KERN COUNTY TREASURER AND TAX COLLECTOR

 

CASH MANAGEMENT HANDBOOK

 

 

 

This booklet has been prepared by the Kern County Treasurer-Tax Collector with the cooperation and assistance of the Kern County Auditor-Controller-Clerk. Its purpose is to present an overview of our banking functions and services, and to assist you in working with our Financial Services Team. We welcome your comments and suggestions.

 

Telephone

(661) 868-3402

Fax

(661) 868-3409

E-mail

TTC@KernCounty.com

Website

www.kcttc.co.kern.ca.us

Office Hours-General

8:00 AM-5:00 PM

Office Hours-Deposits

9:00 AM-2:00 PM

 

 

To keep up-to-date on the changing world of banking and how it affects you, please visit our Website regularly.

 

Objectives

 

The goal of the County’s cash management function is the accurate and secure receiving, receipting and processing of payments received at various locations throughout the County.  This includes payments that are processed manually, through department/agency cash registers, or through automated systems.

 

The County Treasurer-Tax Collector’s office offers support and training to County departments and depositing agencies including guidelines and procedures for proper cash receipting.  It is the responsibility of the County Treasurer-Tax Collector’s office to resolve deposit problems with the County’s bank, no matter what department/agency made the deposit.

 

Department/agency supervisors are responsible for the safekeeping of money that is received and the prompt deposit of those funds into the bank or the transfer of these funds to the Treasurer-Tax Collector. Departments/agencies are expected to provide secure surroundings for employees who handle cash and keep them informed of all County receipt rules and procedures.

 

Properly trained cashiers are expected to be accurate and efficient when processing customer payments, making change, or accepting checks.  They are also expected to safeguard County funds against loss, and to establish and maintain good customer relations.

 

Introduction

 

There is no such thing as “just a cashier” in the County of Kern.  As far as most citizens are concerned, you are a representative of local government!  When citizens or customers come to a County office to pay for something, they expect to talk to someone who is knowledgeable as well as pleasant.  If they have questions about their payment, they expect to receive prompt and accurate answers.  When they leave, you are the one that they will remember.  Just a cashier?  Think again!

 

The function of receiving money is a very important one in the County.  What you do includes one or more of the following distinct yet inter-related areas of responsibility:

 

 

Accepting Money

 

Policies

 

In each section of this manual, you will find policies that relate to the various types of cash receipting activities.  Listed below is a summary of the major cash receipt policies that should be used as a reference.

 

 

Recognizing Currency/Coin

 

The United States Treasury Department has the responsibility for issuing currency for the United States.  U.S. currency takes the form of notes engraved on special paper and comes in seven denominations, each bearing a portrait of a different famous American.  These are as follows:

 

List of U.S. Currency:

 

Denomination

Portrait

$1.00

George Washington

$2.00

Thomas Jefferson

$5.00

Abraham Lincoln

$10.00

Alexander Hamilton

$20.00

Andrew Jackson

$50.00

Ulysses S. Grant

$100.00

Benjamin Franklin

$500.00

William McKinley

$1,000.00

Grover Cleveland

 

In addition, the face of the bill contains key elements: the denomination, Federal Reserve bank seal, serial number, and Treasury Department seal.  The reverse side of a bill is similar for all denominations.  The value designations also differ, but appear in ten places on the bill. The Great Seal of the United States appears in the center of the bill, under the words, ”In God We Trust.”

 

Look at a dollar bill and take special notice of the following parts as you handle it:

 

 

Counting Currency/Coins

 

Counting Currency

 

To insure consistent accuracy, the following method should be used to count currency.  This method ensures that no bill is double-counted.  Always recount the money as many times as necessary to come up with the same total twice.  This means you will always count a stack of currency at least two times.  In a secure area:

 

Counterfeit Currency

Assure yourself that each bill is genuine. It is recommended that at least all $50’s and $100’s, and other denominations at random, be verified with an inexpensive security pen available at  Office Depot.  If you suspect that a bill is counterfeit, do not accept it from your customer. If the customer has left the office, place a Post-It note on the bill with the words “Suspected Counterfeit.”  All suspect bills are to be placed on the top of their respective deposit bundles. If your department/agency handles a great deal of currency, you may wish to purchase a currency counter with counterfeit detector. Remain vigilant to the possibility that the corner of a bill of a larger denomination may have been taped onto the corner of a bill of a smaller denomination. Counterfeit currency will be confiscated by the bank and charged back to your account.

 

Mutilated Money

 

There are specific federal banking regulations for redemption of bills that are torn or mutilated.  A bill must be 3/5 (60%) intact for it to be acceptable.  Any bill that is less that 3/5 should not be accepted as it cannot be redeemed by the bank.  Mutilated coins that are bent, broken or damaged, as well as Canadian and other foreign coins should not be accepted.

