Receiving and Banking Money

What is it?	You will only need to read this Topic Guide if your organisation receives cash, cheques or has facilities for receiving payments by credit card. 
                       
Definitions	A Receipt is a document written by the receiver acknowledging payment is received.

                       A Tax Invoice is an invoice that contains additional information relating to GST.  A Tax Invoice needs to be provided to people paying money if they are able to claim back any GST they have paid.

Receiving money 
•	Whenever your organisation receives cash, cheque or credit card payments, a receipt must be provided to the person/organisation paying the money. A Tax Invoice may also need to be provided.

Banking money
•	All cash and cheques should be banked promptly, at least weekly but more frequently if large amounts are received. If you have received any credit card sales, you will need to use the credit card vouchers to prepare a Merchant Card Summary to send to the bank.  
•	Where possible, the person banking the money should be a different person to the person receiving the money.

What a Manager and Committee Member needs to know about receiving and banking money
•	Managers and committee members need to ensure there are controls in place so that no money is lost or stolen. These controls include:
•	keeping a record of all monies received (receipt)
•	making sure all money received is securely stored
•	banking is done frequently and if possible, by a person other than the person receiving the money
•	banking documentation (stamp from the bank) is checked by another person after banking has taken place.
•	When looking at the financial reports, always check that the income received is consistent with what you think has been received by the organisation. 

Where does receiving and banking money fit in?

Where receiving money fits in:

Money is received by the organisation and a receipt is written.

The information from the receipt is recorded in the organisation’s records and posted to the relevant revenue account.

Where reconciling bank statements with the books fits in:

Money is banked.

A monthly bank reconciliation is done to check the amount shown as received in the organisation’s records against what the bank has actually received (Bank Statement).