There is also an important term called petty cash book that looks like a usual book managing any institution or establishment petty cash recording every day routine transactions made on the Imprest account...
That means that for instance if your month starts with some $50 in your petty cash amount and by the end of the month it is left only $40 then the spent $40 is added to your account to start the new month...
These documents are called petty cash dockets...
But how to deal with every day needs? Imagine you work at the office or you own an office and even have an employee responsible for routine purchasing like those including stationery office materials and so on? This is exactly the reason of the existence of petty cash Imprest system allowing to trust the employees by knowing all the expenditures they’ve made due to the dockets they show you – and actually not you (they provide it to the system) – by the end of the month so that the account will be replenished...
The main sense of petty cash system is the replenishment of money spent...
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Why are Imprest funds in the form of a petty cash so popular today? First of all, you have the maximum amount of a petty cash – every establishment or individual has its/his own petty cash limit...
All the Imprest funds are kept in a record with the help of documentation presented by the petty cash dockets or receipts...
Petty cash Imprest funds consider that the custodian should document the way he uses his petty cash...
Usually Imprest funds are fixed funds (more often petty cash funds) that are presented in the form of currency or coins used for making a small amount of payments...
So, if your initial petty cash amount makes out $150, you’ve spent $140 you are to replenish $140 to bring the float back to its initial condition it had at the beginning of the certain period within which you’ve managed to spend the money...
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What is Imprest system and what’s the point with the Imprest funds? The creation of the Imprest petty cash account comes from the United Kingdom...
We will tell you about the Imprest funds, their advantages and disadvantages, ways to create Imprest account, we’ll tell you what petty cash is in detail and so on...
This allows the clients check the amount cash left anytime they would like...
In other words, the main issue of the Imprest system work is the documentation of the way your petty cash is spent...
At the end of the month all of these dockets are summed up in the total by being deducted from the petty cash float opening showing the amount left in the petty cash float...
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Moreover, many people use this system in order to save the chief cashier time as they usually write up their cash book or post it into the ledger...
How does this petty cash book looks like? Normally it is a book that is kept for controlling the petty cash of any company or department...
Otherwise in case you can not do it it should be replenished by a guardian that is usually presented by a bookkeeper that can do take the expenses from his own personal account petty cash float...
Thus, the petty cash book system is provided in the Imprest system...
What are the advantages of a petty cash Imprest system? First of all, it is an easy way to cover the simple cash expenses without indicating them in the general cash book...
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With a merchant account, your funds can be accessed within 2-3 days after transactions...
This means that you will only receive your money after a certain period and this may limit your cash flow...
Bear in mind that most providers keep the funds in their accounts for 14 up to 30 days if you use conventional services, i.e...
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When your cash is managed in an improved way, it allows for a better organization of your business cash flow...
The benefits of ACH payment processing include the following:
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