See http://chris.gunawardena.id.au/software-development/arduino-clock/

clock_final.cpp

  int SER_Pin = 8;   //connects to pin 14 on the 75HC595
  int RCLK_Pin = 9;  //connects to pin 12 on the 75HC595
  int SRCLK_Pin = 10; //connects to pin 11 on the 75HC595
  
  const int number_of_74hc595s = 3;
  const int number_of_register_pins = number_of_74hc595s * 8;
  boolean registers[number_of_register_pins];
  
  //Mapping of LED order to serial converter pins
  int hour_led_order[] = { 17, 18, 19, 20, 21, 22, 23, 12, 13, 14,  15, 16 };
  int minute_led_order[] = { 5, 4, 3, 2, 1, 0, 6, 7, 8, 9, 10, 11 };
  
  void setup() {  
    pinMode(SER_Pin, OUTPUT);
    pinMode(RCLK_Pin, OUTPUT);
    pinMode(SRCLK_Pin, OUTPUT);
    //Serial.begin(9600);
  }
  
  //set current time
  int hours = 9;
  int minutes = 29;
  int seconds = 55;
  int milliseconds = 0;
  
  long previous_millis = 0;        // store last time loop was run in milli seconds
  long last_blink_millis = 0;      // store time when seconds tick
  
  void loop() {
    //increment by seconds and cascade down
    unsigned long current_millis = millis();
    milliseconds = milliseconds + (current_millis - previous_millis );
    previous_millis = current_millis;
  
    //Serial.print(hours); Serial.print(":"); Serial.print(minutes); Serial.print(":"); Serial.print(seconds);Serial.print("."); Serial.print(milliseconds); Serial.println("");
    
    //increment time
    seconds = seconds + (milliseconds/1000);
    minutes = minutes + (seconds/60);
    hours = hours + (minutes/60);
  
    //reset to 0 when over 60, 12 etc
    milliseconds = milliseconds % 1000;
    seconds = seconds % 60;
    minutes = minutes % 60;
    hours = hours % 12;
  
    display_time( hours, minutes, seconds, milliseconds );


    //Flash all led's every second to simulate seconds ticking
    if( (current_millis - last_blink_millis ) > 1000 )//ms
    { last_blink_millis = current_millis;
      seconds_blink();
      delay(150);
    }else{
      delay(200);
    }


  }
  
  void seconds_blink()
  { for(int i=0; i<number_of_register_pins; i++)
    {  registers[i] = HIGH;
    }
    write_registers();
  }
  
  
  void display_time( int hours, int minutes, int seconds, int milliseconds )
  { clear_registers();
    registers[ hour_led_order[hours] ] = HIGH;
    registers[ hour_led_order[minutes/5] ] = HIGH;
    registers[ minute_led_order[minutes/5] ] = HIGH;
    write_registers();
  }
  
  void write_registers()
  {  digitalWrite(RCLK_Pin, LOW);
     for(int i=0; i<number_of_register_pins; i++)
     {  digitalWrite(SRCLK_Pin, LOW);
        digitalWrite(SER_Pin, registers[i]);
        digitalWrite(SRCLK_Pin, HIGH);
     }
     digitalWrite(RCLK_Pin, HIGH);
  }
  
  void clear_registers()
  {  for(int i=0; i<number_of_register_pins; i++)
     {  registers[i] = LOW;
     }
  }