SUBSECTION 2.2.3.5
OTHER WARRANT PROCEDURES

2.2.3.5.1

Non-Deliverable Warrants

Effective Date:

Sept. 1, 1998

2.2.3.5.1.a

A warrant in the custody of an agency is considered non-deliverable only after a search has been made to locate the payee.

2.2.3.5.1.b

A warrant deemed to be non-deliverable is to be canceled. When canceling a non-deliverable warrant, the agency is to debit GL Code 7130 "Warrant Cancellations In-Process" and credit GL Code 5194 "Liability for Canceled Warrants/Checks - Short-Term." (Refer to Section 2.2.3.8.8 for illustrative entries.)

2.2.3.5.1.c

Permanent registers are to be maintained by agencies to record all transactions concerning non-deliverable warrants.

2.2.3.5.2

Statutorily Canceled Warrants

Effective Date:

Sept. 1, 1998

2.2.3.5.2.a

2.2.3.5.2.a(1)

As prescribed in RCW 43.08.062, the Office of State Treasurer (OST) is to cancel warrants which have not been presented for payment within 180 days from the date of issue or, if registered and drawing interest, within 180 days from the call date. Warrants are to be canceled on the last day of the month in which they become cancelable.

2.2.3.5.2.a(2)

Agencies are to monitor the OST Warrants 90 - 179 Days Old Aged Outstanding Report 1230B on a regular basis. Agencies are to notify the payee that, in accordance with state law, outstanding warrants are canceled after 180 days. If the warrant has been lost or destroyed, the procedures listed in Section 2.2.3.5.3 are to be followed. Warrants issued in error are to be canceled by the agency before they are statutorily canceled in accordance with RCW 43.08.062.

2.2.3.5.2.a(3)

OST is to forward a list of canceled warrants to each agency. This list is to include warrant number, date issued, and amount.

2.2.3.5.2.a(4)

Agencies are to maintain a register of statutorily canceled warrants. If this information is requested in accordance with the Public Record Act, RCW 42.17.260, pursuant to subsection (9) of this act, agencies are to ensure this information will not be used for commercial purposes. To this end, before releasing this information, agencies are to have the "Affidavit to Release Outstanding or Canceled Warrants" signed by those requesting a copy of the register of statutorily canceled warrants. (Refer to next page for form.)

2.2.3.5.2.a(5)

The agency is to prepare a Journal Voucher (A7-A) debiting GL Code 7130 "Warrant Cancellations In-Process" and crediting GL Code 5194 "Liability for Canceled Warrants/Checks - Short-Term." (Refer to Section 2.2.3.8.9 for illustrative entries.) Instructions regarding disposition of these funds are contained in Section 2.2.3.5.5.

2.2.3.5.2.b

2.2.3.5.2.b(1)

As prescribed in RCW 43.08.062, an agency may issue a new warrant for a statutorily canceled warrant presented for payment.

Statutorily canceled warrants presented to OST for payment are to be sent to the issuing agency.

2.2.3.5.2.b(2)

When a statutorily canceled warrant is reported as lost or destroyed, an agency may issue a new warrant.

2.2.3.5.2.b(3)

If the issuing agency determines to reissue a warrant, the statutorily canceled warrant, if available, is to be returned to OST. The agency is to issue a new warrant payable to the legal owner of the statutorily canceled warrant and submit a copy of the new warrant to OST. The re-issuance is to be recorded so as to reduce the liability (GL Code 5194).

2.2.3.5.2.b(4)

If the issuing agency determines not to reissue the warrant, a letter explaining the reason for disallowance is to be sent to the legal owner. A copy of the letter, along with the statutorily canceled warrant, if available, is to be sent to OST.

2.2.3.5.2.b(5)

OST is responsible for controlling statutorily canceled warrants.

2.2.3.5.2.b(6)

Agencies are to maintain a record of reissued statutorily canceled warrants. This record is to reference, or be incorporated within, the Statutorily Canceled Warrant Register (refer to Section 2.2.3.5.2.a(4)) and contain the following for both the original and the reissued warrant: warrant number, warrant register, date of issue, and amount.

2.2.3.5.3

Lost or Destroyed Warrants

Effective Date:

Sept. 1, 1998

2.2.3.5.3

When a warrant has been reported as lost or destroyed, the agency is to contact OST to request information on the status of the warrant.

2.2.3.5.3.a

Lost or Destroyed Warrants Statutorily Canceled--If the warrant has been statutorily canceled, the procedures listed in Section 2.2.3.5.2 are to be followed.

2.2.3.5.3.b

Lost or Destroyed Warrants Statutorily Redeemed--If the warrant has been redeemed, the procedures for forged warrants listed in Section 2.2.3.5.4 are to be followed.

