When Petty Cash Isn't so Petty

Jan 25th 11
By Louisa Cowan

Although the word petty comes from the French word petite meaning small, often there is nothing small about the amounts of petty cash needed day-to-day in the yachting industry. Wads of money are handed out and each cent must be accounted for. Most crew find themselves dealing with hundreds, if not thousands, in petty cash during their careers. Here are some tips to help keep the cash flowing accurately.

The first thing to remember is that the yacht’s petty cash is not your money. You’ve been trusted to spend it on behalf of the boat. You must be able to justify what the petty cash is spent on and prove that your purchases and payments add up. It can be tempting, even with the strongest will, to borrow a few bucks here and there, but be warned, this can become messy.  Always keep your finances completely separate from the boat’s finances.

 

Most vessels have clear rules and procedures to account for the petty cash, but have different ways of managing the money. Make sure you are familiar with the cash policy on board. If you are able to present the accounts in the exact way the captain or management company require, there is much less margin for error.

Whenever there is an exchange of monies, make certain you receive a formal record of the transaction. There always should be written confirmation that a sum of cash has been handed to you; the record should include the date and how much was given. Make sure this is done is for your benefit as well as the benefit of yacht. You don’t want to risk any claim that you were given more or less money that you actually received.

Despite the very best attempts at record keeping, inevitably, mistakes happen. Money gets lost, receipts are misplaced and sometimes the numbers just don’t add up. Most captains, owners or management companies are the first to admit that there is a certain element of trust involved when crew deal with the vessel’s money – there is the assumption that employees are honest. Occasional mistakes may be overlooked, but should errors become a regular occurrence with certain individuals, then questions should and will be asked. The key is to be vigilant and as accurate as possible to avoid any sinister accusations that may threaten your job.

Where the vessel is in the world will determine how much petty cash will be utilized. In the Caribbean, for instance, the need to carry cash is much greater than in The States, where credit cards are more prevalent. When visiting countries that do not take cards, hiring dayworkers who require cash payment or provisioning in a local market, cash is an absolute necessity. At times like these, organization is the key. Saving all receipts until the end of the month can be a disaster. You may lose track of small change and what is a simple ongoing task becomes a huge, complicated job. Do your accounting on a weekly basis, if not more often.

The bottom line is to look after the money that you have been entrusted with, keep it in a safe place, be careful with your receipts and stay on top of your administrative duties. If mistakes happen, be upfront about them as soon as you realize and don’t try and cover them up. Accounting may be a mundane part of your job, but do it well and it will alleviate a lot of stress at a later date.


Related Topics:

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