Generally, managing the petty cash in a company is regarded as the simple bookkeeping task and it is given less importance. But unfortunately if these petty cash mishandled can lead to account bungling. The common mistakes range from missing or replacing small receipts to larger business audit. So bookkeeping should be given much importance in a company.
As far as the petty cash account management is concerned, the first mistake that the petty cash custodians make is that they sometime ignore the small amount spent for the company. For example may be 5 to 10$ for buying stationeries like pen, pencil or staples etc or some 2 to 3 $ for the maid for tidying up the office premises etc…These amount when lost track will add up to few hundred dollars and ATO will fail.
The next is that despite any payment method the receipts sometimes will not be kept recorded. If this is practiced it would lead to confusions. So cash receipts have to kept recorded or saved for future references. If the petty cash is maintained in the form of any electronic back up, in any of the websites or any in petty cash management software, it is very important to take a back up of the data frequently. The next factor is to classify the expenses and income properly.
Finally, in order to keep the book keeping tasking streamline manner, it is very important to have document for every step of a transaction. Any cash receipt should make an entry.
