Cash Handling Security Best Practices for Restaurants

Published on January 20, 2025 | 9 min read

Cash is still king in many restaurants—especially for tips, small checks, and customers who prefer not to use cards. But cash also creates risk: theft, robbery, counting errors, and reconciliation headaches.

This guide covers proven security practices to protect your cash, reduce theft, and maintain accurate records without turning your restaurant into Fort Knox.

Why Cash Security Matters

The National Restaurant Association estimates that employee theft costs the industry $3–6 billion annually. Cash is the easiest target because:

• It's anonymous (no paper trail)
• It's portable (fits in a pocket)
• It's immediate (no waiting for deposits to clear)
• It's hard to track (unlike card transactions)

Even honest employees make mistakes. A $50 counting error once a week = $2,600/year in unexplained shortages.

The 5 Layers of Cash Security

Layer 1: Physical Security

Layer 2: Process Controls

Layer 3: People Management

Layer 4: Technology

Layer 5: Reconciliation

Let's break down each layer.

Layer 1: Physical Security

1.1 Secure Your Register

• Lock the drawer: When not in use, lock it. Only managers have keys.
• Limit access: One person per drawer per shift. No sharing.
• Keep small bills: Don't let $100s and $50s pile up. Drop excess into the safe every hour.
• Use a drop slot: Bills over $20 go into a locked drop box immediately.

1.2 Invest in a Quality Safe

• Bolted to the floor: A portable safe is a portable theft.
• Time-delay lock: Prevents smash-and-grab robberies. Even you can't open it instantly.
• Dual control: Requires two people to open (manager + owner, or two managers).
• Hidden location: Not visible from the dining room or front door.

1.3 Limit Cash on Premises

• Daily deposits: Don't let cash accumulate. Deposit daily or use a cash pickup service.
• Keep minimal starting banks: $100–$200 per register is enough.
• No large bills in the drawer: If a customer pays with a $100, give change and drop the bill immediately.

1.4 Cameras

• Cover the register: High-resolution camera pointed at the cash drawer and POS screen.
• Cover the safe: Record who accesses it and when.
• Cover exits: Back door, office, storage areas.
• Visible signage: "This area is under video surveillance." Deterrent effect.
• Cloud storage: Don't rely on local DVRs that can be stolen or destroyed.

Layer 2: Process Controls

2.1 Assign One Drawer Per Person

Never let multiple employees share a drawer. If there's a shortage, you can't pinpoint who's responsible.

2.2 Count In, Count Out

• Start of shift: Employee counts the starting bank with a manager present. Both sign off.
• End of shift: Employee counts the drawer. Manager verifies. Both sign the cash-out form.

2.3 Blind Counts

The employee counts first without knowing the expected total. Then the manager counts. If they match, great. If not, recount together.

2.4 Require Manager Approval for Voids, Refunds, and Comps

These are common theft methods:

• Ring up a sale, void it, pocket the cash.
• Comp a meal for a friend, keep the payment.
• Process a fake refund, take the cash.

Solution: All voids/refunds/comps require manager PIN and a written reason.

2.5 Separate Duties

• Don't let the same person: Handle cash AND reconcile the books.
• Rotate responsibilities: Different people count, deposit, and reconcile each week.

2.6 Surprise Cash Counts

Randomly, mid-shift, have a manager count a drawer. Don't announce it. If employees know they might be checked anytime, theft drops.

Layer 3: People Management

3.1 Hire Carefully

• Background checks: Especially for roles handling cash.
• Check references: Ask previous employers about honesty and reliability.
• Trust but verify: Even great people make mistakes or face temptation.

3.2 Train on Cash Handling

Don't assume employees know how to handle cash properly. Train them on:

• Counting techniques (count twice, out loud)
• How to spot counterfeit bills
• When to drop cash into the safe
• What to do if the drawer is short or over

3.3 Set Clear Policies

Put it in writing:

• "Shortages over $10 will be investigated."
• "Repeated shortages may result in termination."
• "No personal cash in the register."
• "No borrowing from the drawer."

Have employees sign acknowledgment.

3.4 Pay Fairly

Underpaid, unhappy employees are more likely to steal. Competitive wages and a positive work environment reduce theft.

3.5 Lead by Example

If managers are sloppy with cash or take shortcuts, staff will too. Model the behavior you expect.

Layer 4: Technology

4.1 Modern POS System

A good POS tracks:

• Every transaction (time, amount, employee)
• Voids and refunds (who, when, why)
• Cash vs card breakdown
• Discrepancies between sales and cash collected

Popular options: Toast, Square, Clover, Lightspeed.

4.2 Cash Counting Machines

If you handle $500+ in cash daily, a bill counter ($100–$300) pays for itself in accuracy and time savings.

4.3 Smart Safes

These automatically count and track deposits. When a manager drops cash, the safe logs the amount, time, and user. No manual counting needed.

