Cash Department of Bank Prepared by Nida Tariq

CASH DEPARTMENT OF BANK CASH DEPARTMENT OF BANK prepared by Nida tariqprepared by Nida tariq

What is a bankWhat is a bank

An An establishmentestablishment authorized by a  authorized by a governmentgovernment to  to acceptaccept depositsdeposits, , paypay  interestinterest, clear , clear checkschecks, , makemake loans, act as  loans, act as anintermediary in financial anintermediary in financial transactions,and provide othertransactions,and provide other

financial services to its customers.financial services to its customers.

What is cash department???What is cash department???

The total amount of money held The total amount of money held at the bank by an individual or at the bank by an individual or company. company.

Main functions of cash Main functions of cash departmentdepartment

This department performs these This department performs these main functions main functions

Cash receiptsCash receipts Cash payementsCash payements

Function of cashier in cash Function of cashier in cash departmentdepartment

Solid cashSolid cash Defective cashDefective cash Sorted cashSorted cash

lets talk about risk and controls….

lets talk about risk and controls….

who or what is at riskThe Money

WHY?

Risk and Controls!!Risk and Controls!!

In the cash collecting process, YOU are just as important as the cash………..

Risk?Risk?

Cash is lost Cash is stolen Bank Statement doesn’t agree

with dept records No audit trail Finger pointing/Accusations Lost revenues

Types of Cash FundsTypes of Cash Funds

Change FundChange Fund

Temporary Change FundTemporary Change Fund

Petty Cash FundPetty Cash Fund

Temporary Cash FundTemporary Cash Fund

Change Funds:Change Funds:

An amount of cash held by An amount of cash held by a department or officea department or office

Temporary Change Funds:Temporary Change Funds:A Cash fund maintained for a A Cash fund maintained for a

specific short term specific short term

Petty cash fund:Petty cash fund:

An amount of cash held by a An amount of cash held by a department or office to pay department or office to pay for small incidental expensesfor small incidental expenses..

Temporary Cash Fund:Temporary Cash Fund:

A small cash fund established A small cash fund established to make small dollar cash to make small dollar cash paymentspayments

Collecting the CashCollecting the Cash

How is cash received?How is cash received? Who is going to collect the Who is going to collect the

cash?cash? Who will record the cash?Who will record the cash?

Collecting the Cash In PersonCollecting the Cash In Person

The cash received must be entered The cash received must be entered on a cash register, if one is available, on a cash register, if one is available, and a copy of the receipt given to the and a copy of the receipt given to the customer.customer.

If a cash register is not available, If a cash register is not available, then create a dual copy receipt, keep then create a dual copy receipt, keep one for balancing, and give one to one for balancing, and give one to the customer.the customer.

““Now that we have collected the Now that we have collected the cash, what do we do with it?cash, what do we do with it?

SecureSecure Balance Balance DepositDeposit ReconcileReconcile

How is cash going toHow is cash going to be secured? be secured?WHILE in Use…WHILE in Use… If making change is necessary, each person If making change is necessary, each person

collecting cash should have a cash box or drawer collecting cash should have a cash box or drawer that no one else uses.that no one else uses.

When not in Use…When not in Use… Secure the cash box in a locked drawer and limit Secure the cash box in a locked drawer and limit

access. access. Secure the cash drawer by locking it and limiting Secure the cash drawer by locking it and limiting

access.access.When Collecting…When Collecting… When collecting payments in a high traffic area, you When collecting payments in a high traffic area, you

may want to consider installing an alarm system. may want to consider installing an alarm system. (Contact Department of Public Safety for guidance)(Contact Department of Public Safety for guidance)

BALANCINGBALANCING

Every day, all cash receipts must be Every day, all cash receipts must be balanced.balanced.

• Compare the cash (currency, coin, Compare the cash (currency, coin, checks, credit card receipts, etc.) to the checks, credit card receipts, etc.) to the records (cash register tapes, receipt records (cash register tapes, receipt copies, sales logs, etc.)copies, sales logs, etc.)

• Identify and resolve any discrepancies.Identify and resolve any discrepancies.• Sign and date to provide evidence of Sign and date to provide evidence of

balancing.balancing.

ReconciliationReconciliation

Verify that all transactions are Verify that all transactions are complete, recorded, and deposited complete, recorded, and deposited on a timely basis.on a timely basis.

This function must be performed by This function must be performed by an employee who has no cash an employee who has no cash handling responsibilities.handling responsibilities.

Reconciler investigates and resolves Reconciler investigates and resolves discrepancies, and initials (or signs) discrepancies, and initials (or signs) and dates documentation reconciled.and dates documentation reconciled.

Segregation of DutiesSegregation of Duties

This is the most important This is the most important control in the cash collection control in the cash collection process, and often, the most process, and often, the most difficult to manage. A different difficult to manage. A different person should be involved in person should be involved in each step: recording of each step: recording of charges/billing, cash receipting, charges/billing, cash receipting, cash depositing, and cash depositing, and reconciliation.reconciliation.

The basic goal or objective of The basic goal or objective of the bank is to earn profit and the bank is to earn profit and cash department plays an cash department plays an important role in this matter.the important role in this matter.the bank receives cash from the bank receives cash from the clients and invests it in clients and invests it in business.It is a face of a bank. business.It is a face of a bank.

THANKYOUTHANKYOU