Deposits

SUBJECT: DEPOSITS NUMBER:
C.4.
DEPARTMENTS & DISTRICTS AFFECTED: ALL AGENCIES, DEPARTMENTS, AND DISTRICTS GOVERNED BY THE BOARD OF SUPERVISORS
EFFECTIVE: 12/83 REVISED: 02/01, 01/12
 signed_________________________________ David E. Sundstrom, Auditor-Controller
TABLE OF CONTENTS
1. POLICY
1.1 Purpose 1.2 Authority 1.3 Definitions
2. INTERNAL CONTROLS
2.1 Segregation of Duties 2.2 Accountability 2.3 Deposit Order Verification by Departments/Agencies 2.4 Endorsement of Checks 2.5 Check Payee / Payor Identification 2.6 Counterfeit Bills 2.7 Payment/Electronic Cards 2.8 Timely Deposits - Special Circumstances
3. PREPARING THE DEPOSIT ORDER
3.1 Deposit Order Sections
4. TRANSMITTING DEPOSIT ORDERS
4.1 Transmitting Department or Agency 4.2 Auditor-Controller
5. BANK DEPOSIT
5.1 Armored Car Messenger Service 5.2 Delivery to Treasurer-Tax Collector 5.3 Direct Deposit at Local Bank Branch 5.4 Alternate Deposit Method
6. DEPOSIT ORDER CODE CORRECTIONS
EXHIBITS
SUBJECT: DEPOSITS NUMBER:
C.4.
DEPARTMENTS & DISTRICTS AFFECTED: ALL AGENCIES, DEPARTMENTS, AND DISTRICTS GOVERNED BY THE BOARD OF SUPERVISORS
EFFECTIVE: 12/83 REVISED: 02/01, 01/12
 signed_________________________________ David E. Sundstrom, Auditor-Controller
1. POLICY
All monies collected or received by County departments/agencies shall be deposited, whenever practical, with the County Treasurer-Tax Collector, or other legal depository, no later than the working day following the date received, except for trust fund monies which must be deposited on the date received according to law. If it is not practical to deposit monies by the working day following the date received, then deposits should be made at least monthly or whenever $100 is accumulated, whichever occurs first. Special circumstances, such as remote locations, may warrant a larger accumulation of monies before a deposit is practical.
1.1 Purpose
To provide adequate internal control over all County receipts and to maximize interest earnings and cash flow.
1.2 Authority
1.2.1 Board of Supervisors' Resolution No. 82-162
Board of Supervisors' Resolution No. 82-162, dated February 2, 1982, authorizes the Auditor-Controller to prescribe the accounting policies for all offices, departments, and institutions under the control of the Board of Supervisors.
1.2.2 Board of Supervisors' Resolution No. 94-1128
Board of Supervisors' Resolution No. 94-1128 allows T-TC to accept Discover Card for property taxes.
1.2.3 Board of Supervisors' Resolution No. 96-575
Board of Supervisors' Resolution No. 96-575 approves County use of Master Card, Visa, and debit cards for the various reasons allowed in the Government Code Section 6159 and Revenue & Tax Code 2511.1.
1.2.4 Board of Supervisors’ Resolution No. 98-436
Board of Supervisors’ Resolution No. 98-436 approves T-TC accept American Express.
1.2.5 Minute Order dated June 13, 2000; Agenda Item 74
Minute Order dated June 13, 2000; Agenda Item 74 approves JWA to accept American Express.
1.2.6 Board of Supervisors’ Resolution No. 02-095
Board of Supervisors’ Resolution No. 02-095 approves use of internet for payment cards under T-TC’s Wells Fargo agreement.
1.2.7 Government Code Section 27008
Government Code Section 27008 requires the certificate of the auditor for all deposits made in the County Treasury.
1.2.8 Government Code Section 6159
Government Code Section 6159 authorizes Counties to accept payment cards and allows fee to be charged upon Board of Supervisors approval.
1.2.9 Revenue & Tax Code 2511.1
Revenue & Tax Code 2511.1 authorizes Counties to accept payment cards for property taxes and allows fee to be charged upon Board of Supervisors approval.
1.3 Definitions
1.3.1 Monies
Includes currency, coins, checks, warrants, money orders, payment/electronic cards, etc.
