{"id":2293,"date":"2015-08-24T20:34:50","date_gmt":"2015-08-24T20:34:50","guid":{"rendered":"https:\/\/www.peeriosity.com\/shared-services\/articles\/?p=2293"},"modified":"2022-08-08T17:18:36","modified_gmt":"2022-08-08T17:18:36","slug":"making-smart-decisions-about-petty-cash","status":"publish","type":"post","link":"https:\/\/www.peeriosity.com\/shared-services\/articles\/2015\/08\/making-smart-decisions-about-petty-cash\/","title":{"rendered":"Making Smart Decisions about Petty Cash"},"content":{"rendered":"

The word \u201cpetty\u201d is defined as something that is relatively worthless or unimportant, with a secondary definition of a person who gets caught up in the small details.\u00a0 The word \u201ccash\u201d however, takes on a whole other meaning, with an emphasis at most companies on proper business use, tracking, and detailed record keeping.\u00a0 While some companies continue to have petty cash funds, complete with an imprest system for replenishing with detailed receipt and approval requirements, in today\u2019s world with many competing approaches for small dollar purchases, the better description for \u201cpetty cash<\/a>\u201d embraced by most companies is \u201cobsolete\u201d and \u201cunnecessary\u201d.\u00a0<\/span><\/p>\n

A Peeriosity member at a large healthcare company wanted to quickly understand the range of approaches other companies take to administering petty cash funds.\u00a0 As stated by the member, a Senior Director of Purchase-to-Pay Operations<\/a>, \u201cWe have a number of different small offices that require an efficient payment method for small dollar purchases. We are curious if other companies currently maintain a Petty Cash process or utilize an alternate tool as part of best practice identification.\u201d\u00a0 \u00a0<\/span><\/p>\n

Within a few minutes, the member was able to use Peeriosity\u2019s iPollingTM <\/sup>to create a question, with the real-time posting of poll results and the ability for the member to see immediately who responded, what company and region they represent, with the opportunity to contact individual respondents directly using Peeriosity\u2019s built-in communication tool, Peer MailTM<\/sup>.\u00a0 \u00a0<\/span><\/p>\n

The Peeriosity member\u2019s iPollingTM<\/sup> question asked how important having a petty cash process was to addressing small dollar purchases, with a follow-up question to secure details about the primary solution being used to address the need for small dollar purchases. As expected, for many companies petty cash does not play a significant role in small-dollar purchases, with 32% of member companies indicating that petty cash has been completely eliminated.\u00a0 Here are the details:<\/span><\/p>\n

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For 65% of member companies, the preferred alternative to petty cash is the use of a purchasing card, and for an additional 26%, the use of a travel card or reimbursement through the T&E process<\/a> is the preferred method.<\/span><\/p>\n

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While it may seem like maintaining petty cash funds in multiple locations isn\u2019t a big deal, since there is little impact on either Shared Services or the local Finance team, the truth is that for most the alternatives for making purchases using a purchasing or a travel card<\/a>, or for reimbursement through the T&E process, is easy and readily available.\u00a0\u00a0 Once you get through the initial and temporary frustration of employees who are resistant to the change, it is likely that petty cash can be eliminated completely.<\/span><\/p>\n

Here are a few of the comments added by iPollingTM<\/sup> participants:<\/span><\/p>\n