Manage Petty Cash and Expenses · NSW DEPARTMENT OF EDUCATION Glossary of Terms 3 Cash Journal: The cash journal in SAP is used to manage minor out-of-pocket expenses within an organisation

NSW DEPARTMENT OF EDUCATION WWW.DEC.NSW.GOV.AU

eLearning

Manage Petty Cash and

Expenses

FIN0040 (updated August 2016)


Course Introduction

2

Welcome to the Manage Petty Cash and Expenses

(FIN0040) eLearning course.

This course has been designed to provide you with an

overview of petty cash management processes.

Having completed this course, you will be able to:

explain the split of petty cash management

responsibilities between schools and EDConnect

process petty cash claims

request for petty cash float recoups

perform period end petty cash activities

manage travel and general expense claims.

Course Duration: 135 minutes

Course Pre-requisite: nil

Course Introduction

Petty Cash Management

Petty Cash Claims

Automated Cash

Float Recoups

Manual Cash

Float Recoups

Petty Cash Period End

Activities

Course Summary

Manage Travel and Expense

Claims


Glossary of Terms

3

Cash Journal: The cash journal in SAP is used to manage minor out-of-pocket expenses

within an organisation. It can be used independently of other posting transactions. The

opening and closing balance of the petty cash float, as well any cash claims and float

recoups can be recorded and displayed.

Petty Cash Float: The petty cash float is a small cash fund that is kept in a secure location

on a school’s premises. It is used for the payment of minor out-of-pocket expenses.

Petty Cash Float Recoup: A petty cash float recoup is a deposit of funds into the petty

cash float to bring the float balance back up to the maximum threshold.



4

Having completed this module, you will be able to:

describe a petty cash float and what it is used for

explain how petty cash float management

responsibilities are split between schools and

EDConnect

explain the difference between a petty cash claim

and a general expense claim

Course Introduction


Petty Cash Claims

Automated Cash

Float Recoups

Manual Cash

Float Recoups


Activities

Course Summary


Claims


The petty cash float is a small cash fund that is kept in a secure location (eg a safe) on a

school’s premises. It is used for the payment of minor emergency or unexpected

expenses, such as:

student refunds not exceeding $20 (eg for cancellation of excursion)

lawn mower fuel

barbeque gas cylinder.

You will manage the petty cash float using the SAP cash journal. The main transactions,

which will be covered in this course, are:

posting a petty cash claim transaction in the cash journal

reversing and deleting entries in the cash journal

posting a recoup cheque in the cash journal to increase the float balance.

Petty Cash: Introduction

5

Note: Petty cash claims must be $100 or less. This

limit is set according to Treasury’s directions and

ensures that larger expenses are clearly tracked in

the system and are more transparent.


Petty Cash Management: Split of Responsibilities

6

Previously, you were responsible for the management of the petty cash floats eg

establishing and closing the float and notifying the bank of the changes to your

school’s cheque encashment signatories.

However, these responsibilities have shifted away from schools to EDConnect, who

will manage these responsibilities centrally.

This division of responsibilities is summarised in the table below.

Responsibilities

Schools EDConnect , Petty cash SSC Accounts Payable

Processing cash claims Float recoups

(automatically or manually)

Periodic float reconciliation (performed monthly as a minimum)

Processing manual float recoup requests

Updating float thresholds and closing floats

Updating banking partner with school cheque encashment signatory changes

Assisting schools if float is stolen

Generating cheques for manual and automatic cash float recoups


EDConnect, Petty cash is now responsible for the below and should be contacted in the

first instance for guidance on how to proceed:

Updating the minimum and maximum threshold of the petty cash float

Closing the petty cash float

If cheque encashment signatories at a school have changed, EDConnect will be

responsible for communicating these changes to the banking partner.

If there are any banking related issues (eg a cheque has not been processed

correctly).

Petty Cash: Maintaining the Banking Relationship

7

All banking

related-issues

should be

escalated to

EDConnect in the

first instance

rather than

contacting the

bank directly.


Petty Cash: Introduction to the SAP Cash Journal

8

The SAP cash journal is used to electronically manage a school’s petty

cash float. The system automatically calculates and displays the opening

and closing balances of the petty cash float, as well as showing all entered

transactions posted in the cash journal.

