Financial Procedures - Cash & Banking Procedures
Clare CollegeFinancial Policies and ProceduresCash & BankingProcedures1 Page
Clare CollegeCash & Banking ProceduresContents1.Banking Procedures1.11.21.31.41.5Receipt of cash and cheques within a departmentStorage/security of cash and cheques within a departmentCollege bank accountsBanking of sterling cash and chequesBanking of foreign cheques2.Debit and Credit Card epting card paymentsPCI DSS CompliancePDQ TerminalsRefundsChargebacksDocument retentionPreventing fraudStaff training and recording3.Petty Cash3.13.23.33.43.53.6Purpose of petty cashConditions for using petty cashDepartment request for a petty cash floatPetty cash imprest systemReconciling the imprest systemReplenishing the petty cash floatAppendix A – Petty cash imprest form2 Page
Clare CollegeCash & Banking Procedures1. Banking Procedures1.1 Receipt of cash and cheques within a departmentAll cheques must be made payable to Clare College.It is the responsibility of the Head of Department to establish procedures whichensure that all cheques and cash received are given intact (i.e. no deductions) withinone week, or more often if the sums received exceed 250, to the Bursary forbanking.The following are not permitted from any cash takings/receipts:The cashing of personal cheques even if the intention is to reimburse the floatlaterThe topping up of any petty cash floatThe payment of travel expenses or advances to employeesThe payment to individuals for services supplied (e.g. payments to visitors fortravel expenses)The payment of external suppliers for services renderedPost dated chequesWe should only accept post-dated cheques if it is unavoidable and only after referralto the Finance Manager.1.2 Storage/security of cash and cheques within a departmentAll monies should be taken promptly to the Bursary as detailed in 1.1 anddepartments are responsible for ensuring cash and cheques are kept secure untilthey are handed over. Amounts up to 250 cheque/cash combination can be held ina locked drawer/cabinet in a secure office overnight. Amounts greater than this mustbe kept in a safe.Lost or missing cashIn the event of cash being lost, missing or stolen, the Finance Manager must benotified immediately who will then inform the Bursar.1.3 College bank accountsThe College currently has three bank accounts for paying in funds with Barclays:Bursar’s accountTutor’s accountDevelopment account3 Page
Clare CollegeCash & Banking ProceduresAll College income, including donations, must be paid promptly into a College bankaccount and must be recorded in the College accounting system. Employees of theCollege have no authority to open bank accounts for the College.1.4 Banking of sterling cash and chequesAll banking of cash and cheques is done through the Bursary. They will completepaying books, record the income on the accounting system and bank the cash andcheques into Barclays Bank.1.5 Banking of foreign chequesWherever possible all transactions and receipts should be requested in poundssterling. All foreign cheques will be taken to Barclays Bank for negotiation by theBursary. Any bank charges and exchange rate differences will be a cost to thedepartment.2. Debit and Credit Card Receipts2.1 IntroductionAn efficient method of receiving payments is to accept debit or credit cards. Thissection covers the procedures and legal requirements the College must adhere to.2.2 Accepting card paymentsThere are two different ways to accept card payments. Transactions can beaccepted where:a. the card holder is present; orb. the details of the card are entered manually (card holder not present).‘Card-present’ and ‘Card-not-present’ refers to whether the customer has presentedthe card for processing in person and is required to either enter their chip-and-pinnumber or sign a form.We accept all major cards such as Visa, MasterCard, Maestro and Solo.Under no circumstances must card details be accepted by either email or via anetworked fax.4 Page
Clare CollegeCash & Banking ProceduresSurcharges for paying by cardAt each terminal there will be a notice displayed (under Payment ServicesRegulations 2009) clearly stating surcharges to be made as follows:Card TypeSurchargeDebit cardsFreeCredit cardstransaction value up to 100Set fee of 3.00 per transactionCredit cardstransaction value over 100.013% of amount of each transactionIf the card holder is not present then these surcharges must be communicated andaccepted before processing the payment.2.3 PCI DSS ComplianceThe Payment Card Industry Data Security Standard (PCI DSS) is a worldwideinformation security standard defined and published by the Payment Card IndustrySecurity Standards Council. The standard was created to help prevent payment cardfraud through increased controls around the data and its exposure to compromiseand applies to all organisations that hold, process or exchange cardholderinformation.It is our responsibility to ensure card details and personal data on customers arestored securely by us (and any