Policy Notes: Petty Cash Fund
The following policies apply to use of, protection of, and accounting protocol for petty cash funds for minor business expenses.
On this page:
- Petty Cash Reimbursements Limits
- When Petty Cash May Not Be Used
- Protecting Petty Cash
- Accounting Protocol for Petty Cash Transactions
- Approval Policy for Petty Cash Reimbursements
Primary Policy Sources: Administrative Guide Policy 5.4.4
Petty Cash Reimbursements Limits
Petty cash reimbursements are authorized up to $100 per transaction. The reimbursement MUST be for the exact amount of the expense. Splitting transactions exceeding $100 or requesting reimbursement for less than the full expense is not allowed.
Instances When Petty Cash May Not be Used
Petty cash may NOT be used for:
- Payment for services performed by employees or non-employees
- Personal loans and cashing personal checks
- Buying hazardous materials
- Stanford Faculty Club dues
- Social or travel club dues
- University parking permits (personal expense)
- Traffic citations
- Personal expenses
- Transactions involving students
- Interest charges
- Amounts over $100 (unless a department requests, and the Treasurer approves, a higher limit for the department)
- Expenses over 120 days old (anything older than 120 days must be reimbursed through an expense report)
- Recurring expenses (e.g. employee business-related home internet or cell phone expenses)
Protecting Petty Cash
All petty cash custodians and temporary custodians MUST complete the Petty Cash Custodian Certification requirements and the associated petty cash training before assuming responsibility for the fund.
Keep all petty cash in a locked box, and the locked box in a locked desk or cabinet. Only custodians should have access to petty cash.
Accounting Protocol for Petty Cash Transactions
Proper petty cash accounting requires custodians to obtain receipts, record expenditures and make payments only for authorized expenditures. A sales slip, cash register tape, or other receipt MUST be attached to a Received of Petty Cash form for each expenditure.
The only exception is reimbursement for mileage where a log with odometer readings, date, destination and business purpose serves in lieu of a receipt.
When a receipt is not available, the transaction must be entered in an expense report and the reason for the missing receipt must be provided during replenishment.
The petty cash fund should always balance. The total cash on hand plus the total receipts and reimbursement requests in process should equal the original amount of the petty cash fund.
No one may approve his or her own reimbursement request. Also an individual may NOT approve expenses for anyone to whom he or she reports, either directly or indirectly.
The petty cash custodian may NOT approve online petty cash replenishment requests. Replenishment requests must be reviewed and approved by a person with online signature authority for the department activities / accounts being charged.