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- 1). Purchase a journal that the petty cash custodian can use to record petty cash transactions in. If you prefer doing business digitally, journalize your petty cash entries in a digital spreadsheet.
- 2). Make copies of petty cash "checks" for you and your employees to use. These are not real checks, but receipts that employees must fill out to give to the petty cash custodian when funds are replenished or withdrawn. On your petty cash checks, require that employees provide their name, date, description of transaction and amount. Implement a policy that demands a petty cash check be thoroughly filled out and handed to the petty cash custodian before funds can be replenished or released.
- 3). Make your petty cash custodian record the information from these receipts in the appropriate columns of the journal or spreadsheet. Instruct your petty cash custodian to keep these receipts in a folder in case a problem or misunderstanding arises. The categories in the fund journal should include "Date of Transaction," "Type of Transaction" (a debit or credit), "Description for Transaction" and "Amount of Transaction."
- 4). Add a category after each transaction that requires your petty cash custodian to calculate the new petty cash fund total. Depending on how often you replenish your business's petty cash fund and how often money is withdrawn, the fund's total can vary dramatically throughout a given period.
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