Currency Manipulations and Preventive Mechanisms: A Brief Guide for Retail Businesses

Cash is the king and where there is cash there are always chances of cash shrinkage. Retail businesses face the challenge of handling a large cash volume on a daily basis. Dealing with a large amount of cash increases the probability of manipulations and leads to internal and external thefts. The blog post discusses cash shrinkage challenges faced by the retail stores along with possible preventive mechanisms.

1. Cash Theft

Internal cash thefts take place as a result of discrepancy in the cash handling process. A cashier can collect money and not make an entry in the cash register, which makes it easy to remove the cash at the end of the shift. Such cash manipulations are often unnoticed due the absence of an automated process to record each transaction.

Using an automated cash safe can prevent such instances of theft. A cash safe not only stores money but creates an electronic record of every cash transaction. Automated cash management systems provide real-time reports to audit the cash transactions. Cash safes eliminate the need for handling cash manually, minimizing the possibility of manipulations and reduces the instances of internal and external thefts.

2. Bill Write-Offs

A person having access to the accounting sheets and ledgers can make unauthorized adjustments in the favor of friends and relatives, striking off the unpaid credits owed to the business.

Retail stores need to limit the amount of credit given to the customers and keep a check on the number of persons who have access to ledger balances. Store managers can perform random audits of the accounting sheets and cash registers to keep a track of the write-off balances. Retail businesses can also deploy additional reporting mechanisms to pull-off monthly write-off details.

Fake Returns

Fraudulent merchandise returns is another reason of cash shrinkage. A cashier can register one or multiple fictitious refunds in the cash register and remove the extra money that is equivalent to the fake repay value. Such instances of internal thefts go unnoticed as the cash balance and register don’t reflect any discrepancy.

Retail owners can deploy multi-layer mechanisms while processing refund money.Authorization of a senior refund authority, an electronic record of the return and scrutinizing cash value debit in the case of excessive or dubious refunds are some of the effective ways to overcome these issues. A periodic observation of the irregularities in the ledger balances can also check counterfeit returns.

The Way Forward

Internal thefts continue to haunt the retail businesses that handle a lot of cash on a daily basis. It is, therefore, imperative to enforce individual financial accountability for the cash handling staff, such as cashiers. A cash safe allows any retail business to overcome the issues of internal thefts by providing a real-time check of every financial transaction made on or off the cash counter.