Disbursement Management Petty Cash, Human Subjects, Financial Aid Refunds

Marsha Lovell

Associate Controller, Business and Finance Services – UCLA

Chris Ramos – UCLA Manager, Student Accounts and BruinCard – UCLA

Why Disbursements? We are invested in improving our processes by working smarter! • • • • • •

Cost cutting ‘Going Green’ Automating processes Building skills Minimizing complacency in the workforce Ensuring we are in compliance

What We Streamlined? • Petty Cash and Change Funds • Human Subject Research Funds • Employee Recognition Funds • Financial Aid Disbursement

Where Did We Start? The root of the problem •

• •

Customer needs and expectations • Timeliness • Verification • Approval • Shuffling oversight Compliance with federal, state, UCLA and other regulations Staff feedback

Disbursements • Research project fund restrictions • Several hundred petty cash funds • Too much information – IRB, participants SSN • Staffing - one person full time, manual • Federal regulations – audit, cost of checks, lost checks, manual work during peak period

Putting the puzzle together • Student Accounts • Payment Solutions & Compliance • Accounting and Cash Management • General Accounting Office • Accounts Payable Office • Treasury Services • Research Office

Old School Processes Human Subjects/Petty Cash • IRB/Petty Cash form approved by General Accounting Office (GAO), paper form • GAO sends approval to Accounts Payable • Funds paid by check to department • Department takes check to Cashier’s office for funds • Department gets cash and spends • Department requests reimbursement from GAO • And the cycle repeats • Cycle time – approximately 1-2 weeks

Old School Processes Employee Recognition • Departments submit email request or paper form to Purchasing department • Either paper check or gift card equivalent purchases mailed to requesting department. • Non-compliant electronic gift card ordering, card numbers downloaded to workstation • No secure delivery method utilized. In some cases departments picked up gift cards directly from stores. • Fulfillment cycle time – approximately 2-4 weeks

What is critical? • • • • • •

Approval Authorized person to receive funds Disbursement amounts and type Compliance with policy and regulations Speed Where do we get the funding?

Approvals • • • •

Research department – oversight/audit Departmental approval – policy/audit Fund Manager – accounting Federal regulations and requirements

• We are NOT the money police!

Authorized Receipt and Storage • Validate receipt with BruinCard • Two authorized personnel on each form • Coordinate delivery time between 2 hour window • Submit safe information on request form • Audit information from form

Disbursement Amounts and Type • Options – cash (theft), check (need SSN), gift cards, BruinCard (staff/student) • Preferred cards – no ship/handling, card costs - 3 days max • Non-preferred cards – 3-4 weeks possible • Denominations stocked • Requested feedback on cards wanted

Compliance • • • • •

UCLA policy 361 – secure delivery UC BUS 49 – cash handling UCLA safe requirements IRS requirements – cash over $600/1099 Higher Education Act restrictions – ‘mandatory’ • Audit tests

Speed • 3 day from receipt of approval – Preferred – Denominations on hand – ½ FTE saved in one department alone

• 3-4 weeks – Non-preferred – Online

Funding • Accounting & Cash Management does the journal entry to pull funds from department for awards and Dunbar delivery • Full cost assigned to department if nonpreferred • No check costs • No charge to department for service, except delivery cost

Human Subject Form

Current Petty Cash Process • Petty Cash/Change Fund (PC) reviewed by Student Accounts (SA), approved by department head - fillable PDF on the web – annual cash audit • SA sends approval to Cashier’s office (cash disbursement) and Accounting & Cash Management (journal entry to move cash) • Funds paid by cash to department, delivered securely by armored courier, spends cash • Department requests reimbursement from SA • And the cycle repeats • Fulfillment cycle time – approximately 3 days

Process Enhancements • •

• •

• •

Shortened delivery time from 1-2 weeks to 3 days Changed paper request forms into fillable PDF which require signature – can scan if no electronic signature functionality, electronic submission required Positive customer response to changes Closed or reduced many Petty Cash accounts due to increased interaction, annual on site audits – tracking petty cash turns Increased audit visibility and approval of process Compliant cash handling delivery with increased safety

Petty Cash Turns BFS: Student Accounts Petty Cash 800 700

Avg # of Days

600 500 400 300 200 100 0 Jul

Aug

Sep

Oct FY 14

Average # of Days Petty Cash Turns

Nov

Dec

Jan

Current Human Subject/Employee Recognition Process • •

•

•

Departments submit fillable PDF form, along with any IRB approval paperwork, via email to Cashier’s office. Cashier’s office disburses cash or gift cards (preferred stock) within three business days via secure armored courier. Non-preferred gift card orders assigned to Student Accounts for ordering. Will take longer than three business days. Disbursements logged daily, journal entries by Accounting & Cash Management weekly, reconcile monthly, audit quarterly by Student Accounts/annually auditors.

