Reconciliation means matching three things: what your POS says you sold, what your payment processor deposited in your bank, and what your accounting software shows. When all three align, your books are accurate. When they don’t, you need to find out why.

Start with the daily sales report from your POS. This shows gross sales broken down by payment type like credit cards, debit, and cash. Compare the credit card total to your actual bank deposit from the payment processor. These numbers won’t match exactly because processors deduct fees before depositing. A $1,000 day in credit card sales might show up as a $972 deposit after the processing fee.

Record the deposit at the gross sales amount in your accounting software, then record the processing fee as a separate expense. This keeps your sales accurate and lets you track what you’re paying in fees over time. Lumping everything into one net deposit hides both numbers.

Cash needs separate tracking. Your POS reports cash collected, but that money only hits your bank when you physically deposit it. If you deposit weekly instead of daily, the gap between cash collected and cash deposited is where errors and shrinkage hide. Reconcile cash daily even if deposits happen less frequently.

Tips create another layer of complexity for restaurants and bars. Credit card tips show up in your POS totals, but you pay them out to employees separately. Record tips collected as a liability when the sale happens, then reduce that liability when tips are paid out through payroll or daily cash distributions. Without this treatment, your books overstate revenue.

Refunds and chargebacks cause timing differences. A refund you process today might not hit your bank for several days. Track pending refunds so you’re not confused when deposits don’t match, and so you know to follow up when the adjustment finally clears.

Daily reconciliation catches problems while context is fresh. Weekly works for most small businesses if volume is manageable. Waiting until month-end makes discrepancies nearly impossible to trace because you’ve forgotten what happened and the transaction details have faded.

Many POS systems integrate directly with QuickBooks or Xero. Square, Toast, Clover, and Shopify all offer connections that automatically sync sales data. Integrations save time but require careful setup. Verify that sales categories, tips, discounts, and fees land in the correct accounts. A poorly configured integration creates more cleanup than manual entry would have.

If you reconcile manually, use a simple spreadsheet that tracks daily POS totals against bank deposits. Note every discrepancy and investigate same-day while transactions are fresh. Most issues come from timing, processor fees, or data entry mistakes.

The point of all this is trusting your revenue numbers. Without proper POS reconciliation, you don’t actually know what you sold last month. And if your sales numbers are wrong, your profit calculations are meaningless. Scottsdale bookkeeping services that understand retail and restaurant operations can set up your chart of accounts and reconciliation process so the numbers make sense from day one.