The cash journal is a single-screen transaction. Once you have logged into

the SAP Portal, you will be able to access both the Cash Payments and

Cash Receipts tab of the cash journal.

The SAP cash journal is used to process the following

transactions:

saving and posting cash journal entries

reversing incorrect cash journal entries

NSW DEPARTMENT OF EDUCATION WWW.DEC.NSW.GOV.AU 9

Petty Cash: Navigating to the Cash Journal This is the SAP cash journal transaction screen. Navigate to this screen by clicking

on Petty Cash, located under the Finance tab on the SAP Portal.

Hover over the red boxes for a

brief description of that section of

the screen. Specific transactions

are covered in the following

modules.


If you have a claimable out-of-pocket expense that is $100 or less (and the expense can

be claimed using petty cash), you can submit a claim to have it paid from your school’s

petty cash float.

If the out-of-pocket expense is more than $100, or it is not an expense which can be

claimed using petty cash, it needs to be claimed via the expense claim process.

The system has been configured so that if a claim for more than $100 is entered into the

cash journal, the following information message will appear on the screen.

Petty Cash Claims: Introduction

10


Petty Cash Claims

11


explain when cash claims from the petty cash float

can be made

explain how to process a petty cash claim

describe how the petty cash claim form should be

completed

Course Introduction


Petty Cash Claims

Automated Cash

Float Recoups

Manual Cash

Float Recoups


Activities

Course Summary


Claims


This is an overview of the petty cash claim process.

Petty Cash Claim: Process Overview

Employee

completes

claim form

Petty Cash Officer

(SAO/SAM) pays

cash to employee

Form rejected and sent

back to employee with

reason for rejection

Employee signs

form to confirm

receipt of cash

Petty Cash Officer

(SAO/SAM) enters

transaction into

cash journal

Attach

receipts and

tax invoices

Principal

(or financial delegate)

approves or rejects form

Petty Cash Officer

(SAM/SAO) certifies

form completed correctly


1

35

64

2

7

Petty Cash Claim: Completing the Claim Form (1/4)

This is an overview of a petty cash claim form which the employee completes in Excel.

EDConnect, Petty cash maintains the petty cash claim form and it is available to download

from the EDConnect Intranet.

Roll your cursor over the red boxes for details of the mandatory fields.


The employee prints the completed form and attaches all relevant supporting

documentation (eg receipts and tax invoices). The employee then hands the form to the

certifying officer .

Z

Note: If a receipt / tax invoice cannot be provided (eg

the receipt is a train ticket which has been collected),

a written declaration explaining the situation must be

provided. The declaration can be written on the back

of the form. The employee must sign the declaration.


The certifying officer signs the Petty

Cash Claim form to certify it has been

completed correctly.


Once the certifying officer has certified the form is completed correctly, it is sent to the

principal (or financial delegate) for approval.

Before approving the request, the principal (or financial delegate) must check:

Petty cash claim details completed correctly

Petty cash claim is within $100 limit per transaction

All supporting documentation is attached and reconciles with amount being claimed

The principal (or financial delegate) signs and dates the Approval box (see below).

Once the form has been approved, the cash is paid to the employee. A note is made on the

form to indicate that the employee’s claim has been PAID.



The petty cash officer (SAM/SAO) inputs the petty cash claim transaction into the

cash payments tab of the cash journal. The petty cash officer (SAM/SAO) then posts

the transaction in the cash journal.

Once the transaction has been posted, the document status will become green.

16

Petty Cash Claim: Cash Journal Entries (1/2)

The petty cash officer (SAM/SAO) files the petty cash claim form and

supporting documentation according to DoE document repository policy. This

ensures the documents are readily available if needed for audit or account

reconciliation purposes.

Posted

Not posted


Common cash claim transactions are set up in the cash payments tab with a transaction

number. Each of these transactions is linked to a GL account except where noted (see

table).

Petty Cash Claim: Cash Journal Entries (2/2)

17

Transaction 1

If all other transaction

numbers are not suitable

transaction 1 should be

used. The user can select

an appropriate GL account

manually (ie no default GL

account).

