Cash Acceptance Policy

Lehigh University

Finance & Administration

CASH ACCEPTANCE POLICY

 

Purpose:

To identify a general underlying philosophy in regards to cash acceptance in its various formats, including electronic payment transfers (Wires and ACHs), checks, card payments, and currency (“Cash”). Ideally, the collection of cash should be centralized; however, given the complexity of Lehigh University it is not always possible or practical. This document is intended to provide guidance to ensure proper handling of the University’s cash.

Policy:

The overall objective of this policy is to safeguard Lehigh’s operating funds by receiving and depositing cash payments to the university via the most secure method possible. Lehigh University faces multiple risks related to cash that is received by departments and units, the greatest of which is loss or theft of funds. The best way to mitigate this risk is to have funds deposited in a university bank account as quickly as possible. The university understands that some departments (Zoellner Arts and Athletics, for examples) have external events where the public is in attendance and a “no currency” policy cannot be mandated. However, it is with the above objective in mind, therefore, that the university highly discourages receiving payments in currency and highly encourages receipt of payments via electronic payment transfers when at all possible.

Required Authorization to Collect Money 

Before undertaking any new cash handling operation or activity, approval for the activity must be received from the Treasurer’s Office. Once accounts are established, the department should contact the Controller’s Office to demonstrate how this new operation or activity will be accounted for and how deposits will be made. 

Preferred Cash Receipt Method: Electronic Payment Transfers

 The preferred method of cash receipts is by electronic payment transfers of either wires or ACHs. This method allows for immediate deposit directly to the university account, eliminating deposit float time and reduces the number of individuals having access to the funds. Receipts via electronic payment transfers occur on a daily basis and vendors are encouraged to make payments in this manner. The university utilizes a bank service in which the main operating account number is protected and special “masked” account numbers are assigned to the departments to distribute when setting up vendor payments. These assigned masked account numbers also aid the Treasurer’s Office in identifying the incoming funds to the appropriate department.

Acceptable Cash Receipt Method: Checks

If a payor is unwilling or unable to send payment via an electronic payment transfer, an acceptable cash receipt method is via checks. There are several methods for how checks can be deposited to the university banking account. The Treasurer’s Office works with departments to help determine the most appropriate deposit method(s) to meet each department’s depository needs, which may include using local Remote Deposit Capture (RDC) technology to deposit checks electronically via scanner or phone or by submitting checks to the Bursar’s office for deposit. Volume of receipts is the primary determining factor. As more departments are set up to remotely deposit checks, less checks are being sent to the Bursar’s office for deposit.

Accepting checks requires more departmental procedures to be in place to safeguard the deposits. An effective system of internal controls is designed to provide reasonable assurance that errors will be detected and corrected in the normal course of activities. The areas that receive large volumes of checks have formalized processes to address segregation of duties as it relates to receiving, logging, and depositing incoming physical checks. A series of high-level process steps is outlined below for establishing departmental funds management controls within three main cash handling activities: Receiving Funds; Depositing Funds; and Accounting and Reconciliation.

Receiving Funds

a. Determine who is authorized to receive funds, and ensure personnel are properly trained

b. Ensure money is counted and verified

c. Ensure funds and information are safeguarded

Depositing Funds

a. Determine who is authorized to deposit funds, and ensure personnel are properly trained

b. Deposit all funds into a university Treasury-approved bank account in a timely manner

c. Ensure funds and information are safeguarded at all times

Accounting and Reconciliation

a. Ensure deposits post to the appropriate index/account code

b. Reconcile receipts/deposits with Statement of Activity

Discouraged Cash Receipt Method: Currency

As currency acceptance is the riskiest method of cash receipts, it is highly discouraged from being accepted. All funds collected by any department of the university must be deposited into an authorized university bank account as soon as practical, generally on the date of collection. Where this is impractical and where the total deposit is less than $750, the deposit may be made within one business day of collection. This policy will protect university funds as well as facilitate proper cash management. All currency deposits must be in U.S. dollars. The Treasurer’s Office must approve the use of all university bank accounts as well as any exceptions to this policy. Making deposits at the designated university depository bank branch in person (requires prior arrangements/approval by Treasurer’s Office).

Foreign Cash Receipts

Lehigh University does not accept physical foreign currency or checks issued from foreign banks located outside the U.S. or Canada. This includes payments from students, suppliers and other affiliates, regardless of whether checks are issued in U.S. dollar (USD) or foreign currencies.

Accepting checks issued from foreign banks (non-U.S./non-Canadian) presents unique challenges in the collection of the funds. Unlike domestic checks that are cleared through the United States Federal Reserve, foreign-issued checks must be presented and cleared through a variety of channels depending on the banking system associated with the country of origin. Potential impacts due to the more complex clearing process for foreign checks include significant delays; additional layers of fees which could be substantial; higher university administrative time and costs; and foreign exchange risk that could result in less than full payment after conversion to USD.

The university is sensitive to the strategic partnerships held with suppliers and academic affiliates abroad as well as its diverse student population. Accordingly, the Bursar’s Office is available to assist students, and the Treasurer’s Office is available to assist faculty, and staff in determining cost effective payment alternatives, including foreign wire transfers through the SWIFT payment network. The University is also setup to receive foreign student payments via Flywire, which is an international wire payment service.

Anyone requiring assistance with payment alternatives for foreign payments may contact the Treasurer's Office for more information.

VISA/MASTERCARD/AMERICAN EXPRESS/GOLDPLUS

To accommodate customers wanting to pay by charge, credit or debit card, authorized units may accept Visa/MasterCard/Gold Plus and/or American Express payments. This process is consistent with other cash handling procedures, though some additional steps are required. Generally, only authorized departments may request authorization to become a card merchant. Please contact the Treasurer’s Office for more details.