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Thread: Retail business: Accounting for POS losses

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    Question Retail business: Accounting for POS losses

    Hi,

    How would you account for the money that is short from the till when a daily reconciliation of cash per POS system vs actual cash counted shows a difference (ie. "shortbanked")

    Would it be captured as sales (ie. VAT supply) and then when shortbanked reversed as sales (reverse VAT). Or would it be a seperate expense (eg. POS losses) and not merely reversed against sales? What would be best practice?

    Thanks a lot.

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    Diamond Member Justloadit's Avatar
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    In my opinion, the operator should replace the shortfall, else it can breed to petty theft on a regular basis across all tills.

    I would create a separate expense item to keep tabs on the amount of shortfall, but as a journal Cr with VAT included in the same manner as you would handle a discount entry.
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    Site Caretaker Dave A's Avatar
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    It's shrinkage

    And I regret it goes down as an expense line item - without a tax invoice that you could claim back input VAT with

    Tax deductible though (within reason).

    I'm with Justloadit on the "cracking heads" side of this.
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