Cash Handling Training

Association of Public Treasurers

of the US & Canada
Training Benefits for You Today
 Enhance your own performance

 Entertain and exchange new ideas

 Build confidence

 Receive recognition

 Built on the APT manual for reference

No such thing as
“Just a Cashier”
 You are a City ambassador!
 You must be:
 friendly
 courteous
 honest
 professional
 exhibit high levels of integrity
Your pivotal role
 Treat others as you expect to be treated
 Your Performance Standards
 produce accurate results
 perform efficiently and cost effectively
 perform according to established standards
 show initiative to excel and contribute
 establish good public relations
 create positive impression through a well
groomed personal appearance
Training Modules
 Money System Background

 Currency Identification and Handling

 Daily Operations

 Security
Our Training Purpose
 Learn specific skills and knowledge
 Instill customer service orientation
 Increase accountability and reduce errors
 Increase safety
 Standardize procedures
 Implement certification and training Programs

 Collect money and collect ideas!

Module One:
Background
Your Treasury
and the Flow of Money
Our U.S. Banking Structure
 Established by Alexander Hamilton
 Independent and branch banks
 Federal Reserve - the banker’s bank

MANUAL PAGE: 3
Federal Reserve System
 Federal Reserve Act - 1913
 Currency control
 supply, flow and issuance
 Federal Reserve Board
 12 Districts
 12 Federal Reserve banks
 25 Branches and 9 Additional Offices
 47 Check processing centers
Inside the “Fed”
 Board of Governors
 Federal Open Market Committee
 Federal Advisory Council
 Federal Reserve Banks
 Member Banks
 Credit Policy
 Margin Requirements
 Reserve Rate
 Discount Rate

MANUALAPPENDIX A
Moving Money through the Fed
 Currency flow
 A move to electronic transactions
 expedited funds regulations Reg CC
 “Check 21”
 cost and efficiencies – “ECA”
 retention at first bank of presentment
 Checks
 daily “fed letters”
 sort and transfer through ABA numbers
Can You Name the Districts?
 1  7
 2  8
 3  9
 4  10
 5  11
 6  12
The Federal Reserve Districts
 1 Boston  7 Chicago
 2 New York  8 St. Louis
 3 Philadelphia  9 Minneapolis
 4 Cleveland  10 Kansas City
 5 Richmond  11 Dallas
 6 Atlanta  12 San Francisco

MANUALAPPENDIX A
•Source: www.federalreserve.gov/
City Treasury Responsibilities
 Receive and retain funds
 Safeguard and disburse funds
 Invest funds at all times
 Receipt customers
 Maintain accurate records
 Maintain customer relations
 Understand emergency situations

MANUAL PAGE: 3-4

Inside Your Treasury
Treasurer
Central Cashier

Depository

Department Department Department

Cashier Cashier Cashier

Consolidated or “Central” Cashiering vs. Decentralized
Sample Legislation from APT US&C

 Establishing cash handling as a City function

 Create legal references internally
 Require certification
 Require training
 Establish timely deposit responsibility
 Establish timely deposit liability

MANUAL PAGE: 30
Module Two: Currency
Money, money, money!
Checks, checks, checks!
A Close Look at Currency
 Seven denominations
 Numeric and alpha value notations
 One Federal Reserve seal
 No longer by District
 Treasury seal
 Unique serial number (2 times)
 Federal Reserve District designation
 Four times on the one dollar bill
 In the serial number and alpha numeric