 

Counting Coins

 

As with counting currency, establishing a set routine for counting coins can insure accuracy.  Coins are stored in coin wrappers, or rolls, to ensure accurate handling.  Each person counting and inserting the coins into wrappers should initial, date, and department stamp the wrappers.  Count each coin. Do not count by building a stack, then comparing the height of other stacks. When you open a wrapper of coins, always empty the whole package into the coin drawer or coin machine, and verify its contents.

 

While you are not required to accept coins as payment, inevitably you will receive them. As a matter of courtesy, coins may be accepted in a reasonable quantity. Customers who pay with rolled coins must put their name, address, and daytime telephone number on the outside of the wrapper.

 

Six kinds of U.S. coins are issued as follows:

Value

Name

Metal Content

$ .01

Penny

Bronze (copper/zinc)

$ .05

Nickel

Nickel and copper

$ .10

Dime

Copper/nickel alloy

$ .25

Quarter

Copper/nickel alloy

$ .50

Half Dollar

Copper/nickel alloy

$1.00

Silver Dollar

Copper/nickel alloy

 

 

 

 

 

 

 

 

Susan B. Anthony dollars are easily mistaken for quarters. Use caution.

 

NOTE: Government Code section 24350.  Each salaried officer of a county or judicial district shall charge and collect for the use of his or her county and pay into the county treasury on or before the fifth day of each month the fees allowed by law in all cases, except those or a percentage of them allowed him or her, and those which are a charge against the county.  No salaried officer who collects fees pursuant to this section shall be required to accept coin in payment of those fees.

 

Receiving Money

Currency and Coins

 

The following are the steps to be used when receiving currency and coins from a customer:

 

 

Making Change

 

Giving change to a customer is one of the most important jobs of a cashier. If the amount given to the customer is incorrect, either the person will feel cheated or the department/agency will lose revenue.  Either way, you will be out of balance at the end of the day.  To be certain that the amount given to the customer is correct, change should be counted at least two times.  Once when you count it out of the cash drawer and a second time when you count it back to the customer.   Below is an example of how to count back change:

 

Example: The customer’s bill was $67.31 and he gave you $100.00

 

Cashier:  “Your bill was $67.31 out of $100.00.  Your change is...”

 

 

“Thank you.”

 

 

Types of Checks

 

A check is issued to transfer funds from one party to another.  The term “negotiable instrument” means that when properly endorsed, the check is payable to the holder when presented at the issuer’s bank.

 

The drawer or “maker” is the party issuing and signing the check.  The drawer may be one or more individuals acting on their own behalf, or the drawer may be one or more individuals authorized to act on behalf of a company, corporation, partnership or municipality.  The drawee is the party upon whom the check is drawn, usually a bank or trust company.

 

The payee is the party to whom payment is made.  The check can be payable to one or more individuals, to a business, corporation, partnership, municipality, or government agency.  When accepting checks for the department/agency, always ask the customer to write “County of Kern” (and/or department/agency name) as the payee.

 

Personal Checks

 

Personal checks are the most common type of check.  Personal checks belong to people who maintain demand account balances at banks.  Ensure that the maker’s name, address and telephone number appear on the check. No cash back may be given for a check transaction unless this procedure has been approved in advance by the County Auditor-Controller-Clerk.

 

Company Checks

 

Company checks may appear similar to personal checks. Some have a carbon paper strip attached for the company’s own bookkeeping system. Some are computer prepared. Company checks may also have stubs or copies attached. Many of these checks have special instructions printed on them. Instructions may be “Look for the watermark on the back of this check before cashing,” or “The colors of this check change from top to bottom,” or “Two signatures required.”  These instructions are designed to assure that the payment is truly authorized. Failure to follow these instructions may expose the County to loss.

 

Cashier’s Checks

This is a check drawn by a bank on its own funds.  Since only the failure of the bank would cause the check to be dishonored, they are usually accepted readily.  However, as with a personal or company check, the payee should be “County of Kern Department/Agency” and no cash should be given back as change. Cashier’s Checks are also known as:

 

 

Personal Money Orders

 

A personal money order is a check purchased from a financial services vendor for cash.  The purchaser fills in the date, the payor, and the payee’s name and address.  Vendors usually restrict the maximum amount for which they will issue a money order.  This amount is printed on the face of the money order.  For example, on the money order may be printed the words “not to exceed $300.00”  If the amount of the money order is more than the “NOT TO EXCEED” amount, you should not accept it. Cash may be given back as change for a money order.

 

Traveler’s Checks

These checks, sold by banks, are similar to money orders. They are signed by the purchaser on the face of the check when purchased, and countersigned when cashed, either on the face or on the back.  When using a traveler’s check at a County facility, the customer must countersign and write in the payee in the presence of the cashier.  Traveler’s checks should be processed the same as any other check. (If the travele’s check is completed correctly, cash may be given back as change.)