1.3.2 Initial Collection Records
Handwritten cash receipt copies (refer to County Accounting Procedure (CAP) No. C.5., Handwritten Cash Receipts), calculator tapes or customized forms documenting County receipts.
1.3.3 Forms
County of Orange Deposit Order Form (See Exhibit I.) This 4-part form is distributed as follows:
  1. White - Tax Collector
  2. Goldenrod - Auditor-Controller official file copy
  3. Canary - Department/Agency official file copy
  4. Pink - Auditor-Controller memo copy
1.3.4 Validated Deposit Order
Canary-colored copy returned to department/agency by Treasurer-Tax Collector.
1.3.5 County Accounting and Personnel System/Advantage Financial System (CAPS AFNS)
County accounting system used to access current financial information through the use of various tables.
1.3.6 County Accounting Procedure (CAP)
Accounting procedures established by the Auditor-Controller.
2. INTERNAL CONTROLS
As stated in CAP No. S.2., Internal Control Systems, "All County departments/agencies shall maintain effective internal control systems as an integral part of their management practices. This is because management has primary responsibility for establishing and maintaining the internal control system."
2.1 Segregation of Duties
Responsibilities for receiving and depositing monies should be segregated between several employees to establish internal control over collections. An essential segregation of duties is having someone other than the employee receiving monies preparing the Deposit Order. Similarly, the person verifying the final Deposit Order should not be the person who prepared it. (See Section 2.3 of this Procedure.) Another essential segregation of duties is having a supervisor or individual with no other cashiering or depositing duties comparing each amount on the Deposit Order to the initial collection records, to help ensure that all collections received were deposited.
2.2 Accountability
Accountability should be established when monies are initially collected or received by preparing some type of Initial Collection Record (examples include receipt forms, lists and calculator tapes.) This Initial Collection Record should be signed and dated by the person receiving the monies. Over-the-counter receipts or field collections should be documented by the issuance of a County of Orange handwritten cash receipt or a cash register receipt. Mail collections should be documented by the preparation of a detailed listing by an employee with no other deposit or cashiering responsibilities. Additionally, when monies are subsequently transferred between employees during the collection and deposit process, the employees should document the transfer of accountability in writing. It should be stressed to employees that it is to their own benefit to verify the amounts being transferred to them, prior to signing for the funds. In the event of a loss, the transfer of accountability provides management with a method to determine where, when and possibly how the loss occurred.
2.3 Deposit Order Verification by Departments/Agencies
Upon receipt of the validated Deposit Order, the department/agency shall compare it to the original Deposit Order and to the Initial Collection Records to ensure that no unauthorized changes were made and that all collections were deposited. An independent person with no receipt or Deposit Order preparation duties shall perform this comparison.
2.4 Endorsement of Checks
All negotiable instruments, such as checks, warrants, and money orders, should be endorsed with a restrictive endorsement stamp immediately upon receipt.
2.5 Check Payee / Payor Identification
The payee on each check should be the County of Orange, a County department/agency name, or a department head/agency director. Each check received over the counter should have the payor's name, address, and telephone number imprinted. The person accepting a check should write payor identification such as driver's license number on the check. All of this information provides documentation that may be needed for subsequent collection efforts.
2.6 Counterfeit Bills
Some departments/agencies have incurred cash losses because they unknowingly have accepted counterfeit bills. Departments/agencies should use the most effective, practical counterfeit detection devices available to prevent acceptance of counterfeit bills. When the Treasurer-Tax Collector is notified by the bank of a counterfeit bill, the accepting department/agency will be charged for the loss. See CAP No. C.3., Cash Losses, for relief of accountability and replenishment procedures for losses attributable to counterfeit bills.
2.7 Payment/Electronic Cards
In order to prevent fraud and protect cardholder information, any department/agency (merchant) within the County of Orange that processes credit card transactions must maintain compliance with the Payment Card Industry Data Security Standards (PCI DSS). Failure to comply with PCI Data Security Standards (See Exhibit IV) can result in losing the ability to process card payments, being assessed hefty fines imposed by card associations, and/or violation of federal or state law. While PCI DSS compliance is the responsibility of each merchant, the overall program is managed by the County Treasurer. Compliance will be verified and monitored by the Treasurer’s Office, regardless of which processing bank the agency uses. Please contact the Treasurer’s Cash Management division for further information and documentation at cashmgmt@ttc.ocgov.com.
