Whether you run a chain or own your own restaurant, knowing how to do a cash closing is essential to keep your business running smoothly. 

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This article will teach you the steps to follow to calculate totals, identify possible fraud and check for discrepancies. You will also learn the importance of following strict rules when it comes to cash management.

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What is cash closing and what is the process?

Cash register management at the end of the day consists of grouping all the operations carried out during the day, and everything is recorded in the cash book. This accounting document, generally digitized, allows managers to keep their accounting up to date and comply with tax regulations.

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Specifically, it involves recording the restaurant's income and expenses each day. The cash book is very specific and contains details of services and products sold. It is a very practical inventory, as long as each transaction is carefully recorded. 

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At the end of the day, the contents of the cash register correspond to the difference between the day's receipts and disbursements. For a restaurant owner, managing the cash register at the end of the day means reconciling:

• The theoretical balance, calculated as follows: opening balance + revenues - disbursements
• The actual balance obtained from a physical count.

Today, most cash registers include cash register closing as a feature. However, even if your cash register software supports closing, it is up to you to check the accuracy of the information entered.

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Cash register management also involves updating the accounting entries in the corresponding accounts, both for amounts collected (sales to customers), but also for amounts disbursed (supplier invoices, amounts deposited in the bank, etc.).

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Below we show you the process in detail.

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5 steps for a good cash closing in restaurants

Step 1: Before starting, it is important that all employees make sure that all customers have been charged. It is also important to verify that all tables are clean and that there are no uncollected utensils or orders. Once this has been verified, you can proceed with closing the cash register.

Step 2: The second step is to remove all cash from the cash register and separate it by denomination. This will help simplify the accounting process and avoid errors. Next, all coins and bills should be counted to make sure they match what was recorded in the cash register during the day. If there are any errors, they should be noted and corrected before continuing.

Step 3: Once all cash payments have been counted and separated, they should be kept in a safe place until they can be deposited or delivered to the person responsible for the money. It is important to be careful with this money, as it represents total income for the day.

Step 4: The next step is to review all transactions to ensure that they have been charged correctly and that there are no errors. If there are any errors, they should be noted and corrected before proceeding. Once all payments have been verified, receipts can be printed and filed as official records.

Step 5: Last but not least, it is important to clean the cash register to prepare it for the next day. This includes removing all cash, taking out printed receipts, clearing previous transactions from the system, etc. If there is anything that is not understood or is not working properly, it is important to ask for help before you leave because it could cause problems tomorrow.

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The cash register closing process is very important to maintaining good management and order in the restaurant. Although it may seem overwhelming or intimidating at first, with a little practice it will be easy to master in no time.

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6 tips for a good cash count in the hospitality industry

When closing the cash register of a restaurant, it is important to take into account some factors to avoid problems. 

1. Establishes rules for cash withdrawals

In the restaurant business, following strict rules for cash deliveries can help avoid any irregularities. Although it takes away some convenience, such a rule will give you more control over your business. 

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The first step is to create a cash handling policy and, once drafted, you can start adding specific rules. The most important rule is the Strict Discrepancy Rule, which outlines the actions to take if a discrepancy is discovered. A good way to avoid and anticipate potential problems is to train your staff on these rules.

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2. Do not make cash payments with the money in the cash register.

Taking money out of your restaurant's cash register can be tempting, especially when you have a big pile of cash in front of you. 

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However, cashing up essentially means taking money out of the cash register without recording it on the sales reports. Not only does this distort the day's revenue figures, but it can also result in discrepancies between cash and credit or debit sales. 

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Plus, at the end of the day, balancing the cash drawer will become a nightmare. It is always best to record all sales accurately and track all transactions, even if it means waiting until closing time to handle the physical cash. 

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3. Keep a daily record of activities at the cash register, whether you have a bar or a restaurant.

Cash registers are an important tool to control your restaurant's income and expenses. 

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By keeping an accurate record of your daily cash register activities, you can quickly see if there are differences between the total cash inflow and total cash outflow. This allows you to identify and correct possible errors right then and there, instead of discovering them weeks or even months later. 

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In addition, keeping accurate records is important for business security, as it provides reliable evidence in the event of theft or fraud.

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In summary, keeping accurate daily records is vital to help you keep track of your restaurant's income and expenses - it's a simple step that can save you time and trouble in the long run!

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4. Do not do the whole process manually, use some software to help you.

Are you tired of struggling to balance your daily till at the end of each shift? Software can offer a solution to this common problem.

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While some business owners rely on manual calculations to balance their till at the end of the day, using a program can improve accuracy and save time.

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Specialized cash register software not only ensures that all transactions are accounted for, but also offers additional features such as reporting and tracking of sales trends. In addition, a cash control software tool offers protection against human error and fraud .

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It also helps improve the security of your financial transactions by providing a more reliable system of record. Investing in a cash management software solution is a smart decision for any business looking to streamline its operations and improve its overall profitability. 

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5. Check that your waiters give good change.

One way to ensure accuracy is to have your servers always check the change they give to customers. It may seem like a minor task, but even small errors can add up over time and spoil the daily count.

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Train your servers to always check the change they give to customers. This will help keep an accurate cash register at the end of the day. 

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In addition, this practice also demonstrates a level of attention to detail and accountability, and can enhance the customer experience. 

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6. Check for mismatches after each shift.

To conduct a cash count in a restaurant, you must check for discrepancies. These discrepancies can be due to employee theft, errors in menu items, or problems with food costs. The daily discrepancy log sheet can help you identify problems and make adjustments to minimize gaps.

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Check discrepancies after each shift. If possible, always use the same staff member or supervisor to perform a daily check. Small discrepancies are usually the result of human error, but large discrepancies may indicate a more significant problem. If mismatches are frequent and substantial, consider disciplinary action.

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Checking for discrepancies can be tedious, but it is essential to prevent chargeback disputes. Make sure cash drawers are open when you do your cash count. Using a device such as a POS can help you check everything. 

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Another way to check for inconsistencies when doing a cash count in a restaurant is to review the counting procedure with all employees. Many cash count mismatches are caused by employee errors. A shortage is a sign that cash is missing and an overcount may mean that employees have accidentally left customers overdrawn.

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Conclusions: the importance of closing the cash flow statement

All restaurants must ensure that their cash registers balance at the end of the day. To do this, you must carry out periodic checks; for example, at the close of each day, the cash register must be checked. The objective is that the balance recorded in the ledger corresponds perfectly with the amount in the cash register.

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If there is the slightest discrepancy, the cause must be found: theft, input error, etc. Cash anomalies should not be trivialized. Similarly, it is obvious that the balance cannot be negative, however, it is common for this to happen sometimes, so it is important to find the cause.

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And in your restaurant, have you implemented best practices for better cash management?