 

Foreign Items

 

No foreign items including checks, money orders, traveler’s checks  should be accepted unless the words “U.S. Funds” or ”U.S. Dollars” appear on the check, and a Federal Reserve routing number is MICR encoded at the bottom of the item. The Federal Reserve routing number is a nine (9) digit number appearing on the lower left of the check. Generally, this number allows the item to be processed through the bank system. Without this code, the item is subject to bank collection charges which, in many cases, exceed the value of the payment. If there is any doubt about the item, contact the Treasurer-Tax Collector’s Office for guidance. Any foreign items accepted are to be forwarded to the Treasurer-Tax Collector’s Office for processing. DO NOT INCLUDE THEM IN YOUR REGULAR DEPOSIT WITHOUT SPECIFIC AUTHORITY FROM THE TREASURER-TAX COLLECTOR’S OFFICE. (Any collection fees incurred for converting the item to US dollars will be charged to your department/agency.)

 

Endorsements

 

All checks should be endorsed upon receipt.  The endorsement is written or stamped in the area indicated on the back of the check. 

 

Returned Items

 

Frequently, checks deposited are returned unpaid by the makers bank. The reasons for return include:

 

 

When a check is returned, our account with the bank is charged for the item. The Treasurer-Tax Collector’s Office will determine from which department/agency the check came, and create a Debit Memo charging that department/agency for the Returned Item. It is then your department’s/agency’s responsibility to adjust your records and, following your departmental/agency procedures, attempt to recover payment.

 

Valid Checks

 

Several requirements must be met to make a check negotiable or valid:

 

 

All or part of this information may already be on a separate form or on the front of the check.  If any of it is not, you should ask for it and record it on the front of the check.  The name of the   department/agency, location of facility, or account number should be either stamped or written on the back of the check in the space for endorsement.

 

·        Finally, if the routing number and account number are not pre-printed at the bottom of the check, you should not accept the check

 

Electronic Payments

 

 

Customers sometimes want to pay electronically through the Fedwire system or Automated Clearing House (ACH) system. An example of an ACH payment is the Direct Deposit payroll received by most County employees. The federal government has mandated that all federal payments be made electronically by January 1, 1999. Use of electronic payments is expected to grow by 500% over the next five years. Should your customer wish to use electronic payment systems, contact the Treasurer-Tax Collector’s Office for assistance. Any electronic payments must be receipted in the same manner as cash or checks.

 

Deposit Accounts

 

Satellite Banking

 

The County’s primary bank is Wells Fargo Bank. Through Wells, we have established a Cash Concentration deposit account for use by County departments/agencies. Depositing departments/agencies receive unique deposit slips which allow the Treasurer-Tax Collector to identify the depositing department/agency. Information required to produce an EROD is sent to the Treasurer-Tax Collector by facsimile. The Treasurer-Tax Collector then prepares the EROD for posting. If your department/agency is interested in such an arrangement, please contact the Treasurer-Tax Collector.

 

Similar arrangements exist with Bank of America and can be established with other major banks. If your department/agency wishes to explore the benefits of such an account, contact the Treasurer-Tax Collector’s Office.

 

ERODs

(Electronic Record of Deposit)

 

The EROD form provided on the Treasurer-Tax Collector’s website serves two purposes:

 

·        It is the Treasurer-Tax Collector’s Deposit Receipt as authorized and required by Government Code Section 27009.

·        It contains the coding required certification for the Auditor-Controller-Clerk to post your deposit to your funds on the books of the County.

 

Should the EROD not be properly completed, it may delay crediting your funds and affect your quarterly interest apportionment.  Your departmental/agency accounting supervisor should have specific instructions that affect your department/agency.  Following are some general rules that apply to ERODs:

 

 

 

These general rules apply to all ERODs presented to the Treasurer-Tax Collector in person, fax, mail, or wire transfer.

 

Credit Cards

 

By Resolution 91-456, the Board of Supervisors granted authority for County departments/agencies to accept credit cards in payment of County fees. Credit cards may be accepted in one of two ways:

 

 

Under the direct bank contract, your department/agency will be charged a credit card discount fee, or processing fee, usually based on the estimated dollar volume of activity to be processed. While state law permits municipalities to add this fee to the amount charged, the credit card contracts do not. There can be no difference between the amount charged to a credit card customer and a cash customer. Therefore, you will not realize the full amount charged for your service.

 

Third party credit card service providers provide an alternative solution by charging a “convenience fee” for each transaction. This fee is added to the customer’s charge and paid to the provider. Your department/agency then receives full value for your services.

 

Either way, before accepting credit cards, your department/agency MUST:

 

 

Please contact the Treasurer-Tax Collector and/or Auditor-Controller-Clerk if you wish to proceed with credit card acceptance.

 

 

 

 

 

 

 

 

maindoc:  cashbook.doc

Updated:  June 5, 2003