GAP NO. 200.030
Petty Cash and Change Funds

I.	General
II.	Establishing a New Petty Cash or Change Fund
III.	Procedures for Handling Petty Cash & Change Funds
IV.	Reimbursement of a Petty Cash Fund
V.	Procedures for Changing or Closing a Petty Cash or Change Fund
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I. GENERAL

• Petty Cash Fund: An amount of cash, not to exceed $500, held by a department or office to pay for incidental expenses. The fund needs to be replenished periodically as incidental expenses are incurred and reduce the amount of cash on hand.

• Change Fund: An amount of cash held by a department or office and used to give change to customers when they are paying for goods or services.

Duke allows petty cash and change funds where needed for convenience paying for incidental expenses or for making change in departments where cash is regularly received from customers. The funds received by a department to establish a petty cash or change fund are not an expense, but a loan from the general fund of the University that must be properly safeguarded by an established custodian and returned when the fund is no longer being used and/or closed.

 

II. ESTABLISHING A NEW PETTY CASH OR CHANGE FUND

To establish a new petty cash or change fund, complete the request form for Establishing a Petty Cash or Change Fund and send it to the Director, Accounting Services for approval.

The form requires the following information:

• Fund Title
• Amount requested. Petty cash funds can not exceed $500.00.
• Purpose of the fund (e.g., reason the fund is needed).
• Physical location of the fund: petty cash or change funds should be located on property owned or leased by the University.
• Plans for safeguarding the fund (e.g., locked in safe, etc.).
• Cost object: departmental code for fund
• Fiduciary of the fund: name, job title, and e-mail address of the person having overall responsibility for the fund.
• Custodian of the fund: name, job title, and e-mail address of the person in whose custody the cash will be kept. This cannot be the same person as the Fiduciary of the fund.
• A Department Head, Director, or Business Manager must approve the form, acknowledging the Fiduciary and Custodian. In some cases the Fiduciary & Department Head etc. will be one and the same.

Once the fund is approved by Accounting Services, a vendor number will be established for the fund and an e-mail notification will be sent to the Fiduciary, Custodian, and Department Head, Director or Business Manager. The approved cash will be issued to the Custodian upon presenting a valid Duke ID at 705 Broad Street in the University Cashier's office located on the second floor, Suite 201.

 

III. PROCEDURES FOR HANDLING PETTY CASH AND CHANGE FUNDS

The following procedures must be followed for each fund. The fiduciary of the fund is responsible for ensuring that these procedures are followed. Non-compliance with these procedures will result in immediate dissolution of the fund.

• Only one person, the Custodian, should have physical custody of the fund. This person should not have responsibility for accounting records.
  
  
• The Fiduciary of the fund should establish an alternate Custodian who will be responsible for physical custody of the fund when the Custodian is absent.
  
  
• A maximum single disbursement amount is to be established for the fund. The Fiduciary of the fund must approve any disbursements over the maximum amount. The Fiduciary should document the approval of any disbursements over the maximum disbursement amount.
  
  
• When making disbursements from the fund, the custodian must obtain from the recipient, a properly authorized receipt, paid invoice or other supporting documentation, prepared in ink or typed, listing the amount and account code to be charged.
  
  
• The fund is not to be used to cash personal checks for employees or students.
  
  
• The fund is not to be used to pay individuals for work performed or services rendered.
  
  
• The fund is not to be used for any type of loan to any person.
  
  
• Expenses that are not within the scope of the fund's purpose may not be paid from the fund.
  
  
• The cash and receipts must be maintained under lock and key in the physical location noted in the Establishing a Petty Cash or Change Fund request form.
  
  
• The Custodian should count and balance the fund each day it is used, with a minimum of one count and balance performed monthly. Documented reconciliations should be kept in the department. At all times the expenditure receipts plus cash on hand must equal the authorized amount. Any discrepancies identified, should be investigated and adjusted promptly.
  
  
• The fund should be reimbursed to its original authorized amount at least once each fiscal month. See section IV REIMBURSEMENT OF A PETTY CASH FUND for more details.
  
  
• Revenues should never be used to establish or increase the size of a petty cash or change fund. Deposit all income and gifts through the University Cashier's Office or other appropriate office (refer to GAP 200.025, Cash Handling Procedures ).
  
