Getting Started with Petty Cash
Learn about petty cash, allowable and unallowable uses, as well as general fund administration at Columbia University.
Details
What Is Petty Cash?
Petty cash is a separate departmental cash fund for paying minor approved business expenses that cannot be paid via other University non-cash methods.
Columbia University discourages the establishment and/or use of a Petty Cash Fund and has developed alternative means of conducting business to replace using petty cash as a payment method:
Non-Cash Payment Options – For all campuses: Procurement Card (P-Card), U.S. Bank PayCard, and check. For Columbia Irving Medical Center (CUIMC): digital compensation (e.g., Gift Cards, Venmo, PayPal, direct bank account deposit, deposit to debit card) or physical debit card via TruCentive. Options may be subject to change. Check with CUIMC Controller or Central Office of the Controller.
Who Manages Petty Cash for the University?
The Office of the Controller authorizes the establishment, increase, modification, certification, and closure of petty cash funds. In addition, all petty cash funds require appropriate departmental DAF approval; IRB approval for research and human subjects; and CUIMC Controller Office approval for CUIMC departmental general unrestricted funds.
DAF Approver
An employee with DAF authority is required to provide adequate controls, monitor and approve the custodian petty cash activity and the PC monthly reconciliation. All reimbursements to a fund's custodian must be signed off by a senior DAF within the department or school. As part of the certification process, the designated petty cash DAF, not the custodian, is required to physically count the cash on hand, account for all receipts, and complete the required annual certification form.
Custodians
Each approved petty cash fund has a custodian who is responsible for reconciling the fund on a regular basis (at least monthly), management of expense reimbursements, fund replenishments, recordkeeping and general fund administration. It is the petty cash fund custodian’s responsibility to take adequate precautions for the safekeeping of the funds under their control.
The custodian must be a full-time salaried officer or staff employee. New petty cash custodians must take the required Petty Cash Web-Based Training before a fund will be set up. Contact the Service Center to request more information about this training.
Petty Cash funds are intended solely for essential and approved expenses and should not exceed $80. (Exception: reimbursement of cost of monthly MTA Metrocard). It is not permitted to split the transaction in order to circumvent this limit.
Petty Cash may NOT be used to reimburse purchases made on credit cards or debit cards.
Expenses charged to a Petty Cash Fund must be in compliance with the University’s Travel and Business Expense policy.
Expenses that are reportable to the IRS or subject to income tax withholding are not reimbursed through petty cash.
Petty Cash may not be commingled with any other fund or project.
Petty cash cannot be used to pay for (or reimburse) honoraria, services, equipment, travel or salary advances, registration fees, business meals outside of the office, expenses that are older than 120 days. Such expenses must be processed using a Travel and Business Expense Report.
Under no circumstance may an individual, including the custodian, approve his or her own petty cash expense or that of a person to whom he or she reports. Such expenses should be approved by a senior DAF within the department or school.
The custodian should never deposit or cash petty cash checks against their personal bank account. This is against policy and can result in closing of the funds.
Only the custodian and the department head should have keys to the box and cabinet. Funds should never be left unattended and unsecured. In the event funds are lost or stolen, the Custodian or a senior staff member must contact the University's Department of Public Safety to process a Security Report, plus notify the Office of the Controller ([email protected]) by sending a memo outlining pertinent information of loss, including which unrestricted account loss should be charged to if closing the account. Any funds missing from a Petty Cash Fund will be charged to the responsible department unrestricted chartstring. The Custodian may be subject to disciplinary action for any violations of this policy that contributed to the loss of funds.
Managing the lifecycle of a petty cash account includes the following interrelated steps:
- Open a Petty Cash Fund
- Request a Reimbursement
- Maintaining a Petty Cash Fund
- Replenish a Fund
- Change the Petty Cash Fund Project Information
- Update the Petty Cash Fund Custodian
- Increase or Decrease the Amount of a Petty Cash Fund
- Close a Petty Cash Fund
Please review each step's webpage before attempting to submit a ServiceNow request.