CORPORATE INTERNAL AUDIT DEPARTMENT (CIAD)

91 Fendler Street, East Tapinac, Olongapo City Tel. No.: (047) 222-3992

Reference No.:
09-IAD-SYS-08-0003-MA

Date:
August 26, 2009

Subject Title:
FINANCE POLICY

Subject:
REVISED PETTY CASH FUND POLICY
I. INTRODUCTION

Effectivity Date: _____________________

PETTY CASH is a small amount of discretionary funds in the form of cash used for expenditures where it is not sensible to make the disbursement by check, because of the inconvenience and costs of writing, signing and then cashing the check. The most common way of accounting expenditures is to use the imprest system. The initial fund would be created by issuing a check for the desired amount. The entry for this initial fund would be to debit Petty Cash and credit cash. As expenditures are made, the custodian of the fund will reimburse employees and secure a petty cash voucher in return. At any given time the total of cash on hand plus reimbursed vouchers must equal the original fund. A PETTY CASH FUND may be established in a strategic business unit (SBU)/support services unit (SSU) when there is evidence that a continuing cash advance should be kept on hand to permit the purchase of low-value supplies and services that cannot be purchased under the low-value. Each business unit/support services unit places its own restrictions on the petty cash funds established on its accountability, including the amount of cash in the fund and the peso limit per expenditure. Each fund must be used strictly in accordance with the purpose for which it was authorized.

II. ESTABLISHMENT OF PETTY CASH FUNDS The Office of the President has the sole authority to designate an SBU/SSU to who shall have petty cash funds, the specified amount of each fund including increases or decreases in the funds, and the peso limit per expenditure.

III. POLICY SCOPE This policy applies to all the SBU and SSU. Recommending approval: Concurred by ACCTG MGRs: Approved by:

Audit Manager

President/CEO

CORPORATE INTERNAL AUDIT DEPARTMENT (CIAD)

91 Fendler Street, East Tapinac, Olongapo City Tel. No.: (047) 222-3992

Reference No.:
09-IAD-SYS-08-0003-MA

Date:
August 26, 2009

Subject Title:
FINANCE POLICY

Subject:
REVISED PETTY CASH FUND POLICY
IV. POLICY PRINCIPLES A. Designation of Custodian

Effectivity Date: _____________________

A custodian of the fund, who is directly responsible for the safekeeping and disbursement of the cash, must be appointed by the SBU Manager/SSU Manager. The original check written to establish the fund, and checks written to replenish it, are made payable to the custodian of the fund. Written instructions detailing procedures that must be followed in using petty cash funds should be provided to the custodian. The following are the authorized petty cash funds for SBU/SSU. SBU/SSU Bingo Party Bingo Party E-Bingo PEGS 1 PEGS 2 PEGS 3 Lotto Sams Pizza Executive Office HRD CIAD/MIS Accounting TAC Marketing Department TAC Marketing Department Sams/CKG CKG- Subic Grand Seas CKG-Greenhills Lane Authorized Petty Cash Fund 8,000.00 5,000.00 5,000.00 5,000.00 5,000.00 2,000.00 15,000.00 4,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 8,000.00 2,000.00

B. Accountable Forms involved 1. The CAF (Cash Advance Form) and the LS (Liquidation Statement) are forms captioned in one piece for easy and efficient management of forms. (Please refer to Annex 1 for the sample CAF and LS). Recommending approval: Concurred by ACCTG MGRs: Approved by:

Audit Manager

President/CEO

CORPORATE INTERNAL AUDIT DEPARTMENT (CIAD)

91 Fendler Street, East Tapinac, Olongapo City Tel. No.: (047) 222-3992

Reference No.:
09-IAD-SYS-08-0003-MA

Date:
August 26, 2009

Subject Title:
FINANCE POLICY

Subject:
REVISED PETTY CASH FUND POLICY

Effectivity Date: _____________________

2. CAF and LS are serialized forms. Each CAF goes along with LS of the same series. 3. CAF must be accomplished in requesting for petty cash. The CAF will be perforated when requesting for petty cash and when liquidating same series LS will be perforated.

C. Petty Cash Disbursements 1. Expenses paid from a petty cash fund can only be made for the purpose(s) for which the fund was authorized and must be supported by receipts. 2. Peso limit expenditure must not exceed PhP500.00. Disbursements more than such amount qualifies for check disbursement not petty cash. 3. A CAF (Cash Advance Form) must be accomplished to request for cash advance for petty disbursements. This shall be accomplished in 2-copies distributed as follows: Original Copy Duplicate Copy Petty Cash Custodian Requesting Employee

4. LS (Liquidation Statement) must be prepared in liquidating the cash advance. Supporting receipts attached to it. 5. Replenishment shall be based on LS and supported with receipts. 6. Petty cash fund shall not be used to pay labor expenses. 7. Cash advances in the petty cash fund must be liquidated within 2 working days. 8. None liquidation within the prescribed period shall be automatically charged to the requesting employee. 9. The total receipts plus the cash on-hand must equal the specified authorized petty cash fund at all times. Recommending approval: Concurred by ACCTG MGRs: Approved by:

Audit Manager

President/CEO

CORPORATE INTERNAL AUDIT DEPARTMENT (CIAD)

91 Fendler Street, East Tapinac, Olongapo City Tel. No.: (047) 222-3992

Reference No.:
09-IAD-SYS-08-0003-MA

Date:
August 26, 2009

Subject Title:
FINANCE POLICY

Subject:
REVISED PETTY CASH FUND POLICY

Effectivity Date: _____________________

D. Replenishment 1. Fund replenishment shall be made immediately once the fund is 60% consumed. 2. Check shall be on the name of the petty cash fund custodian. 3. PRF (Payment Request Form) must be prepared on top of the Summary of Petty Cash Liquidation with attached supporting vouchers and other documents. 4. Accounting Department and/or CIAD have the authority to deny, reject and exclude expenses that they deem are not acceptable hence shall not be replenished and automatically charged to concerned employee.

