QFinance defines cash float as money a retailer keeps to give change to customers. Such money is kept in a range of banknote denominations and coins. Departments in an organization may also set up cash float accounts to avail change, as University of Toronto does. To handle the change problem, the institution utilizes the cash float provision to keep track of cash movement from its account to the requesting department.
According to Charles Sturt University (CSU), cash flow is set to be available at the outset of trading, enabling the cashier to give it to customers. Although the cash has to be held in various denominations, there is no standard requirement for how that can be implemented. Usually, a retailer determines the amount and breakdown of cash float based on internal policy and processes, size of business and time of the day.
As the University of British Columbia explains, cash float, which may also be described as the change float or petty cash account, can prove more efficient than using many checks. Thus, departments that have to meet costs for a large number of minor tasks will find cash float accounts beneficial. At the end of a business day, the cash float is removed from drawers, CSU states.