Cash balance limit at the cash register: important nuances

Establishing and subsequently enforcing limits on the amount of cash balance are important aspects of cash management in an enterprise.
If a business entity accepts and spends cash, it should pay due attention to these issues. The cash balance limit in an organization cannot be determined arbitrarily. It must be correctly calculated and properly approved. Only in this case will the application of specific standards for the cash register be considered legal.

What is it and why is it needed?

The cash balance limit of an organization is currently established in accordance with the procedure regulated by the Directive of the Central Bank of the Russian Federation under number 3210-U dated March 11, 2014.

This regulatory document regulates various aspects of cash discipline, which are generally binding for legal entities working with cash.

The instruction of the Central Bank of the Russian Federation stipulates that certain business entities - individual entrepreneurs, small enterprises - have the right to operate a cash register using a simplified system.

The limit (standard) of cash in the cash register is a limitation of the maximum amount of cash allowed for storage in the business cash register of an enterprise at the end of the operating day (after entering the relevant information into the cash book).

Accordingly, there should not be an excess amount of cash in the cash register of a business entity at the end of the day.

The law, however, stipulates some restrictions on this rule.

Thus, the organization has the right to receive and spend cash for necessary purposes if the established cash standard is observed (limitation on the maximum amount of cash balance available in the cash register at the end of the operating day).

Each enterprise sets this limit independently, but is guided by the procedure regulated by the Central Bank of the Russian Federation.

Compliance by an enterprise with standards for cash balances is an important area of cash discipline and financial control.

Who should set up for an LLC?

If an organization is required to set a cash balance limit, but has not done so properly on time, it is set to a zero limit by default.

Under such circumstances, any amount of cash that ends up in the cash register by the end of the operating day will be considered excess.

The cash balance of funds is limited and approved for the enterprise by a special administrative act (order) of the head of the business entity.

An individual entrepreneur independently sets a cash limit for his activities and consolidates this standard with an appropriate order (if, of course, he has such a desire).

There is no strict form of administrative act regulating the amount of the maximum cash balance.

The order for approval of the cash limit must contain the following mandatory details:

limit amount (maximum limit);
date of entry into force of the established limit;
algorithm for calculating (justifying) the amount of the entered limit.

How often can I change sizes in a company?

The organization, at its own discretion, establishes or revises the period during which a given cash balance limit should be in effect.

The order approving the cash limit usually only mentions the date of entry into force of such a limitation.

Thus, the maximum cash limit established by a specific order of management can be valid at the enterprise for several years, and can be adjusted monthly if there is a real need for this.

Whether it is necessary to annually establish and review the current standard is not enshrined in legislation.

It is advisable to review (adjust) this limit in the following cases:

the amount of incoming cash revenue has changed significantly;
the amount of cash spent has increased or decreased significantly.

Who does the cancellation apply to?

Establishing a maximum limit for the amount of cash on hand is the responsibility of each business entity conducting cash transactions.

Exceptions to this rule are individual entrepreneurs and legal entities legally classified as small businesses. Do small businesses need to set a limit?

In other words, business entities, exempt from the need to establish such a limit, have only the right to independently limit their cash balance, but not the obligation.

If individual entrepreneurs or small businesses nevertheless set such limits for themselves, enshrining this in the relevant orders, the given restrictions must be strictly observed, and the excess amount of cash must be transferred daily to the servicing banks.

With whom should the established cash standard be agreed upon?

The maximum cash limit is clearly regulated by an administrative act of the management of a company or individual entrepreneur who wishes to limit the amount of the daily cash balance.

The issuance of a corresponding order by the manager is a sufficient procedure for putting this limit into effect.

There is no need to coordinate this restriction with the tax service, the servicing commercial bank, or other external entities.

You just need to follow the generally binding procedure for calculating such a limit.

What document establishes the cash limit?

The cash limit is not agreed upon with the bank. The organization and individual entrepreneur approve it independently by issuing an order signed by the director or individual entrepreneur. The cash limit, at the discretion of the manager, is approved for any period (month, quarter, year, etc.). After the expiration of the specified period, a new order is issued. The deadline may not be specified in the order, and then you can work with this limit for several years until you approve a new document with new calculations.

