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FI 6 Imprest Accounts Petty Cash

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FI 6 Imprest Accounts Petty Cash

Preamble

In schools, other than those operating local bank accounts, imprest account advances of appropriate amounts are made by the Head of Finance to a designated employee at a school (normally the Headteacher), the account being operated using an official bank imprest account. Where the school operates a local bank account, the petty cash account is operated on a cash basis and the petty cash account is funded from the local bank account.  In either case petty cash accounts are intended to be used for the payment of relatively small payments and for postage.  General guidelines issued by the Head of Finance exist for imprest accounts administered centrally see Imprest Accounts on SchoolsWeb. The operation of petty cash accounts at schools using local bank accounts is covered in the notes for guidance for Local Bank Accounts, also on SchoolsWeb.  These instructions set out the framework within which centrally held imprest accounts and petty cash accounts funded from school bank accounts should operate.

Instructions

Centrally held imprest accounts:

6.1     The Head of Head of Finance may in consultation with the Headteacher concerned make imprest advances to a designated imprest holder, either the Headteacher, or his/her nominated representative, to defray certain expenses. The imprest holder shall maintain a record of payments and reimbursements in the form and manner prescribed by the Head of Finance.

6.2     Imprest Bank accounts will be opened with the Council's bankers, (or alternative can be agreed if there is no local branch) for use by the imprest holder.

6.3     The imprest holder shall not cause this account to be overdrawn. It shall be a standing instruction to the Authority's bankers that the amount of any overdrawn balance on an imprest account shall be reported to the Head of Finance, and any resulting fees incurred will be passed to the School.

6.4     Where the amount of the imprest advance proves to be inadequate the Head of Finance should be contacted with a view to increasing the advance, either on a permanent or a temporary basis, as appropriate.

6.5     Cash receipts must not be paid into an imprest account, but must be banked or paid over to the Head of Finance as provided elsewhere in these instructions.

6.6     The weekly credit limit shall reflect individual need and shall be set by the Head of Finance.  The approval of the Head of Finance shall be required to exceed this limit.

6.7     An imprest account shall be the personal responsibility of the imprest holder, who may be required by the Head of Finance to make good any deficit in the account.

6.8     Imprest Accounts are managed using SIMS FMS, and the reimbursements are made electronically using File Transfer to the SAP interfaces.

6.9     The following instructions shall be observed in connection with transactions to and from imprest accounts:

(a)     The imprest holder shall submit to the Head of Finance a claim at not less than monthly intervals via Sims FMS/File Transfer system.  The account shall be reconciled correctly to actual bank and cash balances held before the claim is submitted.

(b)      Schools shall hold the petty cash vouchers and other documentation in accordance with Internal Audit guidance on retaining source documents.

(c)      Individual payments shall be limited by type and value, as determined by the Finance Service Director.

(d)      Where VAT is to be recovered the Imprest holder should ensure that the appropriate VAT requirements are met, please see VAT guidance on SchoolsWeb

(e)       Personal or other cheques must not be cashed out of an Imprest account.

(f)    Schools will be required to provide evidence of the reconciliation of the Imprest Account to the Bank Balance and confirm the level Imprest Balance as part of the Local Authority’s End of Year procedures.

6.10     It is essential that the Head of Finance be informed of any changes to the account e.g. emergency signatories, as the Authority's bankers will only accept changes in account details from the Head of Finance Service Director. (forms available on the SchoolsWeb)

6.11   Whenever an employee leaves the employment of the Authority or Governing Body or otherwise ceases to be entitled to hold an imprest, the account should be reconciled and balanced before official handover to the new Imprest Account Holder.

Petty Cash Accounts Funded From School Local Bank Accounts:

6.12   The petty cash account shall operate on the basis of a fixed advance from the local bank account.

6.13    The person responsible for checking the claim and drawing the reimbursement cheque shall be someone other than the person responsible for the petty cash account. In checking the claim the actual cash balance shall be verified.

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