What is the primary purpose of petty cash in an organization?

The primary purpose of petty cash in an organization is to pay for inexpensive items. Petty cash is a small amount of money kept on hand for minor expenses that may arise in day-to-day operations, such as office supplies, refreshments for meetings, or small maintenance costs. This system allows for quick and convenient access to cash without the need for a formal purchasing process, helping streamline operations for smaller expenses.

While managing staff salaries and paying for external suppliers are important financial functions, these are typically handled through more formal payroll and accounts payable processes, respectively. Additionally, petty cash is not meant for large transactions, as it is specifically designed for minor expenditures. Thus, its main function is to facilitate the payment of low-cost items efficiently.