The Cash register It is a reality that occurs daily in any store or business, therefore it is commonly known as the cash count and is He estimates that to do it correctly it is necessary to keep a memory of each of the cash movements produced during the working day.
In this article you will find:
What is the cash count?
The cash count consists of the analysis of all transactions carried out in cash, within a certain time, in order to check if the cash received has been accounted for and corroborate the physical balance corresponds to the balance shown in this counting. On the other hand, it serves to know if internal controls are properly carried out.
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When performing the cash settlement, any of the following cases occur:
- Cash in settlement = book balance:
The money in cash exactly matches the cash-on-book count balance.
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- Cash in settlement
The money in the cash register is less than the balance registered in the books, with a presumed shortage.
- Cash in settlement> book balance:
The money in the tonnage is greater than the balance recorded in books, with a presumed surplus.
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In those small companies the accounting is carried out by the cashier, administrator or owner, in large or medium-sized companies the accounting is done by an internal auditor or tax auditor.
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What is the cash count for?
The main objective of the cash settlement is to square the box, in order to check that all the cash is accounted for and that the balance presented in the account corresponds to that of the box. And it must be backed by cash, vouchers or checks.
In reality, the purpose of the accounting goes beyond a simple check of the cash, it seeks to verify the proper use of the money received and assigned to the responsible persons.
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When should the box be archived?
These audits can be scheduled weekly or monthly, as appropriate for the company to carry out its controls. However, it is necessary to know that an adequate control policy requires that some cash balances be carried out in a manner surprise, that is, not foreseen by the cashier, which must be made by a person other than the one who performs the cash counts scheduled.
Steps to follow to perform a cash settlement
It is necessary to consider that the steps to carry out a cash accounting may vary according to the policies implemented by the company.
However, here are some of the steps to follow to perform a cash settlement:
- The first thing to do before counting the money is to check if each of the movements, all collections and payments made up to that moment, in addition to verifying that the balance corresponds to what is actually there must be.
- Request the documentation turned for the last time to exercise the documentary cut.
- The cash manager delivers the documentation in the presence of the worker responsible for the tonnage.
- The person responsible for carrying out the accounting proceeds to the counting and ratification of the balance.
- The person in charge of the tonnage, makes the closing act, in this act the observations and differences detected regarding the use of cash according to the company's policies are detailed.
- Copies of the minutes are delivered to the accounting department and the cash manager.
- At the end of the accounting, accounting must analyze the minutes to keep the accounting records regarding the differences, whether surplus or missing. It is worth noting that these entries must be subject to the accounting policies of the company.
Given the case that there are shortages, two alternatives are proposed:
- Collect the shortfall from the cashier.
- Guess the missing as an expense.
Given the case of surpluses, they are generally recorded to other income.
How is the cash count calculated?
As has been said, the cash count results from calculating the difference between the cash balance (what is recorded in tickets sales and management software or books) and cash in the till (cash plus collection in other forms of pay).
Considering the following variables:
DV: Sum of sales for the day
CEF: Cash at closing
CEI: Initial cash balance
VO: Payments by other authorized means
OG: Outflow of money for different items of the company
D: Discounts
CC: Credit sales
Using the following mathematical formula:
VD = CEF + CEI + VO - OG - D - CC
When there is a shortage, a negative count is considered, in any case the causes must be found out and noted.
Possible causes of a negative cash settlement
- Existence of counterfeit money-
- A bad annotation of a return, it may happen that the seller has made a mistake writing down the return of a customer, since it can be done in cash, for a purchase receipt, by bank, etc.
- Wrong sale, when more units sold than the actual sale are recorded.
- Stole.
- Bad money count.
How the cash count and the cash count differ
In general, these two processes are understood as the same concept, but the truth is that the cash count is part of the cash settlement and is the part that allows us to understand the process in general.
As is known, the cash count consists of the comparison between the money that is in the box and the values recorded in the accounting, by its part, the count corresponds to the count made to make the respective annotations in order to total the money and make the comparison relevant.
Including the confirmation of vouchers and supports of the expenses and income of money indicated in the cash account.
Finally, it is worth noting that, despite being a fairly simple process, it is very important within the administrative process, it goes beyond Simply knowing the balance that must exist is part of the management of cash and bank accounts so that the company can meet its obligations of pay.
