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Petty Cash Change Fund and Disbursement Fund Procedures

Petty Cash Funds

Petty cash funds are requested by the department for use as a change fund (during cash sales transactions or to purchase items that are not available through normal purchase channels) or as a disbursement fund (as payments to participants in research projects) are established through the Office of the University Bursar (OUB).

The person requesting the funds referred to as the fund custodian must be a Virginia Tech faculty member, classified staff employee, or a Virginia Tech graduate assistant participating in a research project. These funds require two individuals be responsible for the cash, the fund custodian and the department head. Both the fund custodian and the department head are responsible for the proper use of the fund and for the repayment of the fund. For disbursement funds reimbursed by a grant, the Principal Investigator must also approve and sign the request and is responsible for the proper use of the fund and for repayment of the fund. The Office of Capital Assets and Financial Management will perform an annual audit of petty cash funds.

Funds must be kept in secure locations. See Acceptable Safeguards in the Funds Handling Policy (DOC) for change funds.

Funds are established by completing a written request, i.e. Petty Cash Change/Disbursement Request Form (http://www.bursar.vt.edu/forms/pettycash.pdf), 7 - 10 days prior to the date the fund is needed and submitting to The Office of the University Bursar (OUB). The OUB reserves the right to deny requests based on the purpose/justification for the request, unauthorized department approval, the amount of the fund, the planned safeguarding of the fund, or any outstanding petty cash balances remaining in either the department or fund custodians name, or any past due balances owed the University by the custodian. If a request is denied for any reason, a representative from the Office of the University Bursar will notify the individual requesting the fund.

Once the University Bursar approves the request, it is sent to the University Controller's Office for a check to be issued to the fund custodian. The check may be picked up at the Customer Service Windows of the Office of the University Bursar 7 - 10 days after the request form is submitted. Petty cash checks must be picked up by the fund custodian. The person picking up the check must be able to provide a pictured identification to the customer service representative.

The Customer Service Section is not authorized to cash checks of any type. Therefore, the fund custodian must cash the petty cash check at a local bank. The fund custodian is responsible for the safeguarding of the funds as specified on the Change/Disbursement Request Form. Funds are subject for review or audit by authorized University Officials at anytime.

Disbursement Fund

For disbursement funds, if a request for petty cash is greater than $500 but less than $2,000, the custodian must store the cash in a departmental safe or open a checking account in the custodian's name by project. If the request for petty cash is $2,000 or more or the cumulative amount of the petty cash assigned to the fund custodian for a project is equal to $2,000 or more, a checking account is required to be opened in the fund custodian's name for the specific project. Please contact Janet Moran (jamoran@vt.edu) to establish a checking account. Once the project is complete the checking account will be closed. The checking accounts are not subject to monthly fees; however, the cost of overdrafts, if they occur, is the responsibility of the department. A monthly reconciliation of the checking account is required by a departmental staff member who does not handle funds related to the project in order to maintain separation of duties. The Office of Capital Assets and Financial Management will perform an annual audit of checking accounts. Petty cash funds may be used for legal, allowable purchases only. If you have questions about a proposed expenditure, please check with Accounting Services or Purchasing to avoid problems.

Once the University Bursar approves the request, it is sent to the University Controller's Office for a check to be issued to the fund custodian for amounts less than $2,000. A check may be picked up at the Customer Service Windows of the Office of the University Bursar 7 - 10 days after the request form is submitted. For requests in the amount of $2,000 or greater, a checking account must be established for you by OUB and the funds will then be transferred to the fund custodian's checking account. If a request is denied for any reason, a representative from the Office of the University Bursar will contact the individual requesting the fund.

All uncashed checks from petty cash funds are considered unclaimed property and must be reported as such. If any check is not cashed by the payee within 180 days, and the payee cannot be contacted for disposition, the funds must be reported as unclaimed. Contact Susan Edwards (susaned@vt.edu) for more information regarding the reporting of unclaimed funds.