MANUAL PAGE: 6
Currency Notes
Who ?  $1
 $2
 $5
 $10
 $20
 $50
 $100
 $500
 $1,000
 $5,000
 $10,000
Currency Notes
 $1 George Washington
 $2 Thomas Jefferson
 $5 Abraham Lincoln
 $10 Alexander Hamilton
 $20 Andrew Jackson
 $50 Ulysses S. Grant
 $100 Benjamin Franklin
 $500 McKinley
Gone but not
 $1,000 Cleveland
forgotten...
 $5,000 Madison
 $10,000 Chase
What’s backing it up?
 George Washington  What is the picture?
 Thomas Jefferson
 Abraham Lincoln
 Alexander Hamilton
 Andrew Jackson
 Ulysses S. Grant
 Ben Franklin
What’s backing it up?
 George Washington  Great Seal & Pyramid
 Thomas Jefferson  Declaration of Indep.
 Abraham Lincoln  Lincoln Memorial
 Alexander Hamilton  US Treasury Bldg
 Andrew Jackson  White House
 Ulysses S. Grant  US Capitol Bldg
 Ben Franklin  Independence Hall
The History of Money
 Clubs to cryptography
 increasing need for security and procedures
 First metal coins created about 600 B.C.
 First paper money was Chinese 400 B.C.
 First electronic money - ACH - 1950’s
 Digital internet money - 1990’s
 PCs as ATMs
 Patriot Act of 2002
History of US Money
 Used Spanish/French/English until 1775
 1775 first issued to finance war
 Paul Revere made first plates
 1792 Mint Act after Constitution
 1793 first coins minted (first one to Martha W.)
 1861 first paper “Demand Notes”
(“greenbacks”)

 1793-1861 1,600 banks issued 7,000

varieties of paper money
History of US Money
 1878 Act created Silver Certificates (blue seal)

 1863-1929 Banks could issue

National Bank Notes
 1913 Federal Reserve Act creates
Federal Reserve Notes
 Currently:
 99% Federal Reserve Notes (green seal)
 1% US Notes (red seal)
Who are the current players?
 US Treasurer
 Anna Escobedo Cabral

 Secretary of the Treasury

 John Snow
New Currency
 Larger, off center portrait
 Colors added in 2003
 Watermark portrait
 Color shifting ink (lower right)
 Low-vision features on $20 and $50
 New $20 released in November 2003
 New $50 and $100 in 2004 and 2005
 $5 and $10 redesign under consideration
 $1 and $2 will not be redesigned
 New Currency
 Embedded security thread (1990)
 left on $20 & $100
 right on $50
 “US Treasury”
 Embedded security strip
 $ 20 glows green
 $ 50 glows yellow
 $100 glows red

MANUAL APPENDIX A
New Currency
 Micro-printing patterns (1990)
 $ 20 in oval and lower left “USA 20”
 $ 50 in Grant’s collar and side border
 $100 in Ben’s coat and lower left
 The New Bills
1.Federal Reserve Note
5.Serial Number
6.Placement
9.Federal Reserve District
12.Fort Worth!!

•http://www.treas.gov/usss/
•Source: Department of the Treasury - United States Secret Service
 The New Color of Money - $20
 Subtle green, peach and blue colors in background
 Adds complexity to the notes
 Enhanced portrait and White House
 “20” in yellow covers the background
 Blue Eagle in background, metallic green eagle
and shield left of Jackson $20
 Watermark and security thread retained
 Color shift from copper to green dramatized
Currency
 Cotton-linen blend with red-blue fibers
 Treasury Seal:
 scales for balanced budget
 carpenters square for an even (fair) cut
 Pyramid:
 face lighted but (unexplored) west is dark
 uncapped because we are not close to finished
 eye is divinity (not man alone)
 clouds are rolling away - i.e. clearing
Currency Lingo
 Annuit Coeptis
 “God has favored our endeavor”
 Novus Ordo Seclorum
 “a new order has begun”
 E Pluribus Unum
 “one nation from many people”
 MDCCLXXVI
Currency
 The bald eagle
 never afraid
 strong and smart to fly above
 wears no crown
 shield is unsupported by a king
 Olive branch and arrows
 wants peace but willing to defend
freedom
 13 stars for the original 13 colonies
Coins
 Minted in
 Philadelphia, Denver, San Francisco and West Point
 Backed by precious metals kept at
 Fort Knox and West Point Depositories
 Seven types
 Smooth or ridged edges
When taking cash closely note
 The numeric value on each corner
 The value written out across the bottom
 The Federal Reserve Seal
 The unique serial number in two places
 The four Federal Reserve bank numbers

