Penn State Cooperative Extension
Accounting Requirements

1. Record-Keeping Requirements
   
   
   1. Maintain general ledger on computer using Financial Records Program. Entries are to be made as part of your voucher and check preparation process and immediately after bank deposits. Monthly and annual reports should be generated and kept on file by report date.
      
      
   2. Maintain checkbook register. Cleared checks and deposits should be noted with a check mark, in ink. It should be noted, in ink, where register was balanced to monthly bank statements.
      
      
   3. Perform monthly bank reconciliations using worksheets provided on the back of bank statements. This should be done ink and initialed and dated by person reconciling the bank statements to the general ledger and checkbook register. Bank statements should be filed by date. Cleared checks should be put in order by number and kept on file with bank statements.
      
      
   4. Consecutively numbered vouchers must be prepared for each expenditure. Check numbers should appear on vouchers. Approved vouchers should be filed by number. Each voucher must be supported by a vendor invoice or receipt to provide independent evidence of the nature of each expenditure.
      
      
   5. Cash receipt records must be maintained. Consecutively numbered, three copy, receipts must be prepared for all monies received. This includes income from for-sale items, registration fees, gifts, and awards. Receipts should be distributed as follows: top copy to customer, second copy stays with cash until deposit, third copy stays in receipt book. The third copy is used to conduct periodic numeric sequence audit.
      
      
   6. Bank deposit records must be maintained. Bank deposit slips should be filed by deposit number or date. Deposit slips must have attached supporting cash receipt slips. Deposits must be made when receipts equal $100 or at the end of the week, whichever occurs first. Inventory control records must be maintained for all for-sale items such as soil test kits and publications.
      
      
   7. Workshop and meeting attendance sheets must be retained for verification involving events requiring registration fees. Attendance sheets should be signed by all participants and should indicate if the registration fee was prepaid or collected on-site. Individual customer receipts can be provided using an auxiliary receipt book. One receipt, with attendance sheet attached, can be written from the master receipt book for monies collected on-site. Attendance sheets should be reconciled to registration fees collected to ensure all participants have paid. Registration fees may be charged for extension-sponsored workshops for incremental costs associated with the cost of conducting the workshop. It is imperative that the fee charged cover only the cost incurred and that the extension clientele understand the nature and purpose of fees charged.
      
      
2. Signature Approval Procedures
   
   
   1. Commissioner’s Account — Checks must be signed by the extension board treasurers. Another executive member of the board should be authorized to sign checks when the treasurer is not available. Vouchers must be signed by one or more executive members of the committee. Vouchers must also be signed by CED, to certify that the expenditure is in furtherance of approved extension programming.
      
      
   2. Special Account — The CED must sign all checks and vouchers to certify that the expenditure is in furtherance of approved extension programming. A signature proxy should be set up to provide check approval during CED’s absence and for checks payable to the CED. Vouchers must also be signed by the extension staff member initiating the expense.
      
      
   3. 4-H Development Account — Checks must be signed by the 4-H Development Committee Treasurer. Another executive member should be authorized to sign checks when the treasurer is not available. Vouchers must be signed by one or more executive members of the committee. Vouchers must also be signed by a member of the extension staff, CED, or 4-H Agent to certify that the expenditure is in furtherance of approved youth programming.
      
      
   4. Miscellaneous — Pre-signing a number of checks in advance and the use of signature stamps are not allowed on any financial documents. Such practices cause serious control problems and open the door for misuse of funds. Original signatures will be required on all financial documents.
      
      
3. Purchasing Procedures
   
   
   1. To ensure availability of funds and expenditures are prudent, reasonable, and in furtherance of approved extension programming, all staff must obtain prior approval from the CED before initiating an expense.
      
      
   2. At least three bids should be obtained for purchases over $5,000 to ensure competitive pricing.
      
      
   3. The University is exempt from paying Pennsylvania Sales and Use Tax. Documentation to provide to vendors is on file in County Cooperative Extension Offices.
      
      
4. Petty Cash Fund Policy
   
   
   1. Petty cash funds are used for minor local purchases that individually do not cost more than $50.00. If such a fund is needed, it should be established and maintained on an impress basis (i.e., cash in the fund plus receipts for reimbursed expenditures should equal the total amount of the fund at all times). Such funds are not be intermingled with other funds such as revenues from for-sale items.
      
      
   2. Reimbursement must be supported by a cash register tape or sales slip. Such receipts must be approved by the CED and marked "paid" after reimbursement. The recipient should also sign the receipt as evidence of receiving reimbursements. The use of a "Request for Reimbursement Form" helps organize and standardize this process.
      
      
   3. Petty cash funds are not to be used for cashing personal checks or for making cash advances. When the cash balance becomes low, reimbursement for the exact amount of expenditures should be made by preparing a check payable to "Petty Cash". A voucher should also be prepared and should have all supporting receipts attached.
      
      
5. Audit Requirements
   
   
   1. All extension-supervised accounts must be audited annually by an outside party not involved in day-to-day account management and maintenance activities. This may be accomplished by using volunteer audit committees or hired professional auditors. The role of auditors and the CED are outlined in the Annual Audit Guidelines for County Extension Accounts.
      
      
6. Financial Guidelines for County Extension Accounts
   
   
   1. Staff having account management and maintenance responsibilities should be familiar with and ensure compliance all pertinent financial policies and guidelines in place including Financial Guidelines for County Extension Accounts.
      
      
7. Unallowable Expenditures
   1. Any expenditure that is for the sole benefit of extension staff and not in furtherance of approved extension programming are unallowable (e.g. flowers, cards, refreshments, alcohol, donations, fines, club or personal membership dues, personal subscriptions, office parties, entertainment, gifts, awards, etc.).
      
      
   2. Cash advances for any purpose are not allowable. Travel expenses are to be out of pocket and reimbursed by processing a Travel Expense Account Form for actual expenses incurred.
      
      
   3. Personal telephone calls must be charged to your home phone or personal calling card.