What is an important reason to limit cash handling in a business?

Limiting cash handling in a business is primarily important to reduce the risk of theft and errors. When cash is handled frequently, it creates multiple opportunities for mistakes to occur, such as incorrect change being given or miscalculations in sales reports. These errors can lead to financial discrepancies that may be challenging to reconcile later on.

Additionally, cash is a tangible asset, making it a target for theft. With fewer employees handling cash and less cash on hand, the likelihood of theft, whether through employee dishonesty or external criminal activities, decreases significantly. By limiting cash transactions, businesses can enhance their overall security measures and ensure greater accuracy in their financial reporting.

Other options offer some advantages; for instance, increasing transaction speed and promoting employee satisfaction are beneficial, but they do not directly address the critical concerns of risk management and accuracy associated with cash handling. Maintaining a clean working environment is also important, but it does not link as directly to cash handling as reducing risk does. Therefore, the focus on reducing risk is the most compelling reason to limit cash handling in a business context.