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Cash Advance & Liquidation

Version Date: 30 May 2008  

Policy Statements
  1. Purpose: Cash advance is requested for a specific purpose or for an explicit activity. Normally, the advance is taken from the budget of funded activities or projects. An advance is usually used to cover costs which are needed before the start of the project. These projects generally have a Project Information Sheet (PIS).
  2. Coverage: All UA&P employees
Implementing Guidelines
  1. Cash Advance
    1. The amount of cash advance requested may vary:
      1. For advances of less than P 2,000.00 a petty cash advance form is used.
      2. For advances of more than P2,000.00 but not to exceed P20,000.00, a request for payment form is used. The advance will be paid in the form of a check. Requests for more than P20,000.00 are referred to the Director for Finance for study and approval.
    2. Only those who are directly involved in the activity/project, and could therefore be held accountable for the funds, should request for the advance. This person is also responsible for liquidating the advance at the end of the activity/project (see IV.6.c). The advance will be granted only to those who do not have outstanding unliquidated transactions, except if the activity for which funds were previously advanced is still ongoing. This will prevent intermingling of funds secured for different purposes.
    3. The advance is approved by the immediate superior of the employee (i.e., Dean, Asst. Dean, School/College Secretary, Unit Head, Department Chair, Executive Director, Program Director), or by any OPCOM or MANCOM member in case of absence of the former. The person requesting for the advance cannot approve his/her own request even if he/she is a University official.
  2. Liquidation of Cash Advance
    1. The advance must be liquidated within three (3) days after the activity. Failure to do so would mean that the full amount of the advance will be deducted from the employee’s salary.
    2. The liquidation report must be approved by the immediate superior of the employee (i.e., Unit Head, Department Chair, Executive Director, Program Director), or by any Opcom or Mancom member in case of Unit heads. The person liquidating the advance cannot approve his/her own report even if he/she is a University official.
    3. Only expenses related to the purpose of the cash advance and within the period and place stated, may be included in the liquidation.  Non-related expenses, if any, should be coursed through its own procedure.
      1. Travel expenses would ordinarily cover transportation, board and lodging, terminal fees, gasoline, entertainment or representation with client.
      2. When a personal car is authorized for its use, the  circular on transportation reimbursement shall apply.  This excludes any payment of driver’s services, food, board and lodging, etc.
      3. In case a contract or a project has specific terms of reference (TOR), such should be mentioned/indicated whenever an expense liquidation is made.
    4. Expenses without receipts may be supported as follows:
      1. For tips to waiter, this may be incorporated as additional entry on the official receipt. Prudence should be exercised in considering whether or not a service charge is included in the amount paid.
      2. For other non-documented expenses like taxi fare, tricycle, porter/ room boy tips, etc., a pro-forma receipt indicating the nature of the expense, type of service rendered, point of origin/destination, etc as the case may be, should be accomplished.  The form for transportation reimbursement may be used.
    5. The expenses listed in the liquidation report are subject to final verification by FMR. Only those expenses related to the purpose of the cash advance, and incurred during the course of the activity/project can be liquidated. All expenses must be supported by appropriate official receipts (i.e., original, authentic and legal). Transactions that do not follow policies will be referred to the Director for Finance.
    6. Lost receipts must be reconstructed, and approved by the Director for Finance.
    7. Unused cash advance must be returned to the cashier. It should not be spent for unrelated activities/projects. The person, on the other hand, will be reimbursed for additional funds that he/she advanced from his/her personal account to cover official transactions.