Category Archives: Restaurant Accounting

How to Issue and Account for Employee Advances in Your Bar, Restaurant, or Nightclub

Restaurant employees

As much as we try to avoid them, employee advances are inevitable in restaurants, bars, and nightclubs. An employee advance is an advance towards an employee’s pay deducted from future paychecks. Advances are issued to employees for various reasons, but they’re typically issued because they need to get paid in advance to cover personal expenses.

Depreciation and Fixed Assets Policy for Restaurants and Bars

If you’re frustrated by a massive depreciation expense throwing off your restaurant’s P&L, this article is for you. CPAs commonly record tax depreciation in their clients’ books so that the tax returns match the financial statements. Tax depreciation is generally higher than book depreciation due to the accelerated depreciation system allowed by the IRS. The

Accounting for Gift Cards in a Restaurant Group

Appropriately accounting for gift cards is essential for restaurant groups because each store P&L needs to report its share of sales to measure performance accurately, and the balance sheet of each store needs to show the amounts it owes and is owed as a result of selling and redeeming other store gift cards respectively. This

Why Your Accountant Should Be Paying Your Bills

Managing bill payments is a tedious and time-consuming process, but is integral to a restaurant’s day to day operations. You already understand why bill pay is an extremely important process but may not fully understand the benefits of having your accountant involved like the national chains do. This article explains why your accountant should be

How to Calculate and Assess Controllable Profit

How to Calculate and Assess Controllable Profit

Every restaurant has controllable and non-controllable expenses. Controllable profit measures the amount left over after deducting controllable expenses from your sales. A seasoned and effective general manager will maximize controllable profit by monitoring and managing the controllable expenses. In this article, you’ll learn how to calculate controllable profit and why it’s an important measure of

Guest Post: How to Choose a Restaurant Accountant

Just as different restaurants serve different cuisines, different restaurant owners and operators have different financial goals. You might be trying to go with the flow and only need a bookkeeper to help you with invoices, or you might be ready to rock the boat and drastically scale your operations with a CPA and CFO by

The Importance of Accrual Basis Accounting

When interviewing prospective clients, I ask, “Are your financials on a full accrual basis?” This question allows me to quickly understand whether they have access to valuable and actionable financial information. Unfortunately, most restaurateurs cannot answer this question because they don’t know the difference between accrual basis and cash basis financials and the impact it

Guest Blog: Restaurant Accounting EDI Integration

If your bill payment process involves tracking invoices by hand and lots of manual data entry, you would benefit by implementing electronic data interchange (EDI) between your inventory/POS system, your accounting system, and your vendor’s billing. This setup, such as EDI with Fintech, helps you optimize your invoice line-item data input, improve the accuracy of

Capturing Prime Costs in a Commissary Model | 2 Simple Methods

Commissaries and shared central kitchens have always been advantageous for single-concept restaurant groups. Due to increased off-premises dining and high labor costs, commissaries are becoming more and more advantageous. In this article, we’ll cover when a commissary is beneficial, and two of the most common and simple methods of invoicing and accounting for food and

Gross Sales vs Net Sales in Prime Cost Reporting

Prime costs are key indicators of your restaurant’s financial success. In another blog, we answered the first most common question, “What Should Prime Cost Be in a Restaurant?” In this article, we address the second most common question regarding prime costs: Do we use gross sales or net sales in prime cost reporting? Gross Sales