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Collection Security Guidelines

10/19/2011

A. Introduction

The collection security guidelines provide internal controls designed to safeguard cash, checks and other types of tender received by departments. Some controls may not apply to every area but safeguards need to correspond to associated risk. Managers should ensure that their area is in compliance with this policy. Any additional site specific procedures should be documented.

B. Collection Safeguards

1. All funds received by the campus are to be deposited to appropriate University financial system accounts established and approved by the campus Controllerís Office and bank accounts established by the University Treasurerís Office. Under no circumstance should a University unit hold or open a bank account for the purpose of accepting and/or disbursing funds that relate to University functions.

2. Checks received by revenue-producing areas must be made payable to the University of Massachusetts (Name of the Operation). The detailed deposit instructions can be found at this link http://www.umass.edu/aco/forms/deposit_slip_info.pdf. The Bursarís Office should be contacted to obtain directions on the use of restrictive endorsement stamps for deposits.

3. Checks, credit cards, order forms, etc., often contain personally identifiable information (PII) that must be protected under Massachusetts General Laws, Chapter 93H. Bank and credit card account numbers, Social Security numbers, and other data must be properly safeguarded. Refer to http://www.oit.umass.edu/security/data-security-compliance-umass-amherst for more information.

4. Unless specifically approved otherwise by the Controllerís Office, checks should be accepted only for the exact amount of purchase. When possible, proper identification (driverís license, student ID) should be obtained and written on the check.

5. All collections received by revenue-producing areas should be deposited to the Bursarís Office daily. Exceptions to the daily deposit rule may be granted by the Controllerís Office for departments with low dollar or extenuating circumstances. All approved exceptions will be issued in writing with an explanation of any requirements.

6. Unattended cash must be kept in a safe or secured locked area, and access to collection areas should be restricted.

7. There should be appropriate segregation of duties in the collection and deposit process. At a minimum receipts should be verified by someone other than the person who collected the receipts.

8. Operations that need revolving change funds should request the funds through the Controllerís Office. Change funds should be drawn from and posted to the Universityís financial system account as an advance. Change funds should not be obtained by using operational receipts. The amount of the change fund should be the amount necessary for operations and should be adjusted for cyclical conditions.

9. Cash disbursements for materials, supplies, or personal services from the cash receipts or from change funds are prohibited. All expenditures must be made from approved accounts, following campus procurement policies.

10. Payroll checks, personal checks, or checks made payable to the University or any unit of the University may not be traded for cash from collections or change funds.

11. Returned Checks: Checks returned for non-sufficient funds (NSF) should be posted to the financial system. Areas should attempt to recoup funds as soon as possible, requesting that replacement funds for NSF checks be in the form of cash, certified check, or money order.

C. Reconciliation of Collections

The following processes are designed to ensure amounts collected are forwarded to the Bursarís Office, deposited and recorded in the general ledger.

1. All receipts should be recorded on a control document (receipt form, cash register, tickets register, meter, etc.) at the time of the transaction. Control documents should be reconciled to the amount to be deposited. Deposits should be reconciled to the ledger.

2. Ideally, no more than one person should work from the same cash drawer. Minimally, each person collecting funds should have their own lockable cash drawers or method to establish accountability. Each drawer should be separately reconciled to the receipts recorded for that drawer.

3. A record of cash overages and shortages should be maintained and regularly reviewed by a manager. Variances should be investigated by the manager and, if necessary, corrective action taken. Overages should not be held to apply against future shortages or for other purposes.

4. The campus is responsible under State Internal Control legislation (Chapter 647) to report to the State Auditorís Office any cash and/or property shortages, thefts, losses or variances. A loss occurs when funds were received but lost before being deposited or if funds in the control of the area are misplaced or misused. Each collection area is required to submit a monthly report to the campus Controller specifying any instances of such activity or to report there were no such occurrences. Reminders of the reporting requirement are issued via email by the Controllerís Office and replies to the email reminders may be used to report on the monthís activities.

5. Any loss totaling more than $50 should be immediately reported in writing to the Controller explaining the situation and any actions taken to correct the situation. A monthly report of all instances is prepared by the Controller and forwarded to appropriate offices. Additional audit or review of the operation may result from such occurrences.

6. Collection and change fund reconciliations should be done at least at the beginning and end of each shift, preferably not in view of the public.

7. Records regarding collections and subsequent reporting and handling should be maintained for three years.

D. Cash Bags

Cash bags are used by areas that have high levels of collections to deliver deposits to the Bursarís Office teller window or drop box. Cash bags will be opened by the Bursarís Office the next business day. Sealable single use deposit bags are an acceptable alternative to using lockable permanent bags.

1. Whenever cash is transported from one building location to another, it should be in a locked bag and the bag should be concealed. Checks can be sent through campus mail. However, cash can never be sent through campus mail. When sending checks through campus mail, departments should use a manila envelope rather than standard size envelopes.

2. Bags are numbered and assigned to specific areas. Keys should be assigned by the collection site to specific individuals. If a bag becomes damaged, it should be returned to the Bursarís Office for replacement.

3. Each bag should contain the collections and a summary of the collections signed by the individual(s) responsible for the deposit. A confirmation of the deposit will be returned to the collection site. The confirmation should be matched to the siteís records of the deposit.

E. Safe and Revenue Repository Controls

It is important that combinations or keys providing access to the safes or other secured locked areas be tightly controlled.

1. The area collection manager must maintain the following information for each safe under his/her control: internal control number, location, custodian, date of last safe combination change, and listing of persons having access to the combination. The knowledge of safe combinations and number of keys should be limited to the least number of people possible.

2. All safes must be kept locked except when cash is being taken out or being put into the safe.

3. The custodian of the safe must have signatures of the persons who receive safe combinations or assigned keys.

4. Each area is required to have procedures in place for accessing locked locations and periodically making combination changes for safes.

F. General Items

1. Unannounced reviews of a collection areaís operation may be done at the discretion of University and/or campus administration.

2. Inappropriate administration of University assets could result in disciplinary action by the campus against all individuals involved in the action. If an obvious theft has occurred, the University Police should be contacted immediately. Persons who suspect a misappropriation or other financial irregularity may have occurred should contact the campus Controllerís Office. For more information, see the Fraud Policy at http://www.umass.edu/aco/fraudpolicy.htm.

 

 


 

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Room 405 Goodell Building
140 Hicks Way
University of Massachusetts Amherst
Amherst,  MA 01003-9272
Tel:  (413) 545-0806
Fax: (413) 545-6088

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