Transaction 3

Student refund

transactions are entered

via the EBS interface

(which interacts with the

cash journal). GL account

will be defaulted according

to EBS system setup.


Automated Cash Float Recoups

18


explain the following concepts:

minimum threshold

maximum threshold

current float balance

recoup amount.

explain the automated recoup process and when it is

triggered

save and post the appropriate cash journal entries.

Course Introduction


Petty Cash Claims

Automated Cash

Float Recoups

Manual Cash

Float Recoups


Activities

Course Summary


Claims


Automated Float Recoup: Introduction

19

When the cash available in the petty cash float is low, the petty cash float needs to be

replenished. The process for replenishing the petty cash float is an automated process.

Each petty cash float has a set minimum and maximum threshold. The minimum and

maximum threshold for each float is maintained in SAP by EDConnect, Petty cash

If, for any reason, float thresholds need to be updated, please contact EDConnect,

Petty cash ([email protected]) in the first instance.

This automated process is triggered when the petty cash float balance falls below a set

minimum threshold. The recoup amount is the amount needed to bring the current

float balance back up to the maximum threshold.

$500

Maximum

Threshold

$100

Minimum

ThresholdCurrent Float

Balance

$50

Recoup Amount

$450

School APetty Cash

Float

$0

mailto:[email protected]


Automated Float Recoup: Process Overview (1/4)

20

This is an overview of the

automated process for

replenishing the petty cash float

via the SAP Portal.


When the petty cash office (SAO/SAM) enters a cash claim transaction into the cash

journal, the balance of the petty cash float will update automatically.

If the float balance needs to be recouped to the maximum threshold, a pop-up message

will appear. If a float recoup is required, the petty cash officer (SAM/SAO) should

click “yes” on the pop-up message.

By clicking “yes”, a Workflow document is created and sent to the principal (or financial

delegate) for approval. The approver should never approve a float recoup request

without reviewing all supporting documentation for the request.


21

Note: If the petty cash officer (SAM/SAO)

accidentally clicks “yes” and a float recoup is not

required, inform the approver immediately. They can

reject the parked invoice sitting in Workflow.


Once the recoup request has been approved, Accounts Payable will generate a recoup

cheque in their next payment run and send it to the requesting school.

Previously the cheque was made out to the individual who was authorised to cash the

cheque. However, the cheque is now made out to ‘Petty Cash <School Name>’ for

consistency across the schools.

When the cheque is received, two authorised cheque encashment signatories (or,

following policy for a small school, one authorised signatory) must sign the back of the

cheque and write “please pay cash” above their signatures. Bank of Schools

26 November 2013

Pay _________Petty Cash School A___________

The amount of _____Nine hundred dollars only--

____JennieLau_____

2134200848-12230810-1238702430

$900.00- Please pay cash


Note: The names of the authorised cheque

encashment signatories must have been provided to

the local branch of the banking partner by the

EDConnect.


The cheque is taken to a nominated

bank branch by an authorised person

to have it cashed.

At the bank, the person cashing the

cheque must produce two forms of

identification, including one form of

photo identification.

23

A complete denomination breakdown

of the proceeds of the cheque is to be

taken with the cheque to the bank.


The cheque must be posted in the cash journal within 48 hours of cashing the cheque.

The cheque is posted in the Cash Receipts tab of the cash journal in the SAP Portal.


Manual Recoup Requests

24


explain the manual recoup process and when it is

required

save and post the appropriate cash journal entries.

Course Introduction


Petty Cash Claims

Automated Cash

Float Recoups

Manual Cash

Float Recoups


Activities

Course Summary


Claims


Manual Float Recoup: Introduction

Generally, a recoup will take place automatically when the float balance falls below the

minimum threshold. However, in extenuating circumstances it may be necessary to

manually request for a recoup.

Examples of situations where a manual request may be necessary include:

A temporary system or network outage is preventing the Petty Cash Officer

(SAM/SAO) from being able to replenish the float automatically through the SAP

Portal and a recoup was urgently required.

A fundraising activity (eg fete) is taking place on the weekend and the amount of

funds available in the float needs to be increased temporarily to meet additional minor

expenses.

A manual recoup process may take up to one week to process, and schools should not

request a float recoup manually except where absolutely necessary.


