5.1 Bad Check Charge-Backs
This paragraph concerns accounting procedures for checks deposited by agencies which are returned by the bank for insufficient funds or any other reason.
Returned checks are sent directly to the depositing agency and are applied as a reduction of revenue for the agency who originally deposited the check.
It is the responsibility of each depositing agency to fill out form TR-11, Bad Check Charge-Back Notice and send it to the Treasury, as well as recover any money still due the State. (Exhibit 2-7).
A recovered bad check is redeposited as a new item on a CO-39.
The Treasury will process the TR-11 and notify the Comptroller via a summary report of returned items by Agency, Fund, and Revenue Object. The Comptroller will then record the returned item as a reduction of revenue for the appropriate agency.
In the case of electronic CO-39 reporting, a BC/BK document type must be transmitted to the Treasurer's Office. Please note that Bad Checks are a reduction of revenue and thus a negative amount. Appropriate back-up documentation, including a copy of the charge-back notice, must be held at the agency. Form TR-11 will no longer be used by agencies transmitting electronically.
5.1.1 Charge-Backs to Wrong Agency
Note: Agencies receiving bad checks should verify (1) that the amount on the check and the debit memo are the same, and (2) that the check received belongs to their agency.
If any of these discrepancies occur, please return the check and debit memo, along with a note stating the problem, to the Treasury.
If an agency is Charged-Back incorrectly and has processed the check on a TR-11, the following procedure should be followed:
  1. Send a copy of the submitted TR-11 to the Treasury with the incorrect item high-lighted, and a brief explanation that includes the correcting entry.
5.2 Correction of Bank Deposits
At times a "Deposit Correction Advice" is sent by a bank to the State Treasurer. The State Treasurer, in turn, will notify the particular agency concerned by memorandum.
The agency will correct the State records by making an adjustment on the next Deposit Slip, Form CO-39 to be submitted by that agency. This is the only way to adjust the State records to agree with the funds on deposit with the bank.
The adjustment is made on Form CO-39 as follows: Indicate the number of the Deposit Slip which is being corrected, i.e., "Bank Correction on Deposit Slip No. ______." Complete all the account coding that is required and show the amount being corrected in the amount column. If the correction is for a reduction then the amount shown in the amount column should be in brackets and subtracted from the total amount being deposited. If the amount of the deposit being reported is an increase, then the amount in the amount column will not be bracketed in parenthesis and will be added to the total amount being deposited.
5.3 Unresolved Bank Corrections
Unresolved bank deposit discrepancies are processed in the same manner as bad check charge-backs.
The procedure applies only to bank debit and credit memos that are:
  1. At least two years old.
  2. Clearly identifiable by agency and which the Treasury, in conjunction with the agency and the appropriate bank, has been unable to resolve.
The agencies will be sent a Form ST-21, Treasury Correction Notice, (Exhibit 2-7a), attached to which will either be checks returned by the bank or outstanding bank debit and credit memos.
Form ST-21 is prepared in duplicate by the Treasurer for distribution as follows:
  1. One - retained by the State Treasurer.
  2. One - sent to the agency: this will be reviewed and signed by an authorized official of the agency acknowledging receipt and returned to the Cash Management Division, Office of the Treasurer. A copy should be retained by the agency.
  1. One - sent to the agency: this will be reviewed and signed by an authorized official of the agency acknowledging receipt and returned to the Cash Management Division, Office of the Treasurer. A copy should be retained by the agency.
These adjustments will appear on the agency's monthly receipts report as a BC. However, these corrections could result in either an increase or a decrease in the agency's revenues.
5.4 Adjustments of Revenue and Corrections of Deposit Slip Coding Errors
Corrections or adjustments to deposit slip codings are made by the agency on the next Deposit Slip, CO-39, submitted in the same fiscal year as follows:
a. Give the deposit slip number being corrected:
Coding correction of Deposit Slip No. ______, or
Adjustment of Deposit Slip No. _____.
b. Show the coding and amount of the incorrect or original entry in brackets, followed by the corrected or new coding and amount. The two amounts must be equal.
Note: For agencies transmitting CO-39 information electronically, if a coding error is realized before 4:00 p.m. the same day, corrections can be made on-line. If realized before 10:00 a.m. the next business day, contact the Bank Control Unit of the Treasury. Any errors discovered later must be adjusted on the next transmission under a new document number.
c. Exceptions:
All prior year errors and adjustments must also be corrected by Form CO-604.
5.5 Revenue Refund Procedures
When an unrestricted General Fund revenue item must be refunded it is not recorded as a reduction of revenue but as an expenditure. The expenditure is charged against the appropriation 0-9605-002 Refunds of Payments which is a non-functional appropriation administered by the Comptroller.
