What is Petty Cash?
Petty cash is a small amount of cash kept for minor business expenses such as tea, transport, cleaning and small repairs.
Updated
Meaning
English
Petty cash is a small amount of cash kept for minor business expenses such as tea, transport, cleaning and small repairs.
Roman Urdu
Petty cash thora sa cash hai jo chhote kharchon ke liye rakha jata hai, jaise chai, kiraya, safai aur chhoti marammat.
Also called petty expenses, chhote kharchay, imprest.
Example
An office keeps 10,000 rupees of petty cash. Over two weeks it spends 9,200 on tea, courier and a plumber, with a slip for each. The owner tops it back up to 10,000 against the slips.
How it works
In many shops petty expenses come straight out of the galla, which is why the night count rarely matches. The fix is simple: either keep a separate petty cash box with a fixed amount, or record every payout from the drawer with a reason at the moment it happens.
The classic method is the imprest system: start with a fixed amount, spend against slips, then refill exactly what was spent. At any moment, cash plus slips should equal the fixed amount. Review the categories monthly, since small items like tea and fuel add up to large amounts over a year.
In Nafaa
In Nafaa, cash taken out of an open till is recorded with a reason, and cash expenses come out of the open shift, so the drawer's expected cash stays correct. Shops can also move money between the drawer and a separate cash account.
Related terms
- Operating Expenses
Operating expenses are the regular costs of running a business that are not part of the goods sold, such as rent, salaries, electricity and internet.
- Galla
A galla is the cash box or drawer at a shop counter where the day's cash sales are kept and change is given from.
- Cash Over and Short
Cash over and short is the difference between the cash counted in the drawer at closing and the cash the bills say should be there.