Petty Cash Procedures

Establishment of a Petty Cash Fund

The purpose of a petty cash is to provide funds to make cash purchases of small amounts. The amount of purchase shall be limited to the General Fund accounts only. Not allowed for federal grants.

The following guidelines shall govern all petty cash accounts:

1. The Petty Cash account will be limited to amounts authorized by Finance Department.

2. The department supervisor shall exercise safeguard over the petty cash fund.

3. Disbursements from petty cash shall be limited to small amounts and should not exceed $50 for a single transaction.

4. Petty cash may be used for small purchases, reimbursements, postage, permits, and fees. Any exceptions must be pre-approved by the Finance Department.

5. Requests for reimbursements from petty cash must include the original receipts or invoices.

6. The department supervisor is responsible for maintaining accountability of all petty cash transactions.

7. It is strictly prohibited to cash checks from the petty cash fund.

8. Petty cash is not intended to circumvent District procurement policies and/or procedures.

9. Petty cash vouchers may be requested from Finance Department.

Operating Procedures

1. The petty cash account is established and approved at the beginning of each year by the Director for Finance. A payment authorization must be submitted to the Finance Department with the following information:

a. Vendor: MCISD Petty Cash b. Account: 1XX-00-1102-00-XXX-300-000 c. Description: To establish petty cash for fiscal year for (purpose of petty cash) d. Amount: Limited to authorized amounts e. Signature: Department Supervisor

2. A check will be issued by the Finance Department for the requested amount. The check will be made payable as noted on the Payment Authorization.

3. The department supervisor must endorse the check and cash it at the bank. The petty cash must be held in a safe, vault, or other secure area. It cannot be left in a locked drawer at the office or file cabinet.

21 4. Disbursements from petty cash should be limited to isolated incidents. The receipts and petty cash on hand should always equal the amount of the Petty Cash Account.

5. A petty cash voucher shall be used when petty cash is distributed. The voucher should include the following.

a. The amount distributed for the petty cash item b. Date c. Payee d. Disbursement explanation e. The account number to be charged f. Signature of person authorized to distribute petty cash

6. The employee making the purchase must submit the receipt to the office clerk upon arrival with purchase. The office clerk shall attach the receipt with a copy of the petty cash voucher. Any excess funds must be returned to the petty cash account. The clerk shall note the amount returned on the petty cash voucher.

The District is exempt from State taxes. Any taxes paid will become the personal liability of the employee making the purchase. A Texas Sales and Use Tax Exemption Certification must be remitted to the merchant at time of purchase.

7. To replenish the petty cash account, the Payment Authorization Form must be submitted to the Finance Department. Reimbursement of petty cash may be from several sources, depending on the type of expenditure.

Petty cash funds are imprest funds, that is, the total of paid bills (petty cash vouchers with attached receipts) plus actual cash must always equal the total authorized amount of the fund. The fund should be reimbursed as the remaining cash depletes below a comfortable level as determined by the amount of activity in the account.

The petty cash vouchers and original receipts/invoices must be attached to the Payment Authorization Form to support the expenditures.

8. The petty cash account must be closed at the end of each year in the following manner:

a. The Payment Authorization Form with supporting documents shall be submitted to the Finance Department for the un-reimbursed receipts/invoices. The form shall have the note: TO CLOSE OUT PETTY CASH.

b. Accounts Payable will issue the clerk a receipt for the petty cash received. The account will be credited for the amount received and the balance will then be zero at year-end.

c. Review your general ledger accounts to ensure that the petty cash balance reflects the correct balances after posting is done.

22 PETTY CASH VOUCHER

ATTACH SIGNED SALES RECEIPT Date:______Amount $ HERE

For: ______

Account: ______

______Signature of Requestor

* Sales tax will not be reimbursed to employee making purchase

FOR OFFICE ONLY Cash Actual Difference Advanced Receipts $$ $

Amount Due After Activity/Purchase $

Verified by Accounts Payable

Signature of Requestor

All petty cash must be closed out after completion of activity, ie. sports, book fair, purchase, etc.

BO5002 ‐ Petty Cash Voucher 23