MANUAL PAGE: 6
Counting Money
Counting is 1 - 2 - 3
 3 Three Ways to Count

 2 Two Counts on Each

 (Double Count)

 1 One Total

MANUAL PAGE: 06
Three Ways to Count
 Hand to Hand

 Hand to Table

 Walk Through
Hand to Hand Method
 Separate bills
 all bills facing up
 smallest denomination on top
 Hold in one hand
 Transfer bills separately to other hand
 Look at each bill
 COUNT AGAIN
 Get two counts that agree!
MANUAL PAGE: 6
Hand to Table Method
 Same as hand to hand
 pile bills facing up with smallest on top
 Place funds on table not in customer’s
hand
 Count once into your hand
 Count twice onto the table or counter
The Walk Through Method
 Stack denominations face-up
 Count with thumb and forefinger
 Check each bill
 Count twice for same total

 Counting machines

MANUAL PAGE: 7
Making Change

 Establish a routine
 Two methods:
 cash register calculation
 counting from sale to tendered amount
 Counting back
 smallest coin to the largest bill
 Two counts:
 (1) from the cash drawer
 (2) to the customer
MANUAL PAGE: 8
Customer Transactions
 Keep $$ in view of customer
 Complete transaction before securing $$
 Verify payment against invoice/bill
 One customer at a time
 Always give a receipt
 Security

MANUAL PAGE: 8
General Rules that Count ...
 Money is dirty - wash your hands
 Count in customer’s presence
 Establish a routine
 Double count
 Numbered receipts
 Secure the area
 Create dual control is possible
Strapping
 Count only fifty at one time
 Double count
 Color code or value mark
 One denomination at a time

MANUAL PAGE: 9
Currency Straps
No. per strap Value
$ 1 100 or 50 $100 or 50
$ 2 100 or 50 $200 or 100
$ 5 100 or 50 $500 or 250
$ 10 100 or 50 $1000 or 500
$ 20 100 or 50 $2000 or 1000
$ 50 20 or 40 $1000 or 2000
$100 20 or 40 $1000 or 2000
MANUAL PAGE: 9
Coin Wrappers

No. Coins Value

Penny 50 $ 0.50
Nickel 40 $ 2.00
Dime 50 $ 5.00
Quarter 40 $ 10.00
Half Dollar 10 $ 5.00
Mutilated Money
 What constitutes mutilation
 torn bills - missing parts
 bills written on - bent coins

 Ask for a substitute if possible

 But, it is still legal tender

 Separate for return to bank

MANUAL PAGE: 9
Mutilated Money Rules
 Will your bank credit you?

 If more than 3/5 exists (2 serial numbers)

-you receive face value
 If more than 2/5 exists (40%)
-you receive face or 1/2 value
 If less than 2/5 exists
-you receive nothing
MANUAL PAGE: 9
The Growing Counterfeit Problem
 US bills invite counterfeiting
(color and size similarities)
 Know your bills:
- paper - portraits
- microprinting - seals
- serial numbers - new bills
- color shifting ink - watermark
 Automatic sensing counters
 “Raised” Notes
MANUAL PAGE: 9
If you get a counterfeit bill
 Keep the bill
 Delay passer if possible
 Telephone police or Secret Service
 Observe the passer
 Initial and date on white section of bill
 Surrender the bill to Secret Service or bank
Secret Service Form
 Counterfeit Note Report (SSF 1604)
 instructions on completion
 Secret Service listed in front of phone book
 description of note
 information about note
Checks

 A substitute for cash

 A “negotiable instrument” when presented
 “Drawer” issues and signs the check
 “Drawee” is the bank
 “Payee” is the party being paid

