Preface

A change fund may be established for an agency from an authorized agency operating fund.  A change fund is an amount established by an agency to provide change for customers transacting business on the agency premises.  A change fund is generally a small amount by nature and must be reconciled to the established amount daily and periodically verified by an independent person.

Definitions

Change Fund - An amount of cash needed for making appropriate change to customers (not to be used for making purchases).

Policy

Change funds shall be established at the discretion and approval of the agency management, in an amount deemed necessary to effect operational efficiency.  A change fund may be established from the agency's operating fund.  A change fund shall not be established from incoming cash receipts. 

The change fund disbursing officer or the officer's delegate shall be held responsible and accountable for the money transferred from the agency operating fund to a change fund.

Proper Use of a Change Fund

The change fund should be kept in a secure location and should only be used in the agency's normal course of business to make change for customers.  The change fund must be reconciled to the established amount each day using the following general guidelines:

• Change fund amount never changes from day to day.
• Separate authorized change fund amount from the day's receipts.
• Record day's receipts to appropriate revenue coding – including any overage or shortage.
  

Under no circumstances should a change fund be used to:

• Purchase materials, supplies, or services which could be paid for by state warrant or by P-Card. 
• Cash personal checks.
• Purchase personal items for employees.
• Extend cash advances to employees.
• Any other non-state business purposes.

Administrative Procedures​

To Establish or Increase a Change Fun​​​​​d From an Operating Fund

1. Notify the State Controller's Office, Luma Division that you need to establish or increase a change fund from an operating fund.  Identify a dimension in the chart of accounts to use to track the amount of the change fund within the operating fund. 

2. A state warrant should be drawn on the agency's operating fund, payable to the change fund disbursing officer. 

3. Sight drafts payable to "change fund" or "cash" will not be honored by the State Treasurer.

4. The disbursing officer should cash the state warrant.

Closing the Change Fund to an Operating Fund

1. Reconcile to the established amount.

2. Deposit all cash into the originating operating fund​.