Manual Recoup Process: Process Overview

This is an overview of the manual float recoup process. The Petty Cash Officer (SAM/SAO)

completes a petty cash recoup form, which is emailed to the principal (or delegate) for

approval. If the form is rejected, it is sent back to the Petty Cash Officer for updates. Once

updates have been made, it will have to be re-submitted.


Manual Recoup Request Form (1/3)

27

This is an overview of a petty cash recoup form that the petty cash officer (SAM/SAO)

completes. EDConnect, Petty cash maintains the petty cash recoup form and it is available

to download from EDConnect website.


Manual Recoup Request (2/3)

28

Once the petty cash officer (SAM/SAO) has completed the form, they sign on the

‘Cashier’ line and write the date the form was prepared.

The principal or financial delegate (checking officer) checks:

Legitimate reason for request

Form is completed correctly

Total amount of cash claims equals total recoup request amount

All relevant cash claims have been posted as transactions in the cash journal

Once the principal or financial delegate is satisfied all criteria has been met, they

complete and sign this section of the form.


Manual Recoup Request Form (3/3)

29

The approved request is emailed to EDConnect

, Petty cash

([email protected]),

along with a scanned copy of the cash journal

for processing.

EDConnect , Petty cash will review the request

and forward to Accounts Payable. A recoup

cheque is generated in the next payment run.

Note: If the school does not have a scanning

facility, they can mail a hard copy to EDConnect ,

Petty cash.

The principal (or a financial delegate) also completes, dates and signs this section of

the form.



Petty Cash Period End Activities

30


explain the various petty cash period end activities

that need to be performed

run a petty cash journal report

reverse and delete incorrect petty cash

transactions.

Course Introduction


Petty Cash Claims

Automated Cash

Float Recoups

Manual Cash

Float Recoups


Activities

Course Summary


Claims


This is a checklist of the activities that should take place on a monthly basis (as a

minimum).

Period End Check List:

Reconciling the petty cash float

Ensuring all petty cash transactions have been posted in the cash journal

Ensuring all recoup cheques are banked and receipts are entered into the system

Reversing incorrect petty cash transactions

31

Period End Activities: Check List


Period End Activities: Reconciling the Petty Cash Float

32

At the end of the period, the SAM or the SAO should tally up the physical cash balance

with the balance of the cash journal.

The sum of the current cash journal balance and cash journal transactions (excluding any

recoup requests) should equal the maximum threshold limit of the petty cash float.

If you are unsure of what the maximum (or minimum) threshold for a particular cash journal

is, please email EDConnect , Petty cash ([email protected]).



If the sum of the physical cash balance and all cash journal transactions (excluding float

recoup transactions) do not equal the maximum threshold of the float, the petty cash

officer (SAM/SAO) will need to identify instances where:

A cash claim that has been paid but has not been entered into the cash journal

A transaction has been entered into the cash journal twice

When conducting the petty cash float reconciliation, note that once transactions have

been saved, the float balance will update automatically (ie the transaction does not have

to be posted before the balance is updated).

Period End Activities: Post all cash transactions

33


Another reason why the cash journal report may not reconcile with the physical cash

balance may be because not all received cheques have been banked. Alternatively, the

cheque may have been cashed, but an entry was not made in the cash journal.

The petty cash officer (SAM/SAO) should check and ensure that all recoup cheques

have been banked and that the correct value for the cheque has been entered into the

cash journal.

All recoup cheques should be posted within 48hours of cashing the cheque. The

recoup transaction should never be posted in the cash journal until the cheque

has been cashed.

Period End Activities: Bank all cheques

34

Bank of Schools

26 November 2013

Pay _________Petty Cash School A___________

The amount of _____Nine hundred dollars only--

____JennieLau_____

2134200848-12230810-1238702430

$900.00-


In the SAP Portal, there is the option of reversing incorrect transactions.

Period End Activities: Process Incorrect Transactions

35


Manage Travel and Expenses

36


explain the process for submitting a general

expense claim

explain the process for submitting a travel expense

claim

explain the process for requesting to be set up as a

vendor in SAP.

Course Introduction


Petty Cash Claims

Automated Cash

Float Recoups

Manual Cash

Float Recoups


Activities

Course Summary


Claims


Petty cash claims are available for minor expenses $100 or less, however, submitting an

expense claim is preferable.

