University
Income Recognition and UPPS
No. 03.01.05
Associated
Cash-Handling Procedures Issue
No. 7
Effective
Date: 02/29/2008
Review:
November 1 E4Y
01. POLICY
STATEMENTS
01.01 This
policy sets forth requirements and procedures for the collection and recording
of university income, as well as associated cash-handling and electronic
payment procedures. The Finance and Support Services division has the
responsibility and authority for promulgating policies and guidelines
associated with this policy, so as to safeguard the assets of the University.
This policy applies to all university income, regardless of the method by which
payment is made. It is also applicable to deposits for the reduction of
expenditures.
01.02 Account
managers, deans, directors, and other administrators of departments or areas
that collect and record university income are responsible for assuring that
their employees who are involved in such operations comply with this policy.
02. DEFINITIONS
02.01 University
Income – may be earned and collected from a variety of sources including:
a. state
appropriations;
b. services
provided to students, faculty, staff, and the community;
c. sale
of supplies, equipment, land, and other assets;
d. externally-funded
grants and contracts;
e. interest
and investment earnings;
f. rental
of university property;
g. property
or security deposits; and
h. donations.
As
used in this UPPS, university income will generally be referred to as income.
02.02 Cash
and Cash Equivalents – refers to currency, coins, checks, travelers’ checks,
cashiers’ checks, money orders, savings bonds or other negotiable instruments
that can be converted readily to cash. It also includes payments made to
the University with credit cards, debit cards, electronic checks, ACH debits or
other electronic methods.
02.03 Cash-handling
Procedures – is a generic term that encompasses all procedures related to the
collection, receipting, recording, and security of university income including
payments made via cash, check, and electronic methods.
02.04 Electronic
payment methods include: credit cards, debit cards, stored-value cards, ACH
transfers, electronic checks, and wires.
03. PROCEDURES
FOR RECEIPT OF FUNDS
03.01 The
Cashiers’ Office, managed by the Director of Student Business Services, has
primary responsibility for receipting, depositing, and recording income (and
reduction of expenditures) into the financial records of the University. Under
special circumstances, the Cashiers’ Office may delegate authority for
receipting university income to other university departments provided such
departments implement and document in writing appropriate cash-handling
procedures.
03.02 Individuals
anticipating receipt of such income should contact the Director of Student
Business Services as far in advance as possible for assistance, to discuss
required cash-handling procedures.
03.03 Departments
other than the Cashiers’ Office that receipt university income must have
written procedures for control of these funds. Such procedures must be approved
by the Treasurer (or his or her designee) and may be in the form of individual
departmental procedures or general procedures promulgated by General Accounting
or the Student Business Services Office.
03.04 Timeliness
of Deposits – Deposits must be made with the Cashiers’ Office not later than
the close of business on the next work day after the funds were received. This
time frame is necessary to assure that deposits to the university’s depository
bank meet the State’s requirement for deposit within seven days of the date of
collection (Education Code §51.003-(b)).
a. Same-day
deposit may be required by the Cashiers’ Office due to university holidays or
other extenuating circumstances. It is suggested that funds be deposited
with the Cashiers’ Office on the same day they are collected by a department,
to minimize the amount of cash on hand.
b. Departments
that fail to make their deposit with the Cashiers’ Office within one business
day after receipt may be assessed a charge against their operating account for
the interest lost. If assessed, the amount will be calculated at the current
TexPool rate for the time the funds were not on deposit. The Director of Student
Business Services will document in writing whether to assess or waive this
amount. Extenuating circumstances (such
as illness and emergencies) may be determined by the Director of Student
Business Services as justification for a delay in making a departmental
deposit.
03.05 Deposit
Support Forms – in a format approved by the Cashiers’ Office, all deposits must
be summarized and documented on a form that identifies the type of monies being
deposited (cash, checks, credit card, EFT, Bobcat Bucks, etc.); the
account to be credited; and the appropriate object coding. http://www.sbs.txstate.edu/departments/dept_receipting.html
03.06 Armored
Car/Security Service may be necessary to transport deposits from departments
with delegated receipting authority from their department to the Cashiers’
Office. Generally, this will include high-volume departments such as: Bookstore,
LBJ Student Center, Aquarena Center, and the Student Health Center. The
Cashiers’ Office will negotiate the use of this service on behalf of the
departments and will allocate the costs among the departments using the
service.
03.07 Bank
bags, of a type specified by the Cashiers’ Office, should be utilized for the
transport of deposits from the department to the Cashiers’ Office.
