Receipting of Income - Recommended Practice
Schools often ask what the recommended practice is regarding the receipting of income. Perhaps the point most often reported following school audit visits is that of schools failing to receipt income to a satisfactory standard.
The types of problems encountered at schools include:-
- Not all income being receipted
- Only cash income being receipted
- Cheques from LCC not being receipted (e.g. Standards Fund, VAT refunds)
- Cheques from the school fund not being receipted (e.g. donations)
- Receipts not being issued chronologically
- No audit trail from the receipt book to the SIMS system
The recommended practice for the receipting of income is, as follows:-
- Receipts should be written for all externally generated income received. This includes both income received in cash and by cheque, both from LCC and from other persons/organisations
- Receipts should be issued in chronological order upon receipt of the income
- Receipts should clearly show whether the income was received by cheque or in cash
- ‘Block’ receipts should be issued covering internal pupil-derived income such as trips, swimming etc. The maintaining of adequate pupil records negates the need for schools to individually receipt each pupil/amount
- The receipt book should be periodically ruled off and totalled. These totals should clearly correspond with amounts entered on SIMS and banked.
Entries on the SIMS bank account history in the ‘Receipts’ column should be backed-up clearly by the receipt book. This comprehensive audit trail can only be achieved through the receipting of all income. Schools have a responsibility to be able to clearly demonstrate in its accounting records that all income receipted has been entered on SIMS and banked.
Reasons for Receipting all Income
- Clear audit trail from cash collected to cash banked
- Acts as a safeguard against the substitution of cheques for cash
- Enables checks to be made that income collected has been promptly banked and entered onto the accounting records (i.e. SIMS)
- Top copies of receipts can be given to payees if requested
Any queries regarding the receipting of income should be referred to the Resources Department Audit & Technical Service on Leicester (0116) 2657611/12 (direct line).
Page Last Updated: 20 March 2007