2.8 Timely Deposits - Special Circumstances
2.8.1 Remote Locations
Each department/agency making a deposit from a remote location should analyze the cost of processing the deposit in employee time and mileage compared to the risk of loss, lost interest earnings, and decreased cash flow, and determine the optimum deposit amount for each remote location. Deposits at these locations should be made at least monthly, or whenever the optimum amount is accumulated, whichever occurs first.
2.8.2 Other Special Circumstances
Special circumstances, other than remoteness of location, may warrant an accumulation of monies greater than the $100 stated in the Policy section before a deposit is practical. Such circumstances should be reviewed with the Auditor-Controller before a decision is made to use an amount greater than $100.
3. PREPARING THE DEPOSIT ORDER
Deposit Orders should be prepared to record the receipt of monies. Deposit Orders should not be used to record movement of monies that have previously been recorded by a Deposit Order. Movement of monies should be recorded by a journal voucher prepared in accordance with CAP No. J.3., Journal Voucher Preparation and Review. Therefore, negative (bracketed) entries on deposit orders should be a rarity. Only refunds or reimbursements should be recorded with a bracketed entry on deposit orders. Additionally, these types of transactions should be fully explained in the explanation area of the deposit order. To help ensure that the deposit order information is input correctly, the deposit order information should be legible. The Deposit Order can be prepared using a photocopied template. The information should be printed or typed neatly, in large, dark font. A font size of at least 10 should be used for computer-generated deposit orders.
3.1 Deposit Order Sections
Following the three distinct sections of the Deposit Order (See Exhibit II,) the following information should be included:
3.1.1 The Upper Section
The "Agency/Department" box at the top of the Form shall display the name of the department/agency. The "Agency Code" box at the top of the Deposit Order Form is used to identify the preparing agency (e.g., 003 for Auditor-Controller.) The Auditor-Controller Administrative Services Unit will assign the "Deposit Number."
3.1.2 The Middle Section
3.1.2.1 General Description
The "General Description" area at the left of the Form shall include a brief description of the type and source of monies being deposited for each line on the Deposit Order. If the Deposit Order Form can accommodate the information, the description should include check number, invoice number, invoice payor, and date received, if different than date of deposit, etc. Include any invoice numbers for accounts receivable in the "General Description" area.
3.1.2.2 Account Coding
Following the Deposit Order columns, the proper account coding for a deposit order should include:
COLUMN REVENUE SOURCE CODES BALANCE SHEET (B/S ACCT) CODES
FUND Required Required
AGCY Required Required
ORG Required for Org Code Users Do Not Use
ACTV Optional Optional
REV SOURCE Required Do Not Use
SUB REV Optional Do Not Use
JOB Required for Job Users Do Not Use
REPT CATG Do Not Use Optional
B/S ACCT Do Not Use Required
OBJ Do Not Use Do Not Use
SUB OBJ Do Not Use Do Not Use
All payments received for County invoices originally booked as accounts receivable should be coded to:
  • Balance Sheet Account Code 8200, "Accounts Receivable, Misc. A/C," for invoices billed to individuals or businesses, or
  • Balance Sheet Account Code 8470, "Due from Other Governmental Agencies-A/C," for governmental invoices, or
  • Other appropriate Accounts Receivable accounts.
County General agencies (001-100) should use Fund 100. Trust fund agencies (301-399) should use Fund 300. Other agencies should use the appropriate funds for the monies being deposited.
3.1.2.3 Amounts
Record the amount to be deposited for each line of account coding. The preparer of the Deposit Order should verify that the total agrees to the total of the Initial Collection Records. The "Total Deposit" should equal the sum of the individual amounts listed in the "Amount" column and should be mathematically correct.
3.1.2.4 Explanation
The "Explanation" area at the bottom of the Deposit Order Form should display additional information about the deposit, such as an explanation if the date of deposit is different from the date of receipt. Any additional pertinent information should also be included in this area.
