The purpose of this policy is to establish guidance for the creation and maintenance of imprest cash funds (cash funds) and external bank accounts outside of the Sacramento County (County) Treasury.
This policy applies to all County Departments, Special Districts, and Agencies.
Imprest cash is defined as an account used for petty cash to maintain strict control over small cash expenditures. Ordinarily, these funds and accounts are used for making change, petty cash expenditures or other approved functions that necessitate a separate fund.
External bank accounts is defined as any bank account that is held outside of the County Treasury and the responsibility for management is no longer with the County Director of Finance and rests with the respective County department or district.
It is the policy of the County to establish proper internal controls to safeguard the receipt and disbursement of cash and cash equivalents. Imprest cash (cash funds) and external bank accounts shall only be established with proper approval by the Director of Finance.
The Director of Finance shall approve the minimum number of imprest funds and external bank accounts as necessary for County and district operations.
An authorized imprest cash fund (i.e. petty cash) shall be used by a department, special district or agency for payment of expenses incurred in the conduct of official County, special district or agency business, subject to the following limitations:
An authorized cash fund shall be used by a department, special district or agency for payment of expenses incurred in the conduct of official County, special district or agency business, subject to the follow ing limitations:
An authorized external bank account used by a department, special district oragency that the County acts as its Treasurer shall only be used for purposesidentified in the formal request submitted and approved by the Director of Finance.
Imprest cash funds and External bank accounts will be recorded as followed in the County’s General Ledger:
All imprest cash funds shall be established under this policy. Any custodian and all personnel handling cash shall follow internal control procedures to safeguard all funds, including performing timely reconciliations.
The responsible department or agency/district official or their delegate may request a replenishment of expended imprest cash funds by submitting a claim to the Department of Finance, Auditor-Controller (Auditor-Controller) office with appropriate documentation (e.g. receipt, purpose of expense, evidence of approval, imprest cash reconciliation, etc.).
A. The department Director or district/agency Director/Administrator must submit a written request to establish or modify a cash fund to the Director of Finance. The request must include the purpose of the fund, the amount or change requested, justification for the fund, custodian of the fund, and the authority to obtain the fund.
B. After the request is approved, the department or district/agency may submit a claim, with all the required documentation to establish the cash fund to the Auditor-Controller’s office, and a check will be issued in the name of the custodian, and cash fund. A vendor account is required in the name of the cash custodian, and this vendor account will be used when the fund is replenished. If a new external bank account is requested, the Auditor-Controller’s office will notify the Treasury Division to assist as needed with opening the account.
C. All funds shall be reconciled at least once each month and when the fund is replenished, a copy of the reconciliation shall be submitted with the claim for replenishment. At a minimum, imprest cash funds should be replenished on an annual basis. All requests for disbursements shall include a claim form, approved by an authorized employee and signed by the person receiving the cash. At all times, the cash custodian must be able to provide a full accounting for the fund in the form of cash, vouchers on hand, or a combination of both. Upon request by the Auditor-Controller’s office, the custodian responsible for the fund shall provide a full accounting of the fund, including reconciliation. To facilitate the fiscal year-end close, financial reporting, and the annual report on revolving funds to the Board of Supervisors, departments are required to submit a June 30 reconciliation of their respective funds to the Auditor-Controller’s office.
D. Any shortage in the fund shall be tracked and accounted and include documentation for all cash shortages. Any single cash loss shortage of more than $500 or cumulative cash shortages equal to or greater than $1,000, must be reported by the department or agency/district to the Director of Finance and reported on a Relief of Accountability (ROA)form. As part of the review of the ROA, the Auditor-Controller’s office will document the circumstances concerning the shortage and make recommendations to the Director of Finance as to the final disposition of the case. Overages in the fund shall be deposited into a revenue account, by issuing a receipt and depositing the overage amount. The fund shall never be co-mingled with cash receipts or any other fund.
E. Any change to an existing fund must be communicated timely to the Director of Finance:
1. When an increase to the fund is required, justification for the increase and the amount of the increase should be submitted for approval.
2. A decrease or discontinuance of the fund should be communicated, and funds must be deposited against the department or district/agency fund account.
3. A change in the custodian.
To establish an external bank account, the requesting department/agency will prepare a memo addressed to the Director of Finance for approval that provides the following information:
A. The operational needs of the account that cannot be met by County processes for funds held in the Treasury pool.
B. Identify the requirements for the establishment of this account (statutory, contractual, grant, etc.)
Once the bank account is approved by the Director of Finance, the Treasury Division will work with the department to establish the account with the appropriate banking institution. The account shall be established with the County’s primary bank unless an exception is authorized by the Director of Finance to meet the requester's specific operational needs.
A. The department’s/agency’s Department Head or delegate must approve all authorized signers on the account.
B. The department/agency must work with the Treasury Division to update any changes needed on the bank account (i.e. authorized signers).
C. Departments/agencies shall ensure appropriate cash handling and fraud prevention procedures are used to manage the external bank account.
D. The department/agency must perform monthly bank reconciliations. To ensure proper segregation of duties, authorized signers shall not perform the bank reconciliation or any other bookkeeping functions of the account.
E. The department/agency must timely perform (within 30 days of month end) and maintain monthly bank reconciliations, as well as support for all receipts and disbursements from the account.
F. The year-end bank reconciliation must be submitted to both the Auditor-Controller Division and the Treasury Division within Finance as part of the June 30th year-end closing proces.
Per county policy 1400: Relief of Accountability – Cash and Cash Equivalents,cash losses attributed to fraud, theft, and/or burglary, are required to be reported to the Director of Finance and to law enforcement agencies with jurisdiction within 5-7 days of discovery.
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Change and Imprest Cash Funds Policy Information
Section:
Finance
Subsection:
Cash and Deposits
Authorized By
Ann Edwards, County Executive
Revision History
Revised: 03/2022
Established: 04/2019
Contact
Email: Finance.Director@saccounty.gov