Cash Management Over Reciepts
State of North Carolina
East Carolina University
Cash Management Plan
North Carolina law, Chapter 147-86.10 of the General Statutes, requires that "all agencies, institutions, departments, bureaus, boards, commissions and officers of the State...shall devise techniques and procedures for the receipt, deposit and disbursement of moneys coming into their control and custody which are designed to maximize interest-bearing investment of cash and to minimize idle and nonproductive cash balances."
The Cash Operations Manager, Cash Management Accountant, and University Cashier, under the direction of the Financial Manager for Accounting Services, are responsible for developing, revising, and implementing the University’s plan to carry out Cash Management Policies. The departments primarily responsible for cash management are Student Accounts and University Receivables, Sponsored Research, Grants and Contracts, and Financial Services; however, all department cash management activities must abide by the plan.
Cash Management is divided into three areas: control of receipts, management of disbursements, and investment of funds on deposit.
Cash Management over Receipts:
The objectives of cash management over receipts are to use diligence in collecting funds owed to the State, to provide internal control over cash and cash equivalents and to expedite the movement of monies collected into interest bearing accounts. To accomplish these objectives, the University established the following rules:
1. Except as otherwise provided by law, all funds belonging to the State of North Carolina, and received by an employee of the State in the normal course of their employment shall be deposited as follows:
a. All monies received shall be deposited with the State Treasurer pursuant to G.S. 147-77 and G.S. 147-69.1.
b. Monies received in trust for specific beneficiaries for whom the employee-custodian has a duty to invest shall be deposited with the State Treasurer under the provisions of G. S. 147-69.3.
2. University Deposits will be made by the Cashier’s office at the bank approved by the State Treasurer by 2:00 pm daily, except as otherwise provided by law. The State Treasurer has approved an exemption to the daily deposit rule if receipts total less than $250.00 and deposits are made at least weekly.
3. All checks returned to the main campus of the University on which payment has been refused by the payer because of insufficient funds, closed accounts, or any other reason, will be accounted for according to the University’s returned check policy at http://www.ecu.edu/business%5Fmanual/Cashiers_Procedure1.htm#pro1c. Please reference the section labeled “Returned Checks”. The University accesses a returned check fee of $25.00 per occurrence.
4. If, after thorough research, the University determines it is not entitled to an amount received and deposited on behalf of the University, that amount is refunded to the entity that originally remitted the payment. All research is documented and maintained in the Cashier’s office for review.
5. Payments received via mail and on-site are processed according to http://www.ecu.edu/business%5Fmanual/Cashiers_Procedure1.htm#pro1c. Please reference the section labeled “Receipts For Student Tuition, Fees and Charges”.
6. The Cashier’s office receipts departmental funds and processes these deposits according to http://www.ecu.edu/business%5Fmanual/Cashiers_Procedure1.htm#pro1c.Please reference the section labeled “Receipts from Departmental Deposits.”
7. The University accepts electronic payments, in accordance with G.S. 147-86.22, to the maximum extent possible and in a manner consistent with sound business practices. The University utilizes the Master Settlement Agreement (MSA) for electronic payment processing. The University follows the state electronic payment process policies and procedures as part of its cash management plan and these policies and procedures: (http://www.osc.state.nc.us/Credit_Card/cc_policies.html).
8. The University accepts electronic payments in accordance with G.S. 147-86.22. Departments (Vendors) must complete an ACH Payment Enrollment Form which had already been approved by Wachovia. This enrollment form is provided to the party who wished to send funds to ECU electronically. Electronic payments received by Wachovia on behalf of the university are accessed daily via an on-line connection with Wachovia. These receipts are certified and recorded within 24 hours.
9. Cash receipts are stored in the University’s main vault nightly and during weekends. Each teller has an individual vault within the main vault.
10. Monies due to a State agency, department or institution from other governmental agencies or from private persons shall be promptly billed, collected and deposited.
11.Receipting errors impact the certification of funds to the State Treasurer and must be corrected in the State Treasurer’s system as well as ECU’s financial system. For receipts posted for an amount less than the actual payment, the bank (Wachovia) notifies ECU of the error and credits the correcting amount to the State Treasurer’s account. In the financial system, the Cashier’s Office creates a receipt adjustment for the correcting amount. The correcting amount is entered under the applicable id in the student system and then certified. When receipts are posted for an amount greater than actual payment, the bank (Wachovia) notifies ECU of the error, and requests a check from ECU for the difference. In the financial system, the erroneous student payment must be un-posted. A new charge is added to the student’s account for the amount of the error. Finally, a negative receipt adjustment is posted as a debit to the original revenue account and a credit to cash – then certified as a negative amount. If the notification comes to the cashier’s office, it is that office responsibility to contact financial services and vice versa.
12.Unpaid billings due to a State agency, department or institution shall be turned over to the Attorney General for collection no more than 90 days after the due date of the billing unless the amount is less than five hundred dollars ($500), or (for institutions where applicable) for amounts owed by all patients which are less than the federally established deductible applicable to Part A of the Medicare program. The agency, department or institution may handle these unpaid bills pursuant to agency debt collection procedures.
a. The Attorney General’s office has authorized four private collection agencies to collect delinquent accounts. The University utilizes the State of North Carolina’s Set Off Debt Collection (SODCA) and the State Employee Debt Collection Act (SEDCA).
b. Delinquent accounts are processed according to the section labeled “Bad Debts/Set Off Debt Collection Act and State Employee Debt Collection Act” at http://www.ecu.edu/business%5Fmanual/Cashiers_Procedure1.htm#pro1i.
13.Federal funds received for major federal assistance programs that are governed by the Cash Management Improvement Act of 1990 must be drawn in accordance with the current State/Federal Agreement.
14.All federal fund draws should be timed to that the funds are on deposit with the State Treasurer no more than two business days prior to the disbursement.
In addition to adhering to these guidelines, the University employs other proven techniques, to include cash handling to include:
Receipting federal grant payments by wire transfer when possible. Reassignment of personnel, or the hiring of temporary personnel, when this proves cost effective, to accelerate the processing of remittances during peak periods.
The Use of lock-boxes for patient receipts at the Brody School of Medicine.
Establishing billing schedules which are both efficient and lead to earlier receipt of monies due to the State.
Timing deposits in order to receive current day credit in accordance with schedules available from the State Treasurer.
15.The University maintains crime insurance coverage for the loss of cash and securities by a non-employee committing or attempting to commit a robbery or safe burglary.