3.1.3 The Lower Section
In this section are boxes for the preparer's name and phone number, and a box for a supervisor to document that he/she reviewed the document for accuracy and completeness. The Treasurer-Tax Collector will validate the deposit order and an Auditor-Controller Deputy will sign the Deposit Order in the designated area at the bottom of the form.
4. TRANSMITTING DEPOSIT ORDERS
4.1 Transmitting Department or Agency
The department/agency forwards the completed Deposit Order to the Auditor-Controller. Deposit Orders must be received in the Auditor-Controller General Ledger Unit before 1:00 p.m. Deposit Orders received after that time may not be included in the accounting system processing until the next day.
4.1.1 Deposit Order Transmittal
The preferred method of transmittal is via fax to the Auditor-Controller General Ledger Unit. If the Deposit Order was transmitted via fax, and to prevent against duplicate entry, the department/agency should make a notation on the original Deposit Order form stating that it was "Faxed" along with the fax date and time. (See Exhibit II.) The original Deposit Order form should not be sent to the Auditor-Controller or the Treasurer-Tax Collector but rather should be retained by the department/agency. Prepared Deposit Orders can also be hand-delivered to the Auditor-Controller Administrative Services Unit, or monies with adequate account coding can be hand-delivered to the Auditor-Controller Accounts Receivable Unit, where the monies will be included in the Accounts Receivable daily deposit. The Treasurer-Tax Collector will return the canary-colored copy of the processed Deposit Order to the departments/agencies confirming the deposit.
4.1.2 Duplicate Deposit Orders
Departments/agencies must not submit the same Deposit Order twice. If a department/agency is not certain whether a Deposit Order has already been transmitted, they should contact the Auditor-Controller General Ledger Unit before transmitting it again. If the total dollar amount of a Deposit Order is determined to be incorrect and the current month is still in progress, a written explanation of the correction should be sent to Auditor-Controller General Ledger Unit to process. If the month has passed or if the correction is for anything other than the total dollar amount (also see Section 6,) a written explanation of the correction should be sent to the Auditor-Controller, Accounts Receivable Unit in the format shown in Exhibit III.
4.1.3 Deposit Order Log
Departments/agencies are encouraged to maintain a log of their Deposit Orders and to reconcile the log to the monthly and semi-monthly General Ledgers or regularly to the FLX2 and FLX4 tables in CAPS AFNS, to help ensure that their deposits were recorded properly and accurately.
4.2 Auditor-Controller
The Auditor-Controller records the receipt of the Deposit Order on a log that lists the date, transmitting department/agency, and total amount of the deposit. The Auditor-Controller creates a multi-part Deposit Order Form by photocopying the faxed copy, assigns a sequential identification number to the Deposit Order, and submits the Deposit Order for data entry. The Auditor-Controller retains the pink-colored copy and forwards the other copies to the Treasurer-Tax Collector for validation and further distribution.
5. BANK DEPOSIT
The department/agency places all monies and bank deposit slips in a sealed moneybag. That moneybag can then be sent to the bank using one of the following methods:
5.1 Armored Car Messenger Service
The preferred method for transporting County funds for deposit is the use of an armored car. An armored car messenger picks up the sealed moneybag and delivers the bag to the bank. Arrangements for an armored car messenger should be made with the Treasurer-Tax Collector.
5.2 Delivery to Treasurer-Tax Collector
The department/agency can deliver the sealed bag directly to the Treasurer-Tax Collector cash counter. It is located in Room G58, Building 12 in the Civic Center complex.
5.3 Direct Deposit at Local Bank Branch
An alternative to an armored carrier pickup or delivery to the cash counter is delivery of the deposit directly to a local bank branch, currently the Bank of America. It does not require a sealed bag; however, for security purposes one may be used.
5.4 Alternate Deposit Method
If the department/agency has infrequent deposits, the monies can be hand-delivered to Auditor-Controller Accounts Receivable Unit as noted above in Section 4.1.1.
6. DEPOSIT ORDER CODE CORRECTIONS
Unless authorized by the Auditor-Controller Accounts Receivable Unit, all journal voucher entries to record Deposit Order coding corrections shall be prepared by the Auditor-Controller Accounts Receivable Unit. The department/agency requesting the correction should send a memo in the format shown on Exhibit III to request the correction.
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