Process Enhancements • •

• • •

•

Shortened delivery time from 2-4 weeks to 3 days Changed paper request forms into fillable PDF which require signature – can scan if no electronic signature functionality, electronic submission required Positive customer response to changes Increased audit visibility and approval of process Effective tracking of cash flow. (disbursement activity logged daily, recharge journal entries weekly, reconcile monthly, audit quarterly/annually). Compliant cash handling delivery with increased safety

Financial Aid Disbursements

Old School Financial Aid Disbursement Process • • • • •

Financial Aid department approves and releases funds to post to billing account. SA prints refund reports and reviews for discrepancies daily (no dual review or signatures). SA sends approval of BruinDirect refund file to Cashier’s office to release to student’s account and banks. Paper refunds generated only once per week. Low participation in direct deposit refund process, still very paper based.

What is critical? • • • • •

Review and Approval - Audit Compliance with policy and regulations Speed Low cost No manual intervention by staff

Review and Approval • Financial Aid department approves disbursement to billing system. • One SA specialist reviews refund and reject reports daily and uses electronic signature. • Second SA specialist reviews refund and reject reports daily and uses electronic signature. Sends approval to Cashier office. • Cashier supervisor approves refund files for disbursement.

Compliance with Policy and Regulations • Federal Financial Aid regulations • ‘Mandatory’ word used • Audit regulations (consistent review and timely disbursement to students).

Speed • BruinDirect refunds available within 2-3 business days • Credit card refunds available within 2-3 business days • Paper refunds available within 1-2 weeks

Current Financial Aid Disbursement Process • •

•

•

Financial Aid department approves and releases funds to post to student’s account. SA electronically files refund and reject reports and reviews for discrepancies daily (dual review and esignatures). SA sends approval of BruinDirect and credit card refund files to Cashier’s office to release to billing accounts and banks. Paper refunds generated once per week.

Process Enhancements • •

•

Improved and efficient internal review and approval process (electronic filing and e-signatures). Implemented new refund reject report to account for any students receiving refunds two times in a row. Helps prevent duplicate refunds. Increased participation in direct deposit refund process, reached 82% in current academic year. Due to increased marketing efforts for BruinDirect through mass email blasts, notifications through MyUCLA (student portal), etc.

Long Term Benefits • • • • • • • • •

Compliance with research and audit regulations Reduction in Petty Cash/Change Funds Annual audit requirement standards Faster and accurate processing Improved customer service Cost Effective Methodology Stronger internal controls Protect University assets Timely disbursements

How to Increase Direct Deposit • Tell them what you are going to do • Checklist upon acceptance – Enroll now! • Orientation update – Enroll now! • Contests to encourage enrollment – Enroll now! • Want your money fast? – Enroll now! • Parent’s weekend – Enroll now! • Family orientation – Enroll now! • Reminder email, Did you forget? – Enroll now! • Last reminder – Do you want your money next week or the week after? – Enroll now!

How to Increase Direct Deposit • Email when a refund is available for them – No direct deposit information, check will be cut next week. Sign up now for funds release tonight! Enroll now! • When students come to pick up checks lost in the mail, make them wait 2 weeks (4 weeks?) to ensure it won’t be returned • Returned check pickup – sign up for direct deposit OR pay $25 for reprint fee for lost check • Bad address - $25 or sign up for direct deposit

How to Increase Direct Deposit • Online sign up/change information/manage account • Put in student portal, not an isolated location • Publish information on website, on student bill, FAQ, everywhere • Run statistics on population and target audience • New admits – known for technology, none have signed up in the beginning • Non-traditional students – not necessarily techno-savvy • EMBA/FEMBA students – departments enable bad behaviors

How to Increase Direct Deposit • • • •

‘Mandatory’ is acceptable, just no enforcement options Paper checks only once per week Electronic refunds daily – credit cards, ACH (direct deposit) Other ideas?

What Can You Do? • Are you invested in improving your processes? • Evaluate your processes from an ‘external’ perspective • NEVER accept “That’s the way we’ve always done it.”

Future Projects • • • •

Increased participation in direct deposit refunds (90%) Closure of petty cash and change funds Better internal auditing controls for gift card disbursements System enhancements to better account for refund discrepancies

Future Needs • • • • •

Knowledge workers Technical skill development Embrace change Streamlining ongoing Morale building opportunities

Questions or Comments? Marsha Lovell, Associate Controller Business and Finance Services UCLA 310-206-6034 [email protected] Chris Ramos, Manager Student Accounts/BruinCard UCLA 310-206-1466 [email protected]