Reconciliation
Compare expected versus actual cash, review variances, and approve shift closures.
Reconciliation is the process of comparing what should be in the cash drawer (the expected amount) with what is actually there (the physical count). This happens every time a shift is closed. Eleo calculates the expected amount automatically from the shift’s transactions and highlights any variance for manager review.
How expected cash is calculated
The expected cash amount is derived from every transaction that occurred during the shift:
Expected Cash = Opening float + Cash sales + Float additions − Cash refunds − Paid-outs − Safe drops − Float removals
Each component is tracked automatically. Cash sales and refunds come from POS transactions, safe drops are recorded when cash is moved to the safe, and float adjustments are logged by managers. The cashier does not need to calculate anything manually.
The expected cash calculation only includes transactions that occurred during the shift. Transactions from previous or subsequent shifts on the same register are not included.
Understanding variance
The variance is the difference between the physical count and the expected amount:
Variance = Actual (physical count) − Expected
- Positive variance (overage) — More cash is in the drawer than expected. This could indicate a pricing error, an unrecorded float addition, or a customer overpayment.
- Negative variance (shortage) — Less cash than expected. This could indicate theft, miscounting change, unrecorded paid-outs, or a transaction recording error.
- Zero variance — The drawer balances perfectly.
Your store’s cash policy defines the acceptable variance threshold (both as an absolute amount and as a percentage of cash handled). When a variance exceeds either threshold, it is flagged as a discrepancy and an alert is generated.
Reviewing a reconciliation
After a cashier closes their shift, the reconciliation enters a Pending state. A manager must review and either approve or reject it.
- 1
Open the shift detail
Navigate to Cash & Tills → Shifts and click on a shift with a Pending Reconciliation status. Go to the Reconciliation tab.
- 2
Review the breakdown
The reconciliation tab shows the full breakdown: opening float, each transaction category total, expected amount, physical count, and the resulting variance. If denomination counting was performed, you can also see the denomination-level detail.
- 3
Check individual transactions
Switch to the Transactions tab to review every cash transaction in the shift. You can mark individual transactions as Verified after confirming them against receipts or records. This is helpful for tracking down the source of a discrepancy.
- 4
Approve or reject
If the reconciliation looks correct (or the variance is within acceptable limits), click Approve. If there is an unexplained discrepancy, click Reject and add a note explaining why. The cashier will be notified and may need to re-count or provide additional information.
The cashier who closed the shift cannot approve their own reconciliation. A different team member with the approve_reconciliation permission must perform the review. This is a key internal control that prevents a single person from concealing discrepancies.
Ledger integration
When a reconciliation is approved, Eleo automatically creates double-entry journal entries in the accounting ledger:
- Cash shortages are recorded as a debit to Cash Shortage Expense (5040) and a credit to Cash in Drawer (1010).
- Cash overages are recorded as a debit to Cash in Drawer (1010) and a credit to Cash Overage Income (4020).
This ensures your financial books always reflect the true state of your cash, and variances are properly accounted for. Journal entries are created with idempotency keys to prevent duplicates.
Every action taken on a shift — opening, transactions, spot checks, closing, approval, rejection — is logged in the Audit Trail tab. Use this to understand exactly what happened during a shift and who performed each action.