2.2.3.5.3.c

Lost or Destroyed Warrants (Not Redeemed)--If the warrant has not been canceled or redeemed, OST is to notify the agency in writing. The agency is to determine whether the warrant was lost or destroyed before or after delivery to the payee. (NOTE: Delivery to the U.S. Postal Service or initiation of an Electronic Funds Transfer (EFT) transaction constitutes delivery to the payee.)

2.2.3.5.3.c(1)

If a warrant was lost or destroyed prior to delivery to the payee, the issuing agency is to complete the affidavit section of the "Affidavit of Lost or Destroyed Warrants." The form need not be notarized. (Refer to next page for form.)

If the warrant was lost or destroyed after delivery to the payee, the payee is to complete the affidavit section of the "Affidavit of Lost or Destroyed Warrants". The "Affidavit of Lost or Destroyed Warrants" is to be notarized.

2.2.3.5.3.c(2)

The lost or destroyed warrant is to be canceled and a new warrant is to be issued. The agency is to follow the procedures listed below:

• The agency is to prepare a separate Journal Voucher (A7-A) for only lost or destroyed warrants debiting GL Code 7130 "Warrant Cancellations In-Process" and crediting GL Code 5194 "Liability for Canceled Warrants/Checks - Short-Term." (Refer to Section 2.2.3.8.10.a for an illustrative entry.) The Journal Voucher is to state that the warrant was lost or destroyed.

• AFRS agencies are to enter the Journal Voucher through the normal AFRS batch process prior to sending Form SF993 and the Journal Voucher to OST. The agency is to then send the original of the "Affidavit of Lost or Destroyed Warrants" and the original Journal Voucher to OST for processing. OST is to debit GL Code 4310 "Current Treasury Cash Activity (OST Only)" and credit GL Code 7130 "Warrant Cancellations In-Process."

• When the warrant is reissued, the agency is to debit GL Code 5194 "Liability for Canceled Warrants/Checks - Short-Term." (Refer to Section 2.2.3.8.10.b for an illustrative entry.)

2.2.3.5.3.c.3

If the original warrant is returned unredeemed after reissue, the agency is to immediately void the original warrant. Procedures listed in Section 2.2.3.5.7.d are to be followed for all voided warrants.

2.2.3.5.4

Redeemed Warrants Reported as Lost or Destroyed

Effective Date:

Sept. 1, 1998

When a redeemed warrant has been reported as lost or destroyed, OST is to send a copy of the redeemed warrant to the agency. The agency is to notify the legal owner that the warrant has been redeemed. A copy of the redeemed warrant and a blank "Affidavit of Forged Endorsement," are to be included with this notification. (Refer to next page for form.)

AFFIDAVIT OF FORGED ENDORSEMENT A PDF File

2.2.3.5.4.a

2.2.3.5.4.a.1

If the legal owner claims the endorsement is a forgery, the legal owner is required to complete the "Affidavit of Forged Endorsement." (Refer to prior page for form.) The affidavit must be notarized.

2.2.3.5.4.a.2

After receipt of the signed "Affidavit of Forged Endorsement," the agency is to compare the signature on the redeemed warrant to the signature on the affidavit. If forgery is questionable, the agency is to investigate further. If forgery is obvious, the following procedures apply:

• The signed "Affidavit of Forged Endorsement" is to be sent to OST. OST is to return the forged warrant to the bank for credit

• OST is to record collection of the bank credit on a Cash Receipts Journal Summary (A8) by debiting GL Code 4310 "Current Treasury Cash Activity (OST Only)" and crediting GL Code 7110 "Receipts In-Process." OST is to send a copy of the A8 to the issuing agency.

• The agency is to utilize the A8 received from OST to record the collection of the bank credit. The agency is to debit GL Code 7110 "Receipts In-Process" and credit GL Code 5199 "Other Liabilities - Short-Term." (Refer to Section 2.2.3.8.11.a for an illustrative entry.)

• When the warrant is reissued, the agency is to debit GL Code 5199 "Other Liabilities - Short-Term." (Refer to Section 2.2.3.8.11.b for an illustrative entry.)

2.2.3.5.4.b

Endorsement Not Forged-- If the signature on the original warrant is not a forgery, the warrant is not to be reissued.

2.2.3.5.5

Liability for Canceled Warrants/Checks

Effective Date:

2.2.3.5.5.a

GL Code 5194 "Liability for Canceled Warrants/Checks - Short-Term" is to be used to record obligations for canceled warrants and checks for which proper disposition has not yet been determined.

2.2.3.5.5.b

RCW 63.29, the Uniform Unclaimed Property Act, applies to the outstanding liability for canceled warrants/checks. For methods of reporting and remitting, contact the Department of Revenue, Unclaimed Property Section. Canceled payroll warrants/checks which remain unclaimed for more than one year are considered abandoned. All other intangible property in the custody of the state is considered abandoned after two years. Agencies are to develop procedures for systematically reviewing canceled/outstanding warrants and checks and remitting "abandoned property" to the Department of Revenue. Refer to Section 2.2.5.3.3 for further discussion related to Department of Revenue accounting for unclaimed property.

