There are times when you and your employees need a few dollars in cash to pay for minor business expenses. You might need to buy a few office supplies, pay for a cake on someone's birthday or simply find small change for a parking meter, for example. Most businesses use petty cash for this, monitoring payments in a petty cash book. You'll need to nominate a petty cash manager, typically an accountant, bookkeeper or other supervisor to oversee operations and collect receipts, if necessary. Each employee wishing to make a purchase should go through this representative, rather than leaving the petty cash box or tin open to every employee.
Purchase a ruled notebook -- a small, journal-sized notebook may be the best since it can fit in the petty cash box. Label the notebook with the start date, company name and "If Lost, Contact" contact information. Draw three vertical lines down the first page of the notebook. Label the four resulting columns Date, Purchase, Amount and Balance. You may continue this throughout the notebook upon starting the petty cash book or rely on the person who begins a new page to continue the format.
List the starting balance on its own line with the date recorded. Under the Purchase column, name it Beginning Balance. The first purchase will be recorded on the second line.
Put the starting amount of petty cash in the box or tin along with the notebook.
To make a purchase, have the employee propose to the accountant or manager what he needs and why. The accountant or manager may accept or reject the idea. If accepted, the employee is granted access to the petty cash book and box or tin.
Have the employee submit a receipt once he has made the purchase. Keep all receipts together, fastened by a paper clip, in the petty cash box or book. Remove receipts monthly and file.
Add extra cash to the petty cash fund by withdrawing from the company's account. The petty cash overseer, like an accountant or manager, decides how much should be kept in petty cash, typically under $100.
Keep the petty cash book and box or tin in a safe place, such as the accountant's or manager's office or cubicle. Do not leave it in a common area, such as the lunchroom or meeting area. Keep petty cash purchases small, for expenses like postage, parking meters or party supplies.
Do not record major purchases in the petty cash book. These should be accounted for in the main cash book.
Glenna Parks' work has appeared in "Missouri Life" magazine, "Marshall Democrat-News," "Central Collegian," and the Union Pacific and Amtrak employee publications, "BNSF Today" and "BNSF Railway." Parks received a Bachelor of Arts in communications from Central Methodist University in Fayette, Mo., in 2007.