Petty cash

What this does

Banking Overview → Petty Cash is a small register for cash kept on hand for odd purchases: a part run, postage, a lunch. Money goes in as a replenishment from a bank account and comes out as a withdrawal against an expense account, with the employee who took it. The page shows the current balance against the Petty Cash Fund Target you set.

Before you start

accounting.manage. An asset account in the chart with code 1579 named Petty Cash; the posting looks it up by that code, and not every shop's chart has it. Add it under Ledger → Chart of Accounts before the first replenishment or the ledger post fails with a warning. Keep the receipts; the withdrawal line is the only record of what the cash bought.

Steps

Fund target. Set the Fund Amount ($) the drawer should hold when full (e.g. 500). It's a reference for replenishing, not an entry.

Replenishment. Type replenishment, Date, Amount, From Bank Account, and a Description. The cash withdrawal from the bank is recorded at the same time.

Withdrawal. Type withdrawal, Date, Amount, Employee (who took the cash), Expense Account (what it bought), Description, and optional Notes.

Delete Transaction removes a petty cash line. Use it only for a line entered by mistake, and read the note under Common problems first.

What happens in the books

A replenishment posts Dr Petty Cash / Cr the bank account, so the withdrawal shows in the bank's register. A withdrawal posts Dr the expense account / Cr Petty Cash. The Petty Cash balance in the ledger is the drawer.

Common problems

The drawer doesn't match the balance. Someone took cash without a line. Record the withdrawal now with the receipt, or as a withdrawal to a shortage account if there's no receipt.

I deleted a line and the ledger didn't change. Delete removes the petty cash line only; the journal entry it posted stays, and so does the bank withdrawal for a replenishment. Instead of deleting, record an offsetting line (a withdrawal to reverse a replenishment, or a replenishment to reverse a withdrawal) with a description explaining it, and leave the original. If you've already deleted one, post a reversing journal entry under Ledger → Journal Entries.

Replenishment saved but shows a warning. The petty cash line stands; the ledger post failed (a period lock, or the Petty Cash account is missing from the chart). Fix the cause and post the entry by hand.