MISCELLANEOUS
1.0 GENERAL INFORMATION
- This is used for miscellaneous procedures or instructions. It is also
recommended that special waivers, exceptions or accounting procedures
that apply to your agency be filed in this section.
2.0 IMPREST PETTY CASH FUNDS
2.1 Statutory Reference:
- Section 3-112.
2.2 Petty Cash Funds Definition
- Petty Cash Funds are not funds as defined by paragraph 2.2 on page
1-5 of SAM. A petty cash fund is a segregation of an advance of money
from a fund to be used for the purpose explained in paragraph 2.3 below.
In Connecticut all petty cash funds are operated as Imprest Petty Cash
Funds, i.e. an amount is advanced from the General Fund (or, if
appropriate, from some other fund) to an agency and the agency must at
all times account for this advance. Disbursements are made from time to
time as needed, a receipt or petty cash voucher being completed in each
case. At certain intervals, or when the petty cash is completely
expended, a report with substantiating petty cash vouchers is prepared
and the petty cash fund is replenished for the amount of disbursements
by a check drawn on the appropriate fund bank account. The total
advanced should always equal the cash on hand or in bank plus receipts
for expenditures plus requests for reimbursements in transit.
2.3 Establishing or Increasing Petty Cash Funds
- To establish a new Petty Cash Fund or increase the amount of funds in
an existing Petty Cash Fund, the agency should send a request to the
Office of the State Comptroller (Attention: Director, Administrative Services
Division), in memorandum form, stating the following:
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- (1) The fund from which the advance is requested (General Fund,
Special Revenue, Internal Service, etc.).
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- (2) Whether the request is for a new fund or an increase in an
existing fund.
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- (3) Amount requested (if an existing fund, state the present amount
authorized and the requested new authorization).
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- (4) Justification: be specific, stating the projected uses for the
fund, including the anticipated frequency or replenishment.
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- (5) Whether for a temporary or permanent period of time.
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- (6) The request should come from or be approved by the agency head or
his/her designee.
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- (7) Written procedures and process charts must be maintained.
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- (8) A written policy on travel and employee advances should also be
maintained.
2.4 Use of Petty Cash
- (1) Petty Cash Funds have many proper uses; they are intended
to facilitate departmental or agency purchases of small, but
necessary operating items, not to exceed $50.00, except for
emergencies or specific exceptions granted by the State
Comptroller, based upon the peculiar needs of an agency (change
funds, cash advances or prepayment for travel when required by
collective bargaining agreements or as appropriate for
non-collective bargaining employees, food purchases for agency
business related meetings). To obtain an exemption to exceed the
$50.00 threshold per incident submit an email to
OSC.PETTYCASH@po.state.ct.us with the dollar amount, the
justification, the agency name and the name, address and
telephone number of a contact person. Requests are reviewed on a
daily basis and a response will be sent.
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- (2) Petty cash should not be used for any items that can be paid in
the usual manner.
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- (3) Payments of regular invoices; regular postage needs (except for
small postage purchases, postage due, special delivery, and certified or
registered mailings) are the type of items that should not be paid by
petty cash. Check cashing should be limited to State business with
proper documentation.
-
- (4) All sundry payments of an allowance nature paid to state
employees will be treated as compensation and reported on IRS Form W-2.
Therefore, such payments must be processed on payroll Form CO-17XP-PR
and are not to be paid from petty cash.
-
- (5) Petty cash funds should be used for the splitting of
"First" checks received for Workers' Compensation. A
determination must be made as to the portion due the employee,
if applicable, and/or the State's portion. The funds deposited
from the "first" check are restricted funds and are not be used
for any other purpose. Workers' compensation procedures require
an adjustment check to be issued to the employee within five
working days after receipt of the "first" check from the Third
Party Administrator.
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- Two checks would then be issued if a check is to be split
between the employee and the State. One made payable to the
employee for the correct compensation benefit amount due. The
second one made payable to the "State Treasurer" for the amount
due the agency and deposited as a Refund of Expenditures*. The
coding string should be the same coding on the original payment
processed through the payroll system.
