Petty Cash Control Procedure

Purpose of Petty Cash Control:

Petty cash control is an essential aspect of finance and accounting in hotels. It

involves the management of small amounts of cash that are used for various
expenses such as stationery, cleaning supplies, and other small purchases. To
ensure proper management of petty cash, hotels should have a standard operating
procedure (SOP) that outlines guidelines to be followed by staff members
responsible for petty cash.

The SOP should include details on how the petty cash is to be stored, who has
access to it, and the procedure for replenishing it. It should also specify the
maximum amount of cash that can be held in the petty cash float and the frequency
of audits to be carried out on the funds.

Furthermore, the SOP should outline the documentation required for any petty cash
transactions, including receipts and invoices. This documentation is essential for
proper record-keeping and should be filed accordingly. The SOP should also
define the roles and responsibilities of staff members involved in petty cash
management, including the person responsible for keeping the petty cash records
and the individual responsible for approving petty cash transactions.

In conclusion, the SOP for petty cash control in hotels is critical for ensuring
proper management and accountability of hotel funds. When properly
implemented, the SOP helps to minimize the risk of fraud and mismanagement of
funds, leading to a more efficient and effective finance and accounting system.

The purpose of this policy is to control Petty Cash purchases. It is the

responsibility of the Controller and General Manager to ensure that Petty Cash is
used only for approved purchases and is not abused. All disbursements from Petty
Cash will be made by the General Cashier with proper approval. House Banks are
NOT to be used for Petty Cash purposes.
Petty Cash Purchases Process

 Purchases should be limited to emergencies like medicine, paying doctor

fees, taxi charges for guest relocation, flower arrangements or bouquet for
VIP’s (when the finance team is not available) etc. and they should not
exceed Rs.5000.
 The employee should submit a Petty Cash Voucher that is filled out with a
description, code and signature by the Department Manager.
 Purchases should be approved by the appropriate Executive Committee
member.
 A valid receipt must be attached to each Petty Cash Voucher.
 If the Petty Cash is an advance for a purchase, the receipt and change are to
be returned within 24 hours to the General Cashier.
Reimbursement Process for Petty Cash

 The fund is to be reimbursed at least monthly by a check written from the

Hotel Operating Account to the “Hotel Excelsior Petty Cash Fund”.
 The General Cashier should prepare a Petty Cash Distribution Report in
detail and submit it to Accounts Payable.
 This must be recorded by Accounts Payable in the same month as the
expense occurred.

DATE PAYEE PURPOSE AMOUNT ACCOUNT Ref.