Petty cash management software helps you manage petty cash funds efficiently. The staff creates a check to the cashier with the amount required to fund the petty cash. The accounts payable staff forwards the reconciliation form to an accountant.
BlackLine Account Reconciliations manages and reconciles all petty cash accounts via a centralized system. Our automated reconciliation software delivers templates for recording account data with customizable checklists ensure standardized petty cash records across the organization. Software also provides standardized templates to ensure that petty cash funds are managed consistently across the organization. https://www.bookstime.com/ A centralized repository of all your documentation allows for an easy audit of these records by internal auditors. The petty cash custodian pays out cash as requested in exchange for some form of evidence, such as a receipt or a voucher. The aggregate total of all remaining bills, coins, and evidence of receipt in the petty cash fund should always match the authorized amount of cash for that fund.
Types of Petty Cash Uses
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You get complete control over your funds, disbursals, reconciliations, and compliance with the solution. It streamlines the disbursement process and develops a mechanism for tracking it. These expenses have no material effect and generally do not require a high level of authentication for their payment. While the petty cash definition might be simple enough to understand, its use can be a little more complicated. Therefore, it is appropriate to keep only enough petty cash available for emergency and convenience needs.
Internal
To finance petty cash, you usually take money from your company checking account, as described in the preceding section. A debit (increase) to the petty cash fund and a credit (reduction) to the company checking account are the journal entries that must be documented. Petty cash is a small amount of cash that companies keep on hand, in a locked drawer or box, to pay for minor business expenses. However, in larger businesses, each department or building may have its own petty cash fund. Cash on hand is any accessible cash the business or liquid funds have.
For some organizations, monthly reconciliation works for small businesses, whereas for large organizations weekly reconciliation can get the job done for others. Therefore, choose a reconciliation system that works for your firm. Companies often maintain a petty cash fund balance, and this amount will vary based on your company’s needs.