For out-of-pocket expenses above $100, an expense claim must be submitted.

There are two types of expense claims:

General expense claims

Travel expense claims

This module provides an overview of the general and travel expense claims processes.

Manage Travel and Expense: Introduction

37

Note: Expense claims are only used for out-of-

pocket expenses. All regular purchases are done

via a shopping cart (purchase order).


Before a general or travel expense claim can be processed, an employee must be set

up in SAP as a vendor. This allows EFT payments to be generated for them.

Once an employee is set up as a vendor in SAP, they will not need to do this again.

To request to be set up as a vendor in SAP, the employee completes an Employee

Vendor Maintenance form (available on the Intranet). The completed form is emailed to

the Master Data Management team for processing

([email protected]).

.

Request Employee Vendor in SAP: Process Overview

38



Travel and General Expense Claims: Process Overview

(1/3)

39

This is an overview of the process for travel and general expense claims. Once the

claim is approved it is scanned and sent to Accounts Payable

([email protected]) with receipts and tax invoices for

processing.

Hard copies of the form and supporting documentation (i.e. receipts and tax invoices) are

filed at the school according to DoE document repository policy.

The Travel and Expense claim form is available on the SSC intranet.



Authorising travel and general expense claims

The Authority to incur expenditure and the Authority to authorise payment must be two

different people, they cannot be the claimant and must be someone in a senior role to

the claimant.

Authorising Payment of a claim is an important step in checking overall accuracy and

completeness. The Authorising Officer should:

• Check the expenditure was approved prior to it being incurred and ensure evidence of

the approval is attached to the claim

• Confirm that supply has been satisfactorily performed and the amounts charged are

in accordance with what was agreed

• Check that the calculations and account codes are correct (including GST amounts

and tax codes) as per the supporting documentation

• Check that the claim has not been previously paid and that available discounts have

been taken.


(2/3)

40


Travel expenses: Additional information

Only individuals who are authorised to travel (I.e. Authority to travel form is completed)

can claim travel expenses.

All of the required forms (listed below) are available on EDConnect Intranet:

Authority to Travel

Travel Diary

Travel and General Expense Claim


(3/3)

41


Manage Petty Cash and Expenses: Contacts Checklist

42

Issue Contact

General Queries EDConnect by submitting an online query available on EDConnect

Intranet site or phoning EDConnect – 1300 32 32 32

Float Recoups (Automatic or

Manual)

EDConnect , Petty cash ([email protected])

Establishing Petty Cash Floats EDConnect , Petty cash ([email protected])

Updating Petty Cash Floats

(ie minimum and maximum

thresholds, number of days

between recoups)


Updating school cheque

encashment signatories


Stolen Petty Cash Float EDConnect , Petty cash ([email protected])

Travel & General Expenses Accounts Payable General or Travel Expenses

([email protected])

[email protected]

Set up employee as vendor in SAP Master Data Management ([email protected])

https://servicemanagement.det.nsw.edu.au/kinetic/DisplayPage?name=Identify_Client&form=SSC_Online_Query










Course Summary

43

You have completed the FIN0040 Manage Petty Cash and

Travel Expenses eLearning course.

Having completed this course, you will be able to:

explain the split of petty cash management

responsibilities between schools and EDConnect

process petty cash claims

request for petty cash float recoups

perform period end petty cash activities

manage travel and general expense claims.

Course Introduction


Petty Cash Claims

Automated Cash

Float Recoups

Manual Cash

Float Recoups


Activities

Course Summary


Claims


Additional Reference Materials

Reference Material

LMBR intranet page: https://education.nsw.gov.au/lmbr

Additional Support

EDConnect:

https://detwww.det.nsw.edu.au/lists/directoratesaz/edconnect/index.htm

EDConnect: 1300 32 32 32

EDConnect , Petty cash: [email protected].

44

https://education.nsw.gov.au/lmbr

Documents

Manage Petty Cash and Expenses · NSW DEPARTMENT OF EDUCATION Glossary of Terms 3 Cash Journal: The cash journal in SAP is used to manage minor out-of-pocket expenses within an organisation