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What is Cash Posting? (Process, Steps & Example)

5 September, 2022
5mins read
Kiran Rana, General Manager, Mid-Market
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What you'll learn

  • What is cash posting?
  • What are the steps in the cash posting process? (With example)
  • Challenges involved in manual cash posting process
  • Benefits of automating cash posting process of your business
  • How can HighRadius help in your cash posting process with automation?
What is cash posting?
What are the steps included in the cash posting process? (Example)
Challenges of manual cash posting process
Benefits of automating the cash posting process
How can HighRadius help improve your cash posting process?
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Businesses often record the different types of transactions in separate journals and subledgers. The finance & accounting (F&A) team then copies this data into the business’s general ledger on a regular basis. Managing separate journals makes it easier for companies to keep track of their transactions without too much clutter.

For example, a business would have different subledgers for sales, cash disbursements, daily expenses, etc. They would then shift all the transaction data in the subledgers to the general ledger on a regular basis (daily, weekly or monthly).

What is cash posting?

Cash posting is the process of transferring the transaction details recorded in the different subledgers or journals to the company’s general ledger. It is usually done when a business sees a considerable volume of transaction records in certain activities like expenses, sales, accounts receivable (AR), accounts payable (AP), etc.
Companies with multiple subsidiaries also treat the ledgers of their child companies as subledgers and compile them into the parent company’s general ledgers. Cash posting is a more traditional way of managing accounts, and many businesses are already storing transactions under accounts in general ledgers directly.

What are the steps included in the cash posting process? (Example)

The cash posting process varies from company to company. A business with many cash expenses might maintain a separate cash sheet. Another company with a low volume of similar transactions might add it directly to the general ledger. Let’s look at some of the common steps for posting cash to the general ledger.

steps included in the cash posting process

1) Decide which subledgers are required

Let’s say your business has a high volume of account receivables, account payables, and cash expense transactions. So, maintaining subledgers for these three activities and adding other transactions directly to the general ledger would be the best way to go.

2) Choose the cash posting frequency

Decide the frequency at which the subledgers will be totaled and transferred to the general ledger. Depending on the volume of transactions, it could be done daily, weekly, bi-weekly, or monthly.

3) Verify and make adjusting entries to subledgers

During the cash posting process, all transactions in the subledgers must be verified, and the business must make the necessary journal entry adjustments. Once the transactions are verified, the total is posted to the general ledger.

4) Lock the subledgers

After cash posting is done to the general ledger, ensure that the subledgers and journals are locked so that no changes are made to these records in the future.


Let’s say company A maintains two subledgers for cash expenses and sales. They do their cash posting every week. Now, for a week, their total sales were $250,000, and expenses were $19,000.

So, when the business does cash posting at the end of the week, they will debit the account receivables and credit the revenue. At the same time, the cash will be credited, and expenses will be debited on the general ledger for posting expenses.

Challenges of manual cash posting process

Manual cash posting process involves matching payments with the invoices and the customer data and adding them to the ERP. It takes a lot of time and reduces the overall productivity of your employees. There is a higher probability of error when manually matching the records. Let’s look at some of the other major challenges that come with manual cash posting.

1) Lack of payment information

Companies spend a lot of time and effort matching invoices when a customer makes a payment and provides the remittance data separately. There are also cases where the remittance information is not even provided, which makes it even more difficult for the AR staff to post cash and slows down the entire process.

2) Multiple remittance file formats

Businesses that handle cash posting manually often face the difficulty of handling multiple remittance file formats. Sometimes the information is provided in emails, pdfs, web portals, and other formats, which makes it difficult to aggregate data individually for every client.

3) Handling disputes

Managing deductions, short payments, overpayments, and multiple invoices being paid together makes it complex for AR staff to handle cash posting. The lack of clarity and information on disputes lead to their delayed resolution and additional efforts on the part of the employees.

Benefits of automating the cash posting process

The key to making the cash posting process efficient is to automate it with a cash application solution. Here are some advantages of automating your cash application process:

Benefits of automating the cash posting process

1) Increases speed

Automation enables faster invoice matching and cash posting. It gives companies more visibility into the cash available at hand for business activities and also instantly releases credit for customers who have paid their dues, giving them a better experience.

2) Reduces errors

There is always a chance for errors in manual processes because of oversight, employee fatigue, etc. However, an automated system reduces errors to a significant extent. This ensures data quality and improves efficiency.

3) Improves customer experience

A considerable delay between a customer making a payment, invoice matching, cash reconciliation, and credit replenishment will lead to a negative customer experience. But with automation, cash can be applied instantly without errors, thus elevating the customer experience.

4) Boosts scalability

As a business’s transaction volume increases, it becomes difficult to implement the cash posting process manually. There is also the challenge of accommodating multiple payment methods based on customer requirements.
An automated cash application solution makes adding new payment methods easier and processing large volumes of transactions practically effortless.

How can HighRadius help improve your cash posting process?

J.J. Keller & Associates, a publisher, and service organization, automated their cash posting process with HighRadius solutions and was able to post 80% of cash without manual intervention, thus improving team productivity.
Read the full case story here.

HighRadius’ RadiusOne Cash Application helps your business reduce manual dependency for the cash posting process by automating remittance aggregation from various sources such as check stubs, emails, and web portals.

It also enables touch-free invoice matching, deduction coding, and exception handling by leveraging AI recommendations to match non-invoice numbers. This makes cash posting faster and also improves the customer experience.


1) What is the difference between cash posting and payment posting?

Cash posting is the process of transferring the total of transactions from different subledgers to a general ledger, whereas payment posting refers to when payments are logged into a billing platform/software.

2) Why is payment posting important?

Cash Posting includes verifying and reconciling all the financial data in the subledgers to a general ledger. This makes it easy to identify discrepancies and problems during the month-end close process.

3) What is the role of cash posting?

Cash posting helps to keep a record of all financial transactions in the general ledger and mark invoices as paid/unpaid.

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