DePaul University

Cash Handling Best Practices Guide

“Cash” may include: coins, currency, checks, money orders, and credit card transactions

Segregation of Duties

Segregation of duties is the most important control in the cash collection process. A different person should be assigned responsibility and accountability for each step: 1) collecting & receipting, 2) balancing & depositing, and 3) reconciliation. If there are not enough people to separate these functions, then mitigating controls are necessary. For example:

-Share responsibilities with other departments; or,

-Ensure a person independent of these processes performs the reconciliation outlined below.

Collecting and Receipting Cash

When collecting cash, it is preferable to issue receipts using a pre-numbered receipt book with duplicate receipts, and record the receipt in a receipt log. Information on the pre-numbered receipt should ideally include: 1) the payor’s name; 2) purpose or description of the cash payment; 3) quantity, and unit price, if applicable; 4) type of cash received (check, currency, etc.); 5) total amount of cash received; 6) date; and 7) the signature of the person collecting or receiving the cash.

-Only one person should have access to the receipt book.

-Checks received should be immediately restrictively endorsed, “For Deposit Only to DePaul University”. If a stamp with this message is not available, this can be written on the back of the check.

-A duplicate receipt should be provided to the payor.

Cash should be secured in a locked drawer or safe, to which access is limited to the person collecting the cash and that person’s supervisor. The combination or key should be changed when staff leave the university or when responsibilities are reassigned, and any keys should be kept in a secure, confidential place. If there is more than one person receiving cash at the same time, each person must have his/her own cash drawer and cash receipts log.

Balancing and Depositing Cash

All cash receipts should be balanced and deposited on a daily basis. To maintain proper segregation of duties, the person who balances and deposits cash should not be collecting and receipting cash. To balance cash:

-Compare the pre-numbered receipts issued to the receipts log and to the actual amount of cash in the box.

-Investigate and resolve discrepancies, then sign and date the balancing record to document the process.

To deposit cash:

-Hand-deliver the deposit to the Cashier’s office and complete the Special Receipt form (deposit slip).

-Deposit the entire amount received so that all receipts for the day are posted to the Financial Activity Report.

-None of the cash collected should be used prior to being deposited.

Reconciliation

To maintain proper segregation of duties, the reconciler should not collect and receipt cash or balance and deposit cash.

-Reconcile the cash postings on the Financial Activity Report to the cash receipts logon, at minimum, a monthly basis.

-Investigate and resolve discrepancies, then sign and date the Financial Activity Report and receipts log to document the process.

-Fiscal year-end (June 30th) procedures:

  • Financial accounting standards require that cash received from goods sold or services rendered by the University be recorded in the same fiscal year that the good was delivered or service was provided.
  • Cash will be recorded in the respective departments Financial Activity Report on the same day the deposit was made at the Cashier’s Office.
  • If cash has been deposited in the current fiscal year but the good will be delivered or service rendered in the subsequent fiscal year, departments should complete the Deferred Revenue form and submit to the Controller’s Office.
  • If the good has been delivered or service rendered in the current fiscal year but the cash will be received in the subsequent fiscal year, departments should complete the Revenue Receivable form and submit to the Controller’s Office.
  • Additional information regarding year-end procedures can be found on the Financial Affairs website (

Department Budget Manager Responsibilities

Budget managers are responsible for establishing an effective internal control system which includes:

-Delegating responsibility for cash handling duties,

-Maintaining proper segregation of duties,

-Requiring that staff are properly trained and supervised,

-Reviewing receipts and reconciliations on a regular basis

Any variance from the above procedures should be documented and approved by the VP/Dean for the respective department. Contact Financial Accounting or the Office of Institutional Compliance with questions or comments related to cash handling or to schedule a departmental training on cash handling procedures.