Subject Compensation Petty Cash Account Policy

Purpose:  The purpose of this policy is to provide guidelines for the use of petty cash through the VMRF Accounting Department as compensation to subjects for their participation in a research study, when there is a continuing demonstrated need for cash payments. VMRF balances a responsibility to maintain various levels of confidentiality for information about subjects with record keeping requirements of the State of California, grantor agencies and the Internal Revenue Service. VMRF is committed to fair, honest and appropriate participation payments, independent of the mechanism of payment, and will cross-reference accounting records submitted to VMRF for payment against the appropriate IRB approved protocol to assure the adherence to the approved payment mechanisms and amounts. VMRF follows the requirements on payments to subjects as detailed in paragraph 12 of the VHA Handbook 1200.5, updated on 07/15/2003.

Overview: 

A.  The VMRF Chief Executive Officer has sole authority to authorize the use of petty cash funds.

B.  The Accounting Department of VMRF is responsible for the monthly reconciliation of the petty cash account.

C.  VMRF reserves the right to suspend petty cash funds at any time when management deems it appropriate to protect internal controls.

D.  Subject payments to a non-employee exceeding a total of $599 from VMRF sources during any calendar year will result in a form 1099 (Miscellaneous Income) being issued to the individual and a copy sent to the Internal Revenue Service. Subject payments made to a VMRF employee, at any time during the same calendar year, will be added to the employee’s W-2 for that year. VMRF reminds employees considering participation in a research study that participation has to be voluntary and without any coercion by co-workers, superiors, or any other person.

E.  Petty cash funds are for subject compensation only; personal use and/or business purchases are not allowed.

F.  Bonus payments made to investigators and/or study staff to motivate or reward participant enrollment are not allowed.

Definitions:

Approved Financial Institution:  The approved financial institution for the VMRF petty cash is the San Diego Medical Federal Credit Union, which is located at the VA San Diego Healthcare System.

Application:

Establishment of Petty Cash:  Written requests to establish a petty cash account as a form of compensation to subjects must be submitted to the VMRF Chief Executive Officer. Requests must identify the VMRF project; explain the need for petty cash, and who the petty cash custodian will be. The use of the petty cash fund is on a weekly basis for the use of funds which must be reconciled the following week with the return of the subject compensation forms and the unused funds.

Petty Cash Custodian: The petty cash custodian is the person responsible for requesting the weekly petty cash for subject payments, overseeing the weekly disbursement of the cash to the subjects, the weekly reconciliation of subject payments and the weekly return of the unused funds. This person is also responsible for ensuring that the petty cash is kept in a safe and secure place.

Reimbursement of Petty Cash Account: The replenishment of the account at the San Diego Medical Credit Union is the sole responsibility of the Accounting Department at VMRF. It is the responsibility of the Accounting Department to reconcile the disbursements from the petty cash account and to periodically replenish the account.

Change of Petty Cash Custodian: When custody of the petty cash for an individual PI is to be transferred temporarily or permanently, the PI is to send notification to the VMRF Accounting Manager immediately for approval.

Termination of a Petty Cash Account: When the petty cash account is no longer required, the PI must contact the VMRF Accounting Department for closing instructions.

Approved by the VMRF Board of Directors:  June 11, 2010