—COUNCI

AUG 16 1982

MEMORANDUM
August 5, 1982

J. Maitland B. Kirk
City Treasurer City Administrator

R. Freeman
City Clerk

SUBJECT: Payment of Small Amounts

Council on July Sth, passed the following resolution:

“That the Auditor review payment of small
amounts by cheque over petty cash.”

Because of the obvious costs involved in having the Auditor
prepare a report to Council on the payment of small amounts, I
thought I should outline our payment policy:

‘

Once payment is authorized, we encode the invoice (disbursement
authorization) with the number on our computer system which
corresponds to the particular supplier (person). If the
supplier does not have a number, we set one-up providing the
invoice is over $20.00, if it is under $20.00, we make payment
through. our petty cash bank account. -

The costs involved in processing payments are obviously in
cheque and mailing preparation and while it is costly to

initially set up a new supplier on our computer, it is not
costly as continually addressing envelopes; thus, payments
suppliers which are used repetitively are more efficiently

through our computer.

Why not pay cash ?

We sometimes pay cash for small cost items, however, it is not
convenient in every case as sometimes the supplier is not
present to. accept payment (goods arrived in mail), sometimes
our employee picking up the goods does not have the cash to put
out of his/her pocket until the time for reimbursement.
Sometimes it is just not convenient to pay cash.