Petty cash is whatever your business needs it to be and feels safe keeping on the premises.
I've seen cash boxes from £30 to £200. I would say that the average is £150.
If you do not control the petty cash via use of imprest then very soon there is no control of it at all so a good idea to get into balancing your petty cash weekly and topping up to the set amount (no more, no less).
Ensure that the receipts / invoices account for every penny (and I mean every penny) of what goes out.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Hi Grace
I look after some owner managed businesses and there is no way they would introduce an imprest system, but they do understand that any shortages/items with no receipts just get lumped into their DLA. Ive had some who are actually very meticulous and you can trace every cash withdrawal from the Bank to petty cash tin to spend, with one being out about 4p at the end of the year.
But for the type of business you are working with I totally agree with Shaun - a fully controlled imprest system is the only way to go. The whole point is about accountability and control.
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
There is no set limit, but petty cash is really supposed to be for small cash transactions. Down to the policy of your business, and if they haven't got one, I would ensure one is created. Paying an invoice of that size on a regular basis would mean that you would be topping up the cash tin all the time, so I wouldn't encourage it, but its fine as a one off.
-- Edited by Cheshire on Saturday 26th of December 2015 08:56:56 AM
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
Unless it's fraud, It is obvious that £40 has been spent somewhere which you haven't received a receipt for. It's a very long time since I did petty cash, but shouldn't a voucher be put in the tin whenever money is taken out? I would be making inquiries as to where the £40 has gone first.
-- Edited by Leger on Tuesday 12th of January 2016 02:52:51 PM
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
Unless it's fraud, It is obvious that £40 has been spent somewhere which you haven't received a receipt for. It's a very long time since I did petty cash, but shouldn't a voucher be put in the tin whenever money is taken out? I would be making inquiries as to where the £40 has gone first.
-- Edited by Leger on Tuesday 12th of January 2016 02:52:51 PM
Hi Leger
I have made inquires regarding the petty cash. It has gone missing because there are three people who got access to the the petty cash tin.
I would personally expense the £40.
A/C Petty cash loss / theft etc..
Disallow for tax if there is no crime reference number or police involvement.
Going forward, suggest more stringent petty cash controls.
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Johnny - Owner of an overly-active keyboard.
A man who can read, yet doesn't, is in no way wiser than a man who can't.
I would personally expense the £40. A/C Petty cash loss / theft etc.. Disallow for tax if there is no crime reference number or police involvement. Going forward, suggest more stringent petty cash controls.
Hi Abacus12345
Thanks for your help.
My finance manager just simply posted to 8000 which is sundries on sage . I just felt it is not quite right.
Sorry! 
