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Policy: II.E.1

Issued: December 19, 1997

Owner: Revenue and Collections

Latest Revision: April 7, 2006

ESTABLISHMENT AND OPERATION OF A BANK ACCOUNT

This policy has been migrated to the standardized format.
See
https://policy.itc.virginia.edu/policy/policydisplay?id=FIN-020

1.0 Purpose

This policy describes the general guidelines for establishing and maintaining a local bank account.

2.0 Policy [Top]

2.1 General

Accounting Services is responsible for the establishment and maintenance of relations with both local and out-of-town banks. This authority shall include, but not be limited to, monitoring cash balances or overdrafts and assisting Procurement Services in negotiating fees and charges.

The University of Virginia maintains central bank accounts for the management of cash collections and disbursements. These accounts are under the direct control of Accounting Services and are reconciled on a monthly basis.

Generally, all departments and activities of the University must use these established bank accounts for their deposits and payments. This policy is designed to improve internal control and provide better short-term management of University funds.

The following circumstances may warrant establishment of bank accounts in addition to those under the direct control of Accounting Services:


2.2 Authorization

No bank account which in any way purports to be, or appears to be, associated with the University, shall be established or maintained without the prior authorization of the Director of Accounting Services, whose authority includes bank accounts affecting any University funds.

See also Procedure 2-5, "Preparation of Request for Petty Cash, Petty Cash Checking, or Change Fund."


2.3 Restrictions

All University funds must be placed in a bank account that clearly carries the name "University of Virginia" in the account title.

A University of Virginia bank account may be used only for legitimate and allowable University related revenue and/or expenses. Student, faculty and staff organizations are prohibited from establishing or maintaining bank accounts using the name "University of Virginia" or "UVa" in the account title, except as provided for in the above sections. Furthermore, they cannot use the University's taxpayer identification number in the establishment or maintenance of any bank account. This restriction applies to Contracted Independent Organizations, Fraternal Organizations, and student, faculty or staff organizations operating without either type of agreement. Special Status Student Organizations may be allowed to establish and maintain a bank account using the University's taxpayer identification number, but only with the expressed, written permission of the Director of Accounting Services. See also Policy I.G.1"Agreement for a Contracted Independent Organization (CIO) and Fraternal Organization (FO)."


2.4 Responsibilities

It is the responsibility of both the bank account user and the department or activity head to:

Limit the use of the account to legitimate and allowable University related revenue and/or expenses. Special questions concerning allowable expenses including 1099 reportable expenses can be answered by Procurement Services.

Ensure that all revenues deposited to University bank accounts are also recorded in the University's accounting system. Recording revenues should be done the same day as the deposit, but under no circumstances more than 24 hours after the bank deposit. Departments should utilize the University's Integrated System reporting functionality for this purpose.

Remit to the State all unclaimed checks from petty cash funds. These checks, if not cashed by the payee within the designated time, are considered unclaimed property and belong to the Commonwealth. Contact Accounting Services for procedures to be followed in remitting unclaimed property.

All bank accounts shall be subject to periodic audit by the University's external auditors and by the University's Internal Audit Department.

3.0 Definitions [Top]

4.0 References [Top]

See also Policy II.E.2, "Petty Cash, Petty Cash Checking, and Change Funds."

See also Policy VI.F.1, "Disbursements: General Requirements."

5.0 Approvals and Revisions [Top]

       Previous version in effect from 12/19/97 to 3/3/00 available in policy archive.
       Change of Ownership and minor clarification made to Section 2.4 on 4/7/06


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