MANUAL PAGE: 11
Checks
 Personal Checks
 issued for individual’s demand accounts
 Company Checks
 may have a stub or carbon band
 may have time or dollar amount limits
 Cashier Checks
 drawn on a bank on its own funds
 only a bank failure causes void

MANUAL PAGE: 11
Checks
 Personal Money Orders
 purchased by an individual from a bank
 shows drawee bank and dollar amount
 purchaser fills in other information
 usually dollar restricted (“not to exceed”)
 Traveler’s Checks
 signed on face when purchased and
counter-signed when used
 must be signed in cashier’s presence

MANUAL PAGE: 12
US Treasury Checks
 Seal will smudge red with moisture
 Continuous watermark background pattern
 Ink fades with water & dissolves with bleach
 Signature line is micro-printed
 Ultraviolet shows image in center – recently
enhanced to dual fluorescent wave lenghts
 Never issued with corrections!
Federal Check Standards
 Minimum and maximum check size
 Placement of bank name
 Placement of ABA number
 Paper weight
 Exact location of MICR line
 Federal Reserve assigns MICR
 Not specified for US dollars ($x.xx)
 other currencies must be specified
MANUAL PAGE: 12
City Check Standards

 Department or city payee

 Endorsement by department

MANUAL PAGE: 13
The Check’s Seven Elements
date
2758
APT US&C payee
1229 NW 19th St payor
19
Washington, D.C.
$$123
dollars
Pay to the
order of $ bank
signed

Bank Three
For

002758 004001004 00008088888

MANUAL PAGE: 12 &

APPENDIX C
Check Negotiability
 Current date
 no stale dated checks (old)
 No post dated (future)
 Payee should be pre-printed on check
 Dollar amount must appear the same twice
 Bank name must appear on bottom left
 Check must be signed
 MICR line must appear

 City requirements?
MANUAL PAGE: 14
City Endorsement
City of Tin Cup
1.5”
For deposit only

* Endorse

immediately

* I.d. info

on front

MANUAL PAGE: 13
Endorsement
 Must be signed by both parties if two
party check
 Will you take two-party checks?
 Who is authorized to accept 2-party
checks?

 Department or cashier specific stamps

Additional information
 T-account standards

Driver’s Lic # Credit Card #

Cashier Init Other ID or Auth.

Check Fraud Precautions
 Matching photo identification
 Non-local banks
 Date (accurate, post-dated or stale)
 Legibility
 Drawee bank
 Payable to the City
 New account caution

MANUAL PAGE: 14
Bank Cards - Credit and Debit
 Plastic money for over 50 million people
 Reduced fraud
 Convenience for customers
 Special training required
 Expedited Funds Availability
 Fee payment differs by city

MANUAL PAGE: 14
Credit Card Transactions
 Take card (or number by phone)
 Enter information
 Get signature of customer
 Record confirmation number
 Maintain copy
 Return card to customer
 Process as a check
MANUAL PAGE: 15
MasterCard’s Security Features
Visa’s Security Features
Credit Card Recognition
 Examine signature strip for changes
 Look for ghost numbers and letters
 Check for identical fonts
 Look for warping or bubbling
 Ask for DL and ID
 Compare signature on DL
 If suspicious, make notes on customer
Stopping Bank Card Fraud
 Retain the card until authorization is complete
 Match signatures with the card signature
 Check the expiration date for validity
 Look for alterations
 Check warning bulletins
 Watch the customer’s actions
 Hurried
 overly talkative
 takes card from pocket
 Module Three:
Daily Operations
Cash Drawers
Revenue Statements
Daily Operations
 The cashier is the government
 Control and separation
 Standard procedures
 Safeguards
 Hand to hand method
Receiving and Receipting
 Procedures
 Numbered Receipts
 Double counts
 Customer service

