Virginia Wing's "Wing Bank Solution"

[twe]

We could use a money order, but it would take extra time/manpower to get it, even with a USPO within 250 feet of the squadron building: the USPO is not open when we are doing squadron business.

So the "wing bank" still will cause us extra work/delay.

And that is without considering whether or not using cash to get a money order violates the CAPR about all payments must be by squadron check.

[SarDragon]

The new scheme of "wing is the banker" with a one week delay (if all goes right)
to issue a check, will obviously have a negative impact on our quick response.

I'm not a Finance Officer, but wouldn't it keep the same expediency you're used to if you simply get a money order with the cash the cadets have deposited?  Place the certified money order with the AAFES order form and voila!  Of course the M.O. may cost you 50 cents to a buck, but you guys are already avoiding any shipping charges, so it's not that big of an expense.

Any money remaining from your deposits after the M.O. has been cut, gets deposited into squadron funds.

Just a thought.

Addressing twe and Pylon together.

Well, this sounds non-kosher in the first place. It resembles a similar situation frequently we have in our unit. Joe Schmuckatelli spends money for some widget for the squadron. He also flies the airplane, and now owes the unit money. Logically, one might think that the funds exchange would be for the difference between the two amounts. According to the rules, not so. The unit pays Joe the full amount, and Joe pays the unit the full amount.

Your scheme is similar. The collected funds should be deposited in toto, and then the appropriate amount spent on the uniform items. Where is the "extra" money coming from in the "change box"?

[twe]

At the beginning of each quarter, the "change box" is primed with about $25 in change using a squadron check. I can go to the bank (credit union actually) which is about 300 feet from the squadron building to do that.

[Eclipse]

At the beginning of each quarter, the "change box" is primed with about $25 in change using a squadron check. I can go to the bank (credit union actually) which is about 300 feet from the squadron building to do that.

Well, you can take that task off your calendar now - regardless of what you call it, that's a petty cash account, and you won't be allowed direct access to the bacnk anymore.

The two solutions to this are:

let the cadets / members take care of this themselves

have a member take care of this external from the unit's finances.

[Pylon]

At the beginning of each quarter, the "change box" is primed with about $25 in change using a squadron check. I can go to the bank (credit union actually) which is about 300 feet from the squadron building to do that.

Well, you can take that task off your calendar now - regardless of what you call it, that's a petty cash account, and you won't be allowed direct access to the bacnk anymore.

If no funds are distributed or dolled out of the box, and members are only making deposits to the box, how is it a "petty cash" account?  The very definition of petty cash is for spending money, not making deposits - right?  Or do I have this all wrong?

Nota Bene:  I am not a Finance Officer.  I do not like Math.  Be gentle.  Thank you.

[Psicorp]

At the beginning of each quarter, the "change box" is primed with about $25 in change using a squadron check. I can go to the bank (credit union actually) which is about 300 feet from the squadron building to do that.

Well, you can take that task off your calendar now - regardless of what you call it, that's a petty cash account, and you won't be allowed direct access to the bacnk anymore.

If no funds are distributed or dolled out of the box, and members are only making deposits to the box, how is it a "petty cash" account?  The very definition of petty cash is for spending money, not making deposits - right?  Or do I have this all wrong?

Nota Bene:  I am not a Finance Officer.  I do not like Math.  Be gentle.  Thank you.

It would seem to me that it becomes a "petty cash" account once official unit funds are used as the start-up capital.     What is commonly done is that a member "donates", say a case of soda. The cans/bottles are then purchased by the members at cost (or a tad more) then those funds are used to buy more soda.  At that point it becomes self-sustaining.   Using a unit check for $25 seems to me to be more of a hassle than it's worth. 

I've heard of too many finance officers being tempted to request reimbusement for Excedrin to ever want to be one.  I think I'll stick with Safety.

[twe]

(1) It is not a "petty cash" box because no money is ever spent out of it.  Look up the definition of "petty cash" in the dictionary. I've done so.

(2) I have discussed it with both group and wing. They have no problems with it. We have passed an inspection with EXCELLANT on finance after I've called explicit attention to our "change box" and what we do, and do not, do with it.