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- If it is determined that the entire check amount is due the
State, a check is to be issued, payable to the "State
Treasurer", and deposited as a Refund of Expenditures*. The
coding string should be the same coding on the original payment
processed through the payroll system.
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- If it is determined that an overpayment has been made by the
Third Party Administrator, three checks would then be issued.
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- One made payable to the employee for the correct workers'
compensation benefit amount due. The second one made payable to
the "State Treasurer" for the amount due the agency and
deposited as a Refund of Expenditures*. The coding string should
be the same coding on the original payment processed through the
payroll system. The third one made payable to the "State
Treasurer" in the amount of the overpayment. The following
information must be printed on the check: Employee's name; Claim
number; Department of employment; Date of injury; Third Party
Administrator's check number to which the check is being written
against.
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- Forward this check with a covering memorandum to:
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- Department of Administrative Services
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- c/o Director of Budget
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- State Office Building - Room 508
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- 165 Capitol Avenue
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- Hartford, Connecticut 06106
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- * For recoveries of prior year expenditures against lapsing
appropriations, deposit as a Refund of Prior Year Expenditures,
revenue account 44410.
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- Please direct questions as follows:
- Procedure Interpretation - Administrative Services Division, 702-3440.
- Workers' Compensation Issues - DAS/Personnel, Workers' Compensation
Unit, 713-5002.
2.5 Agency Records
- The following records for all Petty Cash Fund receipts and disbursements must
be kept in detail in order to provide complete accountability.
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- (1) A journal or register in which all fund receipts and expenditures
are recorded.
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- (a) Form CO-92, Petty Cash Fund Account is available from Vanguard
Direct.
-
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- (b) A journal of specific design may be used to meet the needs
peculiar to the agency.
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- (2) Receipts to document all disbursements of funds, i.e. for
purchases from vendors, post office mailing or advances for travel or
other expenses.
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- (3) When warranted by the size of the fund, a checking account for
which prior approval has been obtained from the State Treasurer and the
State Comptroller. Complete form CO-929, Bank Account Establishment
Request.
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- (4) Reconciled checking account statements.
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- (5) Reconciliations of Fund.
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- (a) Detailed count of cash on hand, plus
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- (b) Cash in bank, plus
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- (c) Advances, plus
-
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- (d) Receipts for disbursements not yet submitted for reimbursement,
plus
-
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- (e) Outstanding vouchers submitted for reimbursement, but not yet
received should equal
-
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- (f) The authorized Petty Cash Fund.
2.6 Replenishment
- To replenish the fund, complete a voucher.
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- The replenishment should be done at least quarterly. The frequency
depends on the dollar volume of expenditures in relation to the size of
the fund authorized.
2.7 Re-Deposit of Excess Funds
- If at any time it is determined that the amount of the Petty Cash Fund is
excessive, re-deposit of the excess must be made. Make check payable to "Treasurer,
State of Connecticut." The re-deposit, should include the following information:
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- (1) Revenue account "44378".
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- (2) Title of Standard Account "Petty Cash Returned".
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- (3) Fund Number to which deposit is made.
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- (4) Agency Number.
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- Copies of the above documentation must be sent to the Office of the
State Comptroller, Administrative Services Division to ensure that the transaction
has been processed correctly for reducing an authorized petty cash
balance.
2.8 Payments to Outside Contractors
- Generally, payments to non-state employees (outside contractors) for
honoraria, fees for sports and other special events, and like items must
be processed as a voucher in the usual manner. However, where
circumstances necessitate payment from the agency's Petty Cash Fund, the
responsibility for IRS Form 1099 reporting still exists. To ensure
compliance, the following procedures will apply to all such payments
from Petty Cash to outside contractors.
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- (1) All reportable payments from the agency's petty cash account
must be summarized annually and forwarded to the Comptroller's
Accounts Payable Division, Special Processing Section. Please
include the payee name, FEIN/SSN, complete mailing address and
amount paid to each vendor during the calendar year. This
information must be reported between January 1 through January 10 in
order for the Comptroller to comply with IRS reporting requirements.
It is each state agency's responsibility to comply with this
requirement. Failure to properly report this information can subject
the State to IRS penalties and fines.