third party which stores, transmits or processes suchcard data on our behalf) and only used for the purposes intended. The cardholdermust be able to feel confident the College is taking all necessary measures tosafeguard their personal details.Card details must never be transmitted through email as this is considered anunsecure environment.The College must meet these PCI DSS standards at all times to remain a member ofthe card scheme and to ensure that we can continue to have the ability to processcard payments. An annual audit is carried out based on our Merchant Level which isdependent on the number of card transactions processed per year.2.3.1 The PCI DSS StandardsThe standards are detailed in full on the PCI website athttps://www.pcisecuritystandards.org/ but thy can be summarised into the following12 requirements:5 Page
Clare CollegeCash & Banking ProceduresBuild and Maintaina secure Network12Install and maintain a firewall configuration toprotect cardholder data.Do not use vendor-supplied defaults for systempasswords and other security parameters.Protect CardholderData34Protect stored cardholder data.Encrypt transmission of cardholder data acrossopen, public networks.Maintain a VulnerabilityManagement Program5Use and regularly update anti-virus software orprograms.Develop and maintain secure systems andapplications.6Implement StrongAccess ControlMeasures789Regularly Monitor andTest Networks101112Restrict access to cardholder data by businessneed to know.Assign a unique ID to each person with computingaccess.Restrict physical access to cardholder data.Track and monitor all access to network resourcesand cardholder data.Regularly test security systems and processes.Maintain a policy that addresses informationsecurity for all personnel.2.3.2 The College PolicyThe Bursar is responsible for ensuring the College is PCI DSS compliant and itspolicy includes the following: The College will undertake a PCI Compliance review on an annual basis.If anyone identifies that this policy is compromised or is at risk of compromisethis must be reported to the Bursar immediately.All staff who handle either customer present or customer not present cardtransactions in any form must undertake PCI Compliance training on anannual basis.All customer present card transactions must take place using a PCI compliantelectronic point of sale system.Customer not present card transactions should be limited and other paymentmethods used if available.Card and/or cardholder details must not be stored or transmitted electronically(other than through the Colleges on-line facilities). This includes emailing andscanning of paper copies.6 Page
Clare CollegeCash & Banking Procedures If there is a valid requirement to scan documents that also contain cardtransaction details, the card details must be obliterated using an indeliblemarker pen before scanning.Where possible, any paper notes/or paper copies containing card transactiondetails must be destroyed (cross shredded) immediately after use.Where paper copies containing card transaction details need to be retainedfor a valid reason i.e. chargebacks, they must be retained in a secure, lockedcabinet or room at all times.The retention period for all paper copies containing card transaction details is :- Merchant copies should be kept for a minimum of 6 months (this is thetime limit with which chargebacks can be registered).- Beyond this, copies should be kept for a further 12 months(i.e. TOTAL storage time equals 18 months for the date of transaction)-File by date of transaction.2.4 PDQ TerminalsPDQ (Process Data Quickly) terminals enable credit or debit cards to be used in aswipe card reader that is Chip and PIN (Personal Identification Number) enabled. Itis a secure method of taking payments when the customer is present. The terminalsmay also be used for taking card payments when the customer is not present.2.4.1 Taking payments when the customer is not presentCustomers should be told not to send their card details by e-mail instead they maygive the information over the phone, by fax or by post. Care must be taken to ensurethat these details are kept secure at all times.The person authorised to use the PDQ terminal manually enters the necessarycustomer and card details. It is imperative the department takes upmost care toensure the transactions receive Authorisation and the customer card data matches.2.4.2 Daily task for the departmentAt the end of each working day which included a PDQ terminal transaction, thedepartment must take a Z-reading to ‘clear’ the terminal and give a daily transactiontotal. This till slip must be attached to the relevant sales slips from the day andpassed to the Bursary on the following day.2.4.3 Storage of the terminal and supervisor cardDuring normal working hours, the terminal should not be left unattended unless it isin a secured environment (i.e. locked office).7 Page