 Invoiced versus cash (service)

transactions
Establish Procedures for:
 Setting up cash drawer
 Receiving and receipting
 Overages and Shortages
 Closing and Balancing
 Locating Errors
 Revenue Sheet/Statement
 Deposits
Standard Deposit Requirements
 Each city differs but standards include:
 daily deposit of funds
 consolidated deposit or departmental
deposits
 secure, locked storage of all deposits
 standardized cash receipt forms
 department deposit forms forwarded to
treasury daily simultaneously with deposit to
bank
MANUAL PAGE: 21
Policy Considerations
 Expedited funds

 Receipts

 Safes and deposits

Cash Drawers
 Individual Till Assignment is critical !!!!!!!!
 Fiduciary responsibility

 Coin/currency arrangements
 Beginning cash
 “Bait”
 Security checks
MANUAL PAGE: 16
Establishing a Cash Drawer
 Pennies 100 $ 1.00
 Nickels 40 $ 2.00
 Dimes 50 $ 5.00
 Quarters 80 $ 20.00
 $1 bills 52 $ 52.00
 $5 bills 4 $ 20.00
 $20 bills 5 $100.00
TOTAL $200.00
Establishing a Cash Drawer
 Wrappers and Rolls

 Marking rolls (cashiers and customers)

Opening a Cash Drawer
 Verify beginning cash by double counting
 Check bait money and its location
 Buy needed change from change fund
 Arrange your drawer
 smaller denominations to the right
 bills face up
 be consistent
 Arrange and check other equipment
 sign on

MANUAL PAGE: 16
Maintaining a Cash Drawer
 Always maintain the order and arrangement
 Restock any depleted inventory
 Never leave drawer unlocked
 Always sign off your computer
 Never share a cash drawer
 Transfer extra cash to secure location
 Keep payment documents together
 Retain daily trash until drawer is balanced

MANUAL PAGE: 17
Cash Payments over $10,000
 Cash payments > $10,000
 Reported to Treasury’s Secret Service

 Form # 8300
 Identify of payor
 Identity of receivor
 Description of transaction
Over and Short
 Shortage = unintentional collection error
 Overage = unintentional collection error
 Loss = intentional theft or negligence

 Report immediately
 Document incident

MANUAL PAGE: 18
Closing a Cash Drawer
 Document and records per city procedures
 Balance drawer to receipts
 Deposit funds to Treasurer
 Secure remaining cash
 Report funds received to Treasurer
 Report funds received to department
 Double count

MANUAL PAGE:18
Closing a Cash Drawer
 If possible, close out of public view

 Report overages and shortages

immediately

 Make a final check of work station

Balancing
 Add up checks and tally twice
 Add up credit cards and tally twice
 Count cash twice
 Enter in appropriate columns on report
 Verify beginning cash balance
 List overages and shortages

MANUAL PAGE: 18
Balancing
 Add currency + coins + checks + CR cards
 Determine amount from records
 Compare amounts

 Daily count sheet

 Change fund buy
 CASH DRAWER RECONCILIATION SHEET

DEPARTMENT/DIVISION:
DATE:

Opening Operational Closing

COINS
$0.01
$0.05
$0.10
$0.25
$0.50
$1.00

CURRENCY
$1.00
$2.00
$5.00
$10.00
$20.00
$50.00
$100.00
Other

CHECKS

CREDIT DEBIT CARDS

TOTAL

Cashier Signature:
Supervisor Signature:
Revenue Sheet/Statement
 Bank information
 Matches with deposit slips

 Breakdown of currency and coins

 Amount of checks
 Fund being credited

MANUAL PAGE: 20
Revenue Statement Contents
 Signature of preparer
 Agency/dept. number
 Collecting location
 Breakdown by coin, currency, checks, etc.
 Total of attached deposit slips
 Total Amounts
 CITY OF ANYWHERE For Treasurer's Use Only:
Date Processed:
BALANCE RECEIPT REPORT #12345 Receipt Number:

Department Number: Preparer:

Department Name: Telephone:

Date Prepared:
Transmittal Date:

