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Cash and Cash Equivalents


West Virginia University Policy
Division of Administration and Finance

Policy Number: IARA-02


General Information

Reason For This Procedure:

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

To Whom Does This Procedure Apply:  

  • This Procedure applies to all West Virginia University departments, including those on the regional campuses - Potomac State College of WVU, 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 – and the West Virginia University Research Corporation.



All currency, coins and demand deposits maintained at banking institutions.


Cash equivalents


Highly liquid investments that are convertible to known amounts of cash; have an original maturity of three months or less at the time of purchase; and have insignificant risk of change in fair market value due to shifts in the interest rate.



  • Cash includes deposits held by state agencies on behalf of the institution, for example, cash on deposit with the State of West Virginia. These funds are maintained at a banking institution by the state.
  • For cash equivalents, 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 investments.


Procedure Development

  • The responsibility for procedure development of this policy rests with Institutional Accounting, Reporting and Analysis.


  • The responsibility for implementation of this policy rests with Institutional Accounting, Reporting and Analysis.


  • The responsibility for interpretation of this policy rests with Institutional Accounting, Reporting and Analysis.


Additional information or questions regarding this procedure can be obtained by contacting:

  • Institutional Accounting, Reporting and Analysis at 304.293.4008.
Originally Issued: July 1, 2010
Updated: February 8, 2016
Approved by: Daniel A. Durbin, Senior Associate Vice President for Finance