Accounting book used for recording expenses which are small and of little value, for example, stamps, postage and handling, stationery, carriage, daily wages, etc.


These are expenses which are incurred day after day; usually, petty expenses are large in quantity but insignificant in value. To record such expenses, a different book known as a petty cash book is maintained. It may be maintained by ordinary or by the imprest system.


A petty cash book is quite necessary to create and facilitate small payments in a business or in organizations. It places and recognizes the expenditure for items such as postage and stamps, bus fare, and stationery expenses as well. The petty cash book is meant to meet the day-to-day expenses and thus is entrusted in the hands of a petty cashier


Petty cash fund is to make the payments for small amounts that are less material, such as the postage, small repairs, or day-to-day supplies. A petty cash account is an imprest account, hence, it is only debited when the fund is established or increased in the amount. The fund works on the imprest system, where there is an initial amount of money that is put into an account, that is drawn upon for a specific purpose. When the same account goes below a certain specified amount, the system is used up.