Glossary
What is petty cash?
What petty cash is, how the imprest system keeps the float honest, and how a month of small spends is recorded and topped up.
Updated
In short
Petty cash is a small cash float kept for minor day-to-day expenses. In SimpleERP it is a cash account in the chart, topped up by Quick transfer, with each spend recorded as an expense.
Petty cash is a small amount of cash kept at the office or factory for minor expenses such as tea, courier, auto fare and stationery. Under the imprest system the float starts at a fixed amount, every spend is supported by a slip, and the float is topped up by exactly the amount spent, so cash in hand plus slips always equals the fixed float.
Petty cash: a worked example
Lakshmi Steel Furnitures keeps a ₹10,000 petty cash float at the factory. In the first two weeks of October 2026 the supervisor spends ₹5,800.
| Date | Expense | Paid | Balance |
|---|---|---|---|
| 1 Oct 2026 | Float | ₹10,000 | |
| 3 Oct 2026 | Tea and snacks | ₹1,200 | ₹8,800 |
| 6 Oct 2026 | Courier to Sri Murugan Traders | ₹850 | ₹7,950 |
| 9 Oct 2026 | Auto fare to Tamil Nadu Steels | ₹1,450 | ₹6,500 |
| 13 Oct 2026 | Stationery | ₹2,300 | ₹4,200 |
| 15 Oct 2026 | Top-up from bank | ₹5,800 in | ₹10,000 |
FAQ
Questions, answered
How much should a petty cash float be?
Enough for two to four weeks of small spends, and no more. For a small factory that is often ₹5,000 to ₹20,000. Keep larger payments on the bank, where there is a record without a slip.
What is the imprest system?
A fixed float, say ₹10,000, topped up by exactly what was spent, supported by slips. At any time cash in the box plus the slips should equal the float. A shortfall shows up immediately at the next count.
How do I record petty cash expenses in SimpleERP?
Record each spend as an expense with Petty cash as the paying account, choosing the expense category and attaching the slip if you have one. GST input can be posted when the bill carries it. The petty cash register shows every movement.
Can employees claim back what they spent from their own pocket?
Yes, through expense claims. The employee submits the claim with receipts, a manager approves it, and the payment is recorded from bank or petty cash. That keeps personal spends out of the petty cash box.
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