Explaining why Receipts are Needed

When we ask for reimbursement of expenses, it is not always obvious what sort of documentation is needed.  I wrote the following document for my NHS students; yet I hope it would be useful for others as well:

Receipts Needed

The Business Office, and the school's auditors, need hardcopy evidence that cash is used properly -- that money is used for proper purposes.

A paper receipt can prove that money was properly spent.

We want to prove (to an uninterested accountant) as much of this information as we can: It should be reported (i.e. handwritten) by the person closest to the transaction, preferably by the person who actually handed over the cash to the vendor.

The auditor will want to know:

1- person is authorized to purchase something

2- the purchase was approved by the school, by the organization, by an officer

3- the purchase was for a purpose that is a part of the group's legitimate activities

4- the purchase was for a specified product

5- the specified product was delivered to the group, and was used for the group's purposes.  Was it all consumed that day?  or are we keeping some of it in storage for future use?

6- the product was re-sold for a profit

Piece of paper ideally has these things:

1. Indication of who made the transaction -- buyer name and seller name,
2. how much money was spent, in what form (cash or cheque or transfer, etc.).
3. Best if the receipt is written by the seller and signed by the buyer.
1. However, it can be simply written by the buyer -- in the absence of official-looking stationery, just a blank sheet of paper, handwritten by the buyer and signed by other official people.
4. Buyer signs official signature with date, and again writes the total amount of cash transacted.

Imagine if this went to court.  You should be able to easily and quickly answer these questions:  did you write this information on this piece of paper?  is this your signature?  when did you write it?  is all this information accurate?  

Example:  

funfest October 2015, we lost the receipt from PizzaSchool:

Junhee was the person who actually paid 110000won to the delivery guy.    She writes on a clean piece of paper:

Junhee Cho purchased and received 20 pizzas from Pizza School company on October 16th at 4pm: amount 110,000won cash.    Pizzas were ordered for use at the NHS booth at PTO funfest October 16th.   20 pizzas were received and re-sold.

signed and dated, Junhee Cho

NHS President also signs and dates, writes  "approved"

NHS faculty sponsor also signs and dates it, writes "approved"

Better would be to have the original PizzaSchool receipt, but this paper should satisfy most accountants.  

--J.Thomas, November 2015