Petty Cash Management for Nepali Businesses: A Practical Guide

Every office in Nepal has the drawer. The one with a few thousand rupees for tea, photocopies, a courier, the electrician who came on short notice. Petty cash is genuinely useful, and it is also, in most companies, the single leakiest part of the finance operation. Not because anyone is stealing, usually, but because nobody can say exactly where it went.

Here is a practical system that works for Nepali businesses, whether you run one office or twelve branches.

Why petty cash leaks

Three reasons, almost always:

1. No fixed float. Cash is added "when it runs out", so there is no baseline to reconcile against.
2. No single owner. Three people can open the drawer, so no one is accountable for it.
3. No receipt discipline. Small spends feel too small to document, and fifty undocumented small spends a month quietly become a real number.

Fix those three and you have fixed petty cash.

Step 1: Set an imprest float

The imprest system is old, boring, and effective. Decide a fixed amount for the box, say NPR 15,000. That number never changes. When cash runs low, you top it back up to exactly 15,000, and the top-up amount must equal the receipts collected since the last top-up. If NPR 9,200 left the box, there must be NPR 9,200 of receipts. The float itself becomes the control.

Size the float to cover roughly two to four weeks of small spending. Too large invites casual use; too small means constant top-ups.

Step 2: One custodian per box

Each cash box gets exactly one custodian: the office assistant, the branch admin, whoever is reliably present. Only they hand out cash, and every disbursement gets a voucher slip with date, amount, purpose, and the recipient's signature. If your branch in Butwal has a box, someone in Butwal owns it by name. Shared responsibility is no responsibility.

Step 3: Demand proper bills

For anything beyond the smallest spends, ask vendors for a PAN bill. This is not bureaucracy for its own sake: proper bills are what let your accountant treat these expenses as deductible costs, and they are what the auditor will ask for. Set a simple rule, for example: above NPR 500, no PAN bill means no reimbursement. People adjust within a week.

Step 4: Reconcile before every top-up

Before adding cash, the custodian counts the box and lays out the receipts. Cash plus receipts must equal the float. Do the count with two people present and note the result, even just in a copybook. This takes ten minutes and is the entire early-warning system: a discrepancy caught at the first top-up is a conversation, a discrepancy discovered after six months is a crisis.

Step 5: Surprise counts

Once a quarter or so, someone who is not the custodian counts the box unannounced. In a multi-branch company, HQ finance does this on branch visits. The point is not suspicion; it is that everyone behaves better in a system that is visibly checked, including the honest people, who deserve a system that protects them from blame when numbers wobble.

Signs you have outgrown the cash box

• You have more than two or three boxes across branches
• Month-end reconciliation regularly turns up gaps nobody can explain
• Staff pay from their own pocket and wait weeks for reimbursement
• The same categories (fuel, meals, transport) keep growing and no one knows why
• Your accountant spends days each month re-entering paper vouchers into Excel

Each of these is the cash box telling you it was designed for a smaller company than the one you now run.

Moving beyond the cash box

The system above will run fine on paper for a small office. As branches multiply, the paper becomes the bottleneck: HQ cannot see branch spending until vouchers physically arrive, approvals happen after the fact or not at all, and reconciliation eats your accountant's week.

That visibility gap is what Kharchai closes: employees submit expenses with receipt photos from their phone, approvals happen in the app under rules you set, and every branch's spending lands in one ledger HQ can see the same day. The petty cash drawer can stay for tea and photocopies. Everything else deserves a system. Join the waitlist to get early access.