Old School vs New School – Restaurant Accounting Best Practices

At this year’s National Restaurant Association Show, our Co-Founder John Moody presented a Tech Talk on Restaurant Accounting Best Practices.

In this session, John addressed how to recognize the 10 critical functions of any restaurant accountant or accounting system to ensure financial success for restaurants. He covered how these functions tie together to create the financial picture of the restaurant business, and how small changes can make big impacts on profits.

Here’s an excerpt of John’s presentation. Want to see the whole thing? Contact us and we’ll send it to you!

Restaurant accounting best practices:

  • Restaurant Owners should be asking their accountants and accounting departments
  • Restaurant CFO’s, Controllers, Accountants and Bookkeepers should know forwards and backwards
  • Restaurant Managers are typically doing some accounting functions and should have access to some financial data

Why use an old-school accounting option when there are new-school options available?

Old school:

  • Windows Only
  • Thick Client
  • In the Office Only
  • Servers
  • Heavy Upgrades

New School:

  • Device Independent
  • Browser
  • Tablet
  • Mobile App
  • Updates

To get the most out of your accounting:

Use a Cloud-Based Software

  1. Access system anytime and anywhere
  2. No hardware to maintain
  3. No back-ups to run
  4. Real-time information between accountants, managers and owners
  5. New versions and features typically rolled out faster

Use a modern system with a restaurant accounting structure

  1. Restaurant chart of accounts
  2. Intercompany
  3. No logging in and out
  4. Retail calendar (4-4-5, 13-4, etc.)
  5. Reporting

POS & Accounting

Old School:

  • No POS Data or Detail
  • Manual Entries
  • No Labor Visibility

New School:

  • Drill Down
  • Automatic Journal Entry
  • Full Burden Labor Accrual

Connect your accounting software and POS

  1. Auto-create Sales Journal Entries
  2. Auto-create daily labor accrual Journal Entries (fully burdened)
  3. Allocate payroll between FOH and BOH
  4. Limit the risk for fraud and mistakes
  5. Expected cash deposit starts here
  6. Manage paid-outs

Inventory

Old School:

  • Inventory not Accounting
  • No Inventory
  • Paper Count Sheets
  • Manual Cost Updates
  • Separate Systems

New School:

  • Inventory is Accounting
  • Mobile App
  • Costs Automatically Updated from Invoices
  • Automatic Journal Entry
  • Single System

Count Your Inventory

  1. What part of Inventory isn’t Accounting?
  2. Everything you do with inventory creates a debit or credit
  3. Employees will know you care about inventory
  4. Include Waste and Transfers
  5. Weekly Counts if you want weekly P&L’s
  6. Actual vs Theoretical Report

Want to see the additional sections on Payroll, Bank Reconciliation, Goals and Budgets, Financial Reporting, and Consolidation? Contact us and we’ll send you the full presentation!