Example document

LLC "Success"

ORDER No. 0001 dated 01/11/2016 On establishing a limit on the cash balance of an enterprise In accordance with the Directive of the Bank of Russia dated 03/11/2014 No. 3210-U “On the procedure for conducting cash transactions by legal entities and the simplified procedure for conducting cash transactions by individual entrepreneurs and small entities entrepreneurship" and based on the calculation of the cash balance limit in the cash register, determined based on the volume of cash dispensed from the cash register, I order: 1. Establish from 01/01/2016 a cash balance limit in the cash register in the amount of 60,606 (sixty thousand six hundred six) rubles.

Appendix: Calculation of the cash balance limit in the cash register.

Director _______________ Full name

How to define a legal entity?

The procedure regulated by the above-mentioned Directive of the Central Bank of the Russian Federation provides two ways to calculate the amount of the maximum limit for the cash balance at the end of the operating day.
A business entity can choose one of these options:

taking into account cash receipts;
taking into account cash expenditure.

Calculation based on cash receipts

This method is suitable for a business entity that has regular cash receipts. The limit is calculated using the following formula:

Formula:

Limit = (MON / RP) x VI
This formula contains the following notations:
Limit – the amount of the maximum limit for the cash balance (in rubles).
PN – cash receipts for a specific billing period (measured in rubles).
RP – the duration of the billing period for accounting for cash receipts (measured in the number of days). The maximum duration of a RP for an organization is 92 days.
VI – time interval between the days of transfer of cash to the bank (measured in the number of working days). The maximum duration of a VI for organizations is 7 working days.

By volume of cash issued

The maximum limitation on the amount of cash balance is determined in this case using the following formula:

Formula:
Limit = (RN / RP) x VI
This formula contains the following notations:
Limit – the amount of the maximum limit for the cash balance (in rubles).
RN – the amount of cash spent for a specific billing period (measured in rubles). Cash that is taken to pay employees is not taken into account.
RP – the duration of the billing period for accounting for the amount of cash spent (measured in the number of days). The maximum duration of RP for enterprises is 92 days.
VI is the time interval between the days of accepting cash from the bank (measured in the number of working days). The maximum duration of VI for enterprises is 7 days.

Who should approve?

As mentioned earlier, approval of the maximum limit on the cash balance falls within the exclusive competence of the head of the business entity.

The maximum amount standard is regulated by a special order of the management, which indicates the amount of the established limit, the date of entry into force of this limit, and the procedure for calculating the specified indicator.

What to do if it exceeds?

The establishment and observance of this limit assumes that there should be no excess cash in the cash register of a business entity by the end of the operating day.

Any excess of a given limit - an over-limit amount - is subject to transfer/credit to a commercial bank.

In what cases is it permissible to disrupt cash flow?

Excess cash may be stored at the organization's cash desk only on certain days:

Working days established by the business entity itself for payments to employees. The maximum duration is 5 (five) days.
Weekends/holidays – if cash transactions are made.

Penalty for exceeding

Unauthorized storage by an organization of excess cash is considered a failure to comply with cash (financial) discipline, for which current legislation provides for administrative liability - the imposition of a fine.

Penalties for exceeding the cash limit:

Individual entrepreneurs, officials of organizations - minimum 4000, maximum 5000 rubles.
Legal entities (enterprises) – minimum 40,000, maximum 50,000 rubles.

conclusions

Establishing, approving and subsequently enforcing a maximum limit on cash balances are important aspects of maintaining financial discipline in an organization.

Limiting the maximum amount of cash allowed for storage (withholding) in the cash desk of an enterprise at the end of the operating day is the prerogative of the management of the business entity.

You just need to follow the generally binding rules contained in the Directive of the Central Bank of the Russian Federation, which regulates the procedure for calculating and applying this limit.

This limit can be set for any period, revising the specified standard if necessary. However, it should be remembered that exceeding this limit, approved by order of the enterprise management, may result in the imposition of fines.

How to set a limit in 2021 for cash on hand

At the initial stage, a manager’s order is created in the following ways:

by the amount of revenue;
according to the amount of expenses.

After calculating the amount, an administrative document is issued, a sample of which is presented below.

Order on establishing a cash limit

At the next stage, an order is issued, a sample of which is presented below.