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Accounting in restaurants and cafes: nuances the owner should be aware of

472
3/2/2023

The main complexity of accountancy in a restaurant lies in the fact one establishment includes production, retail, and service rendering. 
When registering a business it is important to choose the right system of taxation, as it determines the amount and complexity of accounts to be kept.
Let's analyse the nuances of the accounting procedure in a restaurant, which you will have to take into account in your work. 

Production records in a restaurant

Public catering bookkeeping is more related not to trade, but to production: the purchase of products, their processing, and sale in finished form as a separate commodity. 

Production accountancy in a restaurant is complex. Batch production is the most commonly used method where products are made and finished products are sold in batches, for example, 15 pizzas or 10 salads, where a certain amount of separate ingredients is written off for each batch. 

The difficulty is that you have to keep track of all these costs, and also not forget about staff work, equipment maintenance, rent, taxes, and so on.

Automation of accounting work in restaurants and cafes helps to simplify the process. To keep such detailed track of the establishments’ work in real-time, you need to implement an automation system that will transfer all the data to your accounting program. 

Accounting applications can't provide that kind of detailed accountability, you have to enter full information manually - it's a long and painstaking process, and there's a good chance that the data will be entered inaccurately. 

If you do not implement an automation system at the very beginning, it will be extremely difficult to organise correct and reliable accounting. 
The better and more functional your system is, the less accounting work you will have to do. 

Financial liability agreement

It is an agreement between an employee and a food establishment where: 

  • The duties of the administration and an employee to keep safe the property of the establishment with which an employee works are stipulated; 
  • Material responsibility of an employee for failure to provide safety of this property is established. 

At the same time, the undeceived income (lost income) is not subject to recovery from the employee. Financial liability agreement is important not only for the employer, which gives confidence that the products or equipment will not be spoiled but also for the employee, as it protects him/her from unfounded suspicions and claims. 
In addition to the financial liability agreement, the bookkeeping and accounting in the restaurant can include commodity reports.

Commodity report of materially responsible persons

It is a report on stocks, goods, and tare movement. It is drawn up in two copies by the materially responsible persons. One copy is attached to all receipts notes and delivery notes and is submitted to the accounting department, and the second copy is kept by them.

An order establishes the periodicity and timing of the report. In practice, it is drawn up separately for each day in a food establishment. 

Before the report preparation, all documents must be sorted as "receipt" and "disposal" of goods. 
The commodity report consists of the receipt part, which is filled out by a materially responsible person based on the primary documents confirming the receipt of goods. 
Before the report preparation, all documents must be sorted as "receipt" and "disposal" of goods.

The procedure for filling out the report:

  • Amounts of goods and tare balances at the beginning of the day. 
  • Remainders must match the data at the end of the day from the previous report. Data on the receipt and disposal of goods for the day should be filled out in chronological order, by the primary documents based on which the transactions were made. 
  • The amount of the balance at the end of the day.
  • Remuneration.
  • Accounting in restaurants and cafes includes an account for the number of employees, hours worked, and output. 

First, you need to determine the number of workers employed in each area, based on the area and occupancy of the establishment. In addition, do not forget about compliance with health and safety standards. As a rule, it is two days on, two days off shift, and 40 hours a week with separate payment for evenings, nights, holidays, and weekends by the Labour Code of Georgia.

There are two forms of remuneration most commonly used in the catering industry: 

  • Time-based: wages are calculated based on the remuneration or tariff rate for the time worked. 
  • Time- bonus based: the wage consists of remuneration for actual time worked and a bonus (monthly or quarterly) for quality work and services. 

A separate topic is the execution of vacations and sick leave.
For convenience and control, a vacation schedule should be drawn up for each employee and a vacation order should be issued.
It is necessary to pay wages and calculate mandatory contributions to the Pension Fund.
 

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