The petty cash reconciliationrequest for reimbursement form must be completed and turned into the accountant for replenishment of petty cash funds expended. Smaller or homebased businesses usually require the business owner to complete this function. Application for a petty cash fund should be made by means of a memorandum to the director of finance. Petty cash reimbursements should be scheduled in advance by calling the controllers office ext. Assign one person to be in charge of petty cash, known as the petty cash custodian. Petty cashcash drawer fund controls and procedures are to ensure that petty cashcash drawer funds are properly established, maintained and that university assets are adequately safeguarded. A cash handling unit is defined as any department making a minimum of two or more deposits per month. Petty cash disbursements c17361 accounting manual page 1 tl 79 123098. Petty cash may not be used to purchase money orders, coupons, gifts cards, and other similar types of prepurchases tenders for goods or services. In the event of theft, the custodian should notify hisher immediate superior as well as the university police.
Petty cash, cash equivalents, change funds and special cash funds must be used strictly in accordance with the purpose for which they were established and authorized. To facilitate minor business expenses, a petty cash fund will be available to employees. Sign and date field 12 authorizing authority to approve the setup or changes to the petty cash fund. Introductory statement all established petty cash funds or change funds are the property of bowling green state university and are subject to handling and accounting policies established by the university. Petty cash custodians are responsible for ensuring that petty cash expenses are appropriate and in accordance with university and local policies, disbursing cash from a petty cash account, documenting expenditures and keeping receipts, reconciling the account quarterly monthly, if sponsored funds are used, replenishing the account, and. Through the use of petty cash policies, petty cash funds are used. Petty cash procedure guide california state university. Review the m75 request of establishment or update of the petty cash fund form and verify the petty cash limit, the purpose of the petty cash fund and plan for safeguarding the petty cash fund. Petty cash policy example accounting forms cash funds. All petty cash vouchers must be preapproved and issued prior to purchasing goods. Petty cash cash drawer fund controls and procedures are to ensure that petty cash cash drawer funds are properly established, maintained and that university assets are adequately safeguarded. Also, the cash will need to be counted and the total should match the total at the bottom of the petty cash log. When petty cash is no longer needed for a department the fund should be closed by reimbursing the fund as outlined above and then the account should then be returned to accounting providing a credit back to the original account withdrawn from. The request should identify the petty cash fund custodian and one other employee that is designated as a back up to the custodian.
The purpose of this document is to outline policy on establishing and managing the asi petty cash fund. When petty cash funds are replenished, the total of the replenishment form cannot exceed the full balance of the fund. When cash becomes depleted, a refund check should be requested by the petty cash custodian to. The use of a university petty cash facility is governed by the. All other purchases must go through the purchase order process via a requisitionrequest for payment. Petty cash accounting involves establishing a petty cash policy, setting up a petty cash log, creating journal entries, and reconciling the petty cash account. The petty cash accounting journal template, the cash box, and all petty cash transactions should be maintained by the cashier. The petty cash disbursement procedure is outlined below. Petty cash procedure sop policies and procedures manual. The bursar is the universitys primary handling agent. Petty cash fund procedures california state polytechnic.
Petty cash funds are used primarily for small expenses in the business. This involves summarizing all disbursements made and issuing cash back to the fund for that amount. Proper documentation consists of a prenumbered petty cash slip and a receipt from a thirdparty vendor. Special care must be taken to protect such funds from theft or misuse. Petty cash procedures example of accounting manual policies. Petty cash departments needing to provide change, or reimbursements should request a petty cash fund from general accounting. The petty cash custodian will be notified for pickup and may present the check to the foundation cashier for cash with the proper identification. The first thing you need to do is document your petty cash procedures and communicate them to all employees.
Accounting and procedures for petty cash accounting guide. Petty cash fund procedures petty cash fund definition a small cash fund used to make incidental purchases where normal purchasing methods are not practical. The appropriate balance sheet account will be provided by the accounting office. Funds must be completely reconciled and accounted for before the controllers office will approve any changes. Accounts payable is responsible for writing checks and paying the companys bills. A petty cash fund is cash in a secure lock box, which is used for small purchases and maintained by a petty cash custodian. Petty cash may be used only for payments to human research subjects and related expenditures only from. The final step is to topup the petty cash to the float amount. The george washington university petty cash procedures manual last revised september 2014 ss it is the departments responsibility to ensure that the comptrollers office is notified of any changes made to the petty cash fund. Terms and condition of use no university petty cash facilities will be issued, or can be used, except in accordance with this policy. While petty cash is a relatively small amount of money, it can be easily stolen or abused if you dont handle it right. Size of a petty cash fund the petty cash fund should be small enough to require.
