Admin

Petty Cash Box

Petty Cash Box

Often campuses need to make immediate small cash purchases.  In response to these cash needs, a petty cash fund may be established.  A petty cash fund must be approved by the Director of Accounting.  The school principal is responsible for maintaining and protecting the petty cash fund.  The petty cash fund’s cashier is the person assigned to manage the petty cash fund on a daily basis.

Initial Setup of Petty Cash Box

Please follow the procedures below:

  1. Prepare a non-standard the vendor information is the Location Name, Miscellaneous Expense and Administrator’s name.  
  2. Use one of the below account codes to establish the cash box:
    • 199.00.XXX.000.XXX   1103   Department or Campus
    • 461.00.XXX.000.XXX   1103   Campus   
  3. Description should be “To establish a petty cash box for ___” enter the name of the Campus/Department.

Forward the non-standard to the Director of Accounting for approval.

Following approval a check will be issued by the Accounts Payable department.  Upon receipt of the check it may be cashed at the bank. 

Guidelines:

  • The maximum amount for which cash payments should be made is $50
  • Cashier is prohibited from cashing employee’s payroll or other checks
  • The petty cash fund should not be a source for loans to employees or other persons
  • Petty cash should not be commingled with cash/revenue obtained from other sources

 

In most instances, petty cash boxes should not maintain a balance of more than:

            Elementary Schools                                $200

            Intermediate Schools                              $400

            High Schools                                          $700

            Others                                                  $50 - $1,000 

 

Petty cash funds should be operated under an impress system.  An impress system is a fund used for small items of expenditure and restored to a fixed amount periodically.  Under an impress system, a signed receipt (indicating the name of the payee and the reason for the payment) is required for each payment out of the fund.  These receipts may be printed in pre-numbered form.  Additionally, a petty cash ledger or running total of the remaining cash in the fund should be maintained.  At all times, the total of the remaining cash and the receipts for payments made should equal the original balance of the petty cash fund.

The petty cash fund should be replenished when the remaining cash balance becomes low.  Prepare a non-standard to request a replenishment of the fund.  The non-standard should be supported by a summary of the payments charged to the correct account code along with the receipts and sent to the accounts payable department for a check to be issued.

The following procedures summarize the petty cash fund operations: 

Once established, the petty cash fund should be maintained in a secure location such as a locked filing cabinet or safe.  The original balance of the petty cash fund should be verified by site-based personnel and noted on a petty cash ledger.

A disbursement from the fund is recorded on a petty cash receipt, which indicates the date, receipt number, employee's name, amount, and purpose of the expenditure.  It also contains the signature of the person receiving the money.  The receipts are kept in the petty cash box, so that at all times the total of cash and receipts equals the original amount.  When a bill has been paid out of petty cash, it is attached to the petty cash receipt.  An approved payment should be for an authorized school activity and be supported by appropriate documentation.

Record the petty cash receipt in the petty cash ledger.

At least monthly, the petty cash fund should be reconciled.  The balance of the petty cash fund should be proven in two ways:

  1. The total of the remaining cash in the petty cash fund should agree at all times with the petty cash ledger.  
  2. The total of the remaining cash and the petty cash receipts should agree with the original balance of the petty cash fund as noted in the petty cash ledger.

When the remaining cash balance of the petty cash fund becomes low, the fund should be   replenished.

Verify the total cash received to replenish the fund agrees to the amount to the copy of the completed non-standard.

Record the receipt of the cash in the petty cash ledger and perform the procedures to reconcile the fund as described above.