(A) Purpose. The cash handling policy is established for the purpose of ensuring adequate internal controls to account for the handling of the City of Hillsboro's ("city") municipal cash and to maintain public trust. The procedures to enforce and controls to ensure that this cash handling policy is carried out are to include but are not limited to those outlined below:
(1) Written documentation evidencing assigned authority (see cash handling policy employee acknowledgment form as attached to Ord. 2024-15); and
(2) Random drawer audits conducted under the direction of the City Auditor. A requirement that any non-compliance with this policy or deviation from set procedures will be reported to the City Auditor in the form of a memorandum outlining the non-compliant act or procedural deviation.
(B) Delegation of authority.
(1) The City Auditor is authorized to promulgate rules for establishing procedures for the receipt, handling, and deposit of municipal cash by municipal employees and persons performing cash handling functions where there are municipal operations being performed, and funds that are to be placed into the municipal treasury. For the purpose of this policy, city employees, employees of companies that perform services operating departments or facilities for the city, volunteers, and all other persons involved in cashier related functions involving municipal cash, whether the employee(s) is/are full or part-time, are covered by the terms of this policy. Incorporated within the authority granted via this policy is the right to require regular reporting to the City Auditor and the right to inspect departmental cash records, including overages or shortages and inspection of departmental practices and procedures in handling municipal cash. The City Auditor may verify and inspect for compliance with promulgated policies, procedures and rules to assure that they are being adhered to through on-site inspections.
(2) The city is required by law to keep detailed records of transactions involving the receipting, retention, and disbursement of all city revenue. The Auditor's office is charged with the responsibility of overseeing the proper receipting and safeguarding of all municipal funds.
(3) Responsibility and accountability for the daily collection of funds is delegated to the principal municipal cash custodian of each operating location involved in cashiering operations along with his/her supervisor.
(C) Duties of city personnel. Any city employee who receives municipal cash in the normal scope and course of his/her duties shall:
(1) Ensure the delivery or deposit is made in compliance with R.C. § 9.38 and comply with rules promulgated by the City Auditor for handling and processing of municipal cash;
(2) Notify his/her supervisor and department head of any loss or theft of municipal money immediately upon discovery. Written notice shall be given to them no later than 24 hours after discovery;
(3) Shall count, balance, report and relinquish cash drawer collections in excess of the cash drawer amount to the facility's principal municipal cash custodian no later than the end of his/her shift each day;
(4) Each cash custodian/the department head or manager shall prepare deposit records and deposit the day's collections in accordance with the following process:
(a) City personnel must deposit all public moneys received by that person with the City Auditor's office or properly designated depository (bank) on the business day next following the day of receipt, if the total amount of such moneys received exceeds $1,000. If the total amount of the public moneys so received does not exceed $1,000, the person shall deposit the moneys within three business day next following the day of receipt, provided the person is able to safeguard the moneys until such time.
(b) Safeguarding the public moneys include proper segregation of duties on handling the cash (signoffs, reviews); securing cash received for deposit in a locked safe within a secured area; and restricted access to the safe. This process must be approved by the City Auditor;
(5) Municipal employees are subject to disciplinary action for failure to comply with the
duties described in the cash handling policy.
(D) Liability for loss. Primary responsibility for care and liability for loss of municipal cash in its custody is recognized at the department/facility level until deposited with the City Auditor's office or bank. Compliance with the procedures approved by the City Auditor establishes a presumption that a municipal department/facility is exercising due care in its custody and care of municipal cash.
(E) Establishment/increase of cash funds. All requests for the establishment of cash funds, (i.e. cash drawer and petty cash funds) must be made to the City Auditor. The City Auditor will maintain a complete listing of all cash funds. The department/facility, custodian and the dollar value of the cash funds are to be maintained on this written listing.
(1) A check request signed by the department head specifying the type of fund (cash drawer or petty cash), the amount being requested, and an explanation describing the basis for the requested funds is required to be submitted to the City Auditor (email is acceptable).
(2) It is not permissible for cash funds to be established out of cash receipts by any department/facility.
(3) A cash fund will not be established until a cash fund custodian has been designated by the department head/facility manager. Cash funds must have only one cash fund custodian responsible for managing cash funds. In the absence of the cash fund custodian, the supervisor is responsible for the control and management of cash funds.
(4) Should it become necessary to change fund custodians, the supervisor must notify the City Auditor and an audit of the cash fund be performed prior to transferring the cash fund to a new cash fund custodian. An audit of the cash fund will not be performed unless and until the new custodian is present.
(5) Upon receipt of the cash fund money, the new custodian will sign the custodian acknowledgment form maintained by the City Auditor.
(F) Termination of cash funds.