  • For projects funded by grants, the project must have funds available and approved Institutional Review Board protocols for human subjects.
  • Petty cash requests should be for the lesser amount of expected payments to participants within 90 days or $2,000.
  • As funds or gift cards are disbursed to individuals, these individuals must sign and date proper receipt documents signifying receipt of funds. The custodian will use these receipts to request reimbursement through their department every 90 days or when the project is completed, which ever comes first.
  • The department should verify funds, gift cards and/or receipts on hand weekly. The total of the documented receipts plus cash and gift cards on hand must always equal the original disbursement fund amount.
  • Discrepancies in the account will be the sole responsibility of the department.
  • The custodian will be sent an electronic notification to their VT email address to view the Accounts Receivable statement from the Office of the University Bursar 1-30 days after the ending date of the research project or after 90 days of when the funds were initially requested. The funds must be repaid by the due date on the statement, which is approximately 25 days after the statement date.
  • If a participant is paid $100 or more, payment must be made to the participant by check.
  • If payments to an individual participant is expected to be $600 or more during a calendar year, a W-9 form must be obtained from the participant since the university is required to report this amount to the Internal Revenue Service (IRS). The department must maintain records for payments to each participant if it is likely the amount to be paid will equal or exceed $600. Please refer to the Controller's Office procedures regarding special payments to human subjects at http://www.co.vt.edu/procedures/p23715.html to ensure compliance with the IRS reporting requirements.
  • Gift cards that are purchased with the disbursement funds must be safeguarded and accounted for the same as cash.
  • If gift cards are mailed to participants, a log must be maintained under dual control documenting to whom the cards were mailed.
  • If petty cash funds have to be left off site with a co-investigator, a signed receipt is required for the amount of the funds left with the co-investigator.


Should a project ending date need to be extended, a written request from the department head or director should be sent to the OUB Loans & Collection Manager stating the reason for the request and the anticipated new date for which the project will end.

Change Fund

  • Prior to requesting a change fund, a funds handling plan must be submitted and approved by the Bursar's Office.
  • Petty cash change funds are used for the purpose of making change during a business transaction or for authorized departments to purchase items that are not convenient or available through university service units.
  • The department should verify funds and/or receipts on hand monthly to insure that the amount of the petty cash fund is properly accounted for in its entirety.
  • Discrepancies in the account will be the sole responsibility of the department.
  • Accounts Receivable confirmation letters will be mailed to the fund custodian annually to verify the balance of Petty Cash Change funds.


When a department has a change in fund custodians, the account name in which the fund was established must also be changed. The department must complete and return to the University Bursar a Petty Cash Change Fund Change of Custodian Form (PDF)

As business activity increases, it is often necessary for the department to also request an increase in the amount of the funds held. The increase for funds must be requested by using the Petty Cash Request Form (PDF) and the custodian must note that the amount requested is an additional amount to increase the current funds held.

Reimbursement of Petty Cash Funds

Disbursement funds should be reimbursed at least every 90 days.

  • Any unused cash must be taken to the Customer Service Windows of the Office of the University Bursar to reimburse the accounts receivable account in the fund custodian's name.
  • Reimbursement to the University fund may be requested by using a Departmental Order for Purchases/Payments (DOPP) form. The DOPP form must be addressed to the "(fund custodian) or Treasurer of Virginia Tech". Supporting documentation (original receipts) must accompany the DOPP.
  • The total of receipts must agree with the total amount on the DOPP form. Completed DOPP forms should be sent to the Controller's Office for processing.
  • The DOPP initiates the transfer of funds to reimburse the University's cash funds and to pay off the Accounts Receivable balance in the custodian's name.
  • If change funds are no longer needed, or if the department wishes to decrease the amount of the cash held, the unused cash must be taken to the Customer Service Windows of the Office of the University Bursar to reimburse the accounts receivable account in the fund custodian's name.


If at any time a cash shortage or discrepancy is noted by the department, contact should be made with the Director of Internal Audit.