Petty Cash Policy Office of Ethics, Compliance & Privacy The George Washington University

Petty Cash

A petty cash fund is initiated by a Department Head’s request, in writing through the Controller, with final approval of the Vice-President of Finance. After Physical Plant has secured this box in a locking desk or file cabinet, the Controllers Office is notified and a numbered receipt book is issued. Finally, the cash fund is distributed through the Controller’s Office.

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The new custodian will also need to be set up as a vendor in KFS. Complete an Electronic Accounts Payable Check Request via the Duke@Work portal to document the loss and replenish the fund. In the event of a loss of funds, a memo must be written to explain the circumstances surrounding the loss. Submit the properly completed Electronic Accounts Payable Check Request and supporting documents to Accounts Payable.

Petty Cash Procedures

Petty cash funds are small, but they do need to be managed properly. You’ll want to ensure that the money isn’t mishandled, and you’ll want to make sure that those little expenses are accounted for when tax time rolls around. Here’s how you can set up an effective, easy-to-manage petty cash system. In reality, the balance in the petty cash account is higher than the amount of cash actually in the petty cash box, since the cash in the box is continually being paid out. However, the difference is so minor that it is completely immaterial to the results in the financial statements. Thus, the difference is only reconciled when the petty cash box must be replenished.

Petty Cash

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Use of petty cash is sufficiently widespread that vouchers for use in reimbursement are available at any office supply store. All reimbursements requests will be checked for math and proper documentation. Proper documentation consists of a pre-numbered petty cash slip and a receipt from a third-party vendor. Hand written receipts are not considered proper documentation.

When you are setting up a petty cash system for your business, you must establish clear and concise conditions so that the funds are not misappropriated. It’s a good idea to specify what things petty cash can be used for; the petty cash policy should be in writing, and available for review by your management team and your employees. Typically, you will want to limit the number of individuals who have access to petty cash funds. You can set up your petty cash float – the maximum, fixed amount of on-hand cash – by cashing a check, usually ranging from $100 to $500 depending on the size of your business.

Business Office

The Account Closure Form, a copy of the Maroon Credit Union Receipt and Report of Money Received should be sent to Accounting Services atcash- Maintaining receipts and detailed records to support all transactions. The Fiduciary should document this quarterly review and maintain the documentation in the department. The cash and receipts must be maintained under lock and key in the physical location noted in the Establishing a Petty Cash or Change Fund request form. Only one person, the Custodian, should have physical custody of the fund. This person should not have responsibility for accounting records. Petty Cash accounts should be replenished in December of each year regardless of the balance of cash.

  • Attach to the request the email approval you received from Accounting.
  • Access to the Safe should be limited to authorized employees.
  • Proper documentation consists of a pre-numbered petty cash slip and a receipt from a third-party vendor.
  • A Missing Receipt Affidavit may be used for missing receipts.
  • Unify all compliance documentation, projects, and stakeholders in one globally accessible, cloud platform to maximize visibility.
  • In addition to a log, your company’s policies should include a requirement for receipts to be provided for every purchase.

The custodian is responsible for maintaining a petty cash payment log and receipts for every transaction. The purpose of a petty cash fund is to provide cash to business units sufficient to cover minor expenditures. The use of petty cash funds should be limited to reimbursement of staff members and visitors for small expenses, generally not to exceed $50, such as taxi fares, postage, office supplies, etc. Wherever possible, local units should use the PCard instead of petty cash. Your company will also want to have a set of policies in place to establish how the petty cash funds are spent and administered. These policies will identify the sort of transactions that qualify as petty cash expenses, and it will establish guidelines for how these business expenses are to be documented. The custodian is responsible for keeping the petty cash funds in a safe place such as a lockable box only to be accessed when needed.

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See Section IV REIMBURSEMENT OF A Petty Cash FUND for more details. It seems a very large amount of petty cash, if that is really what it is. It is important to bear in mind an interesting addition to the petty cash of the private builder before the war.

Petty Cash

If the remaining balance is less than what it should be, there is a shortage. If the remaining balance is more than what it should be, there is an overage. Although there can be minor variances, when unbalanced, the source of the discrepancy should be identified and corrected. Purchase advances should be written on a petty cash slip in the amount of the advance and adjusted to the actual amount of the expense after the return of the receipt and change. Under no circumstances can petty cash be used for personal expenses or loans. Upon completion, the Petty Cash Voucher, along with appropriate supporting documentation should be delivered to the Cashier’s Office for funding. The person receiving cash must have their Rice ID and should be a different person than the form approver.

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