Petty cash or a petty cash fund is a small amount of cash available in hand for paying minor expenses such as employee reimbursements or office supplies without writing a check. These small expenses are recorded in the company’s general ledger expense accounts when the petty cash log template is replenished to the decided float level.
As petty cash provides convenience for minor transactions for which issuing a bank cheque is considered unacceptable or unreasonable. The amount of cash that a company considers petty cash vary by company. It may be in the range of 5$ to 20$. Following are a few examples of payments made from petty cash; You may also check business memo templates.
- Office Supplies
- Reimbursement to an employee for small work-related expenses such as meeting refreshment, official local travel, or laptop bag pack payments.
- Special cards for customers
- Flowers for VIP guests
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Here are some steps that will help you to keep the track of petty cash;
At first, buy a lockbox. It is easily available at an office supply store. You should buy a metal box. It will contain the amount of cash that you have available to use. Moreover, you can also store receipts in it.
Next, assign the responsibility of the lockbox to someone. If you are a single person, then the responsibility of a petty cash fund is yours. If you have a group of people, then you can assign this responsibility to any individual.
The next step is to store the petty cash box and set a limit. You have to keep it out of sight and in a closed drawer. But it can be easily accessible. The thing you should to do is to keep this box in a locked drawer for another layer of protection.
When you have all done with the basics, it’s time to stick money into the petty cash box. Make sure that you are putting enough in to handle most cash purchases while establishing the funds.
After that, make a transaction log. You begin a log of the transactions that go through the box. It can be either a simple handwritten accounting log or an online spreadsheet. Furthermore, you can also download a pre-made template to save time.
Now, the thing you have to do is to track the petty cash fund on the accounting records of your business.
After completing a list of transactions, make sure that a receipt is present for every purchase. It will surely help you to keep the balance sheet in order.
An imprest petty cash system is a procedure of accounting for petty cash expenses. Under this system, the petty cash fund always remains at a fixed amount decided on when the fund is first established. This system allows only the replenishment of the spending made.
There are the following uses of petty cash;
- It is used to buy small items such as tea, coffee, sugar, and stationery.
- Used to provide change to customers who are paying cash.
- The cash that has been paid by customers is kept in it. There is no to deposit it in the bank account. However, the large amounts should be deposited in the bank.
Custodians are appointed to oversee the petty cash fund with the help of petty cash template excel sheets. It’s a duty of custodial to dispense funds and ask for replenishment as per rules and regulations set by the company. Petty cash custodians reconcile petty cash funds periodically to verify the balance fund is correct.
When the balance falls to a preset level, the custodian launches a request for replenishment. Custodian provides petty cash log, vouchers, and receipts at the time of replenishment of new funds. Simple petty cash templates used by custodians for keeping records and management of petty cash funds. You may also like the payroll template.
Petty Cash Voucher:
Petty cash custodian keeps a record of each transaction made through petty cash fund. For this purpose, petty cash vouchers are used to record below information of each payment made,
- Voucher Number
- Payment For
- Attached Receipt approved by the authority
Another voucher is used with a petty cash form template to request the replenishment of petty cash funds. This voucher carries information such as date, details, float, voucher number, cash in, cash out, and balance.
Petty Cash Log:
The petty cash logbook is a weekly or monthly summary sheet that represents general information about each transaction made through the petty cash fund. Petty cash log printable sheets are easily available, filled on a daily basis through vouchers.
These are kept up-to-date to verify the remaining cash in hand. For the reconciliation process of petty cash, it is ensured that the remaining balance of petty cash must be equals to the float minus total reimbursements made during the time frame having attached details of each transaction in form of vouchers as well as receipts. In case of any minor variations, the source of discrepancy is identified and corrected. You may also see the daily checklist template.
Petty cash log example sheet can be made using excel which represents the following information;
- Title (Petty Cash Log)
- Time Frame (Week, Month or Date-Date)
- Date of Transaction
- Voucher Number
- Detail of Payment
- Cash In
- Cash Out
- Total Petty Cash Left (Last value of balance column)
- Approved Float
- Top-Up Amount (Approved Float minus Total Petty Cash Left)
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