PETTY CASH SPREADSHEET

It is just a simple tool for simple transaction on a tiny account such petty cash. This pretty small excel spreadsheet file is consisted of some formulas.

Most of Accountant or a financial controller would prefer to use spread sheet for data management and analysis works rather than usage of data base instant programmed or any accounting instant software. Me, too.

But it is not for the reason this spread sheet is being posted to this page. Absolutely not for such personal judgment. Everyone has own preference.


Lets bear in mind, essence of Petty Cash keeping IS NOT about the tools itself, but the management, procedure, treatment, consistency, accuracy. Having a great financial control system, reliable procedure and clear guideline makes everyone confident for the business operation. So many instant accounting software is available in the market which are wonderful tools indeed. I use some of them as well for some other purposes. But spread sheet always exist in accounting works.

The Company I've been working for uses MAS200, EBS (Embedded Business Solution) by sage for main FIS, with tons of great feature along with the EBS software : General Ledger, Account Receivable, Account Payable, Sales Order, Inventory Management, Warehouse Management, Bill of Materials, Work Order, Purchase Order, Bank Reconciliation and lots more. The analysis feature is also completely great.

In fact, accounting staff also uses spread sheet for daily logger. I am happy with this very tiny sheet, every time I do quick auditing on Petty Cash, I always thanks to this sheet for making me spend only couple of minutes to complete my quick audit. By adding auto filter on the header row, I can even search for a small purchase amounting $0.25 4 years ago. By filtering on column "D" (Vendor), I can get sum of purchase to a certain vendor, its amount and its frequency as well.

When trying to search for some previous receipt, I just do a filter by date, then by the description, once I got it, I move my focus to the last column, I can find the source journal code (SJ#) which leads me to a binder labeled with the same code, I take the binder, bingo ! I got the 3 years old receipt !.

Once again, it's not because of this tiny spread sheet, but it's because of the petty cash management, the effective procedure, the clear guideline, the consistency, the accuracy. As long as you're consistent and tight enough to perform the task by the rule, SURE YOU CAN DO LOTS BIG THINGS WITH THIS SMALL SPREAD SHEET.

If you desire to use this small tools, you may download it here.

I will load Petty Cash Reconciliation very soon. Come back and feel free to pick it.

TYPICAL EVENT AND CONDITION ON PETTY CASH

Pre-reading caution : Read “Petty Cash Tips For Custodian” will give a better understanding about this topic

There are certain typical events and conditions on petty cash that need specific treatment. As a petty cash custodian, you should be ready and adapt to these conditions. Best procedures and policy is just not enough when the custodian is not ready.

Here are some typical events and conditions that common happened in petty cash role, some tips come along with those :

Cash from Sales or Account Receivable

Cash receipt may only come from General Cash account or Checking account. Any cash coming from Sales or account receivable should be submitted to the General Cashier. In this case Send payer to general cashier. Should the General cashier isn't available, you may need to take care the cash receipt temporary, in this case you need to perform the following :

1). Count the money, and put it into a separate envelope labeled with note on it.

2). Issue a cash receipt and a memo to be submitted to the financial controller

3). Transfer the money as soon as the general cashier available. It should been done before the closing day. This transaction should not effect your cash balance, therefore it should also not much bothering the main tasks.

Cash Advance & I Owe You

Try to avoid IOU's and cash advance. For this purpose, always keep some small money and coins in sufficient amount. If you have to do IOU's or Cash advance, you should always put the actual amount drawn from the box, and make a cash receive or cash disbursement slip accordingly. If later on the cash is returned by the purchasing custodian, then treat this as a cash receipt by posting an opposite journal.


Petty Cash Balance below fund float level

You should be able to estimate the next ending balance, the balance desired to be decreased, then you should request for additional fund, asking for IOU is potentialy a problem. Avoid this, and submit a request for additional petty cash fund instead.


Petty Cash Balance above float level

If the float seems to exceed the maximum float level, then make a memo to financial controller and submit the cash to the General cashier upon the approval.


Petty Cash Lost or Stolen

1). It's rarely happened, but it could be happened.
2). In This case, you should react right away, submit official report to financial controller
3). Wait for further instruction
4). Don't move anything and don't go away from your station unless it's instructed


Shifting

On every shift exchange, a physical count should be performed and official responsibility transfer should be documented.

Personal day off & Vacation

You may required to replace your co-custodian who is having a day off or vacation. In this situation is also requires a physical count and official notes should always made and filed. Perform your job as it should be.


Resignation

Resignation by custodian should be made at least 2 months before the effective day. Management need more time to prepare and transfer your responsibility and conduct some training for the new custodian, you should not leave till the new custodian is ready for his own role.

PETTY CASH TIPS FOR CUSTODIAN

Here are some tips for day to day Petty cash treatment & keeping :

Petty Cash Opening (5 minutes time allocated)

Do the follwing step At the beginning of working day:

1. Open the "Petty Cash Spreadsheet"

2. Check every farmula on cell remain correct

3. Open the "Petty Cash Reconciliation sheet" as well

4. Check every formula and make sure no erroneous on it

5. Fill the expected opening balance column (it should be equal with the previous actual closing balance)

6. Perform physical count

7. Put the physical amount into the "Petty cash Reconciliation Sheet" right on the actual opening balance column.

8. Compare the actual opening balance with the expected opening balance, it should no variance. Should any variance arisen, make a note (memo) to be submitted and approved by Financial Controller.

Now you are ready for your today's very first transaction


Petty Cash Receiving (5 minutes time allocated)

1. Once the cash received from Checking account, Count the cash right away

2. Issue a cash receipt slip

3. Put the cash into the petty cash box

4. Update petty cash book/spreadsheet

5. Compare the updated balance with the actual cash in the box, it should be equal with previous balance plus cash receipt

6. File the slip to a binder labeled with "Petty Cash Receipt "


Petty Cash Disbursement (5 minutes time allocated)

1. Verify purchase request received from department, make sure it's written and authorized, correctly follow the procedure set by the management.

