Chapter 2. Accounting Services
Section 2.7. Accounts Payable

2.7.10.3. Petty Cash Fund Purchases

Disbursements from petty cash funds must be properly documented and for a valid University business purpose.

The University does not reimburse Michigan sales tax. Obtain the University sales tax number from the petty cash custodian before making a purchase. Use of the University sales tax number when purchasing items for other than University purposes is prohibited and may result in disciplinary action.

Petty cash funds may not be used for the following:

• Items/receipts in excess of $200.00.



• Payment of sales or excise taxes on any purchases within Michigan since Michigan Technological University is a tax exempt organization and does not reimburse Michigan sales tax.



• Cashing of personal checks or providing personal loans.



• Purchases which are required to be reported in a specific manner such as, but not limited to, personnel services, travel expenses, payroll advances, and business meals.



• The following are prohibited purchases using petty cash:



• advertising


• alcoholic beverages and tobacco


• animals (laboratory)


• automotive repairs (accident related)


• chemicals


• clothing


• controlled substances


• cylinder gases and liquid nitrogen


• donations


• flowers


• hazardous materials


• leases and rentals


• maintenance agreements


• University letterhead, business cards, and envelopes


• Michigan sales tax


• personal items


• items that are intended to be used or consumed by University employees on or off campus for other than official University use.
• professional services


• renovations or remodeling (on campus)


• seminars and memberships


• telephones


• weapons and ammunition




• Hospitality expenses such as meals or entertainment.

Accounting Services has the authority to make exceptions to the above list when special or unusual circumstances apply. Approval for exceptions must be received prior to purchasing items listed above.

An employee purchasing items using petty cash funds, does the following:

1. Obtains prior approval from the department head, supervisor, or fund custodian.



2. Obtains, when necessary, the University sales tax number from the petty cash custodian since Michigan sales tax is not reimbursable.



3. Obtains, when necessary, a petty cash advance from the fund custodian. A petty cash advance is given only to purchase legitimate petty cash items. When an advance is given, the custodian must maintain the following information:



1. the amount of the advance



2. the date



3. the purpose



4. the recipient



5. the recipient's signature



The custodian is responsible for ensuring the employee returns any unused cash.

4. Makes the purchase, paying for the item with personal monies or with the petty cash advance, and obtains an itemized receipt or cash register sales slip.



5. Presents the original sales receipt or cash register sales slip to the petty cash custodian with the appropriate index and account code to be charged. The receipt(s) must include:



1. description of the item(s)



2. date of purchase



3. place of purchase



4. itemized amounts



5. purpose



6. signature of purchaser



7. appropriate index and account codes to be charged.




6. Receives reimbursement for the purchase from the petty cash custodian when personal monies are used or return any unused portion of the petty cash advance to the petty cash custodian immediately after the purchase is made.