Refunds of restricted grant receipts or refunds from other than the General Fund are recorded as expenditures against the grant appropriations or fund involved.
Detailed procedures are contained in the Expenditures section, paragraph 11.0.
6.1 Definition
"Pending Receipts" are monies received by state agencies that are to be held in suspense until the final disposition is determined. Some examples of Pending Receipts are:
6.2 Record of Pending Receipts, Form CO-610
Form CO-610 (Exhibit 2-9) is prepared by the agency in triplicate when pending receipt monies are received. A separate form is used for each payor, completing the top portion through block #12, Amount of Deposit, at the time of receipt. A control account should be maintained to record all transactions (receipts, dispositions - refunds and transfers and balance). Post from Form CO-610 to the control account and file all copies in an "open" file.
6.3 Deposits of Receipts
The Agency Fund 7013, Funds Awaiting Disposition, has been established to enable agencies to comply with statutory depositing requirements (Sec. 4-32).
Deposit monies promptly on Form CO-39, Deposit Slip; record the Form CO-610 document number(s) on Form CO-39 (Exhibit 2-10). Post the deposit(s) to the Control Account and file all copies of Form CO-610 in the "open" file.
Pending Receipts must use form CO-610 with SID 999. Other SID's within the fund may use regular Vendor's Invoices, form CO-17.
6.4 Disposition - Refund
If the disposition is a refund, complete the white and pink copies as follows: check Refund in the Disposition section (top right) and complete the entire lower portion of the form starting with Refund, block #27, of both copies of Form CO-610. In this situation, the CO-610, Record of Pending Receipt, is used to serve as the invoice for refunds to vendors out of the pending receipts fund (Exhibit 2-11).
Several white copies of CO-610 forms may be batched with an Expenditure Batch Header, Form CO-19, and forwarded to the Office of the State Comptroller, Accounts Payable Division for processing. Post the refunds to the control accounts and file the agency (pink) copies of Form CO-610 in the "closed" file. The yellow copy may be discarded if there will be no transfer processed.
6.5 Disposition - Transfer
If the disposition is a transfer, complete the yellow and pink copies as follows: check Transfer in the Disposition Section and complete the following sections; Transfer Revenue To (blocks 13 through 26), Expenditure Coding (blocks 44 through 53), and Authorization (blocks 54 through 56) of both copies of Form CO-610 (Exhibit 2-12). Transmit the yellow copy of the form to the Office of the State Comptroller, Accounting Services for processing. Post the transfer to the control account and file the agency (pink) copy of Form CO-610 in the "closed" file. The white copy may be discarded if there will be no refund processed.
6.6 Partial Dispositions
On occasion, only a portion of the Pending Receipt will be either transferred or refunded. In such an instance, the original copy of the CO-610 should be kept intact for making copies to be attached to partial transfer or partial refund documents, until the final disposition is made. Process the partial transfer or partial refund according to the applicable instructions above. When processing subsequent partial dispositions, add a digit (1, 2, 3 etc) to the pre-printed number to avoid duplicate document numbers in the system. On the copy of the original Form CO-610, in "REMARKS", record the amount currently being disposed and indicate that this is a partial transaction. Post each partial disposition to the agency copy of the Form CO-610 only, thus maintaining a current balance. File the agency copy with the original copy attached in the "open" file. When the final disposition has been completed, file the agency copy with the original copy attached in the "closed" file.
6.7 Bad Checks and Pending Receipts
When a Form ST-21, Bad Check Charge-Back Notice is received from the State Treasurer with a bad check attached:
  1. Invalidate the transaction on which the monies are pending and implement collection procedures, if required.
  2. Cancel Form CO-610 (record the number and date of the Form ST-21 on Form CO-610).
  3. Post to the control account by reversing the original entry and file the Form CO-610 in the "closed" file.
  4. If the bad check is replaced by the payor, process a new Pending Receipt.
6.8 Reconciliation
At the end of each month, take a trial balance of the "open" forms CO-610. This balance should be reconciled monthly with the control account balance and with the Agency Fund 7013 Available Cash Ledger balance for SID 999 (a copy sent monthly to the agency by the Comptroller).
If the reconciliation reveals a need to adjust the Comptroller's records, submit a memorandum directly to the Office of the State Comptroller, Accounting Services.
6.9 Annual Report
Annually, as of June 30, submit a report, in memorandum form, stating that the Agency Fund 7013, Funds Awaiting Distribution, has been reconciled and that any required corrections have been requested by memorandum. This report must be submitted to the Office of the State Comptroller, Accounting Services, no later than July 31.
Negative reports are not required; therefore, only agencies with a balance in the 7013 Fund at June 30 must report.
7.1  Receipts Journal

