I oversee the $250 petty cash for your company. When an employee needs a special item that is not in inventory, I take money from petty cash to purchase that item.

One day, I am short on cash for lunch. You decide to borrow $10 each day for the next 3 days until payday for a total of $30 from petty cash. After payday, you do not have enough to repay petty cash, so you decide to record a cash short/over expense of $30.

Since this is the first time I have ever done this, is this a problem? If so, what steps should be taken to fix this problem? If not, why not?