Petty Cash

It is a common need for churches to establish a small Petty Cash fund to make small recurring purchases for the ministry of the church.  These expenses could be for coffee and food items, ministry supplies, or one time reimbursements.

In the area of Petty Cash the auditors observed that in some cases proper cash handling procedures were not being followed:

1. Petty Cash was being funded by proceeds from undesignated cash offerings and/or ministry fundraisers.  Funds from these sources were not being deposited into the bank account but were stored at the church and used for ministry expenses.
2. Petty Cash was not stored in a secure manner and/or access was not restricted to designated persons.
3. Accounting for both income and expenses of the Petty Cash fund were not done consistently or at all.

Establishing a Petty Cash system needs to take into consideration all of the following Foursquare policies:

1. ​All monies collected by the church are to be accounted for and deposited into the bank account within 48 hours.
2. Expenses of the church are not to be reimbursed directly from offerings or fundraising before being deposited into the bank account.
3. All expenses are to be authorized by a designated person and 2 signing officers of the church are to scrutinize each expense.
4. All income and expenses are to be recorded in the accounting records of the church for reporting purposes to the council, membership and the CRA.

​For more details on these policies please refer to the sections in the Foursquare Administrative Manual:  Offerings Management, Banking and Signing Authorities, Payment of Bills, Books and Records

---

The link below gives an outline of recommended steps the church can take
​to establish and maintain the Petty Cash fund.

Establishing a Petty Cash Fund

---

If you have questions about this post please complete the contact form to the right side of this blog or make your comments below!!

Serving with You
Rhonda Berkhiem