By Jayme F. Moore, CPA
Vice President and Director
Effective cash handling controls are essential to help mitigate potential theft, fraud and errors. Organizations that establish strong cash controls can support financial integrity and trust for their organization.
You may have some of these controls in place already, however organizations should review controls and processes in place to shore up any cash handling gaps that may exist. Below are certain suggested controls that your organization may want to consider:
Segregation of Duties and Dual Controls – Have two individuals count the cash at the same time, once all cash has been collected, and have both sign off on the totals counted.
Reconciliation and Documentation – For all cash collections, regardless of the method of payment, provide appropriate supporting documentation for the collections to the finance department. This can provide protection for all the parties involved in the process.
Vendors – For payment methods such as Venmo, or other cash management and exchange tools utilized, make checks payable or payments to the organization rather than an individual. Providing a reconciliation of funds through screenshots or summaries from certain apps or tools used by the organization can help the finance department reconcile the amounts with accounting records.
Secure Storage and Access Control – Cash should be provided to finance the same day of an event as much as possible. If cash is not provided to finance within the same day, it should be stored in a locked safe or drawer with limited access. This allows for timely deposits into the organization’s bank account.
Cash Handling Policies and Training – Communicate controls to all parties that are involved in the cash collection process, and those that oversee or manage cash on behalf of your organization. If considered necessary, have an annual training to remind all parties of the importance of the controls in place, and adherence to the policies.
Controls and procedures over cash and cash handling that organizations have in place can be essential for reference in any future claims, discrepancies or audits. It also ensures that cash is recorded for use in the proper program or activity and promotes accurate, secure and transparent cash management at your organization.
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