CHAPTER 9: PETTY CASH BOOK
A business usually keeps a
small amount of cash on the premises for transactions whose total value is
very small, and where the use of a cheque is not practical.
Example: If an Administrative
Clerk purchases a packet of envelopes of S$1.50 as the Trading Firm has run
out of envelopes, she will then claim the S$1.50 from the Accounts Department
for the envelopes she has paid. It will not be practical for the Accountant
to pay the administrative clerk a cheque of S$1.50. Hence, the Accountant
will pay the S$1.50 from the Petty Cash Imprest.
A Petty Cashier is put in-charge
of a Petty Cash System.
For company staff to make
a claim from petty cash, they would need to complete a petty cash voucher
& produce a receipt to be submitted together with the voucher.
If no receipts are available,
staff must sign a memo indicating that their claim was incurred for official
business and attach this to the petty cash voucher.
The Petty Cash
Book is similar to the Cash Book, and is both a book of original entry as
well as part of the ledger.
The Petty Cashier's
duty is to maintain the Petty Cash Book & obtain reimbursement from the
company's Accounts Department once the amount of petty cash runs low.
The Accounts
Department will provide a fixed sum of money to the Petty Cashier at the end
of each month or even needs arise. This fixed amount of money is known as
a float, and the system that monitors the flow of monies into and out of the
till is known as the Imprest System.
Want
to learn more about Petty Cash & its claiming procedure
Alan Goh Jiang Wee © 2001-2002