(1) When the need arises to close a municipal cash fund, the department head/facility manager shall notify the City Auditor that the cash fund is to be closed by providing a memorandum (email is acceptable) specifying the reason for the closure. At the point funds are to be relinquished, an audit of the cash fund shall be performed in the presence of the department head/facility manager or the municipal cash fund custodian. Any discrepancy from the proper balance shall be noted and addressed at that time. The City Auditor shall void and return the department head and custodian's signed cash handling policy employee acknowledgment form.
(2) Upon completion of the cash audit and relinquishment of the funds to the City Auditor or his/her designee, the cash will be deposited into the municipal depository and appropriate accounting entries recorded to reverse the recognition of the municipal cash funds on the general ledger.
(G) Security of cash funds.
(1) Funds must be secured in a safe when not being used operationally or receipts are not being prepared for deposit.
(2) Provisions should be made in departments where more than one cash fund exists to secure all funds that are not being currently utilized.
(3) Only the department head, cash fund custodian, and alternates should maintain keys and have access to municipal cash funds on hand and relinquished daily receipts when they are not in operational use or being prepared for deposit.
(4) Bank bags must be locked and kept out of sight when transporting municipal funds for deposit at the municipal depository.
(5) All cash funds must be reviewed for propriety randomly by the department head/facility manager.
(6) Petty cash funds shall remain secured until need arises to perform a transaction involving petty cash.
(7) Cash register drawers shall not be left unattended without the cash register being locked and the register's key removed and retained on the person of the responsible employee.
(8) Cash register drawers shall be removed from each cash register before the close of business each day, relinquished to the department head/facility manager, principle municipal cash fund custodian or on duty alternate, and placed in a vault or safe.
(H) Cash drawer guidelines.
(1) Cash drawers should generally be used for the following:
(a) Making change to the public; and
(b) Receiving payment for multiple types of transactions.
(2) Adequate receipts and documentation must be maintained to support all transactions made from the cash drawer.
(3) A cash drawer custodian may be revoked at the discretion of the City Auditor.
(I) Cash drawer balances.
Department | Fund Limit |
City Water Office | $300 |
City Tax Office | $200 |
City Administration | $100 |
City Parks Department | $500 |
(J) Overages and shortages. Both overages and shortages should be noted and tracked by the custodian and then reviewed and certified by a department supervisor. Significant amounts should be immediately reported to the department director and the City Auditor. If there appears to be a growing pattern or anything unusual or strange about the overages and shortages, that information must be disclosed immediately.
(K) Cash drawer procedures.
(1) Custodians of cash drawers shall issue a receipt to the customer for all transactions.
(2) The custodian shall for a specified period of time complete a cash reconciliation form for deposit with the City Auditor’s office and submission to the City Auditor's office and recording of revenue in the city's accounting system.
(3) If a discrepancy exists between the "total cash on hand" and the "valid cash balance", then the custodian needs to inform his/her supervisor, who then contacts the City Auditor's office. The discrepancy should be noted on the reconciliation with supervisor sign-off, if the unreconciled discrepancy is not known.
(L) Regulation of petty cash.
(1) Petty cash funds are used for expenditures of $100 or less made by a city employee.
(2) Adequate receipts and documentation must be maintained to support all transactions made from the petty cash fund.
(3) A petty cash fund or custodian may be revoked at the discretion of the City Auditor.
(4) The amount of the petty cash fund may be reduced at the discretion of the City Auditor.
(M) Established petty cash funds.
Department | Fund Limit |
None at this time | $0 |
(N) Establishing new petty cash funds. Departments wishing to establish a new petty cash fund shall contact the City Auditor.
(O) Closing a petty cash fund.
(1) If it is determined that an existing petty cash fund is no longer needed, the custodian must close the fund. The remaining cash and all receipts should be taken to the City Auditor's office for deposit.
(2) Contact the City Auditor's office to obtain the appropriate account information before the deposit is made. Supporting documentation will be forwarded to the City Auditor's office for reconciliation.
(P) Petty cash procedures.
(1) The requester shall complete the petty cash reimbursement form (attached to Ord. 2024-15). Describe the purchase/expenditure in the description/explanation area and enter the total amount requested for reimbursement. A receipt for the expenditure must be attached to this form. The form must be signed and dated by the requestor and approved by the City Auditor with his/her signature and the date.
(2) On a periodic basis, the custodian counts the currency and coins in the petty cash fund and sums the receipts in the petty cash fund file. The combined dollar value of the currency, coins and the receipts must equal the petty cash fund total assigned to the custodian. The custodian then completes a petty cash reimbursement form and a check request to reimburse the petty cash fund for the amount of the outstanding receipts.
(3) If a discrepancy exists between the total of the currency, coin and receipts and the petty cash fund total assigned to the custodian, the custodian needs to inform the City Auditor's office petty cash fund to ensure that sufficient currency and coin are on hand to reimburse employees for expenditures.
(1982 Code, § 35.66) (Res. 92-26, passed 12-7-1992; Ord. 2023-25, passed 8-17-2023; Ord. 2024-15, passed 4-11-2024)