Documenting Petty Cash Fund Purchases Procedure

Procedures

Banking & Merchant Services has created a Cash Fund Activity Log that departments can use as a template, if desired. The department also has the option to create their own log to track purchases. Regardless of what Cash Fund Activity Log is being used the department should include:

Authorized employee’s name
Date
Amount
Purpose
Initials of both the Petty Cash Fund custodian and the authorized employee

Receipts from purchases must be retained with the fund to support the total amount of the Petty Cash Fund and the replenishment of the fund. A petty Cash Fund provides convenience for small transactions for when using a PCard or other payment methods are unreasonable. Petty Cash Funds may not be used for personal loans, reimbursements of purchases made on personal credit cards or debit cards, travel expenses, or taxes for which the University is not liable (e.g. sales tax, freight taxes, or federal excise taxes).

It is important that the procedures used by a department include the following:

Any cash received by an employee to make an approved purchase should be recorded on the Cash Fund Activity Log confirming receipt of the money.
Receipts for each transaction are required regardless of the amount. Receipts are kept as evidence for the Cash Fund Activity Log and are required to replenish the fund.
The amount of cash on hand along with un-replenished receipts, and money that has been checked out should always equal the total amount of the authorized Petty Cash Fund balance.
If goods and services purchased using a Petty Cash Fund are returned to the supplier, the custodian must be notified. The custodian should properly document the return.
Petty Cash Funds that are not regularly replenished should be assessed to determine whether they are still necessary.