Petty cash funds policy 3011 general purpose of petty cash funds petty cash is intended for. Review memo request for the establishment of a new petty cash float and challenge. The accountant makes out a check for the total amount requested for reimbursement to the petty cash fund, and charges each indicated expense account number for the individual expense amount. Accounting can be done manually or made easier with bookkeeping software and employee expense. The collection and control of cash at northwestern university are very important functions. The petty cash should be reconciled at the end of the month the same way a bank account is reconciled. Procedures for the handling of petty cash are designed to provide accountability for moneys received in accordance with generally accepted standards of internal controls. Petty cash funds may be established for payment of minor or infrequent expenses where it is. Petty cash or cash drawer procedures cornell university.
Adequate receipts and documentation must be maintained to support all transactions made from the petty cash fund. Petty cash fund procedure controller and treasury texas. Idcash eally, from a control perspective, the collection and controlling of cash should be centralized in one location. The check amount should be sufficient to handle most cash purchases for the time period you choose, but not so large as to encourage theft. Procedures have been established to encourage effective administration and internal control of cash handling operations throughout the university. When cash is added to a petty cash fund, the basic concept is to replace the amount of any cash that had previously been disbursed from the fund. At least once per year, departments must reexamine whether the petty cash account is still required to meet the departments business needs, or if. All petty cash funds are subject to periodic audits.
Petty cash policies and procedures help business owners limit the amount of time they spend on their accounts payable process. Once you have the basics covered, you need to put money into petty cash. Policy the department head is ultimately responsible for the basic safety and control of the cash fund, regardless of who actually handles the transactions, and reimbursements. Businesses that maintain petty cash to pay for small, ondemand necessities should implement proper petty cash audit testing procedures to ensure that employees use petty cash for appropriate reasons and properly account for the petty cash as used. Because of its accessibility, petty cash funds tend to be susceptible to abuse and misuse. You should write a check to the custodian to initially establish the fund. Accounting and procedures for petty cash accounting. Dec 12, 2017 the petty cash fund procedure has been created to provide guidelines for the appropriate establishment, use, and accountability of such funds. Whenever possible, an individual who does not have access to the petty. The petty cash fund was established with the goal of minimizing.
Keep petty cash funds in a secure area such as a locked drawer or small safe. This business process demonstrates how a department can enter petty cash receipts and add backup documentation. Decreasing or closing a petty cash fund when a project director decides that the petty cash fund should be decreased, the amount is returned and deposited with the foundation cashier. Purchaseanywhere petty cash trinity property consultants has adopted the purchaseanywhere cashpass visa prepaid cards to facilitate the accounting and. Petty cash funds should not be comingled with other funds. Petty cash funds are for the purpose of infrequent or emergency departmental purchases.
Only one petty cash voucher per account number can be taken out at any given time. Jun 22, 2019 the disbursement procedure for petty cash is designed to provide sufficient documentation of each expenditure, as well as proof that funds were actually disbursed. Record of petty cash disbursements and request for reimbursement instructions page 2 of 2 rev. Financial responsibility for these funds resides with the host department. It is important to trust your employees when they would be using the fund but it is also right to take precautions.
The procedure for petty cash funding is outlined below complete reconciliation form. Provide a full understanding of the related cash handling responsibilities and accountabilities to the units conducting cash sales. This procedure applies to all employees of the company. Create strong internal controls to ensure cash sale proceeds are appropriately safeguarded. Example of petty cash procedures for accounting manual. Initiation of a petty cash fund department written request to the controller stating reasons the fund is needed. New petty cash procedures cashier services mesa community. General information the two designations of imprest cash used at the university are petty cash and drawer cash. The petty cash procedure helps outline the disbursement and reimbursement of petty cash. A petty cash fund or custodian may be revoked at the discretion of the finance director. Below is the key information that should be included in your petty cash policy and procedures. This policy establishes the proper uses and administration of petty cash funds. Thebursars office is the liaison for identifying and working with all cash handling units.