Overview
As a general principle, all payments should be made by cheque or electronically from the school’s current account. The board of management may authorise the Principal to use a petty cash for amounts of a small nature only.
The petty cash system is part of the school’s internal control system and should be carefully monitored. Petty cash may be used for small payments of goods or services where the school has no formal account. The petty cash expenditure limit should be set by the board at a €50 maximum for each transaction and a suggested monthly maximum of €200. These limits should be reviewed annually and ratified by the board.
Petty Cash Imprest System
The school’s petty cash account should be maintained using the standard imprest system. This means that the board of management sets an agreed maximum figure, for example, €200 per month, from which small agreed expenses are paid. A cheque to ‘Petty Cash’ is written for the exact amount incurred in the previous month to bring the balance back to the agreed level (€200).
All petty cash transactions are recorded in a petty cash book which is balanced off at the end of each month and signed by the Principal. A petty cash voucher is recorded and signed for each petty cash transaction. The petty cash should be counted at the end of the month by the Principal and another person and agreed to the balance remaining.
Decisions concerning the size of the imprest balance and limits on the size of individual payments should be formally ratified by the board each year. Any payments over the agreed expenditure limit must be made by cheque/electronic transfer.
Sample Forms & Templates
- Petty Cash Voucher Template & Example
- Petty Cash Book Template & Example
- Petty Cash Book Excel Template
- Sample Petty Cash Policy