(3) The problem with a "petty cash" box is that money is spent out of the box with no record of where it went or for what. Since the squadron spends money ONLY by check (and never out of our "change box"), there is not a problem.

[Eclipse]

Look up the definition of "petty cash" in the dictionary.

Ok:

Businesses often need small amounts of cash known as petty cash for expenditures where it is not practical to make the disbursement by check.

The most common way of accounting for these expenditures is to use the imprest system. The initial fund would be created by issuing a check for the desired amount. Usually $100 would be sufficient for most small business needs. The entry for this initial fund would be to debit Petty Cash and credit cash.

As expenditures are made the custodian of the fund will reimburse employees and secure a petty cash voucher in return. At any given time the total of cash on hand plus reimbursed vouchers must equal the original fund.

When the fund gets low the custodian submits the vouchers for reimbursement. Assuming the vouchers add up to $80 and that the majority of expenditures were for office supplies, an $80 check is issued and an $80 debit towards office expenses is marked. Once the check is cashed, the custodian has cash at the original amount.

Oversight of petty cash is important because of the potential for abuse. Examples of petty cash controls include a limit (such as 10% of the total fund) on disbursements and monthly audits by someone other than the custodian. Use of petty cash is sufficiently widespread that vouchers for use in reimbursement are available at any office supply store.

Subsitute "insignia" for "office supplies" and your running petty cash, and that is verboten.

If your unit store is operating at a zero-sum, the original $25 from the first quarter should still be in there and you'd just have to be taking that same
money and breaking into smaller bills and cions again.  There would be no need to re-seed the account every quarter.

If you have to "refill" each quarter, its going somewhere, and not being accounted for.

Passing a Wing-level inspection does not equal compliance with regulations, it simply means you have convinced someone at that level its ok.

A Region or NHQ guy might disagree.

I think the only proper way to run a unit store anymore would be to order stuff from the vendors with Wing-issued checks, and require members to pay with checks, remove the cash altogether.  And since that IS a huge PITA, just
sell out what you have and let the members worry about it from there on.

Or...

Get a donor to grant the unit some cash towards insignia, buy it and give it away.

[twe]

Yes, your quote from Wikipedia accurately describes how to run a petty cash box.  But carefully note this part of the quote: "As expenditures are made the custodian of the fund will reimburse employees and secure a petty cash voucher in return." We don't do that (expenditures), and not doing that is how we stay inside the CAPRs.

"If you have to "refill" each quarter, it's going somewhere, and not being accounted for."  The first part of your statement is correct but not the second. At the end of each quarter the entire contents of the change box are deposited into the squadron bank account and thus *are* accounted for and thus need to be replenished.

"A Region or NHQ guy might disagree." Or might agree.  Until one chooses to comment officially, I believe my squadron is fully within both the letter and intent of the CAPRs. As soon as somebody with proper authority tells me to stop, then I will stop.

Enough of this sub-thread.

[ZigZag911]

(1) It is not a "petty cash" box because no money is ever spent out of it.  Look up the definition of "petty cash" in the dictionary. I've done so.

(2) I have discussed it with both group and wing. They have no problems with it. We have passed an inspection with EXCELLANT on finance after I've called explicit attention to our "change box" and what we do, and do not, do with it.

(3) The problem with a "petty cash" box is that money is spent out of the box with no record of where it went or for what. Since the squadron spends money ONLY by check (and never out of our "change box"), there is not a problem.

I believe this is correct, the problem with petty cash accounts is the lack of record-keeping; nothing in the regulations states that small quatities of cash can not be used where circumstances mandate (i.e., running a fund-raiser such as a car wash) where change will need to be made.....regs simply require adequate documentation of the transactions (a register tape, if one can come up with a cash register, or an appropriate computer program on a laptop, would seem to do the trick....so would simple handwritten cash receipts.

[fyrfitrmedic]

 This seems to be coming down the pike right about now, ladies and gentlemen.