Clare CollegeCash & Banking ProceduresBoth the PDQ terminal and the supervisor card must be stored in a secure manner inwhich unauthorised persons cannot access it out of working hours. It must not beswitched off as Barclaycard may need to send notifications and updates during theevening.2.5 RefundsThere will be occasions when it Is necessary to refund a payment charged to acustomer’s card is necessary e.g. cancellation of a conference booking.Refunds must be made in the same manner as the original payment e.g. customercannot be refunded by cash or cheque if the original payment was made by credit ordebit card. The same card should be used for the refund.If the card holder is present, follow the instructions provided in the Terminal’s UserGuide which will include the customer entering their PIN to verify the transaction.If the card holder is not present, follow the instructions provided in the User Guideand ensure the customer receives the customer-copy of the refund receipt.If the original payment card has expired/been stopped then please contact the cardholder.2.6 ChargebacksA chargeback is the return of funds to a customer which is forcibly initiated by thecustomer’s card provider. Card customers have a right to make a chargebackagainst the payment up to six months from the original transaction date.Chargebacks may occur when the card holder does not recognise a transaction ontheir bill (i.e. in the case of identity fraud or clerical error) or if they claim that theyhave never received the goods or service. The customer will query the transactionwith their card provider who will credit their bill with the value if the vendor is not ableto prove the sale was valid.When chargebacks are made against the College, Barclaycard will contact theBursary with some details of the transaction. They will provide the original date, thevalue and some of the card number. They will NOT provide the name of the cardholder – therefore, PDQ receipt must not be filed by the customer’s name (see 2.8).8 Page
Clare CollegeCash & Banking ProceduresThe Bursary will trace the transaction and contact the relevant department for furtherdetails on the transaction. The College will have 10 days to reply to Barclaycard withthe necessary documentation to prove the transaction was valid.2.7 Document RetentionThe security of card and customer data is mandatory to ensure the College is PCIDSS compliant.2.7.1 What information must NOT be stored at any time? The contents of the magnetic stripe also known as Track 2 Data.The Card Verification Value or CVV contained in the magnetic stripe.The Card Verification Value contained in the magnetic stipre image in the chipknown as the iCVV.The Card Security Code also known as CVV2 printed on the back on the cardin or next to the signature pane.The PIN Verification Value or PVV which is contained in the magnetic stripe.Passwords or pass phrases.2.7.2 What information must be stored securely?Any information that is used to authenticate a card payment including but notlimited to: the card number expiry date issue number any other unique data supplied as part of the card paymentAny information that could identify individual card holders and their purchasesincluding: name address purchase description amount other details of the card payment2.7.3 Physical StorageWhere paper copies containing card transaction details need to be retained for avalid reason i.e. chargebacks, they must be retained in a secure, locked cabinet orroom at all times.Store documents in original transaction date or card number order. If there is a queryrelating to a transaction, Barclaycard will not provide the customer’s name. Copy9 Page
Clare CollegeCash & Banking Procedurescredit card receipts must not be sent back to the customer unless part of the creditcard is obscured.2.7.4 Electronic storage – NO!Card and/or cardholder details should not be stored or transmitted electronically.This includes emailing and scanning of paper copies.If there is a valid business requirement to scan paper copies of documents whichalso contain card transaction details, the card details must be obliterated using anindelible marker pen before scanning. Where possible, any paper copies containingcard transaction details must be destroyed (cross shredded) immediately after use.2.7.5 Period of retentionMerchant copies of transactions must be retained in a secure and accessible placefor minimum period of 6 months. Customers can action a chargeback against atransaction during this time. For internal audit purposes, transaction details should beretained for a further minimum period of 12 months.i.e. TOTAL storage time is 18 months from the date of the transactionNote, if you have made a rough paper note of any card details prior to entering theminto a PDQ machine or on a template form these should be securely destroyed oncedetails have been transferred.2.8 Preventing FraudWe all have a part to play in the prevention of card fraud so always be vigilant.When the cardholder is present and the card is issued with a title, ensure thecustomer matches the title (e.g. ‘Mr.’ is printed on the card, and the customer ismale). If you suspect there is an attempted fraud, contact the Finance Manager withfull details of the transaction and for advice on what steps need to be taken.2.9 Staff Training and RecordingIt is important that all staff involved with the accepting of card data either when thecustomer is present with their card or not is aware of these procedures outlined inthis chapter and the PCI Standards. This includes all shift, seasonal, permanent andtemporary workers.The Department should maintain a list of all those currently authorised to use PDQterminals.10 P a g e