03.08 There
are three approved methods of receiving and receipting university income.
a. Cash
Registers – Business operations that are of a retail nature may be authorized
to utilize a cash register to record income. The Cashiers’ Office must approve
the use of a cash register. Departments and offices using cash registers must
deposit income from cash register operations daily in the Cashiers’ Office. Cash
registers are utilized in such operations as the Bookstore, Food Service,
Student Health Center, LBJ Student Center, University Box Office, Athletics,
Campus Recreation, and the Alkek Library.
b. University-issued
Receipt Books – The Student Business Services Office will issue individually
pre-numbered cash receipt books to be used by all other university departments.
Use of receipts other than official university receipts is prohibited. Receipt
books will be issued only to a regular university employee who is to serve as
custodian of the books and who is responsible for assuring that appropriate
cash-handling procedures are followed and the receipt books are
safeguarded. All individual receipt books used and unused must be returned
no later than August 25 of each fiscal year. Under extraordinary
circumstances, the Director of Student Business Services may approve an
extension of that deadline and determine an appropriate time frame. New
books will be issued at the time that previously issued ones are returned.
c. On-line
Receipting – An office or department that receipts a high volume of income may
contact the Director of Student Business Services to determine the feasibility
of utilizing computer generated on-line receipts via the University’s financial
software.
03.09 All
income received by university departments and their cash-handling procedures
are subject to audit and review by the Office of Audit and Compliance, as well
as the Office of the Treasurer. These offices are also authorized and
expected to conduct regular cash counts without prior notice.
04. CASH-HANDLING
PROCEDURES
04.01 The
department head should assign the primary responsibility of receipting and
accounting for funds to one individual (or as few people as possible, depending
on the volume of funds received). Generally, two employees should open the mail
and should be different from those who receipt and account for funds.
04.02 The
responsible individual must be a full-time, permanent employee. (Less than
full-time employees are not covered under the blanket insurance policy.) Part-time
or temporary employees (including student workers) may assist the responsible
person in carrying out these duties.
04.03 Each
department should maintain a single collection point.
04.04 Daily
Balancing of Collections – On a daily basis, the responsible person should
total all cash, checks, etc. to assure that amount equals the amount of
receipts issued. Before depositing funds with the Cashiers’ Office, the
department head should check the balancing of funds and receipts.
04.05 If
funds are received through the mail, the administrative assistant or other
designated person opening the mail, should log in all checks received, and pass
them immediately to the responsible individual to be receipted. The
employee responsible for logging in the mail should not be the same employee
who is responsible for receipting and accounting for funds.
04.06 Departmental
Issuance of Receipts – Departments that receive funds should issue receipts for
those funds. If they receive a payment in the mail they should mail a receipt
to the payer.
04.07 Cashiers’
Office Receipts – The Cashiers’ Office will issue a receipt to the person making
the departmental deposit. That person should immediately return the
receipt to the department. The person making the deposit may be the same person
who logs in mail; however, it should not be the primary person who issues
receipts.
04.08 Timely
Review of Accounts – Not less than monthly, the account manager should review
his or her accounts and compare them with the departmental receipts and the
Cashiers’ Office receipts, to assure that all funds were receipted and accurately
deposited. This review may be delegated to another regular employee (such
as an administrative assistant) provided that individual does not perform any
other duties associated with receipting or depositing of funds.
04.09 Separation
of Duties – Several duties are involved in receipting university funds:
issuance of receipts, deposit with the Cashiers’ Office, review of financial
records, and maintenance of mail logs (where applicable). Ideally, the same
person should not perform all these duties. However, staffing, timing, and
other constraints may necessitate that one individual perform two of these
duties. In such cases, it is necessary that compensating controls be
established by the department to assure that all funds paid to the University are
receipted and deposited. In no case should the same individual perform more
than two of the duties listed.
05. CREDIT
CARDS AND OTHER ELECTRONIC FORMS OF PAYMENT
05.01 The
Director of Student Business Services is responsible for determining activities
for which the acceptance of credit cards and other forms of payment (such as
wire transfer and electronic checks) may benefit the University. Such
determination may include a cost/benefit analysis, security risk evaluation,
separation of duties, anticipated volume, and other relevant factors.
Departments with delegated receipting duties may accept credit cards and other
forms of payment only with prior written approval of the Director of Student
Business Services. The Cashiers’ Office will establish the department as an
approved merchant with the University’s bankcard service provider and will
provide initial training for credit card procedures and equipment.
