Petty cash is a fund issued to departments within a business. Employers will allocate funds to be used for necessities and certain marketing expenses. Petty cash funds will usually have a specified individual appointed to have access and give account for the use of petty cash. Petty cash is never to be used for personal reasons as this constitutes theft; all employers have guidelines on how to use petty cash. Keep accurate records, and use the petty cash under the guidelines mandated by your business.
Petty cash should always be placed in a safe box with a key stored away from public access. Place the money in an envelope and print or type out the starting amount and date on the front.
Keep all receipts that you use petty cash for; it is vital that you have a record for auditing purposes. Because petty cash is to be used for business, it will have to be accounted for during tax time.
Write the new balance on the front of the envelope each time you use petty cash, and place receipts in the same envelope as the cash.
Scan a copy of the receipts you use for petty cash and create a folder on your computer to save all receipts. In the event of theft you will have record. To create a new folder, right-click your mouse, click on "new" and click on "folder." Name the folder "petty cash receipts."
Create a computer spreadsheet or use a notepad to document each time you use petty cash. Petty cash can be used for marketing; for example, you might use petty cash to buy a business lunch. Petty cash can also be used to purchase office supplies, such as ink for the printer or candy jars for the customers. This must be documented accurately and at the time of the purchase. Include the date, the amount and the reason for the purchase, and if it was for a business lunch include the number of people who attended. The more detailed you are, the easier it will be for you to reconcile the petty cash you use later.
Store petty cash in file cabinet with a lock. Do not let anyone working outside of your business know of your access to petty cash.
Never use petty cash for any reason other than for business purposes.
Tips and warnings
- Store petty cash in file cabinet with a lock.
- Do not let anyone working outside of your business know of your access to petty cash.
- Never use petty cash for any reason other than for business purposes.