4.4 Cashless Options

The less cash you handle, the less risk. Encourage card/mobile payments:

• Offer contactless (Apple Pay, Google Pay)
• Add a small convenience fee for cash (where legal)
• Promote online ordering with card-only payment

Layer 5: Reconciliation

5.1 Daily Reconciliation

Every night, compare:

• POS sales report (what you should have)
• Actual cash counted (what you do have)
• Card batch totals (what will deposit)

Formula:

Expected Cash = Starting Bank + Cash Sales − Cash Paid Out (tips, petty cash)

If actual ≠ expected, investigate immediately.

5.2 Weekly Variance Report

Track shortages and overages by employee and shift. Patterns reveal problems:

• Same employee short every week? Theft or poor counting.
• Same shift always over? Customers not getting correct change.
• Random variances? Training issue.

5.3 Monthly Audit

Once a month, do a deep dive:

• Review all voids, refunds, and comps
• Compare theoretical food cost to actual (cash theft often shows up here)
• Check safe logs vs deposit records
• Review camera footage for suspicious activity

Common Cash Theft Methods (and How to Stop Them)

1. Skimming

How it works: Employee doesn't ring up a sale, pockets the cash.

Prevention:

• Require receipts for every transaction
• Mystery shoppers who verify they get a receipt
• Compare sales to inventory usage (if 100 burgers sold but 120 used, someone's skimming)

2. Voiding Sales

How it works: Ring up a sale, collect payment, void it, keep the cash.

Prevention:

• Require manager PIN for voids
• Review void reports daily
• Excessive voids = red flag

3. Fake Refunds

How it works: Process a refund for a fake customer, take the cash.

Prevention:

• Require manager approval and original receipt
• Log customer name and reason
• Review refund reports weekly

4. Short-Changing Customers

How it works: Give incorrect change, pocket the difference.

Prevention:

• Train on proper change-making
• Count change back to the customer out loud
• Mystery shoppers

5. Sweethearting

How it works: Give free food/drinks to friends, or undercharge them.

Prevention:

• Compare sales to inventory
• Review comps and discounts
• Cameras on the register

6. Taking from the Tip Jar

How it works: Skim from the communal tip jar.

Prevention:

• Lock the tip jar or keep it behind the counter
• Count and distribute tips at the end of each shift
• Camera coverage

What to Do If You Suspect Theft

1. Document everything: Dates, amounts, patterns. Don't accuse without evidence.
2. Review camera footage: Look for suspicious behavior (pocketing cash, excessive voids).
3. Run a sting: Mark bills with serial numbers, place them in the drawer, see if they disappear.
4. Interview privately: Give the employee a chance to explain. Sometimes it's an honest mistake.
5. Terminate if confirmed: Theft is grounds for immediate termination. Consult a lawyer before pressing charges.
6. Tighten controls: Fix the process gap that allowed it to happen.

Robbery Prevention

Before a Robbery

• Keep cash low: Frequent drops and deposits.
• Visible signage: "Manager cannot open safe" and "Minimal cash on hand."
• Good lighting: Well-lit parking lot and entrance.
• Clear sightlines: No obstructions blocking view of the register from outside.

During a Robbery

• Comply: Give them the cash. Your life is worth more.
• Stay calm: Don't make sudden moves.
• Observe: Note height, clothing, distinguishing features (but don't stare).
• Don't chase: Let them leave.

After a Robbery

• Call 911 immediately.
• Lock the doors: Preserve the scene.
• Don't touch anything: Fingerprints, evidence.
• Write down details: While fresh in your memory.
• Review footage: Provide to police.
• Support your team: Robbery is traumatic. Offer counseling.

Cash Handling Checklist (Print and Post)

Opening Shift

• ☐ Count starting bank with manager present
• ☐ Both sign cash-out form
• ☐ Lock register when not in use

During Shift

• ☐ Drop bills over $20 into safe every hour
• ☐ Keep drawer organized (bills facing same direction)
• ☐ Count change back to customers out loud
• ☐ Never leave register unattended

Closing Shift

• ☐ Count drawer twice
• ☐ Manager verifies count
• ☐ Fill out cash-out form completely
• ☐ Deposit cash in safe or prepare bank deposit
• ☐ Lock all cash storage areas

Tools and Resources

• Cash counting machines: Cassida, Royal Sovereign ($100–$300)
• Smart safes: FireKing, Brink's ($1,500–$5,000)
• Security cameras: Ring, Arlo, Lorex (cloud storage)
• POS systems: Toast, Square, Clover
• Cash management software: Restro Manager (tracks daily cash-outs with auto-calculated balances and email alerts)

Conclusion

Cash security isn't about distrusting your team—it's about creating systems that protect everyone. Clear processes reduce mistakes, deter theft, and give you peace of mind.

Start with these three changes this week:

1. Implement one-drawer-per-person policy
2. Require manager approval for all voids/refunds
3. Do daily reconciliation and track variances

Those three alone will cut cash discrepancies by 50–80%.

Want to automate your daily cash-out tracking? Try Restro Manager — staff submit cash-outs via a secure link, balances are auto-calculated, and you get instant email alerts with full audit trails.