The use of Petty Cash funds to purchase goods and services and reimburse staff for travel and other expenses can represent genuine savings given the cost of processing a transaction which involves the placing of an order, processing of an invoice, issuing of a cheque and other accounting procedures.
Requests to establish a petty cash fund should be referred to the General Accounting area within Financial Services, who will typically approve the request and arrange for a cheque to be issued to establish the fund.
Petty cash funds should always be kept in a locked cash box and secured in a locked facility. Access to the fund should be limited.
All petty cash disbursements should be supported by a receipt. If a receipt cannot be obtained immediately, then the person receiving the funds should sign a chit indicating the amount of funds received. The chit would be a form that the administrator would use to record the removal of cash from the petty cash fund until they were able to obtain the original receipt (i.e. if an administrator needed cash up front to make a purchase, they would sign a chit, remove the cash, make the purchase, then return the original receipt to the petty cash box). All original receipts would then be submitted via the reimbursement process. A chit is not used in place of a receipt (outside of this purpose). At all times, a reimbursement from petty cash must be supported by an original receipt.
Individual purchases from petty cash funds should not exceed $50.00.
Petty cash funds may not be used for the payment of salaries or wages.
Petty cash receipts and chits should always be kept in the box to prove that money has been spent. The total cash and receipts should always equal the original petty cash amount.
The fund should be reimbursed whenever the cash balance is depleted. All receipts should be totaled and summarized and a cheque requisition prepared for an amount equal to the total.
If and when a petty cash fund is no longer required, then all outstanding receipts should be submitted for reimbursement. The total amount of the fund should then be given to General Accounting with instructions to close the petty cash account. The float balance will be deposited back into the central petty cash account.
Petty cash funds are subject to a count or audit at any time by University auditors or a representative of Financial Services.
It is the department head's responsibility to ensure proper safeguards are in place to protect this fund.