Cash handling procedures are essential to retail operations
Good cash handling policies and procedures are essential to any retail operation that handles cash. Cash is just too tempting a target for many people, especially those who have financial need, or believe they are smarter or more clever than their employer. It’s management’s responsibility to ensure that the entire organizational structure safeguards its cash assets. From cash counting to deposits, your store needs proper policies and procedures in place when it comes to cash transactions and how to handle that money going forward. Here’s what makes a good cash handling policy for retailers.
First of all, the central tenet of your store’s cash handling policy should be that cash is never handled by only one person. Policies that involve at least two employees encourage safe cash handling, at least puts a potential barrier to fraudulent collusion, and mostly eliminates the temptation to take money.
One of the key challenges to cash handling in the retail industry is simply the sheer scope of the amount of money involved. Systems that involve cash point-of-sale transactions can impact a wide variety of systems, from your physical cash registers to video surveillance system.
Some of the key elements of cash handling include:
- Physical cash management: how you receive and distribute cash, where you store it, who has access to it, and how it’s being monitored.
- POS systems: The point-of-sale system is critical to efficient cash management. Make sure cashiers are well-trained and have total control over the drawers assigned to them.
- Payment tracking: All payments, both physical and digital, need to be tracked, monitored and properly stored.
- Paper trails: All receipts, invoices and other payment-related documents must be accurately processed, be subject to a back-up system, and filed.
Best Practices for Cash Handling
Here are a few other best practices for cash handling in a retail operation.
- A safe should be used to store all cash, and a video surveillance system should record all instances where an individual or individuals are accessing the cash.
- There should be two people present whenever cash is transported from one location to another.
- A cash count sheet should document the names of people removing cash from the safe, the date and time cash is removed or returned, a cash breakdown of bills and coins, and two signature lines for people signing cash.
- Cash should always be double-counted during any exchange from the safe.
- Bank deposit slips should match the cash sheets.
Where You Can Improve as a Retailer
Understanding the importance of good cash handling procedures in your retail operation is an important first step. By assessing your current policies and procedures and identifying areas of need, you can improve your internal controls and eliminate risks in your cash management process.