A Receipts Journal shall be maintained by all agencies receiving money. The journal shall consist of sufficient columns for the entry of the following information:

  1. Date of Receipt.
  2. Receipt number when pre-numbered receipts are issued.
  3. Name of Payor, or other identification.
  4. Separate columns for listing receipts by revenue classification (revenue object code); these column headings will vary from agency to agency.
  5. Total receipts.
  6. Amount deposited.
  7. Deposit Slip number.
  8. Date of deposit.
  9. Additional columns may be added to provide other information desired by the agency.
  10. Agencies desiring assistance in designing a Receipts Journal should contact the Administrative Services Division of the Comptroller.
7.2  Internal Control Procedures
Internal control over cash receipts shall be established by each agency to minimize the risk of loss. The procedures will vary according to the size of the agency, the number of persons employed, and the problems peculiar to the specific agency regarding the source and type of receipts. Agencies desiring assistance in revising or improving their procedures should contact the Administrative Services Division of the Comptroller.
Mail received by an agency may contain cash, money orders, and checks. Receipts of such moneys can be safeguarded by procedures which include controls of incoming mail and bank deposits. Where feasible, each of the following duties should be assigned to a different employee:
Opening incoming mail.

  1. Recording receipts in a Receipts Journal.
  2. Depositing receipts.
  3. Issuing licenses, permits, etc., to the remitter.
If duties are separated as above, the employee opening the mail should record the following information either on forms, in duplicate, to be devised by the agency, or in a bound journal:

  1. Date of receipt.
  2. Name of remitter, or the person for whom the remittance was sent.
  3. Amount of receipt.
  4. Type of receipt: cash, money order, check.
  5. Purpose of the remittance.

When the receipts are delivered, the person authorized to receive them should verify the amounts entered on the forms or in the journal. If in agreement, he should then acknowledge delivery of the receipts to him either by:

  1. Signing both copies of the forms, returning the original to the person making the delivery and retaining the duplicate, or by
  2. Signing the journal or issuing a receipt to cover the amounts entered in the journal.
When cash is received in the mail, a pre-numbered receipt should be issued to the remitter; also, where a separation of duties exists as above and the procedure is feasible, the cash should be given immediately to a cashier in exchange for a receipt for the amount of the cash. The receipt form should then be stapled to the envelope in which the cash was mailed, or to a document contained in the envelope. When all the moneys received are delivered to the cashier for deposit, he can then include the cash, previously given to him, in the deposit total. Checks and money orders payable to "cash" or with the payee line left blank should be considered as cash and handled as above, in addition to being stamped or otherwise marked as being payable to the State.
In some instances, it may be advisable to have the employee who opens the mail also stamp the correspondence or document as follows and enter the pertinent information:
RECEIPTS: Date_________ Amount $__________
Check One: Cash Check
Money Order Other


  MARCH 2010
Such a stamp should be helpful in agencies processing many applications or renewals, especially if moneys received should become separated from accompanying documents.
Moneys received should not be mingled with Petty Cash Funds and should be deposited in compliance with the time limitations for depositing receipts.
A receipt form that may be used by all agencies and departments is Form CO-99, Official Receipt . This form is pre-numbered, in duplicate, and comes in 250 sets to a book. Agencies must account for all such receipts issued to them.
An Official Receipt as above, or a substitute form approved by the Comptroller, should be issued for all cash received at a cashier's counter or window and for which a validated license, permit, etc., is not issued to the payor at that time. Such action not only provides for better controls but also protects the employee against future charge that he received more cash than the receipts records show.
Cash held in an office should be properly safeguarded and controlled to avoid losses by pilferage and should be deposited as soon as possible to decrease chances of losses by robbery and to conform with the requirements of Sec. 4-32.
7.3  Accountability Reports
The chief fiscal officer, business manager, or other similar employee shall be responsible for the periodic preparation, where feasible, of an Accountability Report, or cash proof of the total receipts as recorded in the Cash Receipts Journal of the agency. These reports are prepared to compare the moneys that were actually recorded with the moneys that should have been accounted for.

To accomplish a proper comparison, it is necessary to compute the amount of the receipts that are to be accounted for. The methods used for such computations will depend upon the types of receipts and the documentation involved. Some examples of documentation that may be used as a basis for determining computed receipts, fixed rates times number of items, are as follows:

MARCH 2010
For agencies receiving a large volume of unnumbered documents and accompanying receipts in varying amounts, accountability can be established by use of a "batching" method. Under this method, documents and applicable receipts are segregated into batches, either by time intervals as received, or by a preset quantity of documents. They may also be segregated by revenue classification (revenue account). A sequential batch number is assigned to each batch and all documents and checks within the batch are stamped with this batch number.
A recording of receipts for a day could be as follows:

Nov. 12, 1984 Batch # 0995 $ 1,050.00
0996 1,000.00
0997 1,050.00
0998 $ 1,100.00
Total (DS# V3569) $ 4,200.00

Agencies or departments desiring assistance in designing Accountability Reports should contact the Administrative Services Division of the Comptroller.




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