Petty Cash Book is a separate cash book maintained by a petty cashier to record small, repetitive payments such as conveyance, cartage, postage, telegrams and other miscellaneous expenses. In large organisations, if all these payments are recorded in the main cash book, it becomes cumbersome and bulky, and the cashier may be overburdened.

The petty cash book is prepared with multiple columns on the payment side (credit) for specific types of common expenses. The last column is designated as 'Miscellaneous' for items without separate columns, followed by a 'Remarks' column for recording the nature of payment. On the receipt (debit) side, there is only one amount column. Columns for date, voucher number, and particulars are common for both sides.

At the end of each period, all amount columns are totaled. The difference between total receipts and total payments is the balance with the petty cashier. The petty cashier is then reimbursed the amount actually spent.