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Not everyone at your organization needs a credit card or wants to send in reimbursement requests for small transactions. Having a box with petty cash available for those smaller, seemingly inconsequential transactions can be convenient for employees and save the headache of reimbursements. However, just because it is called “petty” cash does not mean it is trivial or unimportant. Keeping track of and reconciling petty cash regularly is still an important part of being a good steward of your resources.

When to use petty cash

Your organization may find petty cash helpful in situations like:

• To pay the person who mowed the lawn when the check writer is not available
• To reimburse an employee for tapes and pens they bought at the Dollar Store
• To cover a parking or toll fee for an event the pastor or director has to attend
• To pay for a coffee order before a team meeting
• And so much more!

Supplies

In order to have and use petty cash you will need:

1. A petty cash box. Someone who is regularly in the office should be in charge of keeping the petty cash box in a safe place where they can easily access it when a need arises but it is out of sight and reach of those who are not authorized to access it.
2. A receipt book to record transactions in detail. This one available on Amazon is less than $15 and will help you keep good records of the money spent, where it went, and why. Give one copy to the person you paid and keep the carbon copy for your records.
3. Petty cash log book. A simple form, like this one, that allows an overview of all petty cash fund transactions. You could also create your own template and print them as needed.

Policy

It is important to have clear boundaries and expectations when it comes to the use and maintenance of petty cash. Here is a free Petty Cash Policy Sample that you can edit to your organization’s needs. For example, we have the Lead Pastor in charge of the petty cash in this policy, but it could just as easily be an associate or youth pastor, a secretary or admin, the director (in the case of a non-profit), or someone else who is regularly in the office. The important part is that whoever is in charge of petty cash should be comfortable taking on the responsibility knowing they would ultimately be responsible for reimbursing the petty cash fund if there was misuse.

Conclusion

Having a petty cash box can certainly be convenient at times and most offices could benefit from having at least $100-$200 in their petty cash box. However, that does not mean it is a free for all box of money. There needs to be a policy and procedure in place with one person taking the responsibility for the maintenance of the fund. This fund needs to be reconciled regularly just like any regular checking account. Take these tips and guidelines into consideration before starting a petty cash fund or consider resetting expectations if you already have a petty cash box and are not keeping it organized and reconciled.