2.2.3.5.6

"X" Warrants

Effective Date:

Sept. 1, 1998

2.2.3.5.6.a

If a warrant was destroyed prior to being mailed, an "X" warrant may be issued to replace the warrant. Agencies preparing "X" warrants are to utilize the Department of Information Services (DIS) on-line system. The agency will need to get system access from DIS as well as detail procedures to create an "X" warrant. The "X" warrant is to be MICR encoded by OST and included with the batch of warrants. The "X" warrant is to be input by the agency exactly the same as the original warrant. If a warrant is lost or destroyed after being mailed, the procedures at Section 2.2.3.5.3 apply.

2.2.3.5.6.b

Agencies preparing "X" warrants are to maintain a register containing the following "X" warrant information:

• Agency number;

• Warrant date;

• Original warrant number;

• "X" warrant number;

• Warrant register number;

• Signature of the individual who input the "X" warrant; and

• Date the "X" warrant was prepared.

2.2.3.5.7

"X" and Blank State Warrant Stock Control Procedures

Effective Date:

Sept. 1, 1998

2.2.3.5.7.a

To control the receipt, issue, and inventory of blank warrants, the procedures outlined below are to be followed. Both regular warrants and "X" warrants are to be controlled in the same manner. Only DIS will have custody of and responsibility for "X" warrant stock.

2.2.3.5.7.b

All blank warrants are to be kept locked in a climate controlled storage area and under the control of a designated custodian or designated alternate custodian. The designation of the custodian and alternate is to be in writing. Access to the blank warrant stock is to be limited to the designated custodian and the alternate.

2.2.3.5.7.c

Warrants are standard items stocked by the State Printer. Agencies are to establish reasonable inventory and reorder levels and follow normal ordering procedures for procurement of blank warrant stock. When warrants are received from the State Printer, the designated custodian or the alternate is to record the following information on an appropriate control form:

• The date received;

• Quantity received;

• Inclusive serial numbers; and

• The new balance on hand.

When warrants are required from the locked storage, standardized requisition forms are to be used and signed by the individual requesting the warrants. In addition, the designated custodian or the alternate is to record the following information on the control form:

• The date issued;

• Quantity issued;

• Inclusive serial numbers;

• Name of the individual receiving the blank warrants; and

• The new balance on hand.

2.2.3.5.7.d

A record is to be maintained of all voided warrants. This record is to include the following:

• The date voided;

• The serial number(s);

• Quantity voided and reason for voiding; and

• Initials of individual taking action.

Refer to Section 2.2.3.5.8 - Warrant Voiding and Destruction Procedures.

2.2.3.5.7.e

A physical count of the blank warrant stock is to be performed no less than monthly. The physical count is to be performed by an individual other than the designated custodian or the alternate. The physical count is to be a blind count (i.e., the individual performing the count is not provided with the book quantity.). Standardized forms to record the physical count are to be developed and used. The individual performing the physical count is to sign each form used to record the physical count. The forms are to be promptly completed and furnished to a designated supervisor who is to perform the inventory reconciliation. Standardized inventory reconciliation forms are to be developed and used. The inventory reconciliation form is to show the following:

• Date of physical count;

• Date the reconciliation form is completed;

• The book quantity as of the date of physical count;

• The physical count; and

• The name of the person performing the inventory.

If the physical count agrees with the book quantity certification of this fact, signed by the supervisor, is to be recorded on the inventory reconciliation form. If there is a variance between the book quantity and the physical count, a second physical count is to be conducted immediately by the supervisor or other party if the supervisor is the designated custodian or alternate. If a variance still exists, the situation is to be reported to the agency head and the agency is to follow procedures for a suspected loss (refer to Section 6.2.2.3).

2.2.3.5.8

Warrant Voiding and Destruction Procedures

Effective Date:

Sept. 1, 1998

2.2.3.5.8.a

Except as noted in 2.2.3.5.8.b below, warrants to be voided or destroyed are to be controlled by OST and DIS. OST and DIS are to develop and implement written procedures for voiding and destroying signed warrants.

2.2.3.5.8.b

Warrants in the possession of a warrant preparing agency (other than OST or DIS) which are to be voided are to be controlled by the agency. Warrant preparing agencies are to develop and implement written procedures for voiding and destroying unsigned warrants.

2.2.3.5.9

Local Check Control Procedures

Effective Date:

Sept. 1, 1998

Agencies with local accounts are to develop and implement written procedures for controlling local checks. Procedures should provide for adequate internal control as prescribed in Section 2.2.3.5.7. Additional guidance can be found at 6.2.2.1.5.