PAWG/CC dropped a line to unit commanders re: an upcoming urgent conference call dealing with finance issues.

[NIN]

WRT the so-called "petty cash" and CAPRs, unit supply funds, etc.

I think the intent of the regulation is that you shouldn't run a "slush fund" in the unit thats not on the books or has no foms of documentation.  Petty cash in this connotation (Wikipedia notwithstanding) is "undocumented transactions."   That would be like having a fishbowl at the meeting, and the proceeds from the unit carwash go into it.  And then you buy gas for the squadron van out of that.  No record of the money coming in, no record of it going out.

A properly done unit supply system is, however, not "undocumented." My unit's supply system is simple, and our "cash on hand to make change" amount is well documented and covered under receipts. The unit has a stash of insignia that is purchased on occasion by unit funds (check to Vanguard, or check to the supply officer who tenders a receipt to the finance committee after putting it on her credit card, which was a method I did not prefer).

Insignia sold has a small (by policy) markup to cover shipping, etc. So your $.30 cent ribbon is now $.40, or similar.  Cadet Schmuckatelli comes to squadron supply and buys a half-dozen ribbons, a ribbon holder and three sets of chevrons.  That's $.40 x 6, $1.60 for the ribbon holder, and the chevrons are $3.00 even each (hypothetical prices).  For C/SSgt Schmuckatelli, that's $13, of which he pays with a $20 bill. The squadron cashbox has $20 in change: a ten, a five, four ones and assorted change to equal a buck.  He gets back a receipt for $13 and $7 in change.  That receipt stays in the books.  Its now part of the official record of "ins and outs" for whatever account is "Materials sold" in the finance ledger. 

This is really not "petty cash," but rather an accounted for transaction that happens to involve cash (but isn't really petty).   Whenever we get more than something like $30 in supply's cashbox (it floats between $20 or $40, depending on how busy supply gets on a given week) our supply officer whips up a finance transmittal to the finance officer with the "receipts from sales" (the money and an accounting of the receipts) and the finance officer deposits that in the bank. He has receipts to show that the money was taken in from whomever is on the list and items went out, and he has receipts that show the money was disbursed to Vanguard or the supply officer's credit card.  The inventory on hand plus the "change making money" in the supply cashbox is an asset,  while the insignia sold & the money spent to acquire are liabilities. In theory, this should all equal zero.  In theory. (in practice, seldom does, but it comes pretty close, within the range of the markup on the materials)

[mawr]

NIN, in simple terms, you have a cash drawer though maybe not as sophisticated as the local 7/11.  I see no problems with it myself.

[NIN]

NIN, in simple terms, you have a cash drawer though maybe not as sophisticated as the local 7/11.  I see no problems with it myself.

Hey, man, leave my college job outta this!

[jimmydeanno]

Yes, I know, another old topic, but I saw this topic being brought up in another thread and thought this the appropriate place to post.

I have experience working with the "wing banker" program, as a former member of VAWG.

The greatest skepticism lies in the reliability of 'Wing,' as well as units thinking that 'their' money is going to be used by someone other than them, or that they need permission to spend 'their' money.

This program worked out great for us at our squadron.  The wing delivered on their promise to process check requests and such quickly (once per week).  As for the "re-reimbursement" amounts, if you are ordering a large amount of supplies from vanguard or the hock, you just placed the order and sent in a check request to mail the check amount to wherever you needed it to go.

The only checks (not checks) that were performed was that you had the right amount of signatures or that you had finance committee approval. 

As for the 'petty cash' dilemma, it never came up.  We had a snack fund that brought cash in every week.  At the end of the night a deposit was put together and dropped off at the bank.  Just had to send a receipt to wing to show where the money came from.

Anytime we wanted a 'report' we'd just ask and we'd have it within a couple hours.

I think this program worked wonderfully.  Again, the only thing that raised concern was the reliability and credibility of 'wing.'

[mikeylikey]

^^  we still have Wings that employ executive directors and paid staffers that have free reign of credit cards and gas cards.  Why couldn't the groups have these cards to help with upfront costs of some situations that a unit may find themselves in? 