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- See Section 8.0 Federal Income Tax Reporting, Form 1099 of the
Expenditure Section of this manual for further details.
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- (2) Optional: You may wish to type in an acknowledgment of
receipt of payment on a Form CO-17 and obtain the payee's signature
at the time of payment.
2.9 Payroll Transactions
- The agency's Petty Cash Fund is not be used to process payroll
transactions. Contact the Comptroller's Payroll Division for the proper
payroll transaction procedure.
2.10 Funds for Travel Expenses and Workshops/Conferences
- When authorized cash advances for travel expenses are made to
employees for whom such provision has been made in a collective
bargaining agreement, or otherwise, such advance should be made from the
Petty Cash Fund. To account for the cash advances, the Petty Cash Fund
custodian must obtain a statement, signed by the recipient,
acknowledging:
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- (1) The amount of the cash advanced.
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- (2) That within 5 working days after return, the employee
will submit a completed Form CO-17XP-PR, Employee Reimbursement
Voucher with the required documentation, to the agency business
office.
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- (3) It is suggested that conference fees be prepaid on a state
purchasing card, if available. Where time constraints exist, payment can
be prepaid through petty cash.
2.11 Internal Reporting
- All Petty Cash Fund custodians must submit to the agency's Chief
Fiscal Officer or Business Manager a monthly status report on the
activities of the Fund. The report should include:
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- (1) Cash on hand
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- (2) Advances
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- (a) Date advanced.
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- (b) To whom.
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- (c) Reason.
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- (3) Outstanding vouchers
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- (a) Not yet submitted for reimbursement.
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- (b) Submitted for reimbursement.
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- (4) Total amount authorized
2.12 Year End Closing
- All expenditures should be recorded in the fiscal year in which they
occur. A yearly replenishment must be made and submitted in accordance
with the Fiscal Year End Instructions issued by the Office of the State
Comptroller.
2.13 Internal Control
Procedures for internal control may vary according to the size of the
fund, the size of the agency and varying agency needs. The following
general rules are to be applied to all Petty Cash Funds.
- (1) The Petty Cash Fund custodian should have no other cash handling
responsibilities.
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- (2) Petty Cash monies should be kept separate from all other monies
received by an agency, except as authorized in writing by the
Comptroller's Administrative Services Division.
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- (3) The authorized fund should be kept to the lowest amount possible,
but yet sufficient to adequately meet the needs of the agency. Wherever
possible, a state purchasing card should be used instead of petty cash.
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- (4) Expenditures should be kept within the restrictions set in
paragraph 2.3.
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- (5) Every transaction must be tangibly documented with forms
such as, but not limited to: vendor's invoice, cash register
tape, petty cash receipt or post office receipt. Each such
document must be itemized and detailed, to the extent possible,
showing quantity, description, prices and total. When completing
the receipt form, use typewriter or ink (not pencil).
Alterations or additions are unacceptable. Section 3-117a of the
Connecticut General Statutes requires original documentation for
expenditures $25 and greater.
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- (6) Every item listed on the Form CO-17 RPC, Request to Replenish
Petty Cash Fund must have an original supporting document attached to
the Form CO-17 RPC when required.
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- (7) A periodic detailed examination of the Petty Cash Fund should be
made by the Chief Fiscal Officer or comparable official to verify the
following:
-
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- (a) That established procedures are being followed.
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- (b) Perform a cash count in the presence of the custodian, to verify
that the cash on hand, cash in bank, advances and unreplenished vouchers
are in balance with the total amount authorized.
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- (c) In addition to the cash, verify all other items included in the
balance such as checks, vouchers, etc.
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-
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- (d) All checks included in the balance should be cashed or deposited
promptly.
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- (e) Verify that checking account bank statements are being reconciled
monthly by a person other than the custodian and/or one who has the
authority to sign checks.
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-
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- 1 Examine, at random, checking account reconciliations
for:
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-
-
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- a Proper procedures.
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-
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- b Math verification.
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-
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- c Receipts compared with deposits.
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-
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-
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- d Timely deposits.
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-
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- 2 Periodically, obtain the checking account statement direct from the
bank and perform a verification of all checks included:
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-
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- a For proper endorsements.
