Procedures - Account Receivables, Petty Cash and Working Fund Accounts

Accounts Receivable

Departmental Receivables
1. Departmentally Maintained Accounts Receivable
2. Fiscal Office Maintained Accounts Receivable
Extension of Credit
1. Sample Extension of Credit Request
2. Blank Extension of Credit Request (AG-213)

Petty Cash and Working Fund Accounts

Petty Cash Accounts
Working Fund Accounts

Departmental Receivables
1. Departmentally Maintained Accounts Receivable
  1. Invoices should be issued within one week of the date of delivery of the goods or the date the services were performed.
  2. Preference is that departmental maintained receivables be kept on some computerized system for Accounts Receivable (QuickBooks, Quicken, etc). At a minimum, reports should be prepared and maintained detailing the total amount due by invoice and the age of any outstanding balance.
  3. All payments are due within thirty days of invoice date
  4. Past-due accounts should be reviewed on an annual basis to determine if they continue to be collectible. Any accounts deemed to be uncollectible should be submitted to the Ag Program Cash Management Office for approval to write these accounts off as uncollectible. Once an account has been written off, no further credit should be issued to this customer.
2. Fiscal Office Maintained Accounts Receivable
  1. Documentation
    1. Form AG-209A, Request for Accounts Receivable Invoice - A fully completed form AG-209A is to be submitted for all items that credit has been extended. Requests should be submitted to Cash Management within one week of the June 14, 2004 of delivery of the goods or the June 14, 2004 the services were performed. For your convenience, a blank copy of this form is included in these procedures following the sample form
    2. Form AG-209B, Memorandum - Requests for Accounts Receivable - A fully completed form AG-209B is to be submitted listing all invoice requests (AG-209A) that are being submitted. Invoice numbers will be added to this document and it will be returned to the department when invoices have been issued as confirmation. For your convenience, a blank copy of this form is included in these procedures following the sample form
    3. Location of forms
      Form AG-209A and AG-209B are available in 2 electronic formats that may downloaded from the Texas A&M Agriculture forms web site in the Cash Management Office section:
      http://agservices.tamu.edu/forms/fiscal_forms.htm#cashmgmt
      Adobe Acrobat: AG-209A.pdf
      Adobe Acrobat: AG-209B.pdf
      MS Word: AG-209A.doc
      MS Word: AG-209B.doc
  2. Sample Invoice Request
  3. Blank Invoice Request (AG-209A)
  4. Blank Transmittal Memo (AG-209B)
Extension of Credit
1. Credit may be extended only when it serves the best interest of the System and is for the public good of the State of Texas (TAMUS Regulation 21.01.04.3).
  
  An approved Extension Of Credit Request form (AG-213) must be on file with the Texas A&M Agriculture Fiscal Office in order for a department to extend credit as a part of it’s departmental activities.
2. Form AG-213 is available in 2 electronic formats that may downloaded from the Texas A&M Agriculture forms web site in the Cash Management Office section:
  http://agservices.tamu.edu/forms/fiscal_forms.htm#cashmgmt
  Adobe Acrobat: AG-213.pdf
  MS Word: AG-213.doc
3. Once approval has been received, credit may be extended when:
  1. The agency receives the greater benefit by the extension of credit.
  2. It is impossible or impractical to (a) require payment in full or (b) request posting a bond or cash deposit prior to delivery of goods or services
  3. The extension of credit will allow the agency to conduct its operations in a more efficient way
  4. The extension of credit will result in a savings of administration costs for the agency or will result in net benefit
4. Sample Extension of Credit Request (Word)
5. Blank Extension of Credit Request (AG-213 - PDF)

