Cash Handling Fundamentals: End-of-Shift Balancing and Drawer Reconciliation

What “Balancing the Drawer” Means at End of Shift

End-of-shift balancing (drawer reconciliation) is the process of proving that the physical cash in a drawer matches what the register/teller system says should be there after all recorded activity. The goal is to produce a documented closeout package that shows: (1) what you counted, (2) what the system expected, (3) any variance (over/short), and (4) what actions you took to resolve or report it.

Reconciliation is not just “counting cash.” It is a controlled workflow that links physical cash, system totals, and supporting reports so that any discrepancy can be traced to a specific cause (data entry, refund/void handling, cash drops, payout, or timing issues).

1) Prepare to Close: Freeze Activity and Secure the Workspace

A. Stop transactions cleanly

• Announce/confirm the cutoff time for your drawer (end of shift, lane close, or terminal close).
• Ensure no new sales are started on your register/terminal.
• Finish any in-progress transaction before closing steps begin.

B. Print or capture required system totals

Use your organization’s standard close reports. Typical items include:

• Register/Z report or terminal close report (sales totals, tender totals, refunds/voids).
• Cash-in/cash-out or paid-out report (if your system tracks payouts).
• Cash drop/safe drop report (if drops occurred during the shift).
• Exception report (voids, refunds, no-sales, overrides), if available.

C. Secure the workspace

• Close the lane/terminal to customers and position the drawer so it is not visible to the public.
• Keep only the materials needed for reconciliation on the counter (count sheet, pen, calculator, deposit bag if applicable).
• Limit access: only authorized staff should be present during the count.
• Do not leave the open drawer unattended; if you must step away, lock/secure it per policy.

2) Count the Drawer by Denomination Using a Standardized Count Sheet

Use a standardized count sheet so every closeout is consistent, reviewable, and auditable. The count should be by denomination (bills and coins), with quantities and extended totals.

Recommended count sheet fields

• Date, shift, terminal/register ID, cashier ID
• Starting float/bank amount (if applicable)
• Denomination grid (quantity and value)
• Subtotal cash counted
• Less: float/bank to remain in drawer (if the drawer is re-banked for next shift)
• Net cash to deposit/turn in
• System expected cash
• Over/short variance
• Signatures/initials (counter, verifier, supervisor as required)

Denomination count table (template)

Counting sequence (end-of-shift specific)

• Remove large bills first and stack by denomination to reduce clutter and mis-sorts.
• Count each denomination and write the quantity immediately on the sheet (avoid “counting in your head” across denominations).
• Extend each line (qty × denomination) and write the extended total.
• Sum extended totals to get Total Cash Counted.
• If your process requires leaving a fixed float in the drawer for the next shift, separate it physically and record it as Float/Bank to Remain.

Control tip: Keep counted stacks separate from uncounted cash. If you need to pause, mark your place and secure the drawer.

Continue in our app.

You can listen to the audiobook with the screen off, receive a free certificate for this course, and also have access to 5,000 other free online courses.

Or continue reading below...

Download the app

3) Reconcile to Register/Teller Totals: Identify Expected Cash

Reconciliation compares two numbers:

• Actual cash: what you physically counted (and, if applicable, net cash after removing the float that stays).
• Expected cash: what the system reports should be present based on recorded transactions and cash movements.

Expected cash: common structure

Your system may calculate expected cash automatically. If you must compute it, a typical structure is:

Expected Cash in Drawer (end) = Starting Float + Cash Sales + Cash Received on Accounts (if any) - Cash Refunds - Paid Outs - Cash Drops

Some environments reconcile to Net Cash to Deposit instead of “cash in drawer.” In that case, you compare the deposit amount you prepared to the system’s “cash to deposit/turn in” figure.

Variance calculation

Over/Short = Actual (Counted) - Expected

• If result is positive: Over (more cash than expected).
• If result is negative: Short (less cash than expected).

4) Double-Count Protocol and Peer Verification (If Permitted)

Double-counting and verification reduce false variances caused by simple arithmetic or transcription errors. Apply these controls consistently, especially when a variance appears.

A. When to double-count

• Always, if policy requires two counts.
• Immediately, if the first count produces any over/short.
• When totals are unusually high/low compared to typical shifts.

B. How to double-count (standard protocol)

• Recount in a different order (e.g., coins first, then bills) to avoid repeating the same mistake.
• Re-extend and re-sum the count sheet totals (verify multiplication and addition).
• Confirm you subtracted the correct float/bank amount (if applicable).

C. Peer verification rules (if permitted by policy)

• Verifier should be an authorized person (supervisor/lead/cash office) and not the same person who performed the first count.
• Verifier performs an independent count or verifies the counted stacks and the math—per policy.
• Both parties initial/sign the count sheet with time noted.
• If peer verification is not allowed in your environment, follow the required alternative (e.g., sealed drawer transfer to cash office for independent count).

