Cash Sales Recording Manual for Merchandising Business

1. Introduction

 Purpose: This manual provides guidelines for accurately recording cash sales in a
merchandising business to ensure financial integrity and compliance.
 Importance: Precise recording of cash transactions is critical for accurate
financial reporting, inventory management, and tax compliance.
 Overview: Outlines the process from the point of sale to the recording and
reporting of transactions.

2. Cash Sales System Setup

 Selecting System: Choose a reliable and user-friendly cash register or POS

system that can be integrated with your accounting software.
 Integration: Ensure the sales system is properly linked to your accounting
software for seamless data transfer.
 Sales Categories: Set up different sales categories in the system (e.g., clothing,
electronics) and appropriate tax rates for each.

3. Daily Cash Sales Recording

 Opening Procedures: Start each day by verifying the cash drawer amount and
ensuring the POS system is operational.
 Recording Sales: For each sale, enter the item, receive cash, provide change, and
ensure a receipt is generated.
 Multiple Payments: If accepting multiple payment methods, ensure proper
recording and separation of cash from other forms like credit.

4. End of Day Procedures

 Closing: Count the cash, reconcile with the POS system's sales total, and prepare
a sales report.
 Reconciliation: Investigate and document any discrepancies between the cash in
the drawer and the sales records.
 Sales Reports: Generate and file daily sales reports for accounting purposes.

5. Cash Handling and Security

  Procedures: Establish strict procedures for cash handling, including minimal cash
in the drawer and regular deposits.
 Security Measures: Implement security measures like surveillance cameras and
restricted access to cash areas.
 Discrepancies Protocol: Set a clear process for reporting and investigating cash
discrepancies.

6. Depositing Cash Sales

 Preparation: Safely prepare cash for deposit, ensuring accuracy in counting and
documentation.
 Recording Deposits: Record each deposit in the accounting system, noting the
date and amount.
 Reconciliation: Regularly reconcile bank statements with recorded deposits to
ensure accuracy.

7. Sales Returns and Refunds

 Returns Procedure: Establish a clear process for handling cash returns, including
receipt verification and refund authorization.
 Adjusting Records: Adjust sales records to reflect the return and ensure accurate
inventory tracking.
 Cash Flow Management: Monitor returns to understand their impact on cash
flow and business operations.

8. Reporting and Analysis

 Sales Reports: Compile weekly, monthly, and annual sales reports detailing cash
sales volume and trends.
 Analysis: Use these reports to analyze business performance and identify sales
trends.
 Business Decisions: Leverage this data for strategic business planning and
decision-making.

9. Auditing and Compliance

 Regular Audits: Conduct regular internal audits of cash sales records for
accuracy and integrity.
 Compliance: Ensure compliance with all relevant tax and financial reporting
regulations.
  Record Keeping: Maintain detailed records for audit purposes, including sales
receipts and deposit documentation.

10. Training and Support

 Staff Training: Provide comprehensive training for staff on cash handling and
recording procedures.
 Support: Offer ongoing support and resources to address any challenges or
questions.
 Procedure Updates: Regularly review and update procedures to reflect any
changes in operations or regulations.

11. System Maintenance and Updates

 Maintenance: Conduct routine maintenance checks on cash registers and POS

systems.
 Updates: Implement software updates and upgrades as needed to ensure system
security and efficiency.
 Technological Changes: Stay updated on technological advancements and
incorporate them into your systems as appropriate.

12. Conclusion

 Summary: Reiterate the importance of accurate cash sales recording and

adherence to these procedures.
 Contacts: Provide contact information for further assistance or questions about
the manual.

Appendices

 Sample Records: Include examples of cash sale transaction records for reference.
 Troubleshooting: Offer solutions to common issues encountered in cash sales
recording.
 FAQs: Address frequently asked questions related to cash sales processes.