  
• The fiduciary should physically inspect (count) the fund at least quarterly to determine that the above procedures are being followed and the fund is being adequately controlled; the amount of the fund is adequate but not excessive; and the need for the fund continues to exist. The Fiduciary should document this quarterly review and maintain the documentation in the department.
  
  
• Duke Police must be notified of any thefts or misappropriation of a fund.
  
  

In April of each fiscal year, Accounting Services verifies each petty cash and change fund's balance. A memo is sent to each Fiduciary, Custodian and Department head for their review and verification of account balances.

All petty cash and change funds are subject to surprise audits of balances and procedures by the Controller’s Division.

 

IV. REIMBURSEMENT OF A PETTY CASH FUND

The fund should be reimbursed to its original authorized amount at least once each fiscal month. To ensure all reimbursed expenses are properly recorded in the proper fiscal year, all funds MUST be reimbursed by the last week of June (the end of the fiscal year).

To reimburse the fund:

• Complete an Accounts Payable Check Request form. Refer to GAP 200.136, Accounts Payable Check Request for procedures on the completion of the form.
  • The "Name of Payee" must be both the Fund title and Custodian, make sure to put the exact fund name with no abbreviations.
  • Please include your assigned vendor number on the form.
  • The amount of the reimbursement request should bring the fund back to its original balance.
  • Charge each expense for which there is a supporting document to the appropriate cost object and G/L Account.
  • Charge any shortages to the department's operating cost center using G/L Account 695600 (Losses, Damages, and Write-offs).
  • Include original supporting documents for each item, please tape them to a separate sheet(s) of paper and attach to the AP check request form.
    
    
• The Fiduciary should review all supporting documentation and approve the Accounts Payable Check Request.
  
  
• Send the completed and approved Accounts Payable Check Request with supporting documents to Accounts Payable, Box 104131, or drop them in the drop box at 705 Broad Street.
  
  
• The Custodian will be notified by e-mail when the cash is available for pickup. Upon presenting a valid Duke ID, the Custodian or Fiduciary may pick up the cash at 705 Broad Street in the University Cashier’s office located on the second floor, suite 201.

 

V. CHANGING OR CLOSING A PETTY CASH OR CHANGE FUND

The Director, Accounting Services, is responsible for approving any changes to petty cash and change funds and for maintaining records of each fund and its custodian.

• To decrease the amount of a petty cash or change fund, complete an Authorization to Increase/Decrease Petty Cash or Change Fund form; submit to Director, Accounting Services. Deposit cash in the amount of the decrease at the University Cashier's Office to fund 1001000, using the G/L Account 119000 for petty cash fund and G/L 119100 for a change fund, make sure to include the title of your fund on the deposit slip.
  
  
• To request an increase to the amount of a petty cash or change fund, complete an Authorization to Increase/Decrease a Petty Cash or Change Fund form, submit to Director, Accounting Services for approval. If the increase is approved, cash will be issued to the Custodian upon presenting a valid Duke ID at the University Cashier's Office, 705 Broad Street , second floor, suite 201.
  
  
• Any change in Fiduciary, Custodian, or location of the fund must be communicated. Complete a Change of the Fiduciary, Custodian or Location of a Petty Cash or Change Fund form; submit to Director, Accounting Services. When the Fiduciary or Custodian of a Petty Cash or Change fund changes, the fund should be reimbursed to its original amount; any overages/shortages should be investigated and charged to 695600.
  
  
• To close a petty cash or change fund .
  • If the petty cash fund is not at the authorized amount, reimburse the fund to its original authorized amount. Complete an Accounts Payable Check Request; refer to section IV for instructions on completing this form.
  • Deposit the total amount of the fund at the University Cashier’s Office to fund 1001000, using G/L account 119000 for a petty cash fund and G/L account 119100 for a change fund..
  • Send a memo to Accounting Services at Box 104132 with the following information:
    • Departmental Receipt Number from deposit slip
    • Date of Deposit
    • Amount of Deposit
    • Petty Cash Fund number
    • Fund Title

Please contact Accounting Services, 684-6874, if you have any questions pertaining to petty cash and change funds, the procedures outlined in this GAP, or need assistance.

 

 

GAP History
Issued:	March 1995
Revised:	February 2002
Revised:	June 2004
Revised:	October 2004
Revised:	Janaury 2005
Revised:	September 2005
Revised:	February 2006
Revised	September 2007

Responsible Department:

Accounting Services