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Is Your Business Conducting Internal Cash Audits? Why and How

  • By admin
  • 07 Jul, 2020
Cash Audit — San Antonio, TX — South Texas Business Systems Inc

Does your business work with a lot of cash on a regular basis? If so, it should be performing cash access audits on a regular basis. If you're not familiar with doing a cash audit, there's no better time to begin than now.

Why? Even a business that has not noticed a problem involving misuse of cash cannot be certain that something has simply gone on unnoticed. And most small businesses can always improve their processes as a bulwark against future trouble. So, if you want to get started with cash audits, here is a short guide to how to do it.

Audit Cash Reporting

An audit is just the independent confirmation of certain business transactions that have occurred in the past. It provides verification that things are done correctly - and therefore boosts confidence in the business practices. Audits do not attempt to verify every single transaction but rather focus deeply on certain elements that represent the whole.  

To audit how cash is reported in your business, for instance, you might choose a recent day and then pull the records related to cash for that day. This audit should be performed at a random interval and generally shouldn't be announced in advance so records aren't altered.

The auditor would look for a record of the amount of cash in the register drawers when each person's shift began. Sales receipts would show how much cash was taken in during their shift. The auditor would then look for written records of how much cash was counted at the end of each shift.

An audit, though, goes further to follow the money. The auditor would check to see what deposits were done on that day and whether these match up to the cash count tapes. Finally, they would check the bank statement to verify the amount officially deposited. Any discrepancies would trigger further investigation as well as follow-up audits of different periods or transactions.

Don't forget to audit other sources of cash, including petty cash. Petty cash is easy to randomly audit. An auditor notes the amount of petty cash originally put in and subtracts the record of purchases. The end result should equal the amount of cash currently in the drawer.

The biggest problems with petty cash are usually borrowing by authorized employees or incomplete records when money is used, and an audit can catch those issues.

Audit Cash Handling Procedures

Auditing should include a look at the procedures used to handle cash in your business as well. This is best done in real time and by an independent but knowledgeable person who doesn't normally work with this cash. An auditor would go through the normal cash handling steps along with employees to see what's being done on a daily basis.

They might observe how cash is counted before and after shifts, whether or not two people work together when cash is involved, what records are printed, how often deposits are done, and how cash is protected when going to the bank. If the auditor knows best practices regarding cash handling, they can soon see where the process is strong and where it is weak.

Look for Improvements

An audit's goal is not just to find problems but also to facilitate improvements. If reconciliations of cash drawers don't include a written record that can be verified, for example, the auditor might suggest using a cash counter with a receipt tape. If cash is being counted in a public space, they may suggest moving this job to a private location and involving two or more employees at all times.

While audits take an investment of time, they provide a valuable service to a growing business. An audit helps prevent small problems from becoming big ones and provides a proactive way to protect the business from liability or financial risk. For help improving your cash practices and auditing abilities, start by consulting with the cash pros at the Banker Money Counting Systems.

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Right now, in your convenience store, you and your employees might count and handle money the oldfashioned way. A currency counter might not seem like a necessary investment, but it's worth the cost. These are a few reasons why these devices are particularly useful in convenience stores.

1. Detect Fake Bills

Because of the sheer number of transactions that are often done in a convenience store throughout the day and because of how fast these transactions usually happen, convenience stores can be at more of a risk of receiving counterfeit bills than many other businesses.

If employees use a currency counter when accepting larger amounts of money, they can quickly check to make sure that the bills they are being given are real.

Even if money has already been accepted by employees and is being counted at the end of the day, the counterfeit detector on your currency counter machine can help you catch fakes so you'll avoid taking them to the bank or keeping them in circulation.

2. Save Your Employees Time

Your employees probably have a lot of responsibilities in your convenience store. Having to spend a lot of time counting money takes away from the other things that they may need to be doing. If you have a currency counter that they can use, employees can make quick work of counting money so that they can quickly move on to the next task.

3. Get Money Put Away Quickly

Convenience stores are at a great risk of being robbed, so taking steps to help prevent theft is important. One of the key things that you can do is to keep a limited amount of money in your cash register drawers. Having employees put money in the safe once they accumulate a certain amount helps decrease the risk of theft, and if theft does occur, it helps minimize the loss.

If employees have to count money by hand each time that they put it in the safe, the money will be left out for longer. Also, robbery may be more tempting if employees are seen visibly counting large sums of money in the store.

With a currency counter, employees can get money counted and put away very quickly and discreetly. This helps keep both employees and the money in your store safe.

4. Prevent Human Errors

Your employees are probably pretty adept at counting money. They might do it all day long when they accept money from customers. This doesn't mean that they can't make a mistake, though, especially if they're in a hurry. Wet bills or brand-new, crisp bills can easily get stuck together, making it easy for a person to make a mistake, for example.

Currency counting machines have high accuracy rates, though. If your employees always use a currency counter when counting money, they will help decrease the chances of a mistake being made.

5. Avoid Spreading Germs

It's no secret that money is often covered in germs. Your convenience store employees obviously aren't going to be able to avoid coming in contact with money, but you should still minimize the spreading of germs.

After all, your employees might prepare hot dogs or other foods for your customers, and you don't want them to spread germs that can make someone sick. You don't want your employees to get sick either.

With a currency counter, you can help minimize how much physical contact your employees have to have with money.

A currency counter is a great investment for any convenience store, whether it's a small, rural convenience store or a large truck stop on a major interstate. Contact us  at The Banker Money Counting Systems to find out more about our currency counting systems and how they can improve your convenience store.
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