2. Check unit price with authorized price list

3. Do a quick cross checking with inventory custodian about stock availability, in the case that request made on an availability stock, refuse the request promptly. Otherwise go a head to the next step.

4. Do a quick test by re-calculate the total amount.

5. Do a quick cross checking to the authorized person for the purchase.
write a cash receipt to be signed by purchaser

6. Disbursed the cash (always avoid a cash advance, this will minimize variance possibility much lessen and final daily reconciliation become headache no more).

7. Update petty cash spreadsheet

8. Compare the updated balance with the actual cash in the box, it should be equal with previous balance minus amount on the slip

9. File the slip to a binder labeled with "Petty cash disbursed "


Petty Cash Physical Count (3 minutes time allocated)

Always performed "quick physical count" every time cash just received or disbursed. It will keep your cash always in neat and clean balance time to time. However, deeply physical count to be performed on every opening and closing day.


Petty Cash Reconciliation (5-10 minutes times allocated)

Once the physical count is done, put the physical amount into the "Petty Cash Reconciliation sheet" compare the actual amount with the expected ending balance pulled from the petty cash spreadsheet or download from the Financial Information System.

Should any variance occurred, perform the following step :

1. check the formula on the spreadsheet to ensure correctness, if it still not fixing

2. If the above still not fixing, do re-count the physical cash

3. Compare amount written on the slip with amount you type on the spreadsheet or system, make sure it's tied out. If you catch the error, fix and compare it again. Mistyped often happened.

4. If it's not fixed yet, screen for any IOU's or Cash advance given to purchasing custodian.

5. Compare again, keep tracking it back, till the error is found and fixed it.

It should matched now, you may go head and start for closing day process.

Reconciliation process become a very time consuming when quick physical count is not always performed on every single transaction.


Petty Cash Closing (5 minutes time allocated)

Once reconciliation has completed, make a daily audit report and reconciliation, signed by you (as a custodian) and the Financial control to approve it. always lock the box and save the box in a metal cabinet

For further reading, I recommend to read : Typical Events and Conditions on Petty Cash, Petty Cash Spreadsheet, Petty Cash Reconciliation sheet.

PETTY CASH MANAGEMENT

Pre-reading info : This article is best for Finance Management level guideline, and good for staff knowledge.


Petty cash fund is a small cash account purposed to cover recurring or small emergency purchases for the company.

Petty Cash Characteristic

• Usually it’s a certain small amount which is set to not exceed or lower than $200.00 to $500.00 per day. Different company may vary.
• Covering small repetitive day to day transaction.
• It’s saved in a small box or ampelove
• Handled by junior finance custodian

Petty Cash Procedure

Regardless materiality fund involved in it, petty cash play such vital role within company’s operation. Small recurring transaction happened everyday, since the opening of day till the closing day. Therefore a neat and clear procedure for petty cash fund is required. There is no reason for management to not control it properly. Inappropriate treatment on petty cash may disrupt the whole operation.

Here are some guidelines and tips for an effective petty cash management and procedure :

Petty Cash Fund Float

On the initial opening of petty cash account, management should set an absolute fund float, different company may set different level of fund float for petty cash. In term of amount determination, management should take the day to day recurring small transaction as a measurement in order to set the maximum and minimum petty cash balance.

It is not good for the company’s operation, having disruption because of insufficient small cash fund. Usually it is set in within $200.00 to $500.00 per day. In term of changing on petty cash float fund set, management should always keep custodian updated, trained, certified and designated appropriately.

Petty Cash Custodian

minimum of couple custodian may required to keep the petty cash. One custodian is always not the right number for petty cash. When a custodian leaving another custodian should replace her/him to keep the petty cash traffic running smoothly, and physical count to be written down into a paper as a transfer of responsibility.

Petty cash Custodian should has basic accounting skill, able to handle day to day small purchasing, a consistent honest person is a must, able to do a simple spreadsheet. Management should provide sufficient training prior to custodian designation, give intensive knowledge of petty cash and purchase requisition procedure, provide continuous petty cash reconciliation skill.

Petty Cash Fund Flow

Once the fund float and designated have defined, management may put the certain amount into the petty cash account. Drawn from the checking account in cash and submit it to the petty cash custodian, custodian should put a signature for the cash receipt and a declaration that they took the responsibility for safeguarding and its utilization should be made at once.

Custodian should keep the petty cash balance to be not lower than the minimum level set by the management. Whenever petty cash balance is desired to be over or less then the petty cash fund float level set, custodian should send a memo (in the case that the balance is more than the float should be) or a petty cash request (in the case that petty cash is desired to be lower than the float should be) to the financial controller for approval.

Petty Cash Disbursement

Department should submit a purchase requisition form to the Financial controller for approval. And petty cash custodian should only disbursed upon Financial Controller approval. Custodian should always generate a payment slip before money is delivered.

Petty Cash Record and Petty Cash Reconciliation

An appropriate petty cash record should be maintain consistently. While petty cash reconciliation need to be performed every closing and opening day. Petty cash physical count is performed prior to the reconciliation and custodian shift change.

Any unbalance amount occurred during the reconciliation should be tracked back and fixed before the closing. An official note for physical count and reconciliation should be made and filed upon Financial Controller approval, and petty cash allowed to be closed.

Related Topic : Cash Management, Petty Cash tips for custodian, Petty Cash reconciliation review and tips.
Related tools : Petty Cash spreadsheet, Petty Cash Reconciliation spreadsheet, Purchase requisition Form.