E. Physical Security When not in use, the funds currency must be place in a safe or a locked receptacle, which is kept in a properly secured area. In the event of a theft, the loss must be reported to the manager.

F. Change in custody of fund 1. When custody of a petty cash fund is to be transferred to another custodian, the manager must accomplish PCCCF (Petty Cash Change of Custodian Form). The purpose of the PCCCF is to document that the manager has approved the change of custodian, that the total of the cash and the receipts equal the specified amount of the fund, and that the new custodian is aware of his or her specific responsibilities related to custody of the fund. 2. PCCCF must be accomplished in quadruplicate copies to be distributed as follows: Original Copy Accounting Duplicate Copy HRD Recommending approval: Concurred by ACCTG MGRs:

Approved by:

Audit Manager

President/CEO

CORPORATE INTERNAL AUDIT DEPARTMENT (CIAD)

91 Fendler Street, East Tapinac, Olongapo City Tel. No.: (047) 222-3992

Reference No.:
09-IAD-SYS-08-0003-MA

Date:
August 26, 2009

Subject Title:
FINANCE POLICY

Subject:
REVISED PETTY CASH FUND POLICY
Triplicate Copy Quadruplicate Copy -

Effectivity Date: _____________________

CIAD Tracer File

3. PCCCF must be duly approved by the GM. 4. If the fund consists of cash and unreimbursed receipts, a replenishment check should be requested so that the full amount may be turned over in to the new custodian.

G. Internal Control Procedures 1. A surprise cash count of each petty cash fund, including a review of the documents on hand, must be performed periodically by the CIAD. 2. A CCS (Cash Count Sheet) shall be used during the surprise cash count. 3. The cash count form must be duly acknowledged by the petty cash custodian especially the discrepancies. 4. Noted shortages shall be automatically charged to the petty cash custodian.

H. Responsibilities The Accounting Department is responsible for reviewing receipt documents provided in support of request for replenishment/reimbursement of petty cash expenditures, and for reimbursing the fund custodian.

Recommending approval:

Concurred by ACCTG MGRs:

Approved by:

Audit Manager

President/CEO

CORPORATE INTERNAL AUDIT DEPARTMENT (CIAD)

91 Fendler Street, East Tapinac, Olongapo City Tel. No.: (047) 222-3992

Reference No.:
09-IAD-SYS-08-0003-MA

Date:
August 26, 2009

Subject Title:
FINANCE POLICY

Subject:
REVISED PETTY CASH FUND POLICY

Effectivity Date: _____________________

V. PROCESS FLOWS Requesting and liquidating petty cash (daily routine) Process Flow Accomplish CAF. Secure approval of manager. Approve CAF. Present approved CAF to Petty Cash Custodian. Check CAF, issue requested cash. Secure receipts. Accomplish LS. Attach receipts. Submit to Manager. Check LS versus supporting receipts. Approve LS. Return to requesting employee. Submit LS with attached supporting receipts to Petty Cash Custodian. Retrieve CAF copy. Attach to LS. Check LS versus supporting receipts. Record disbursements in the petty cash ledger (in MS Excel) Count cash and tally with receipts and CAF. Deposit in safe at the end of the business hours. ***End of Process*** Responsible Requesting Employee Requesting Employee Manager Requesting Employee Petty Cash Custodian Requesting Employee Requesting Employee Manager Requesting Employee Petty Cash Custodian Petty Cash Custodian Petty Cash Custodian Petty Cash Custodian

1 2 3 4 5 6 7 8 9 10 11 12 13

Recommending approval:

Concurred by ACCTG MGRs:

Approved by:

Audit Manager

President/CEO

CORPORATE INTERNAL AUDIT DEPARTMENT (CIAD)

91 Fendler Street, East Tapinac, Olongapo City Tel. No.: (047) 222-3992

Reference No.:
09-IAD-SYS-08-0003-MA

Date:
August 26, 2009

Subject Title:
FINANCE POLICY

Subject:
REVISED PETTY CASH FUND POLICY

Effectivity Date: _____________________

Replenishment/reimbursement of petty cash fund Process Flow Summarize all disbursements (in MS Excel). Attach all LS, CAF and receipts. Prepare PRF. Submit to manager. Check the documents. Return to Petty Cash Custodian. Submit PRF with attached supporting documents to GM. Check PRF. Approve PRF. Return to Petty Cash Custodian. Submit PRF and supporting documents to Accounting Departments. Check PRF, CAF, and LS versus supporting receipts. Check authenticity of disbursements. Prepare APV (if necessary) and check voucher. Attach all supporting documents. Submit to Treasury Assistant. Prepare check. Submit to CIAD. Audit replenishment requests. Endorse to Executive Secretary. Submit check and check voucher to President. Approve check. Return check and check voucher to Accounting Department. Issues check replenishment to Petty Cash Custodian. ***End of Process*** Responsible Petty Cash Custodian

2 3 4 5 6 7

Manager Petty Cash Custodian GM Petty Cash Custodian Accounting Staff Accounting Staff

8 9 10 11 12 13

Treasury Assistant Auditor Executive Secretary President Executive Secretary Treasury/Accounting Staff

Recommending approval:

Concurred by ACCTG MGRs:

Approved by:

Audit Manager

President/CEO