Professional Documents
Culture Documents
Petty Cash
Petty Cash
PROCEDURES
Cash payments shall be made only on duly approved Disbursement Vouchers/Petty Cash
Vouchers/Payrolls.
Proper accounting shall mean the receipt by the Accountant of the prescribed liquidation
documents although not yet recorded in the books of accounts nor audited by the Auditor.
Liquidation shall mean the recording of the liquidation documents in the books of accounts by
the Accountant as a credit to the cash advance account after verifying the same, although not yet
audited by the Auditor.
Section 84. Cash Advances for Petty Cash. Petty Cash (PC) shall be maintained under
the imprest system. As such, all replenishments shall be directly charged to the expense
account and at all times, the PC shall be equal to the total cash on hand and the unreplenished
expenses. The PC shall be sufficient for the non-recurring, emergency and petty expenses of the
LGU for one month. It shall not be used to purchase regular inventory/items for stock and
regular expenses such as rentals, subscriptions, light and water and the like.
Petty Cash shall be set up at the beginning of the year. A Certification on Appropriations,
Funds and Obligations of Allotment (CAFOA) shall be prepared for the fund, recorded in the
appropriate RAAO and obligated as Other Expenses.
The PC shall be kept separately from the regular collections. Payments out of the PC,
which shall be made through a Petty Cash Voucher (PCV) shall be allowed only for amounts not
exceeding P15,000.00 for each transaction, except when a higher amount is allowed by law
and/or specific authority by the COA (COA Circular No. 97-002 dated February 10, 1997 and
COA Circular No. 2012-001 dated June 14, 2012). Splitting of transactions to avoid exceeding
the ceiling shall not be allowed.
A DV shall be prepared for replenishments of the PC during the year duly supported by a
Petty Cash Replenishment Report (PCRR) or list/summary of PCVs, the PCVs and their
supporting documents. A CAFOA shall be prepared for each replenishment and recorded in the
RAAO based on actual expenses incurred.
Within 20 days after the end of the year, the Petty Cash Custodian (PCC) shall prepare a
Report of Disbursements to liquidate his cash advance for Petty Cash Fund. The CAFOA setting
up the fund at the beginning of the year shall be cancelled. Another CAFOA shall be prepared
taking up the liquidation and recorded in the RAAO based on the actual expenses incurred.
Unused cash shall be returned to the Treasurer who shall issue an Official Receipt to
acknowledge the amount returned. A new Cash Advance for Petty Cash Fund shall be set up in
the ensuing year.10
Section 85. Recording Cash Advances for Petty Cash. To establish the Petty Cash at
the start of the year, a DV shall be drawn and supported with a CAFOA for the purpose which
shall be charged to the budgetary item, Other Services. Upon the issuance of the check, the Petty
Cash account is debited and the Cash in Bank – LCCA account is credited. Disbursements from
the PC shall be through the Petty Cash Voucher (PCV), which shall be approved by authorized
officials and signed by the payee to acknowledge the amount received.
Section 86. Reporting Disbursements from Petty Cash. The Petty Cash Custodian
shall prepare the Petty Cash Replenishment Report based on the PCVs and supporting
documents like Official Receipts (ORs), approved purchase request, bills, sales invoices, etc. for
replenishment of Petty Cash when the disbursements reach at least 75% of the PC, or as the need
requires and the Report of Disbursements to liquidate his cash advance for Petty Cash at the end
of the year.