It is the organization’s responsibility to monitor cash shortages and take steps to reduce cash shortages. Excessive cash shortages that are reimbursed on a continual monthly basis are usually temporary theft.
Q. Our leased site has high cash shortages that run about 1% every month. We deduct the shortages from rent every month. As long as we get our money, what’s the problem?
A. The problem is that it is temporary theft. Your organization’s money is being “borrowed” and that is theft. Also, the missing money is not available for the organization to use as the organization doesn’t get it back until it is deducted from rent.