30 - Petty Cash

Overview

The Petty Cash module enables employees to submit expense claims directly into the system that can then be authorised by their supervisor.

Petty cash expenses are controlled in a friendly way, enabling all employees (including those without accounting knowledge) to enter their expenses and get paid for them.

The Petty cash module uses a temporary GL table (pcashdetails), containing all information about payments and expenses entered as petty cash. When cash assignments or expenses are authorised by a supervisor, they are posted into the gltrans table and flagged.

Once any transaction in the petty cash system has been posted it cannot be modified, edited or deleted in any way. Once posted, that's it.

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Setup General Parameters

Set up expenses

Definition of expenses allowed to be used in the Petty Cash system.

This table is used to isolate non-accountant users (most of workers/users of KwaMoja) from the technical details and names used in accounting.

So when the system posts a petty cash expense against gltrans table, it will be posted against the GL account code selected.

PcExpenses.php is used to maintain this table (pcexpenses).

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Set up types of tabs

Different kinds of users have different privileges. CEO can spend petty cash money on a different way than a truck driver does (no disrespect, for any of them ;-). The system maintain these different categories of tabs of table pctypetabs.

PcTypeTabs.php is used to define this kind of different tabs. E.g.: Director, Office staff, Truck Driver, etc.

Set up expenses allowed for type of tab The link between types of tabs and expenses.

Here we need to define which expenses are allowed to a certain type of tab. This table is used to prevent users assigning expenses for expenses not allowed. as example, a user with role "member of parlament" could have a tab of a type "all allowed, including night drinks in a pub", while a user with role "hard worker" could have a tab of a type "transport to workplace" only, so the system can achieve a better control of each one's expenses.

Each company must define here the policy of petty cash payments.

PcExpensesTypeTab.php is the script managing this.

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Set up tabs

PcTabs.php is the script used to set up petty cash tabs

A petty cash tab contains:

At this point we have the system ready to work.

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Workflow

Assignment of cash

The supervisor (authoriser) gives money cash to an employee to be used as petty cash. In script PcAssignCashToTab.php we record this fact.

Supervisor can select only the tabs he/she is supervisor. Must specify amount, date. There are 2 additional fields:

At this stage no tranasction is posted in gltrans table, only at pcashdetails we write down: "Supervisor gives to user X (tab really), Y dollars on date D".

Cash Assignments can be edited and deleted before are authorised. Once authorised and posted can not be modified in any way.

Expense claims

Employee will go out and spend money. Then will report to KwaMoja these expenses in script PcClaimExpensesFromTab.php

Employee will select a tab (from his/her own tabs). And then records details of all expenses incurred:

At this stage no tranasction is posted in gltrans table, only at pcashdetails we write down: "User U reports spending X amount in concept C on date D".

Expenses reported can be edited and deleted before are authorised. Once authorised and posted can not be modified in any way.

Expense authorisation

Once the expenses have been entered, a supervisor will need to authorize them.

In script PcAuthorizeExpenses.php the supervisor must select the tab he/she is supervising.

Expenses which have not yet been authorized will have a tick box alongside them. To authorize expenses, select the relevant tick boxes. If incorrect or in doubt (an employee claiming 10.000.000 USD for fuel car) he can call/email/report him and sort it out. Because it's not authorized yet it can be modified (to 100 USD...)

When the update button is pressed and there are some expenses ticked, then GL posting occurs.

Cash authorisation

A supervisor will also need to authorize assigned cash (or payments).

In script PcAuthorizeCash.php the supervisor must select the tab he/she is supervising.

Assigned cash entries which have not yet been authorized will have a tick box alongside them. To authorize assigned cash entries, select the relevant tick boxes.

When the update button is pressed and there are some assigned cash entries ticked, then GL posting occurs.

Posting workflow

If a cash assigment need to be posted then:

In gltrans

In banktrans

The bank transaction is recorded conveninetly to report the moeny going out from the "GL Account For Cash Assignment"

If an expense need to be posted then:

In gltrans

Notes

Users

All users must be KwaMoja users. Security setting 6 has been created to allow users use this module. So employees can login into KwaMoja only to claim / report their expenses, if allowed.

About advance payments

Many organisations run "open tabs", so employees asks for money first, and later on they spend it (we hope in an appropriate manner) and then report expenses incurred. Any difference will be settled "next report" or "next cash assignment".

That's the idea keeping expense report and cash assignment separate, as it's flexible and fits all situations:

Example Advance of 500 USD and submit claims of 480 USD:

  1. cash assignment of 500 USD
  2. claims of 480 USD
  3. approval of 480 USD (status: employee owes 20 USD to company)
  4. there's 2 options depending on company's culture:
    1. return of 20 USD (cash assignment negative, so 500-480-20 = 0 balanced)
    2. employee keeps 20 USD for his next report. The system will keep track of previous expenses/ cash assigments done, to keep the balance up to date)

Example Advance of 500 USD and submit claims of 530 USD:

  1. cash assignment of 500 USD
  2. claims of 530 USD
  3. approval of 530 USD (status: company owes 30 USD to employee)
  4. there's 2 options depending on company's culture:
    1. extra cash assignment of 30 USD (cash assignment positive, so 500-530+30 = 0 balanced)
    2. next cash assignment of 500 USD will show he has only 470 available, as 30 were owed.