Reporting and Operations
It's amazing how much cash is stolen each year from petty cash funds.
Only one person should have access to the petty cash fund. At all times the cash and the receipts signed for withdrawals should equal the total of the fund in the general ledger.
The cash should be in a locked box and kept in a locked drawer or filing cabinet.
Every time an individual receives cash from the box, a voucher should be signed and placed in the box. The expense coding should be noted on the voucher.
If a receipt is obtained for taxi fare or the purchase of supplies, this receipt should be attached to the voucher.
When the cash in the box is low, the total of the vouchers should be determined and a check written for that amount. The check should be made payable to the individual in charge of the petty cash.
A summary of the expenses noted on the vouchers should be prepared and attached to the check copy. This summary will be the basis for recording the activity in the general ledger.
Under no circumstances should the petty cash fund be used to advance monies to employees in the form of loans.