Policy: 301-Custodian Funds
Date: 07/22/2013

Statement of Policy:

Research Participants Payments

  • U.S. Persons (Citizens, Permanent Residents-Both Employees and Non-Employees)  – This policy and payment procedure, applies to all U.S. Persons (Citizens, U.S. Resident Aliens). UW employees are treated the same as non-UW employees when participating as research participants.  Per the IRS, research participant payments are not considered wages and therefore, payments to UW employees are not required to be processed through the Human Resource System (HRS) (Payroll).
  • Nonresident Alien (NRA) – This policy and payment procedure applies to NRA’s, but the payment method for NRA is restricted to only Payment to Individual Report (PIR) due to the immigration and taxation documentation associated with payments to NRA’s as imposed by Homeland Security and the Internal Revenue Service (IRS). Please read the following for restrictions relating to NRA’s: All payments to NRA’s must be processed through a Payment to Individual Report (PIR) regardless of the dollar amount.  Please follow the Payment to Individual Report (PIR) procedures, attaching all required documentation as outlined in the Non-Payroll Payments Flowchart.

See the web pages for Policy: 103-Payments to Research Participants and Policy: 101-Payments to Individual.

Temporary Fund: Temporary Fund is used when the research study is under 1 year and not feasible to set up a UW Madison checking account.

  • Temporary Custodian Funds are for 3months or less.
  • Custodian is a UW Employee.
  • Custodian Funds (checks) are issued to the custodian only.
  • All research participant studies are to be approved by the Institutional Review Board (IRB).
  • The PIR process is followed when participants are paid $250.00 or more.
  • Funds can be used to purchase gift cards in lieu of cash.
  • If 133 or 144 funds are used to purchase gift cards, e-mail approval from RSP is required and must be attached to the Custodian Fund Request Form.
  • Accounting to close the temporary fund must be received within 30 days of the end date of the Custodian Fund.
  • GPR funds will be charged for the advance if accounting to close the temporary is not received within 30 days.

Replenishable Bank Accounts- Research Participants: These bank accounts are used to pay research subjects by check.

  • Replenishable Custodian Funds are for 1 year or longer.
  • Custodian, Reconciler and Signers are UW Employees.
  • All research participant studies are to be approved by the Institutional Review Board (IRB).
  • Family Educational Rights and Privacy Act (FERPA), Health Insurance Portability and Accountability Act (HIPAA), IRB, and all other UW policies are followed.
  • Ensure checks are being written for UW Madison business according to the intent of the bank account.
  • There will be at least two signers authorized to sign checks.
  • There are no conflict of interest and no related party between custodian and reconcilers. The signer and reconciler cannot be related parties.
  • All payments $250 or more are supported with signed W-9 form.
  • The PIR process is followed when participants are paid $250 or more.
  • Replenishments are based on checks written.
  • Cash will not be advanced out of bank account.
  • Personal funds cannot be used to maintain bank balances.
  • Bank account maintains a positive bank balance.
  • Bank reconciliations are done monthly.
  • Replenish to original advance every 90 days or less. 
  • Department/Reconciler will report any errors on the account within 45 days of month end to Cash Management and the Deans Office/Division.
  • The Custodian Fund Accounting Form will be done every 90 days (or sooner) even if there is no activity.
  • Checks dated more than 90 days old will be voided by issuing stop pays using US Bank SinglePoint web application.
  • GPR funds will be charged for the advance plus the amount of overdraft if not remediated within two weeks.
  • When bank account is closed all unused checks are shredded immediately.

Replenishable Bank Accounts - Contingent Bank Account: These bank accounts are used to pay authorized vendors by check when the purchasing card cannot be used and when the accounts payable process is not an option.

  • Replenishable Contingent Bank Accounts are for 1 year or longer.
  • Custodian, Reconciler and Signers are UW Employees.
  • Family Educational Rights and Privacy Act (FERPA), Health Insurance Portability and Accountability Act (HIPAA), Institutional Review Board (IRB), and all other UW policies are followed.
  • Individual check payments may not exceed $5,000.00 per UW Madison Purchasing policies. See http://www.bussvc.wisc.edu/purch/ipp/ipp5.html
  • Checks are being written for UW Madison business according to the intent of the bank account.
  • There are at least two signers authorized to sign checks.
  • There are no conflict of interest and no related party between custodian and reconcilers. The signer and reconciler cannot be related parties.
  • Replenishments are based on checks written.
  • Cash will not be advanced out of bank account.
  • Personal funds cannot be used to maintain bank balances.
  • Bank account maintains a positive bank balance
  • Bank reconciliations are done monthly.
  • Reconciled to authorized advanced level.
  • Department/Reconciler will report any errors on the account within 45 days of month end to Cash Management and the Deans Office/Division. 
  • The Custodian Fund Accounting Form will be done every 90 days (or sooner) even if there is no activity.
  • Checks dated more than 90 days old will be voided by issuing stop pays using US Bank SinglePoint web application.
  • GPR funds will be charged for the advance plus the amount of overdraft if not remediated within two weeks.
  • When bank account is closed all unused checks are shredded immediately.

Change Fund: Departments which operate retail operations and cashiering registers which require coin/currency handling.

  • Change Funds are used for point of sale/retail operations
  • Change Funds are for the period of time needed for the point of sale operation to manage currency and its change
  • Custodian must be a UW Employee and approved by the Division/Deans Office.
  • Cash will not be advanced from change fund operations.
  • Change Fund cash will not be used to purchase product/food/expenditures needed for the point of sale operation.
  • Refunds to customers will be issued for cash purchases only.
  • Reconciliation to change fund will be done daily.
  • Coin order procedure will be followed to replenish change for point of sale/retail operations.
  • Personal funds cannot be used to maintain change funds.
  • Form and How To Armored Car Service Change/Request

Coin Request Procedure

Change Fund:  Departments which are involved in revenue producing activities that require having coin/currency on hand for retail transactions. The change fund is for an indefinite time period to a Department operating a cashiering function which requires making change for retail sales. 

Request special deposit tickets called “Coin” deposit tickets by e-mailing Cash Management and request  “Coin” deposit tickets along with instructions on how to order coins at US Bank. 

If the Armored Car stops schedule needs to be adjusted or a new stop added please follow instructions for the Armored Car Service Change/Request form (see link below). Cash Management reviews and approves all requests.  Cash Management reserves the right to work with the armored car service provider to revise these requests before changes occur.

If custodian advance is needed in order to manage coin/currency on hand for retail transactions, please review the Custodian Policy/Procedure web site listed below:

To order coins/currency from US Bank please view the following instructions:
Contact Cash Management to acquire a “Location ID” number and password.

Petty Cash:Departments which set up Petty Cash (usually less than $100) for handling small purchases that cannot be effectively handled by a purchase card.

  • Petty Cash is used to handle very small purchases which cannot be paid by purchase card or check.
  • Petty Cash Funds will be reviewed yearly.
  • Custodian must be a UW Employee and approved by the Division/Deans Office.
  • Cash will not be advanced from Petty Cash Funds.
  • Reconciliation to petty cash fund will be done weekly.
  • Replenishments of petty cash funds will be done monthly.
  • If coin/currency is needed for exchanging currently, then the coin order procedure will be followed.

Related Procedure(s):

Who should know this policy?

Deans, Directors, and Staff dealing with custodian funds

Related Documents:

Contacts:

cstdnfnd@bussvc.wisc.edu

Policy and Procedure Index