Balancing efficiency and convenience of a petty cash system with the need to protect against waste, fraud, and abuse

Pago Pago, AMERICAN SAMOA — The Lemanu-Talauega Administration has set a new “petty cash” policy — to be approved by the ASG Treasury —  for all Executive Branch departments and offices. And it’s outlined in Gov. Lemanu Peleti Mauga’s Apr. 27 memorandum to directors.

According to ASG officials, the ASG Cash Policy Manual states in part that if a department needs a petty cash fund, a request should be made through proper channels at the ASG Treasury Department.

In his memo, the governor pointed out that a solid petty cash system provides an efficient means of making payments for unexpected, non­ routine, incidental, or small expenses. He observed that a lack of a petty cash system has hampered government operations.

“Recognizing the need to balance the efficiency and convenience of a petty cash system with the need to protect against waste, fraud, and abuse of public funds, departments and agencies may receive approval from the ASG Treasurer to establish a petty cash reimbursement account,” the governor said and set several conditions needed to satisfy the need for petty cash.

Among the conditions is for the department /agency to adopt a written petty cash standard operating procedure that is approved by the Treasurer; maintain and demonstrate strict compliance with the department's or agency's own approved petty cash standard operating procedure; and submit monthly reports to the Treasurer and Territorial Audit Office on the use and status of petty cash reimbursement funds on forms provided by the Treasurer.

Additionally, the department/ agency must submit to inspection and audit by the Territorial Audit Office at any time without notice; complete a satisfactory annual audit of petty cash funds and related records; and restrict use of petty cash funds solely for the purchase of goods and services for official government functions.

Another condition, set by the governor, is restricting the source of petty cash funds to appropriated funds approved by annual budget allocations every fiscal year.

According to the governor, the Treasurer may approve a department or agency for up to $2,000 in petty cash funds, based on written justification from the requesting department or agency for the requested amount.

He said all departments should minimize the need for use of petty cash by proper planning for equipment maintenance and sustainment and other regularly occurring needs. And this program is not intended to replace the regular procurement process.

“Employees who violate this General Memorandum or an approved petty cash standard operating procedure are subject to restitution and disciplinary proceedings which may result in action up to and including termination of employment,” he governor cautioned.

He also says that departments or agencies which allow violations of their petty cash standard operating procedures shall have their petty cash system immediately revoked.

The new memo supersedes the letter issued in April 2013 by then Gov. Lolo Matalasi Moliga.