursements Honoraria Scholarships Individuals who provide services Repairs Don t pay for: Items over $1,000 Travel expenses Charters Insurance 39 Resources Business Office What s New Links Forms Policies and Procedures University Policies Sales Tax Purchasing Expenditure Policy Check Acceptance Business Office Representative Business Office notices Sign up for the listserv: [email protected] Join us on Facebook: 8/7/