PETTY OPERATING

EXPENSES
PETTY CASH FUND (PCF)

 is used to cover small expenses i.e., purchases that involves petty

cash amount of money for day to day operation of an office.

 It refers to the amount granted to duly designated Petty Cash Fund

Custodian for payment of authorized petty or miscellaneous
expenses which cannot be conveniently paid through
checks/LDDAP-ADA.

Reference: COA Circular No. 2012-001 dated June 14, 2012

COA Circular No. 2013-001 dated January 10, 2013
CASH ADVANCE FOR PETTY
OPERATING EXPENSES
 The Petty Cash Fund to be set up shall be sufficient for the
recurring petty operating expenses of the agency for one month.
 The PCF shall be replenished as soon as disbursements reach at
least 75%.
 It shall be maintained using the Imprest system.

Reference: Government Accounting Manual Volume 1 2015

CASH ADVANCE FOR PETTY
OPERATING EXPENSES
 All replenishments shall be directly charged to the expense
account and at all times, the PCF shall be equal to the total cash
on hand and the unreplenished expenses.
 The fund shall be kept separately from the regular cash
advances/collections and shall not used for payment of regular
expenses such as rentals, subscriptions, light and water bills,
purchase of supplies and materials for stock purposes and the like.

Reference: Government Accounting Manual Volume 1 2015

CASH ADVANCE FOR PETTY
OPERATING EXPENSES
 Splitting of transactions to avoid exceeding the ceiling shall not
be allowed.

 All disbursements out of PCF shall be covered by duly

accomplished and approved Petty Cash Voucher supported by
cash invoices, ORs or other evidence of disbursements

Reference: Government Accounting Manual Volume 1 2015

 Documentary Requirements
A. Granting of Petty Cash Advance
1. Authority of an accountable officer issued by the Head
of Agency or his/her duly authorized representatives
indicating the maximum accountability and purpose of cash
advance (for initial cash advance);
2. Certification from the Accountant that previous cash
advances have been liquidated and accounted for in the
books; and
 Documentary Requirements
3. Approved application for bond and /or Fidelity Bond
for the year for cash accountability of P5,001.00 or more as
provided under Treasury Circular No. 02-2009 dated August
06, 2009.
4. Approved estimates of petty expenses for one month;
and
5. Copy of policy for maintaining PCF under the imprest
system
C. Liquidation of PCF

1. Report on Paid Petty Cash Vouchers (RPPCV) ;

2. Approved purchase request with certificate of
Emergency Purchase if necessary;
3. Bill, receipts, sales invoices;
4. Inspection and Acceptance Report (IAR);
5. Waste Materials Report (WMR) (Appendix 65) in case of
replacement/repair;
 6. Approved Trip Ticket, for gasoline/fuel expenses;
7. Canvass from at least three suppliers, except for emergency
purposes;
8. Summary/Abstract of Canvass;
9. PCVs duly accomplished and signed;
10. OR in case of refund;
11. For reimbursement of toll receipts; and
i. Toll Receipts
ii. Trip Tickets
12. Such other supporting document that may be required.
Accounting Books, Records, Forms and
Reports to be Prepared and Maintained
1. Petty Cash Voucher (PCV)- used to pay obligation to
employees/individuals/agencies/creditors for petty operating
expenses.
2. Report on Paid Petty Cash Vouchers (RPPCV)- to replenish PCF.
3. Petty Cash Fund Record (PCFRec) - to record cash advance,
utilization and replenishment made and to monitor the PCF
balance. All transactions for the day shall be recorded immediately.
4. Petty Cash Fund Register (PCFReg)- to monitor/summarize the Petty Cash
Fund (PCF) established/replenished and the disbursements charged thereto.
5. Petty Cash Fund Subsidiary Ledger- to monitor the balance of the Petty Cash
Fund
6. Cash Disbursement Journal (CDJ)- to record the disbursements made by the
Disbursing Officer/School Head/Petty Cash Fund Custodian.
7. Journal Entry Voucher (JEV)- to recognize the establishment of Petty Cash
Fund.
Illustrative Accounting Entries

1. Establishment of Petty Cash Fund (PCF) – P 8,000.00

Petty Cash Fund 1010102000 P 8,000.00

Cash-Local Currency, Current 1010202000 P 8,000.00
Account (LCCA)

To recognize establishment of PCF to cover petty cash expenses

Illustrative Accounting Entries

Expenses charged to the PCF :

Transportation Expense P 500.00

Postage and Courier Expense 400.00
Total P 900.00
Illustrative Accounting Entries

2. Recognition of Expense

Transportation Expense 502030010 P 500.00

Postage and Courier Expense 502030010 400.00

Petty Cash Fund 1010102000 P 900.00

To recognize expense based on the Report on Paid Petty Cash Vouchers (RPPCV).
Illustrative Accounting Entries

3. Replenishment of Petty Cash Fund (PCF)

Petty Cash Fund 1010102000 P 900.00

Cash-Local Currency, Current 1010202000 P 900.00
Account (LCCA)

To recognize replenishment of PCF based on the Report on Paid Petty Cash

Vouchers (RPPCV) and SDs.