Cash Handling Policy Example

Any organization that works with cash should have clearly defined cash handling policies and procedures to help protect that money.

The fact is, cash is simply too tempting for many people – particularly people with a financial need.

And, it is management’s responsibility to ensure an organization safeguards its cash assets.

People with incentive (a need), rationalization (I deserve this) and the right opportunity (easy access) are candidates for embezzling funds.

Good cash handling procedures can protect the organization, the employee and prevent fraud in the workplace.

Every organization is different and every organization has very specific needs when it comes to cash in the workplace.

The basic premise should be that cash is never handled by only one person.  Two person policies ensure safe cash handling and eliminate the temptation to swipe a few dollars when no on is looking. This is why it is important to have policies and procedures in place.

Following are some general guidelines and things to think about that can help you develop a cash handling policy specific to your organization.

Example Cash Handling Policy

Purpose:  To ensure control and safekeeping of business cash assets.

• A safe should be used to store all cash. Even small amounts of cash (petty cash) and cash register drawers should be secured and under lock and key.
• Safes should only be opened with two people present.
• The person with the combination to the safe should not be one of the people involved in handling the cash in the safe.
• There should be two people present whenever cash is transported from one location to another.
• There should be a cash count sheet which documents:
  Names of people removing cash from safe
  Date/time cash is removed from safe
  Date/time cash is returned to safe
  Cash breakdown – coins, bills, checks, credit card slips
  Two signature lines for people signing cash
• When cash bags are removed from the safe, it should be counted by two people and both people should sign the cash count sheet acknowledging that the recorded amount of cash was in the bag.
• When cash is handed off to the next person, the person accepting the cash should count the cash before accepting it and keep the signed copy of the cash record with the cash.
• When cash is returned to the safe, it should again be double counted and the cash count sheet should be signed by both parties.
• Bank deposit slips should match the cash sheets.

Records should be kept on all cash handling deposits.

These are very simplistic guidelines and should be expanded and adapted to your particular organization. An editable copy of this document can be found by clicking here.

Other things to think about as you build you cash handling policy:

1. Where is the safe located? Is the safe out of public sight?
2. Who has keys to the room the safe is in? The person who has keys to the room should not be the same person who has the combination to the safe.
3. Background checks should always be done on employees. Some organizations do credit checks to find out if there are financial issues with employees.
4. Safe combinations should be changed whenever a person holding the combination leaves employment.
5. There should be a drop slot in the safe to allow for one way access to the safe eliminating the need to unlock the safe every time there is a need to deposit a cash bag in the safe.
6. There should be a camera monitoring all safes and cash registers, particularly those that are isolated and out of a manager’s sight.

Organizations lose billions of dollars each year from embezzlement in the workplace. Good policies and oversight of cash handling is one way to safeguard against theft.

What does your organization do to prevent embezzlement?