Petty Cash Accounts and Working Fund Accounts

Petty Cash

To Establish Or To Increase/Decrease A Petty Cash Fund
1. Submit a request from the Department Head/Unit Head to the Assistant Director for Fiscal Services which includes the following:
  1. purpose for the fund
  2. account to be used to establish or increase the fund
  3. amount being requested with justification
  4. name of primary custodian
2. Upon approval, the Texas A&M Agriculture Cash Management Office will prepare a DFI to generate the beginning or increased petty cash fund balance from the account indicated in the official request. The resulting check will be made payable to the primary custodian, as agent for both the Texas A&M Agriculture and the department/unit.
3. Any funds set aside for a petty cash account will not be available in a departmental/unit account for the life of the petty cash fund.
Accountability
1. The primary custodian must ensure that the receipts, vouchers submitted for processing, and cash equal the current petty cash balance at all times. The cash should be secured in a safe or locking file cabinet with limited access.
2. Monthly, the primary custodian should perform a petty cash count and prepare Petty Cash Count form (AG-214) based on this count. This should remain in the department/unit as a part of the records for the specific Petty Cash fund.
3. Annually, a petty cash count should be made as of August 31st. The Department Head/Unit Head, or their designee should sign this form and the original Petty Cash Count form (AG-214) should be submitted to the Texas A&M Agriculture Cash Management Office by the 5th working day of the new fiscal year. The individual performing this count must be someone other than the primary custodian.
4. If the primary custodian changes, prepare a Petty Cash Count form (AG-214), have the previous and the new custodian verify the funds, and have the new custodian sign as the primary custodian. To complete the transfer of accountability, a memo documenting the transfer of custodianship, along with a copy of the completed Petty Cash Count form, should be submitted to the Texas A&M Agriculture Cash Management Office.
5. Location of forms
  Form AG-214 is available in 3 electronic formats that may downloaded from the Texas A&M Agriculture forms web site in the Cash Management Office section:
  http://agservices.tamu.edu/forms/fiscal_forms.htm#cashmgmt
  Adobe Acrobat: AG-214.pdf
  MS Excel: AG-214.xls
  MS Word: AG-214.doc
Disbursements from Petty Cash Fund
Reimbursements to Petty Cash Fund
2. The departmental/unit bookkeeper should issue a voucher utilizing the vendor ID established for the primary custodian

3. Upon receipt, the resulting check should be cashed by the custodian and the funds returned to the petty cash fund
To Close A Petty Cash Fund
1. If it is determined that an existing petty cash fund is no longer needed, submit the following to the Texas A&M Agriculture Cash Management Office:
  1. Total cash balance of fund
  2. Completed Petty Cash Count form
  3. Memo from Department Head/Unit Head approving the return of the funds
2. All receipts must be submitted for reimbursement before the fund may be closed. The petty cash fund must be returned in its entirety (no unreimbursed receipts will be accepted).
Petty Cash Count Form Example (Word)
Blank Petty Cash Count Form (AG-214 - PDF)

Working Fund Accounts
1. To Establish or To Increase/Decrease a Working Fund
  All requests for establishing or increasing working funds shall be made in writing from the Unit Head to either the Director of the Texas Agricultural Experiment Station or the Director of Texas Cooperative Extension through the Assistant Director for Fiscal Services. The request should include the following:
  1. purpose for the fund
  2. account to be used to establish or increase the fund
  3. amount being requested with justification
2. Accountability
  1. Working funds are to be kept in a bank account separate from any other funds. This bank account must be established by Funds Management and TAMUS Treasury. Under no circumstance should a check be written from a working fund when the balance is insufficient to cover the amount.
  2. The Unit Head is responsible for the working fund and is authorized to sign the working fund checks. As a recommendation, another professional staff member should also be authorized to sign checks.
  3. All working fund checks should be pre-printed and pre-numbered. The working fund check number and the sub voucher (TAES Form 36-53, booklets are available from Disbursements) confirming the receipt of the check should bear the same identification numbers.
  4. Under no circumstances should a working fund check be issued payable to “CASH”.
3. Purpose
  A working fund is to be used to make small but unforeseen purchases necessary for the on-going operation of the unit. This includes payments to vendors where it is not practical or feasible for the vendor to wait for payment or circumstances preclude advance payment by voucher. All spot and emergency purchase requirements will apply to working fund expenditures. Under no circumstances should working funds be advanced for personal loans.
  
