Of course, you should keep your cash in your own drawers, but this line goes back to my grandmother, the wife and mother of the founding fathers of Smyth Systems. She was sure this was the perfect marketing tagline for our type of business. She would have been proud I did! ~ Tim
Make sure that the cash going into your drawers…
goes into your bank account.
Good control begins with a daily reconciliation between the Point of Sale’s calculated register totals and the actual amount of each deposit made into your bank account. Usually, three entries are made daily: one for cash and checks to the store’s local bank, one for American Express, and one for all other credit/debit cards. This simple daily process is critical to effective store management to assure accuracy, avoid shrinkage and assure high customer satisfaction level.
Other than making sure all sales are recorded, nothing is more important than assuring that the monies collected daily match all the sales recorded for the day. If improperly recorded sales aren’t corrected, the entire system becomes suspect. Merchandising statistics aren’t trusted and planning decisions are based upon faulty assumptions. To add insult to injury, costs rise when accountants and staff spend resources recalculating, re-balancing, and guessing at proper account balances. The daily reconciliation process confirms that transactions are properly summarized. Taking a few minutes to balance accounts always saves time in the long run.
Of course, anytime money is being handled, loss through pilferage, fraud and theft must be considered – even from the most trustworthy staff. Given enough temptation only those with the strongest moral fiber will remain honest. The best antidote is to remove temptation with disciplined counts and controls. Drawer counts can be recorded at the Point of Sale Register when drawers are closed or reconciled in the back office. Infrequent or “lazy counts” should be avoided. Counting out only the day’s cash without counting the remaining “leave” is quicker at the end of the day, but it can hide shrinkage until it’s too late to recover.
Optional “blind counts” (where counts are entered without knowing the expected totals) prevent the cashiers from simply keying “lazy counts” by just entering the displayed register totals. Blind counts can also increase reported overages and reduce the net over/short expense – instead of having overages converted to “beer money” on the way home, it stays in your drawers.
Most importantly, a daily reconciliation of bankcards is critical to maintaining customer service levels. It is easy to get lulled into complacency because the technology is so consistent in tying sales to credit card authorizations, but failures in the processing network will occur. Nothing is more embarrassing than billing a customer twice or losing a credit – you can only imagine what happens when retailers double bill all of their clients! This never happened with our system but I do know a retailer that this happened to and they would be the first to tell you how much it has hurt their stellar reputation. Assuring that all credit card transactions are accurate is a customer service obligation that assures that inadvertent errors or network failures never have a negative impact on your reputation.
A simple daily reconciliation of deposits prevents excessive shortages and theft, assures customer satisfaction and is the basis for accuracy all the way to reconciling your cash accounts to your Bank Statement.