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-
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- b That those written during a prior statement period were listed as
outstanding.
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-
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- c Question items that have been outstanding for more than one month.
2.14 Petty Cash Loss
- In the event a significant unexplainable shortage is discovered in
the Petty Cash Fund, the following steps must be taken:
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- (1) Reporting
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- (a) The Petty Cash Fund Custodian must report all losses to the
agency head immediately. If a loss results from an apparent criminal act
or under mysterious circumstances, the agency must:
-
-
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- 1 Immediately notify the local police
department or if applicable, local security
division, i.e. campus police, capital police,
etc.
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-
-
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-
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- 2 Within forty-eight hours of discovery complete and submit Form
CO-853 Report of Loss or Damage to Real and Personal Property to:
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-
-
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-
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- Office of the State Comptroller
Administrative Services Division
55 Elm Street
Hartford, CT 06106
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-
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- Auditors of Public Accounts
State Capitol
Hartford, CT 06106
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- (b) The report should include in the "Brief Description of Property"
the fund from which the petty cash fund was created.
-
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- (c) Questions regarding the reporting of losses should be directed to
the Office of the State Comptroller, Administrative Services Division, Telephone
702-3440.
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- (2) Replenishment for Petty Cash Loss: A separate voucher must be
submitted promptly by the agency to replenish the Petty Cash Fund for
the amount of the loss. A copy of the loss report - Form CO-853 must be
attached to the voucher, to substantiate the claim for replenishment.
The loss must be charged to the custodial agency's appropriation, using
Expense Account 54762 - Petty Cash Losses.
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- (3) Recovery of Loss
-
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- (a) Monies recovered directly by the agency are to be
recorded in the Accounts Receivable module within
Core-CT using account code 54762 - Petty Cash Losses
crediting the custodial agency's appropriation for
current year recoveries and account code 44410 for Prior
Year recoveries.
-
-
- (b) Petty Cash Fund losses recovered under fidelity bond coverage
will be treated by the Comptroller in the same manner as recoveries of
other types of losses. For procedures to obtain the use of funds
realized from an insurance settlement, see the Property Control Manual.
2.15 Check Cancellation - Petty Cash Fund
- On occasion, Petty Cash Fund disbursement checks are returned or
lost, so they must be cancelled and the accounting records adjusted. The
status of replenishment of the particular expenditure will dictate the
portion of the cancellation procedure to be followed.
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- (1) If prior to submitting the expenditure to the Comptroller for
reimbursement, the check is returned:
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- (a) Void the check and attach it to the stub in the checkbook.
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- (b) In the Form CO-92, Petty Cash Fund Account, reverse the original
disbursement entry and increase the balance in the bank account column.
Explain the entry in the description column making reference to the
cancelled item.
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- (2) When the expenditure has been submitted to the Comptroller for
reimbursement and the replenishment is in transit or has already been
received by the agency.
-
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- (a) If the check is returned, void the check and attach it to the
stub in the checkbook; or if the check is outstanding for an extended
period of time and it is certain that it cannot be cashed, issue a
stop-payment notice to the bank. On the Form CO-92, Petty Cash Fund
Account, reverse the original disbursement entry and increase the
balance in the description column making reference to the cancelled
item. When the replenishment is received, you will have excess cash.
Therefore:
-
-
- (b) Issue a check, in the amount of the cancelled
check, payable to the State Treasurer and deposit it
within the Accounts Receivable Module of Core-CT and the
appropriate revenue account for budgeted or non-budgeted
accounts, internal service or enterprise fund account
number. Explain the entry in the description column
making reference to the cancellation.
2.16 Annual Report
- A Petty Cash Fund Report is required for each petty cash advance,
regardless of fund, authorized by the State Comptroller. A statewide
memorandum is issued each fiscal year with the Petty Cash Fund Report
and the detailed instructions. The report will be as of April 30 and due
in the Office of the State Comptroller, Administrative Services Division no later
than May 31 of each year. Certification by the Chief Administrative
Officer, Chief Fiscal Officer or comparable official is required. If
there are any questions on the preparation of this report contact the
Administrative Services Division at (860) 702-3440.
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