05.02 Cost
of Credit Card Acceptance and other Electronic Forms of Payment – Fees charged
by bankcard service providers, financial institutions, and associated
processors will be charged to the department accepting such forms of payment
for departments other than the Cashiers’ Office.
05.03 Electronic Payment Standards and Practices – Numerous
external entities expect and require university compliance with various
standards and practices for handling electronic payments. Among these are
merchant and bankcard service providers that adhere to the Payment Card
Industry’s Card Information Security Program (PCI CISP) (https://www.pcisecuritystandards.org/).
The Texas Department of Information Resources (DIR) also promulgates rules to
assure the security of the electronic payment systems used by state agencies
and higher education institutions. These standards and practices continue to
evolve along with the technologies employed, making it impractical to list them
in this policy.
To facilitate ongoing compliance with these ever
changing standards and practices, university departments are required to seek
an analysis of any new or modified electronic payment methods or processes from
the Cashiers’ Office prior to their implementation. The Cashiers’ Office will
involve Technology Resources as necessary to identify and address security and
technology issues. If resources are required to address the identified issues,
the requesting department will work with the Cashiers’ Office and
Administrative Information Services to develop a project charter for the initiative.
The Charter will be subsequently reviewed and prioritized by the Administrative
Systems Coordinating Council (ASCC). There is no guarantee that departments
authorized to accept electronic payments by one method (e. g., to process
credit cards via payment terminal) will be authorized to accept electronic
payments by another method (e. g., online via the Internet).
The vast majority of security concerns are obviated
if payment card information is never stored on university systems. Consequently,
no university computer system may store payment card information (credit/debit
card #’s, card expiration dates, checking account numbers, etc.) for any period
longer than is necessary to process the individual payment transactions.
05.04 Online
Payment Applications – Departments having a desire to conduct business via
online payment applications shall utilize the University’s established payment
gateways. These gateways have been certified CISP compliant and are critical to
the stability and security of the University’s online business.
Departments
wishing to conduct business via online payment applications shall obtain prior
approval via the university established Electronic Payment Infrastructure (EPI)
Team. The EPI Team will assess a department’s various needs and determine the
resource required to create, implement and support an online payment
application. All online payment
application projects will be prioritized by university established priorities
committees.
Many
resources are required to bring online payment applications to fruition. Some
applications will require technical assistance from the Department of
Technology Resources, whereas others will require departmental and EPI
resources. Student Business Services shall monitor all online payment applications
for production fitness in accordance with this document.
05.05 Documentation of debit/credit card
transactions, including duplicate debit/credit card transaction records, must
be kept by the processing offices, in a secure location such as a vault,
locked cabinet, or a locked room to which physical access is restricted, no
more than 2 years after the month in which the transaction was executed.
06. FINANCIAL
RECORDS
06.01 The
Director of Student Business Services is responsible for the daily analysis of
all deposits to Texas State and will assure that they are receipted to the
proper accounts and deposited in the bank to the proper fund group.
07. REVIEW OF DECENTRALIZED CASH COLLECTION
OPERATIONS
07.01 The
Director of Student Business Services or designee is responsible for reviewing
of decentralized cash collection operations. Departmental deposits from such
sources and on-site review of cash collection operations will be conducted by
the Cashiers’ Office on a regular basis.
If departmental cash collection sites fail to follow this UPPS or
irregularities are found, the Director of Student Business Services may require
that cash collections at a decentralized site be modified, up to and including
cessation of all such activities. The Director of Student Business Services
should consult with their administrative management and management of the cash
collection site regarding problems found in decentralized cash collections and
changes to such operations.
08. RELATED POLICIES
08.01 Departments
receipting university funds should be familiar with related university policies
including, but not limited to, the following:
UPPS No. 03.05.01,
Soliciting, Accepting, and Processing Gifts and Grants from Private Sources
UPPS No. 03.01.20,
Admission Tickets for all University Events
Finance
and Support Services policies and procedures, available at
www.vpfss.txstate.edu/division1.htm
09. REVIEWERS OF THIS UPPS
09.01 Reviewers
of this UPPS include the following:
Position Date
Treasurer November 1 E4Y
Director of Student Business Services November 1 E4Y
Vice
Technology
10. CERTIFICATION STATEMENT
This
UPPS has been approved by the following individuals in their official
capacities and represents Texas State policy and procedure from the date of
this document until superseded.
Treasurer;
senior reviewer of this UPPS
Vice