Petty Cash¶
Last reviewed: 2026-03-31 · Nnamdi
Status: Complete
Route: /petty-cash → /petty-cash/new → /petty-cash/:id
1. What is it?¶
Petty Cash manages small cash advances given to staff for minor business purchases. Unlike Expenses (where the business has already paid), Petty Cash follows a request → approval → disbursement → retirement workflow: an employee requests funds, a team lead approves, the cash is disbursed, and the employee must submit a receipt within 21 days to "retire" the advance. This closes the loop between the advance and the actual spend.
2. How does it work in Finora?¶
2.1 The petty cash list (/petty-cash)¶
Header actions: - New Request — opens the new petty cash request form
KPI summary cards: | Card | What it shows | |------|--------------| | Pending Approval | Count and naira value of requests waiting for approval | | Unretired Balance | Total cash advanced but not yet accounted for with receipts | | Retired This Month | Total amount retired (receipts submitted) in the current month | | Overdue | Count of advances past the 21-day retirement deadline |
Tabs: - All Requests — full list of all petty cash requests - Pending Approval — requests awaiting sign-off - Disbursed — approved and cash given, awaiting retirement - Retired — fully accounted for
Search: by requisition number or description
2.2 The petty cash workflow¶
New Request (Draft / Submitted)
↓
Pending Approval
↓
Approved → Disbursed (cash given to employee)
↓
Retired (employee submits receipt within 21 days)
| Stage | What happens |
|---|---|
| New Request | Employee submits a request describing what the cash is needed for and expected category |
| Pending Approval | Team lead reviews the request; can approve or reject |
| Disbursed | Approved — cash handed to the employee. Clock starts: 21 days to retire |
| Retired | Employee returns with receipt; expense is recorded against the advance |
| Overdue | Disbursed but not retired within 21 days — flagged for follow-up |
2.3 Creating a new petty cash request¶
Click New Request (navigates to /petty-cash/new):
| Field | Required | Notes |
|---|---|---|
| Amount Requested | Yes | Numeric. Maximum ₦200,000 per request |
| Purpose | Yes | Free text description of what the funds are for |
| Expected Expense Category | Yes | COA expense account (6xxx) — can be changed at retirement if the actual spend differs |
| Additional Notes | No | Notes for the approver |
Action buttons: - Cancel — returns to list - Save as Draft — saves without submitting for approval - Submit Request — sends for approval
How the workflow was explained in the UI: 1. Submit your request with the purpose and expected expense category 2. Your team lead will review and approve the request 3. Once approved, collect the cash and make your purchase 4. Upload the receipt within 21 days to retire the advance
2.4 Retiring a petty cash advance¶
When the employee has made the purchase and has the receipt: 1. Open the disbursed request 2. Click Retire (or equivalent action) 3. Upload the receipt document 4. Confirm the actual amount spent and the final expense category 5. Any unspent balance is returned and the advance is marked as Retired
The GL entry on retirement: | Account | Debit | Credit | |---------|-------|--------| | 6xxx Expense Category (actual spend) | Amount spent | — | | 1010 Cash on Hand / Petty Cash Float | — | Amount disbursed |
If the actual spend is less than the advance, the difference is credited back to cash.
3. Business rules & constraints¶
| Rule | Detail |
|---|---|
| Maximum single request: ₦200,000 | Hard limit enforced at the form level |
| Retirement deadline: 21 days | Requests not retired within 21 days become Overdue |
| Category can be changed at retirement | The expected category at request time is a planning estimate; actual category is set on retirement |
| Approval is required before disbursement | An un-approved request cannot be disbursed |
| Receipt upload is required for full retirement | Advances cannot be retired without a supporting document |
| Petty cash posts to the GL on retirement | The cash advance itself is tracked separately — the P&L expense is only recorded when the advance is retired with a receipt |
4. Nigerian regulatory context¶
Petty cash and audit - FIRS may require evidence of small cash expenditures during an audit - The receipt upload at retirement creates a digital audit trail for all petty cash transactions - FIRS expects businesses to maintain a petty cash imprest register — Finora's workflow functions as this register
Staff accountability - The 21-day retirement policy mirrors best practice for accountability over cash advances - Unretired balances represent cash that has left the business with no corresponding expense record — a control risk - Overdue advances should be investigated and either recovered or retired immediately
No tax withholding on petty cash - Petty cash advances are not taxable income to staff (they are advance reimbursements, not compensation) - If a petty cash advance is used for staff benefits, this should be recorded as Staff Welfare (6017) and may have PAYE implications for employees
5. Common customer questions¶
Q: "What's the difference between Petty Cash and Expenses?"
Petty Cash is an advance: the business gives an employee cash in advance, and the employee later accounts for it with a receipt. Expenses are direct business payments — the business pays a supplier or vendor immediately. Use Petty Cash for small day-to-day purchases made by staff; use Expenses for purchases the business makes directly.
Q: "My employee has had cash for more than 21 days and hasn't submitted receipts. What do I do?"
The requisition will appear in the Overdue KPI. Follow up with the employee to submit receipts. If the money was spent and receipts are lost, the amount can still be retired with an explanation — escalate to Tier 2 for guidance on retiring without full documentation.
Q: "Can I approve my own petty cash request?"
This depends on your team's access levels. Finora's approval flow is designed for a team lead/manager to approve staff requests. If only one user exists on the account, the same user can both request and approve. For larger teams, configure team member roles under Settings → Team Members.
Q: "The expense category I need isn't showing at request time."
Select the closest category. The expected category at request time is an estimate — you can change it to the correct category when you retire the advance.
6. Known edge cases¶
Petty cash limit exceeded¶
The ₦200,000 maximum is a hard limit per request. For purchases above this, use the Expenses or Bills workflow instead.
Retirement with partial spend¶
If an employee spends less than the advance (e.g. requested ₦20,000 but spent ₦15,000), the ₦5,000 balance is returned and retired separately. The expense records only the ₦15,000 actually spent.
Lost receipts¶
If an employee loses receipts, the advance cannot be fully retired through the standard workflow. Options: accept a written explanation in the Notes, or record it as a loss/write-off. Escalate to Tier 2.
No petty cash float / imprest setup¶
Finora's Petty Cash tracks individual advances — it does not manage a top-up/replenishment imprest system natively. Businesses that run a fixed petty cash float (e.g. always maintain ₦50,000 in the tin) should record replenishments as a cash transfer from the bank account.
7. Escalation trigger¶
Escalate to Tier 3 (Founder) if: - GL entries on retirement are incorrect (wrong accounts, wrong amounts) - Retired advance is not reducing the Unretired Balance KPI - A petty cash record needs to be deleted or reversed after retirement
Escalate to Tier 2 (Support Lead) if: - Employee needs to retire an advance without full receipts - Business wants to set up a petty cash float / imprest system - Overdue advances need bulk resolution
8. Last reviewed¶
2026-03-31 — Nnamdi. Verified against production. Petty Cash list (empty — no requisitions in test business). New Request form fully captured: Amount (max ₦200,000), Purpose, Expected Expense Category (full COA list), Notes. Workflow confirmed via UI: Submit → Approve → Disburse → Retire (21-day window). Tabs: All Requests / Pending Approval / Disbursed / Retired.