Petty cash voucher

Definition

A petty cash voucher is a document used to authorize and record small cash transactions in a production setting. This form helps track minor expenses, ensuring accountability and proper documentation for the funds that are disbursed from a petty cash fund. By using petty cash vouchers, producers can maintain a transparent record of expenditures for items such as supplies or minor services without needing to process formal purchase orders for every expense.

5 Must Know Facts For Your Next Test

1. Petty cash vouchers should be filled out with details such as the date, purpose of the expense, amount, and signature of the person requesting the funds.
2. It's important to keep receipts attached to petty cash vouchers to provide evidence of the expenditures and ensure proper tracking.
3. Petty cash vouchers are typically used for expenses that do not exceed a certain amount, often set by the production's accounting policy.
4. The petty cash fund should be regularly reconciled to ensure that the total amount of cash on hand plus the total of petty cash vouchers equals the initial fund amount.
5. Using petty cash vouchers helps prevent fraud and misuse of funds by creating a paper trail that can be audited.

Review Questions

• How does the use of a petty cash voucher contribute to accountability in managing production expenses?
  • The petty cash voucher plays a crucial role in maintaining accountability by documenting each small expense clearly. By requiring details such as the date, purpose, and amounts spent, it creates an official record that can be referenced during audits. This documentation helps ensure that all disbursements from the petty cash fund are legitimate and that there is transparency in how production funds are being utilized.
• Discuss the process of reconciling a petty cash fund and how petty cash vouchers fit into this process.
  • Reconciling a petty cash fund involves comparing the total amount of cash remaining with the sum of all petty cash vouchers issued. At regular intervals, usually monthly or quarterly, an account manager or production accountant will gather all vouchers and receipts, ensuring that they correspond with the remaining cash. This process highlights any discrepancies and helps maintain accurate financial records, ensuring that all expenses are properly accounted for and that the petty cash fund remains intact.
• Evaluate the implications of not properly using petty cash vouchers within a production's financial management.
  • Failing to properly use petty cash vouchers can lead to significant issues in financial management, including potential misappropriation of funds and inaccurate expense reporting. Without a clear paper trail from vouchers, it becomes challenging to track how money is being spent, which can result in budget overruns and difficulty during audits. Ultimately, neglecting this process can harm the production's financial integrity and lead to distrust among stakeholders regarding financial practices.

Related terms

Petty Cash Fund: A small amount of cash kept on hand to pay for minor expenses that arise during production, which are too insignificant to warrant writing a check.

Expense Report: A document submitted by employees or crew members detailing their incurred expenses, often used for reimbursement purposes.

Receipt: A written acknowledgment of having received money or goods, commonly used as proof of payment for transactions.