Library Document Details

Imprest Cash / Petty Cash Fund Procedure

Abstract:
This document describes what petty cash is and contains information on how to request the establishment of a petty cash account. See the Financial Affairs Website for additional guidelines regarding this policy.
Effective Date:
10/11/2007
Responsible Party:
Contacts:
None Assigned
Administrative Category:
Applies To:
Faculty, Staff
Material Original Source:

Imprest Cash / Petty Cash Fund Procedure

A petty cash fund is used to facilitate minor emergency payments that cannot be handled through any other UAB purchasing/payables procedures. This type of fund is used for expenditures and therefore only involves an outflow of cash, i.e. revenues should never be deposited into a petty cash fund. Periodically, or as needed, the petty cash fund is reimbursed to its original amount to replenish the cash previously spent. Petty cash funds cannot be used for such closely audited expenses as travel or entertainment. Petty cash funds should never be used to cash checks and should never include personal employee checks. Money should never be borrowed from a petty cash fund as an IOU. Cash advances from the petty cash fund are inappropriate; the expense should be incurred and then reimbursed. It is also inappropriate to use the petty cash fund for any purpose other than the specific purpose of the fund as outlined in the initial request for the fund. Purchases made with petty cash funds should follow University guidelines just as purchases made through normal channels would do. A specific valid Oracle account number must be available for each reimbursement charge.

A change fund operates as a convenience to the department in conducting UAB cash business. This type of fund has neither income nor expense, so the cash balance remains constant. With the exception of the University Cashier's Office and Hospital Cashier's Office, the cashing of checks is not permitted from a change fund. The change fund custodian is simply authorized to exchange currency in order to acquire desired denominations of monies.

A petty cash fund or a change fund must be the definite responsibility of one individual named as fund custodian. The fund custodian is directly responsible for transactions and quarterly reconciliations and for the security and integrity of the fund. The fund custodian should be in direct supervision and in close proximity to the fund. The fund custodian may choose to delegate authority in the management of the fund; however, it is still the custodian who is ultimately legally responsible for the money.