How to create a cash handling and banking procedure

Your first step is to create a clear, written document that details exactly how cash is managed in your business, from the moment a customer hands it over to when it's safely in the bank. A solid procedure removes guesswork for staff and protects your hard-earned money. It must cover four key areas: the daily till float, the end-of-day 'cashing up' process, how cash is stored securely on-site, and your schedule for banking the takings.

Why this procedure is so important

Without a formal process, you're vulnerable to simple mistakes, internal theft, and even robbery. A written procedure ensures every team member handles cash in the same way, creating consistency and making it much easier to spot if something is wrong. It's a fundamental part of your business's security and financial accuracy.

What to include in your procedure

Your document should be a clear, step-by-step guide. Break it down into the following sections:

1. The Till Float

• Float Amount: State the exact starting amount for each till (e.g., £50.00).
• Preparation: Who is responsible for preparing the float each morning?
• Denominations: Specify the required mix of notes and coins to ensure staff can give correct change.

2. Cashing Up (End-of-Day Reconciliation)

• Timing: When should this be done? It should always be at the close of business and away from public view.
• Responsibility: Who is authorised to cash up? Best practice is to have two people present to count and verify the total.
• Process: Detail the steps: count all the cash in the till drawer, subtract the starting float amount, and then compare the remaining total to the day's sales report from your till or EPOS system.
• Discrepancies: What is the process if the cash is over or under the expected amount? State who must be notified and how it should be recorded in a dedicated logbook.

3. Secure On-Site Storage

• Safe: All cash not being banked must be stored in a locked, commercial-grade safe. Specify its location.
• Access: Who has the keys or code to the safe? Keep this list of people to an absolute minimum.
• Cash Limits: State the maximum amount of cash that can be kept on the premises overnight. This is often a requirement for business insurance policies.

4. Banking Takings

• Schedule: How often will cash be banked (e.g., daily, every other day)? Crucially, you should vary the times and days you go to the bank to avoid creating a predictable routine.
• Responsibility: Who is responsible for taking the cash to the bank?
• Safety: Outline safety measures. For example, use a discreet, non-branded bag, vary the route taken, and consider having two people go together if banking large amounts.
• Recording: How is the banked amount recorded in your accounts? Always keep banking receipts as proof of deposit.

Putting it into practice

Once written, make sure every staff member who handles cash reads, understands, and signs a copy of the procedure. Keep it in a place where it can be easily referenced, such as in the staff handbook or office. Reviewing the document every six months will ensure it stays relevant and effective as your business grows.