Cash/Checks/Charges/Wires Total Reverses/Corrections

$100.00 Reason/Date Amount
$50.00
$20.00
$10.00
$5.00
$2.00
$1.00
$0.50
$0.25
$0.10
$0.05
$0.01
Total Cash
Checks
Visa/MC/Bank Cards
Wires/Direct Deposits
Tender Total
Pesky Errors
 Illegibilty
 Not breaking a strap
 Round file fall-out
 Cash stuck in drawer
 Not verifying tapes
 Not double counting
 Not clearing adding machine
MANUAL PAGE: 19
Hard to Find Errors
 Commingled currency
 Leaving cash drawers open
 Not finishing a transaction
 Distractions
 Adjustments for partial payments

MANUAL PAGE: 20
Separation of Duties
 Separation of duties helps everyone

 A supervisor should
 verify all drawers
 prepare deposit slip
 If you sell inventory at your station
 another individual should reconcile inventory
 maintain an inventory log
Designing the Work Area
 Location
 Security (doors, cameras, windows, etc.)
 Limited Access
 Vault Access
 Supervision
 Personnel Checks
 Balancing
Armored Car and Night Deposits

 Security
$$$$

 Float

 Non-government money

 Costs
MANUAL PAGE: 21
Module Four:
Security
They are in it for the money!
 Preventing

 Reacting

 Recovering
Preventing a Problem

 Lights
 Action (visibility and activity)
 Cameras
 Awareness of cashiers
 Inconspicuous transport of funds
 Varied routines
 Cash policies
 Inaccessibility
MANUAL PAGE: 22
Preventing a Problem

 Keep a clear counter space

 Keep unauthorized people out of area
 Check security devices
 Maintain only necessary cash balances
 Use bait money
 recorded serial numbers

MANUAL PAGE: 23
The Best Protection

 Concentrate on the transaction

 Separate transactions and customers

 Only deal with one customer at a time

Reaction Guidelines
 Preservation of life and safety

 To Catch a Thief
 (Not stop the crime)

 Preservation of City Funds

MANUAL PAGE: 23
Reaction Steps
 Assume there is a weapon
 Be polite and calm
 Keep talking
 No heroics
 Observe and listen
 Protect evidence
 Call for help (911)
 after you are safe!
 After they are gone

MANUAL PAGE: 24
Observing the perpetrator
Sex Race Age Weight

Height Weapon Hair Glasses

Tattoos Complexion Scars Hat

Tie Coat Pants shirt

Recovering from a Robbery
 After they leave the building
 Close the cash drawer
 Secure the area
 Call the supervisor
 Call 911
 Speak to no one

 Faint
MANUAL PAGE: 24
Emergency Procedures
 Fire/Bombs/etc.

 Prepare procedures
 Protect people first
 Secure the cash

 Practice with the Police and Fire

MANUAL PAGE: 24
Summary
 Write procedures
 Secure areas with cash
 Check it twice!
 Separation of responsibilities
 Prepare
About your trainer:
Linda Patterson, CTP
President, Patterson & Associates

Linda, who has trained cash handling, collections, and investment courses for the
Association of Public Treasurers and Public Treasury Institute for over 20 years,
is the President of Patterson & Associates, an investment advisory firm
established in Austin, Texas in 1994.

800-817-2442
www.patterson.net
 APT US&C
 APT represents over 1,000 public treasury and finance officials in
local, county and state/provincial governments throughout N. America.
The Association provides education, certifications and technical
assistance to its membership. Visit www.aptusc.org for information
on the 2007 Annual Conference in San Diego, August 11-15.

 PTI
 PTI provides training manuals and coordinates training seminars for
public treasury and finance officials. The Institute and APT formed an
alliance in 2004 for a wide range of training manuals workshops. Visit
www.PublicTreasuryInstitute.com for information on booking a
seminar in your city, county or region or to purchase the latest
treasury manuals on line.