Cash Handling Procedures

I received the following responses to a question in the November 5, 1999 EHC regarding cash handling procedures. Once again it shows that in the real world, there is more than one right answer to a question.

Pam Keith <pkeith@dfn.com>
I read your question on Mr. Marvins "electronic house call" today. I'm sure some of the things we do you are already doing, but it never hurts to offer suggestions from other restaurants.

- It is policy that all cash drawers are counted out in the office with the manager and bartender both to verify the amount is correct. This has solved the problem of "my drawer was short to begin with" or " I didn't count it, I thought you guys did it!".

- No one is allowed to exchange tips in their tip out jar for money from the cash drawer. The only time money may be removed from the tip jar is if a customer asks for change.

- Our POS system allows us to "cash in" the amount of money that is in the till. This has helped us when cashing out the bartender at the end of their shift.

- Our POS system also allows us to make the bartenders sales summary "blind", it will not show what cash sales have been entered nor what amount of cash they owe. It only shows non cash i.e. credit cards, gift certificates, etc.

- If we feel someone may be "dipping" into the till, the manager will run a "full summary" which does show the amount of cash that should be in the drawer. They simply run the report and ask the bartender to open the drawer. They then count it right then and there in front of the bartender.

- Our POS system allows for the cash drawer to open after a sale is complete only - no "no sales". We use server banking so we don't have cashiers, but we do have a terminal and cash drawer at the host/hostess station for other purposes. We decided to disconnect the cash drawer from the POS system. We had keys made for the managers and they manually open the cash drawer when needed. POS systems are not fool proof and in the past we believed someone (or ones) had figured out a way to "pop" the drawer when it was connected.

- We make sure that if the bartender is "over" he/she does not get to keep the money. We explain to them that they must have taken money for a drink and not keyed it in. When they are short, we use the reverse explanation, they keyed in a drink and didn't collect for it. We make them pay any shortages.

- Last but NOT least, DO NOT allow anyone access to the cash drawer besides the person it has been assigned to. The only way you can claim theft is if they were the only ones with access to the drawer. The only key to the drawer should be in the office, not on a managers key chain.

Howard Chasser <hcv123@worldnet.att.net>
We have had the unfortunate experience of catching a number of employees with their hand in the till. Here is some of what we learned.

You need to have a very tight system of controls on your cash management from the time it leaves the customers hand. Some thoughts: look out for a cashier who keeps a calculator handy, does a lot of adding and /or subtracting and/or figuring on paper. Set up a rule that if they are off (over OR under) by more than x$ y amount of times they will lose their job (x and y variables depend on your tolerance). Consider installing a hidden video camera over your register - the reality is that you will only be able to randomly check it, but if someone is stealing - you will probably catch them - and have evidence to prosecute if you so choose. Look for excessive numbers of no sales or voids. If you have a physical check that gets rung in, consider randomly checking the total dollar amount of the checks to the amounts rung in. Make sure that you have separated the duty of writing a check and ringing in cash payment. That should be enough to at least get you thinking if not get you started.

PS: Something that the Doc said the first time I heard him speak that has never left my mind: "It's not a question of if your employees are going to steal from you, it's a question of how much you're going to let them get away with!" Cash is one of the easiest things to steal.

Chip Fowler <fowlout@aol.com>
I run a gourmet deli in Baltimore and have experienced similar concerns with my cashiers regarding cash handling. I instituted the following policy:

We provide the cashiers with a $300 bank to start their shift with. They are responsible to count that bank before they begin their shift to verify the $300 bank. At the end of the shift we again count the $300 bank and pull that to the side, leaving the remainder of the money for the deposit. The policy that I instituted stated that the cashier cannot be more than .025% over or under from their gross sales. If they exceed the .025% variable in shortages or overages then they would be responsible to pay the entire difference to the house. Anything within that .025% variable is considered acceptable and the cashier is not responsible to pay the difference. Example: $1000 in gross sales x .025 = $2.50

If the cashier did $1000 is gross sales the variable would be $2.50. If the cashier was more then $2.50 over/under then they would be responsible to pay the entire amount that they were short to the house. I had all cashiers sign this policy and I put it in their files.

Michelle Kerr <mkerr@tegh.on.ca>
With regards to cash handling, we have the following procedures:

We are unionized and have two retail outlets. A cafeteria and a coffee shop, everyone has their own $300 float and does their own deposit. You only work on your own cash. Cash deposits are counted daily by two different people in a management position, it is reconciled with a daily cash report printed from the computer system.

Each day you can be +/- $2.50 from your computer "read". If you go over that amount it is documented. Each month you can be outside that $2.50 window 3 times. If you are out a large amount ($10 or more) we count the employees float. After the third time you receive discipline up to and including termination if it continues. We generally warn people when they are on their "third strike". Because we are unionized we start with a verbal warning, then a written warning and then suspensions. The fifth discipline step is termination. We implemented these procedures 3 years ago and it has improved cash handling leaps and bounds! We rarely discipline staff for it as most of them don't go beyond the 3 times per month. Yes, we have terminated for poor cash handling. Some suggestions; written policies and training are a must, meet with all staff to fully explain the expectations of their cash handling ability, and document, document, document! Discipline will never "stick " without it. Good Luck.

Howard Black <hblack1@bellsouth.net>
I have two steadfast rules when dealing with cash registers/and cashiers:

1) One person to a register, period with no exceptions. They count the beginning till, they purchase their own change from the manager and they count down their till at the close of their shift. THEY ARE THE ONLY ONES ALLOWED IN THAT REGISTER....PERIOD!

2) We have total register accountability. Any difference more than $2.00 and the cashier receives a Notification of an Over/Short.

Actions to the Notification are:
- 1st notice......Find the problem and retrain
- 2nd notice......Find the problem and retrain
- 3rd notice......Final warning and retrain
- 4th notice......Termination

We also post on our bulletin board each day how the previous day registers balanced. I guarantee that this program works, but there is one word repeated three times that is VERY important . . . RETRAIN!

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