The establishment of strong internal controls for cash collections is necessary to prevent mishandling of funds and to safeguard against loss. Strong internal controls are also designed to protect employees from inappropriate charges of mishandling funds by defining his/her responsibilities in the cash handling process. Included in the definition of cash are the following: coin, currency, checks, money orders, credit cards, accounts receivable charges, electronic funds transfers, and all cash equivalents (tokens, gift cards, parking tickets and stamps). Cash handling includes but is not limited to staff with the following roles and responsibilities: unit management, eDeposit users, billers/invoicers, cash collection point cashiers and supervisors, deposit preparers and reconcilers.
All University of Iowa units and staff handling cash are required to undergo the departmental and staff certification process.
Units should be aware that at any time, internal or external auditors may visit cash handling units to perform unannounced cash observations or cash counts.
Departmental Certification Responsibility for Units Handling Cash
- Each unit is required to annually complete the University of Iowa Cash Handling ICON course. Units new to handling cash are required to review the presentation as soon as they are responsible for that function. The presentation may be reviewed as a unit or individually.
- Each unit must have a cash handling procedure submitted for approval to Accounting and Financial Reporting through the workflow process. Units new to handling cash must submit their procedures for approval within one month of assuming that function. Accounting and Financial Reporting will monitor units for compliance.
- At a minimum, procedures should be reviewed annually by departmental management to determine if any procedural changes have occurred. If changes have occurred, each unit must update their procedures and submit them for re-approval to Accounting and Financial Reporting through the workflow process. Changes to staff specifically assigned to a cash handling function do not require re-submission for approval. Update Institutional Roles-Cash Handling to document staff changes.
- Cash Handling Procedures must be resubmitted every three years to remain up to date.
- Each unit must ensure that current and new staff handling cash meet the requirements of the staff certification process.
Staff Certification Responsibility for Individuals Handling Cash
- Staff are required to complete the University of Iowa Cash Handling ICON course annually. Staff new to handling cash are required to complete the course as soon as they are responsible for that function. The course may be reviewed as a unit or individually.
- New staff are required to review their unit’s approved procedures within one month of assuming a cash handling position and at least annually thereafter.
- Each individual must understand his/her role in their unit’s cash handling process.
- Staff must review procedures annually as a refresher. In addition, they must review updated departmental procedures as provided by unit management in a timely manner. We recommend reviewing policies and procedures every January.
Departmental procedures should incorporate the principles of good cash handling which include the following:
- Proper Segregation of Duties
- Adequate safeguards for handling, transporting and storing cash
- Promptly depositing cash at the bank or designated deposit drop location on campus
- Independent reconciliation of deposit documents to the statement of accounts
- Management oversight and review
- Copying and storing of checks received is strongly discouraged in order to protect sensitive information.
- If copying and storing checks received are required for a specific compliance, the following safeguards must be implemented. Copied checks must have signature, bank routing number, account number, and social security number blacked out and the copies must be kept in a secure location where access is limited. Copied checks should not be kept any longer than the minimum amount of time required and then destroyed by shredding.
The use of checking or other bank accounts by University personnel for depositing University cash is prohibited. Periodic reviews of cash handling procedures will be conducted by Accounting and Financial Reporting and are always subject to audit by Internal Audit and external audit or review firms. Departments not complying with approved procedures may lose the privilege to handling cash.
Departments requesting wire transfers to a University bank account must notify the University of Iowa Treasurer's Office in advance of each expected transfer and provide the amount and the MFK to be credited.
Who Should Know This Policy
Any official or administrator with responsibilities for managing University cash receipts and those employees who are entrusted with the billing/invoicing, receipt, deposit and reconciliation of cash for University related activities should follow this policy.