Petty cash report: reconcile spending and float

A petty cash report reconciles small cash payments, replenishments and the cash remaining in a company's fund. It should explain both what was spent and whether the physical cash agrees with the records. A balanced expense list alone does not prove the cash is present.

Start with the fund and the cutoff

Identify the location, custodian, authorized float and reporting date. Separate a cash drawer used to make change from a fund used to reimburse expenses. Combining them makes sales receipts look like replenishments and conceals which person is responsible for the balance.

The IRS petty cash example in Publication 583 describes a fixed fund whose unspent cash plus outstanding petty cash slips equals the fund amount. It also describes replenishing the fund for outstanding slips. That is the control behind an imprest fund: an authorized amount supported by cash and vouchers.

Use the broader cash management report for liquidity across company bank accounts. The petty cash budget addresses the separate question of how much the fund should hold.

Assemble the workbook rows

Bring the voucher register, replenishment log, physical count sheet and approved fund amount. Keep voucher number, payment date, category, purpose, amount, receipt reference and replenishment batch. A replenishment request is different from cash actually received by the custodian.

Use one row per voucher. If a receipt contains several categories, split its amount into category lines and preserve the shared receipt reference. Check that those lines add to the receipt total before summarizing them.

Here is October's register for a US distribution company's office fund. The authorized float and opening physical cash are both $1,000. No vouchers were outstanding at the opening cutoff.

The first three vouchers were included in a replenishment of $250, physically received on October 15, 2026. The later vouchers remain unreimbursed at October 31. Replenishment batch references should identify exactly which vouchers the payment covers.

With the table headers in row 1 and columns A through D, total spending and outstanding vouchers are:

=SUM(C2:C7)
=SUMIF(D2:D7,"No",C2:C7)

The results are $435 spent and $185 outstanding. Reimbursed vouchers total $250, so $250 plus $185 proves the register's $435 total. These are whole-dollar example amounts; no rounding is applied.

Reconcile movements to the physical count

Expected closing cash = Opening physical cash + Replenishments received − Cash payments

Cash variance = Counted cash − Expected closing cash

Build a separate summary with labels in column A and amounts in column B:

The movement is $1,000 plus $250 less $435, leaving expected cash of $815. The count is $810, so the report shows a $5 shortage. Keep that exception visible while the reviewer checks count accuracy, missing vouchers and unrecorded cash movements.

A replenishment approved in October but received in November does not belong in October's physical cash movement. Keep it as a pending item until the custodian actually receives the money. Otherwise the report creates a shortage merely by treating an approval as cash.

Prove the float a second way

For this fund, counted cash plus unreimbursed vouchers should equal the authorized float. Vouchers already replenished no longer support the current float because the replenishment has replaced them with cash.

The $995 accounted for less the $1,000 authorized amount gives the same negative $5. Agreement between the movement check and the float check strengthens the explanation; it does not resolve the shortage.

Cornell's petty cash guidelines provide a useful control example: monthly reconciliation, reconciliation at replenishment, detailed receipts and supervisory review. A company's own policy should name its custodian, reviewer and escalation process.

Show spending without counting it twice

The voucher categories produce supplies of $215, courier payments of $140 and parking of $80. Together they total $435. Calculate each category with the same pattern, changing the category label:

=SUMIF(B2:B7,"Supplies",C2:C7)

This category view explains use of the fund. It does not add another expense on top of the vouchers. Equally, the $250 replenishment is an internal cash transfer, not additional spending in a companywide cash summary.

Petty cash is a small component of working capital. Its report should remain focused on custody and evidence rather than trying to explain the company's entire cash position.

Where it goes wrong

• Adding every old receipt to the float. Only unreimbursed vouchers support the current fund; retain replenished receipts as history.
• Treating a request as cash received. Use actual receipt timing and identify pending replenishments separately.
• Clearing a shortage through a category total. Show the cash variance explicitly and follow the approval policy before accounting for it.
• Counting a voucher twice. Match voucher IDs to replenishment batches and accounting entries before posting another expense.

Reconcile your own fund in Covirage

Upload your voucher workbook and replenishment log, with the physical count and authorized float identified. Covirage maps the columns, and its tools compute spending, outstanding vouchers and reconciliation differences; the external AI model explains the result with every figure traced to its rows. Create a free Covirage account and bring a sample of your own data; creating the account takes about a minute.

See Covirage for finance teams for the supporting finance workflow.