  TAES working funds may also be used circumstances similar to the following:
  1. Payment of salary or wages in the event payroll checks are not received on time. The amount paid in such a circumstance may not exceed net pay due the employee on that date. Net pay is to be verified by the Payroll Office.
  2. To pay temporary or wage employees for services already performed if the employees are unable to wait for payroll to be processed.
  3. To pay for contract labor if the contractor cannot wait for payment by voucher. Payment to agricultural labor contractors is authorized only under a signed Independent Contractor Determination/Agreement (Form AG-106, http://agservices.tamu.edu/forms/CGforms.htm).
4. Completion of Sub voucher (TAES Form 36-53)
  (click for larger view)
  1. The number supplied on the sub voucher must match the check number issued from the working fund to pay for the items listed.
  2. Form should be dated the same day as the working fund check.
  3. All items purchased or services received must be listed individually, with the amounts itemized
  4. Total amount spent must also be written out, as on a check.
  5. Either the person that prepared the form or the payee must sign sub voucher.
  6. Total amount of check (A) must equal total spent (B) must equal written amount (C).
5. Reimbursement of Working Fund
  1. Reimbursement of the working fund should be made at least twice monthly or more often, if necessary, to avoid depletion of the fund. Original sub-vouchers and all other receipts available must be attached to the reimbursement request. A purchase order (“L” document) should be issued for reimbursement, as soon as possible after the funds are issued from the working fund. This may be accomplished in two ways:
    1. Issue a separate “L” document for reimbursement of funds as it is disbursed. Each sub-voucher would then be reimbursed individually, using the sub-voucher/check number as the invoice number
    2. Issue an “L” document for the first reimbursement of funds since the last reimbursement request. Close but do not route the document. As additional funds are disbursed, the document would be re-opened and additional line items would be created. Receiving could be done as the line items are created, resulting in multiple shipments for one “L” document.
      Once a reimbursement is deemed necessary, the document would be routed for approvals. At that time, invoicing and any additional receiving would be completed. In this instance, your “L” number would serve as your invoice number.
  2. Reimbursement of sales tax may only be made from unrestricted gift funds (06-212XXX or 07-2XX999). A completed Texas Sales and Use Tax Exception Certificate (State of Texas form 01-339, http://agservices.tamu.edu/forms/fiscal_forms.htm - accounting) should be provided to the vendor to avoid sales tax being charged.
  3. Reimbursement of part-time wages for seasonal employees (TAES only) paid out of the working fund can be accomplished through either of the following methods:
    1. By using the TAES Wage payroll Voucher Working Fund Reimbursement form, TAES Form 87-63, one check for the total amount requested will be returned with the regular payroll checks. The check will be made out to TAES and is to be deposited into the working fund.
    2. By placing the seasonal worker on payroll. When the payroll is received, the unit should verify that the full amount of the payroll check has been paid to the seasonal worker through the working fund. After this determination has been made, the payroll check may be deposited into the working fund as a reimbursement.
6. Reconciliation of the Working Fund
  1. Each month, the working fund shall be reconciled upon receipt of the bank statement. Working fund bank accounts should be set up on a calendar month basis to ensure that the bank statement covers one full month only and does not overlap any calendar months.
  2. Form AG-216; Working Fund Reconciliation should be used to complete the reconciliation. Outstanding checks, reimbursable sub-vouchers and irregular payroll checks should be itemized on the Ag-216 by number and corresponding amount. A person authorized as a signer on the working fund account should not complete the reconciliation.
  3. Upon completion, the original form AG-216 and a copy of the bank statement must be sent to the Fiscal Office for review.
    1. Reconciliations for TAES should be sent to the attention of Bill Gray.
    2. Reconciliations for TCE should be sent to the attention of Melissa Ray.
  4. Location of forms
    Form AG-216 is available in electronic format that may downloaded from the Texas A&M Agriculture forms web site in the Cash Management Office section:
    http://agservices.tamu.edu/forms/fiscal_forms.htm#cashmgmt
    MS Excel: AG-214.xls
7. Year End Reporting
  To meet year-end reporting requirements, all expenditures must be reimbursed as of August 31. These reimbursements will receive special handling so as to have all working funds fully reimbursed at fiscal year end.
8. Working Fund Reconciliation Form Example
9. Blank Working Fund Reconciliation Form (AG-216)

updated July 22, 2008

Procedures - Account Receivables, Petty Cash and Working Fund Accounts

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