Clare CollegeCash & Banking ProceduresAll staff should on an annual basis complete ‘refresher training’ to remind themselvesof the standards and protocols that must be adhered to. In addition any new staffshould receive training on the requirements as part of their induction.3. Petty Cash3.1 Purpose of petty cashThis procedure aims to ensure:There is an accurate account of all petty cash expenditureControl is maintained over both the nature and level of expenditureSecurity measures are in place to minimise the potential for fraud/misuse ofpetty cashThe College Bursary holds petty cash which is available to all Departments under theconditions for using petty cash as detailed below in section 2.2.Some Departments may request to hold a petty cash float (normally up to amaximum of 100) – see section 2.3.3.2 Conditions for using petty cashPetty cash must be used exclusively for expenditure directly relating toCollege business. Under no circumstances must petty cash be used to makepayments to external suppliers for services rendered.Petty cash must not be used to reimburse mileage or other travel costs. Inthese cases College Expense forms should be used.Petty cash must not be used for personal expenditure even if the intention isto reimburse the float later.Payments from petty cash shall be limited to items of expenditure below thecost of 25.All payments from petty cash must be supported by a receipted voucher.Expenditure claimed should always be authorised by someone other than theclaimant (Head of Department or College Officer).Claimants receiving reimbursement must sign for receipt of monies.Staff responsible for the petty cash float must ensure the records are alwaysup to date.Petty cash floats will not be replenished until all coding information is up todateThere must be monthly independent checks of petty cash balances and use.Heads of Department are responsible for the security of any float and forensuring that all expenditure is properly supported and authorised.Departments are required to certify their petty cash float at the end of thefinancial year.11 P a g e
Clare CollegeCash & Banking Procedures3.3 Department request for a petty cash floatRequests for a petty cash float and any permanent, or temporary, increase toan existing float must be made in writing by the Head of Department to theFinance Manager clearly stating the amount of petty cash float required (thisis normally a maximum of 100).The Finance Manager will review the request and if approved inform the Headof Department to collect the float from the BursaryThe Bursary will maintain a list of each department’s petty cash limit.3.4 Petty cash imprest systemEach department will need to establish a Petty Cash Imprest System for recording allpetty cash received in and paid out.A summary of the details for each petty cash transaction completed should betransferred to the Imprest Form (Appendix A), which is used for replenishing thepetty cash float and as a basis for the Bursary to prepare a journal to post thetransactions on to the accounting system.3.5 Reconciling the imprest systemAs part of the department’s month end procedures the petty cash imprest systembalance must be reconciled to the actual cash in hand and signed off by the Head ofDepartment.3.6 Replenishing the petty cash floatA copy of the completed imprest form and all accompanying receipts should bepassed to the Bursary within the first week of the following month. They will checkthis form and replenish the float up to the agreed limit. The Bursary will refuse toreplenish floats if discrepancies with the imprest form are found, pending approvalfrom the Finance Manager.In cases where there has been no activity for a period of three months or more, thenthe department, together with the Finance Manager, should re-assess the need forand the level of a float.12 P a g e
Clare CollegeCash & Banking ProceduresAppendix APETTY CASH IMPREST FORMDEPARTMENTDateCost CodeAmountDescriptionTOTALCASH IN HANDBalance of cash in hand checked & found correctTOTAL IMPRESTSigned (Head of Dept)13 P a g e
Cash & Banking Procedures 1. Banking Procedures 1.1 Receipt of cash and cheques within a department All cheques must be made payable to Clare College. It is the responsibility of the Head of Department to establish procedures which ensure that all cheques and cash received are given intact (i.e. no deductions) within
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