CONTROL OF CHANGE FUNDS

          Change funds may be provided to cashiers either from local agency funds or from State appropriations. The business office should keep a record of the amount of each change fund and its location. Signed receipt forms should be on file from the fund custodians. Periodic physical counts should be made of the change funds by business office personnel. Cashing of personal checks from change funds should not be permitted. The amount of each change fund should remain constant and be withheld at the close of each day from the total cash in the register or cash drawer and used as the fund with which to begin the following day. The remaining cash is turned in as representing the current day's receipts. Cash receipts should not be retained with the change fund after the close of the business day.

CONTROL OF IMPREST FUNDS

          Ordinarily, petty cash funds are maintained on an imprest basis; i.e., the fund is replenished for the exact amount of the expenditures reported. Caution should be exercised to ensure that the size of the fund is consistent with the needs for which it was created. Periodically, the necessity for the fund and the amount thereof should be reevaluated.

          State agencies may have petty cash funds which are operated as checking accounts through local banks and/or which represent actual cash in the possession of their employees. Controls to be exercised for funds retained in bank accounts are discussed in the preceding section of this Chapter.

          All disbursements from non-bank petty cash funds should be supported by invoices that are properly approved and dated. These should be examined and cancelled when the fund is reimbursed. This reimbursement should be frequent and the distribution of the charges clearly shown on the voucher submitted for reimbursement. Section 4.0240 of this manual fully details the reimbursement procedure to be used.

          Periodic physical counts should be made of these funds by someone other than the custodian of the fund. The cashing of personal checks from these funds should not be permitted.

CONTROL OF POSTAGE

          Controls should be established over the use of postage. This can be accomplished most effectively by the use of a postage meter. All metered postage should be purchased by check, payable to the postmaster. An employee independent of the mailroom should verify that the amount entered on the meter is the full amount of the check. Under no circumstances should checks issued for meter postage be used for the purchase of stamps or be exchanged for cash. The postmaster's receipts for metered postage should be retained and a daily record should be kept of the meter readings. At intervals, the changes in the ascending and descending meter readings should be reconciled with the metered postage purchases for the period.

          Special circumstances may require the use of postage stamps. This should be kept to a minimum and controlled by the use of requisitions. The stamps should be purchased by check from an established petty cash fund, if available. A single individual should be responsible for the distribution of the stamps and should maintain a record of their receipt and distribution. At intervals, the stamps in the custody of this individual should be inventoried and reconciled by another individual with the stamps purchased and requisitions filled.

CONTROL OF NEGOTIABLE SECURITIES

          Generally, investments are made by OSC pursuant to Section 98 and Section 98-a of State Finance Law. Some agencies may have in their possession negotiable securities such as stocks and bonds. Records and controls must be established to ensure that these are properly accounted for. As a minimum, there should be:

a.      Proper authorization for acquiring or disposing of securities.

b.      Evidence of the acquisition of the security.

c.      A record of the security showing: cost; adjustments to cost; date acquired; serial number; income received; value received at disposal.

d.      Accounting records to document the transactions resulting from the acquisition and disposal of securities and the receipt of dividends and interest earned on securities.

e.      Safekeeping of securities either by the rental of a safe deposit box or the use of safekeeping equipment. Access to the securities should be vested jointly in at least two responsible employees. If possible, securities should be registered. To the extent that there are bearer securities, control thereof should be placed with a custodian bank or the State Comptroller. Confirmations from custodians should be obtained periodically.

f.      A physical count and inspection of securities at periodic intervals; as a minimum, annually. This inspection should be made by an independent official in the presence of the custodians.

g.      Segregation of duties between security custodians and the employees maintaining the cash and general accounting records.