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Part 4 of 7 · Petty cash tracker series ~5 min read

How a petty cash count works

The count is where the system earns its keep, and the only variable that really matters is how often it happens. A difference found within a week is nearly always explainable; the same difference found after four weeks is a write-off. Everything in this post is in service of making a count cheap enough to do weekly.

Key takeaways

  • A count is one number typed by the custodian, and it takes under a minute.
  • The count is recorded as a movement, so the ledger holds every reconciliation.
  • A match is completely silent. A mismatch lists the movements since the last count.
  • A mismatch never names a person, because the answer is almost always a missing receipt.
  • Weekly is the default. Monthly is where these systems go to fail.

What counting looks like

The system prompts the custodian on the cadence set for that float. The screen shows one field and one button: how much is in the tin. It deliberately does not show the expected balance beforehand, because a number on the screen while somebody is counting is an anchor, and anchored counts agree with the system far more often than independent ones do.

How a petty cash count is taken and reconciledA vertical chain of five steps entered by a box labelled Count prompt, sent on the float's own cadence. Step one has the custodian type the total, with the expected figure hidden. Step two records the count as a movement in the append-only DynamoDB movements table. Step three asks whether it matches the expected balance to the penny, exiting to Silent, the usual outcome. Step four lists the movements since the last count. Step five sends one message with the difference and the list. A note says the expected figure is hidden while counting because a number on screen anchors the count.AWS ACCOUNTCount prompton the float's cadenceCustodian types the totalexpected is hiddenRecord the countas a movementDynamoDB movementsappend-onlyMatches expected?to the pennySilentthe usual outcomeyesList the movementssince the last countOne messagedifference and the listThe expected figure is hidden while counting. A number on screen anchors the count.
Fig 1. What happens when somebody counts. Hiding the expected figure until after the count is submitted is a small choice with a large effect on how honest the reconciliation is.
  • Database
  • App integration
  • Machine learning
  • Management
  • Analytics

Why the count is a movement

Recording the count in the same append-only ledger as spends and top-ups means the ledger answers a question it otherwise could not: when was this float last verified, and by whom? A float whose last count was eleven weeks ago is a different risk from one counted on Friday, and that fact should live in the same place as everything else rather than in a separate table nobody joins to.

It also means a count can be superseded. A recount five minutes after a miscount is a second count movement, both are kept, and the reconciliation uses the latest. Editing the first would violate the same rule that keeps spends immutable.

The mismatch message

What it says, in order

  • The difference. “Office tin: counted £42.60, expected £46.60. Short by £4.00.”
  • Since the last count. Every movement, with date, amount, vendor and a thumbnail of the receipt. Usually four to ten lines.
  • The prompt. “Most differences are a receipt that was not photographed. Is there one in the tin that is not on this list?”
  • Two buttons. “Found it — here’s the photo” and “No, record the difference”.
  • No names. The movements carry who photographed each receipt, and the message does not lead with that, because leading with it changes what the message is.

The prompt line is doing most of the work. In practice the single most common cause of a shortfall is a receipt that went into the tin without being photographed, and saying so plainly in the message directs the person to look in exactly the right place. A message that only reports the difference sends them to think about people instead.

Recording an unresolved difference

Sometimes the money is genuinely gone and no receipt turns up. That is recorded as an adjustment movement with a reason, which brings the balance back in line and leaves a permanent, visible record of the write-off. That record is the useful part: three unexplained shortfalls in a quarter on the same tin is a pattern worth a conversation, and it is only visible because each one was written down rather than absorbed.

Cadence

Five occasions for counting a petty cash floatA horizontal row of five boxes. Daily: for a high-turnover site tin. Weekly: the sensible default. Monthly: differences become unresolvable. On top-up: always, whatever the cadence. On handover: whenever the custodian changes. A note says the last two are not cadences but events where a count is non-negotiable.WHEN TO COUNTDailyhigh-turnover site tinWeeklythe sensible defaultMonthlydifferences unresolvableOn top-upalways, whatever elseOn handovercustodian changesThe last two are not cadences. They are events where a count is non-negotiable.
Fig 2. When a float should be counted. The two event-driven counts matter more than the cadence: a top-up and a change of custodian both need a verified starting point.

The handover count is the one most businesses skip and most regret. A custodian who hands over an uncounted tin inherits every unexplained difference in it, and so does the person taking over. Counting at handover takes a minute and draws a line that both people can point at.

Next: what the month end looks like for whoever does the books.

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