400.3 Cash Change Funds

Date Adopted: 1/22/2003
Date Revised: 1/03/2018
References: MOM 2-1900, MOM 2-1200, MCA 5-13-309, MCA 5-13-310
Issuing Office: Administration and Finance
Approved By: Vice Chancellor for Administration and Finance

1. Policy

   The University of Montana Western maintains Cash Change Funds.

2. Purpose

   A Cash Change Fund, which consists of monies withdrawn from the State of Montana Treasury, is used to provide coin and currency needed to conduct cashiering or similar operations. The account remains fixed at all times and is never used to make purchases.

3. Procedures

   1. Administrative Oversight and Review of Cash Change Funds

      1. The UMW Director of Business Services receives all departmental requests for change funds. After the request is approved, it will be sent to the Department of Administration for final approval.
      2. It is the responsibility of each department’s management to establish and maintain a system of internal controls over collections and deposits. A proper division of duties is an internal control requirement for cash. The function of receiving cash, preparing/issuing receipts and depositing cash should not be performed by the same individual responsible for maintaining the records for cash. Cash records include daily cash reports, pre-numbered receipts, cash register tapes, accounts receivable records, organizational reports and any departmental detailed revenue/sales reports. The individual(s) who maintain the records should verify the accuracy of cash. Daily verification should include confirmation of total cash and accuracy of departmental receipts issued and tracking this total to the deposit to Business Services. Cash deposits should be reconciled monthly to Banner departmental reports. Any discrepancy should be investigated and documented for future reference. Material unreconciled differences should be reported to management.
      3. Change funds must be made available to the University of Montana Internal Auditors, Legislative Auditors, and Business Services representatives upon their request.

   2. Restrictions and Use of Cash Change Funds

      1. Because a cash change fund may be used only to “make change”, at the start of each day the fund should contain only the authorized amount. Current collections may not be used to increase or create a cash change fund.
      2. Each cash change fund should be physically segregated and must be adequately secured at all times. When a cash change fund is not in use or is unattended for even a brief time, it must be appropriately secured. At a minimum, a lockable strongbox must be provided which must be secured in a locked desk drawer during non-working hours.
      3. The departmental supervisor or director will designate the custodian of the cash change fund, and the number of individuals who have access to the fund.
      4. The number of people permitted access to a cash change fund should be kept to a minimum.
      5. The Director of Business Services will be notified of any changes involving the custodian or number of individuals authorized access to the cash change fund.
      6. Expenditures from a cash change fund are prohibited.
      7. Checks may be accepted in payment for the amount of goods and services provided. Negotiable instruments (i.e. checks) shall be restrictively endorsed at the time of initial receipt. The following restrictive endorsement must be placed on all negotiable instruments deposited to Business Services:

      FOR DEPOSIT ONLY
      TO THE DEMAND ACCOUNT
      OF THE MONTANA STATE TREASURER
      5108
      UNIVERSITY OF MONTANA WESTERN

      8. Every day that the cash change fund is in use, a formal reconciliation shall be performed prior to the end of that day.
      9. Documents of the formal reconciliation must be maintained by the department and made available to the University of Montana Internal Auditors, Legislative Auditors, and Business Services representative. Permission to destroy these records must be granted by the Director of Business Services, generally after three (3) years.
      10. Collections for goods and services will be separated from the cash change fund daily and deposits made to the Business Services cashiers whenever the amount exceeds $100.00. Weekly deposits should be made if revenue is under $100.00.
      11. Change funds that are no longer used must be returned to Business Services. These funds should not be deposited to departmental accounts.
      12. Any abuse of the intent of these policies for cash change funds may result in the loss of use of a change fund.

   3. To Obtain a Cash Change Fund

      1. A department supervisor or director can apply to the Director of Business Services for the establishment of a cash change fund by filling a Request for Change Fund form (obtained from Business Services).
      2. If the application is approved, a check will be drawn with The University of Montana Western named as a payee. The custodian must obtain the cash from Business Services.
      3. The policies and procedures for operation of the change fund will be reviewed with the custodian at this time.

   4. Changes in Custodians

      1. Any changes in responsibilities or personnel involving the Cash Change Fund Custodian must be reported by submitting a Notification of Custodian Change form (obtained from Business Services) to Business Services. The new custodian will be made aware of change fund policies and procedures. The Notification of Custodian Change form must be completed at the point in time when the old custodian relinquishes control of the fund to the new custodian or the Department Chairperson.

   5. Daily Reconciliation of Cash Change Funds

      1. Policy requires a daily formal reconciliation when the fund is in use. A Change Fund Reconciliation Sheet (obtained from Business Services) or a similar form must be prepared daily and kept by the department until given permission to destroy by the Director of Business Services. Any cash register tapes, receipt books, or evidence of change fund activity must be retained with this reconciliation.
      2. The amount of cash received each day (as evidenced by cash register tapes or manual pre-numbered receipts) plus the starting amount of the fund should equal the total in the cash drawer at the end of the day. All unresolved differences must be documented with material differences being reported to Business Services as outlined in MCA 5-13-309 (3) and MOM 2-1900-30, Lost or Stolen State Monies. Any overages must be separated from the change fund and deposited with the Business Services cashiers. Any shortages should be replenished as soon as possible. Shortages of $25 or less can be replenished by an offsetting entry on the deposit receipt with Business Services. Larger shortages will require replenishment by a check. The departmental index should be used with account number 62825 either cash overages or cash shortages.

   6. Temporary Cash Change Funds

      1. Temporary cash change funds can be obtained by departments for short-term special events. These funds must be requested by the departmental chairperson in advance of the event. A Cash Withdrawal Form can be obtained from the Business Services cashiers. Lockable cash boxes are also available.

4. Authority

   MOM 2-1900, MOM 2-1200, MCA 5-13-309, MCA 5-13-310

5. Responsibility

   Vice Chancellor for Administration & Finance, Director of Business Services, University Cashier, Department Supervisors, Cash Change Funds Custodians