[jimmydeanno]

I'm not sure what costs would be associated that would need to be paid "upfront."  The group that I was in handled their plane fuel etc. through a billing system pre-arranged at the airport.  They would then bill the wing and it would be paid accordingly.

The only situation that came up was with encampment with quick "supplies needed" runs, but the wing just sent someone with check writing authority to encampment and all was good.

[c172drv]

Someone earlier in the thread said no one from VAWG is jumping up and down about the greatness of the program, or something to that effect.  There's a reason.  The program is "OK" but, as has been noted, it is tedious.  We have wing questioning our use of funds after we've approved it.  We have to submit more paperwork than if we had simply had to conduct an audit each year.  Funds are drawn from the account occasionally without our asking so we have to go back to question them.  We have discussed asking for an audit now of Wing due to the issues our squadron has encountered.  If this was a simple process of submit a form electronically it would be fine.  We have to submit a spreadsheet detailing where everything is going or where it went in the case of a reimbursement.  Then they want the receipts as well.  For crying out loud it is our money that we raised.  Not money the wing gave to us.  OK, end of rant.

John
VAWG Member

[JohnKachenmeister]

It is my understanding that this is all coming about because an Air Force audit revealed that $7,000,000.00 was unaccountable.  It is also my understanding that individual squadrons were not audited, only Wings.  Therefore if the Wings can lose $7,000,000.00, why not punish the functional squadrons and give the Wings more money to lose?  Is this typical of government/military thinking?  And seriously, turn around on a check can be 1-2 days..get real.  Wing can and does routinely lose everything from promotions to Unit Citations requests.  Now all of a sudden they are going to be Mr. Efficiency.  This is about as good an idea as Vanguard was/is.  This is going to increase the bookkeeping and paperwork at both Wing and squadron levels by an immense amount.  Each squadron already has between 80-90 annual reports to Wing and National.  Please, do we have the time and personnel for this?  JMHO

Your understanding is not accurate.

There WERE funds that could not be accounted for.  They were the funds retained by the squadrons.  The ESTIMATE is that the amount could be as high as $7 million, but since they are largely unaccounted-for funds, nobody knows how much is actually unaccounted for.

That's why all auditors give CAP a "Qualified" audit;  The funds accounted for are correct, but we don't know what else might be out there.

Now, if you are the Combined Federal Campaign, or the United Way, do you give money to an organization that has no way of accounting for millions of dollars?  Not unless you want a FoxNews camera crew chasing you down in the mall parking lot!

So, NHQ has come up with a fix:  Wing will manage the funds.  They ARE STILL YOUR SQUADRON'S FUNDS!  Nobody is stealing from you.  Wing cuts the checks instead of you.

If you have any ways of fixing this and making it better, suggest them.  The idea of getting rid of the 2-signature requirement is good. (I don't even think you need 2 signatures if Wing cuts the check.  There is a different regulation for disbursing funds at Wing and higher HQ.)  Another idea would be a direct-pay system with Vanguard where the unit can order supplies, and Vanguard would bill the wing with an identifyer as to which squadron's account to debit.

But this is going to happen.  Quit if you want to, but there are two locomotives driving the train:

1.  There is a history of financial irregularities.  Yes, the financial irregularities all occurred at echelons higher than Squadron, but in CAP, as in the RealMilitary, $hit rolls downhill.  We happen to live in the valley.

2.  National-level charities, such as CFC and United Way will NOT make contributions to organizations that cannot show an unqualified audit.

So, lets deal with it as best we can.

[capchiro]

John, your comments were certainly timely..only about 8 months late..by the way, I don't see anywhere in my post that I was considering quitting..So I don't know where you came up with that. It would also appear from posting since mine that not everyone is happy with the Virginia Banking Solution and as I predicted, it has not cut down on the paper work at Squadron level or the problem/need/violation of having/using a slush fund or petty cash or any other name one would like to call the need to have disbursable funds at the squadron level at all times for things like awards, ribbons, rank, cokes, gas for the Church van, etc..So, while some of my fears were unfounded, some were well founded and have been realized..