To classify cash and cash equivalents for external reporting in a manner that complies with Governmental Accounting Standards Board Statements.

This Policy applies to all West Virginia University departments, including those on the regional campuses (Potomac State College of WVU, WVU at Parkersburg, WVU Institute of Technology, Charleston division of the Robert C. Byrd Health Sciences Center, Jackson’s Mill State 4-H Conference Center and Camp, and the WVU Farms).

 POLICY

Cash is defined as all currency and coins and all demand deposits maintained at banking institutions. This definition includes deposits held by state agencies on behalf of the institution, for example, cash on deposit with the Financial Information Management System (FIMS). These funds are maintained at a banking institution by the state.

Cash equivalents are defined as highly liquid investments that are convertible to a known amount of cash, have an original maturity of less than three months at the time of purchase and have insignificant risk of change in fair market value due to shifts in the interest rate. Original maturity is a classification made at the time of purchase and is the period of time until the instrument reaches maturity (not the maturity on the original instrument). Therefore a three-year Treasury Note purchased two months from maturity would be classified as a cash equivalent. Since the cash equivalent classification is made at the time of purchase, no reclassification of short-term investments to cash equivalents will be made. Examples of cash equivalents would be cash in money market and cash invested in the Investment management Boards (IMB) polled investments.

The Accounting & Reporting Unit of Accounting & Financial Systems is responsible for procedure development.

The responsibility for implementation of this policy rests with the Accounting & Reporting Unit of Accounting & Financial Systems

The responsibility for interpretation of this policy rests with the Accounting & Reporting Unit of Accounting & Financial Systems.

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