Add employee custody account to the chart of accounts

#What is a Petty Cash Account?

It is a financial account used to track the amounts given to a specific employee to perform tasks such as purchasing supplies or covering work-related expenses.

This account is part of the current assets in the accounting tree. It is affected by manual entries and financial transactions that occur on it.

You can add an account named Employee Petty Cash under which there are sub-accounts bearing the names of employees who have petty cash.

💡Example:

You own a business and have an employee responsible for purchasing daily supplies. When you give this employee an amount to cover work expenses, record the amount in the petty cash account by entering a manual entry. When the employee uses these amounts for expenses or purchases, you should add the details on the platform (invoices and the payment method used in spending the petty cash amount) linked to his petty cash account. The system will automatically issue entries based on the operations you added. These steps help facilitate tracking and documenting financial transactions.

#Adding an Employee Petty Cash Account in the Accounting Tree

1. Go to Accounting > Chart of Accounts.

2. Click on "New Account."

3. Choose the main account: Current Assets.

4. Modify the account code if needed.

5. Enter the account name: Employee Petty Cash.

6. Add description (optional).

7. Click on "Save."

   The account is added immediately.

ℹ️ Note: If you linked the petty cash account with a payment method, and then added detailed accounts inside it, the link with the payment method will be canceled, and you will need to re-link it again.

#Adding a Detailed Account for Each Employee

1. In the Chart of Accounts > Click on Assets > Current Assets.

2. Go to the petty cash account.

3. Click on the three dots in front of the account.

4. Choose "New Sub-account."

5. Enter the new account name: Ahmed's Petty Cash.

6. Add description (optional).

7. Click on "Save."

   The account is added immediately.

#Adding Petty Cash Amount (Manual Entry)

(Example: Disbursing 1,000 SAR to employee Ahmed from the fund).

1. Go to Accounting > Journal Entries.

2. Click on "New Manual Entry."

3. Add the basic information:

4. Choose the first account, and enter the amount in the (Credit) field.

5. Choose the second account: Employee Petty Cash Account, and enter the amount in the (Debit) field.

6. Add description and attachments (optional).

7. Click on "Save."

#Save Options:

• Save and Print: The entry is saved immediately, and the print page appears to print the entry.

• Save as Draft: To continue later.

#Linking Petty Cash Account with Payment Methods

Go to Settings > Payment Methods.

#If the payment method is previously added on the platform:

1. Click on the icon (🖋️).

2. From the linking account field, choose the desired petty cash account.

3. Click on the mark (✔️).

4. Click on "Confirm" to confirm the operation.

#If the payment method is not added on the platform:

1. Click on Add Payment Method.

2. Add the name of the payment method (e.g., Ahmed's Petty Cash).

3. Specify the payment method category.

4. Choose the desired petty cash account.

5. Write a description for the payment method (optional).

6. Click on the mark (✔️).

ℹ️ Note:

• The accounting goal of the linking process is to document all financial transactions that occurred according to the method used.

• If you choose the category (Cash), the default linking account (Cash in Fund) will appear and cannot be changed. If you choose (Credit Card or Other), you can manually specify the petty cash account.

#Using the Linked Payment Method

(Example of adding an expense)

1. Go to Accounting > Expenses.

2. Click on Expenses > New Expense.

3. Choose: Single Expense, or Multiple Expenses.

4. Add the name of the expense and its date.

5. Choose the payment method (Ahmed's Petty Cash).

6. Complete the steps to add the expense.

7. After adding the expense, the amount is deducted from the employee's petty cash account in the chart of accounts.

#Managing the Petty Cash Account

#Modify the Account:

1. Go to Accounting > Chart of Accounts.

2. Search for the account name or code.

3. Click on the three dots in front of the account name.

4. Choose "Edit Account."

5. Modify the data you want (account code, account name, description).

6. Click on "Save."

#Archive the Account:

1. Go to Accounting > Chart of Accounts.

2. Search for the account name or code.

3. Click on the three dots next to the account > Choose Archive Account.

4. Click on "Archive Account" to confirm the operation.

   The account is moved directly to the archived accounts.

⚠️Note:

• Accounts with balances cannot be archived - the account must be zeroed first by creating a manual entry and then archived.

• You will not be able to use the account until it is restored.

• The linking of payment methods associated with the account is canceled and re-linked to default accounts.

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#Frequently Asked Questions

1. Can I add the petty cash account to more than one payment method?

   Yes, you can.

2. Can I delete the petty cash account after adding it?

   You cannot delete any account from the chart of accounts, but you can archive it.