Separation of duties principle: The person who ran transactions should not be the only person who can confirm the final cash total when variances exist, if your operation supports dual control.

5) Handling Over/Short Results: From Math Check to Variance Resolution

When a variance appears, treat it as a structured investigation. The goal is to confirm whether the variance is real and, if possible, identify the cause using documentation and system logs.

Step 1: Confirm the count and the math

• Recount cash (double-count protocol).
• Check extensions (qty × denomination) and the grand total.
• Confirm whether you are reconciling to “cash in drawer” or “cash to deposit” and that you used the correct figure.
• Verify the float/bank amount removed or left in the drawer matches policy.

Step 2: Confirm you used the correct system report

• Ensure you printed the correct register/terminal close report (right date/time, right terminal ID).
• Confirm the report reflects the correct shift (no overlap with another cashier’s activity).

Step 3: Check transaction logs for common variance drivers

• Refunds: confirm each cash refund has supporting documentation and matches the report amount.
• Voids: confirm voids are properly recorded and not mistaken for refunds.
• No-sale/open drawer events: review for unusual frequency that may indicate process issues.
• Cash drops: confirm drops were recorded in the system and physically removed from the drawer.
• Paid-outs/payouts: confirm any cash removed for store expenses is documented and included in expected cash calculations.

Step 4: Look for “timing and tender” issues

• Sale recorded as cash but actually paid by card (or vice versa).
• Split tender entered incorrectly.
• Refund issued to wrong tender type.

Step 5: Escalate and document per policy

• If variance remains after checks, record it clearly on the count sheet and variance log (if used).
• Notify the designated supervisor/cash office following your escalation thresholds (e.g., any variance, or variances over a set amount).
• Do not “force balance” by moving cash from personal funds or other drawers.

Documentation standard: If you correct an error (e.g., you discover a missed cash drop entry), attach the supporting evidence (report line item, drop receipt) and note the adjustment path required by your system.

Worked Example: Full Close-to-Reconcile with Sample Numbers

Scenario

• Starting float (bank) in drawer: $200.00
• System close report shows:
  • Cash sales: $1,245.60
  • Cash refunds: $35.00
  • Paid-outs: $20.00
  • Cash drops to safe: $900.00

Step A: Determine expected cash to deposit (system-based)

First compute expected cash remaining in drawer at end:

Expected cash in drawer (end) = Starting float + Cash sales - Cash refunds - Paid-outs - Cash drops

= 200.00 + 1,245.60 - 35.00 - 20.00 - 900.00

= 490.60

If policy requires leaving the starting float of $200.00 in the drawer for the next shift, then expected cash to deposit is:

Expected cash to deposit = Expected cash in drawer (end) - Float to remain

= 490.60 - 200.00 = 290.60

Step B: Count the drawer by denomination (actual count)

After stopping transactions and securing the workspace, you count and record:

Float to remain in drawer: $200.00

Actual cash to deposit:

Actual cash to deposit = Total cash counted - Float to remain

= 500.60 - 200.00 = 300.60

Step C: Calculate variance (over/short)

Compare actual cash to deposit to expected cash to deposit:

Over/Short = Actual deposit - Expected deposit

= 300.60 - 290.60 = +10.00

Result: $10.00 over.

Step D: Apply variance resolution workflow

• Double-count: Recount cash and re-check extensions. If the recount changes the total, correct the count sheet and re-run the variance.
• Check report selection: Confirm the close report is for the correct terminal and time window.
• Review exceptions: Look at refunds/voids list. Example check: a $10.00 cash refund might have been processed as a void instead, or a refund may have been issued to card but recorded as cash.
• Review cash drops/paid-outs: Confirm the $900.00 drop was recorded and that the physical drop receipt matches. If a $10.00 paid-out was given but not entered, that could explain an over/short depending on direction.
• Document outcome: If no cause is found, record “$10.00 over—cause not identified” and follow escalation rules.

6) Produce the Final Closeout Package (What to Turn In)

Your closeout package should allow a reviewer to reconstruct the expected cash and verify what you counted without redoing your work from scratch.

Typical closeout package contents

• Completed count sheet with denomination breakdown, totals, float amount, deposit amount, and variance.
• Register/terminal close report (Z report or equivalent).
• Exception documentation (refund/void slips, manager approvals) as required.
• Cash drop receipts and/or safe drop log references (if drops occurred).
• Deposit details: deposit bag number, deposit slip, breakdown of bills/coins if required, and any required seals.
• Signatures/initials: cashier and verifier/supervisor per policy.

Packaging and handoff controls

• Place cash to deposit in the approved deposit bag/envelope; seal it per procedure.
• Attach or bundle reports and count sheet in the required order (so reviewers can follow the workflow).
• Record handoff time and recipient (cash office/supervisor) if your process requires a chain-of-custody log.