Accounting of Cash Transactions

Every company has an equipped room where it keeps, receives and gives out cash. Cash includes petty cash, valuable documents and mandatory accounting documents. Rules and procedure for accounting of cash transactions are prescribed by the Central Bank of the Russian Federation. Incoming cash must be recorded in cash receipt voucher, while outgoing cash in cash payment vouchers.

Procedure for cash transaction accounting:

1. Issue cash receipt and cash payment vouchers
2. Enter documents in the relevant register
3. Record transaction in cash register
4. Make daily summarization
5. Submit cash report to accounting department

Once a month, cash revision must be held, at the initiative of a company officials. It can be initiated without prior notice. A cashier bears financial liability for the safety of cash and valuable documents, which liability is set forth in the employment contract with the cashier. Accounting must be adequately structured and 100% transparent.

Accounting: Objectives

Correct payments and proper performance of contracts ensure full and timely receipt of money in cash and to bank accounts. In the regular course of business, a company makes payments to its employees and partners, pays taxes and insurance contributions.

Key functions of accounting of cash transactions:

• fully and accurately reflect cash transactions;
• strictly and continuously control the availability and integrity of cash;
• ensure that payment settlements with suppliers and clients are made correctly and in due time;
• ensure that funds are used for intended purpose;
• stringently control payments to employees, budgetary and extra-budgetary funds.

The amount of cash to be held by a company is subject to limitation as set by a bank upon prior agreement with the company’s executive management. A company may choose its partner bank at its own discretion.

Accounting of foreign currency cash transactions

A special cash account is required for foreign currency cash transactions. Accounting of such transactions must follow the procedure prescribed by the Central Bank of Russia. A company may receive foreign currency cash to pay for business travel only. It is strictly prohibited to use foreign currency for any other purpose.
Upon receiving foreign currency cash, the cashier must issue a cash receipt voucher according to a procedure similar to the one applicable to cash transactions in Russian Rubles. Foreign currency cash shall be recalculated according to the exchange rate change. The recalculation procedure must be set forth in the accounting policy. To facilitate accounting, accounting and calculation must be continuously improved and automated, with state-of-the-art software.

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