Accounting Best Practices for Toronto’s Restaurant Industry
Running a successful restaurant in Toronto requires more than just great food and service—it demands precise financial management. At BBS Accounting, we’ve helped numerous Toronto restaurants optimize their financial operations. Here’s our comprehensive guide to restaurant accounting best practices.
Point of Sale (POS) System Integration
Essential Features
- **Sales Tracking**
– Menu item performance
– Time-of-day analysis
– Server performance
– Payment method breakdown
– Discount monitoring
- **Inventory Management**
– Real-time stock levels
– Recipe costing
– Waste tracking
– Purchase ordering
– Supplier management
Cost Control Measures
Food Cost Management
- **Inventory Controls**
– Weekly inventory counts
– Recipe portion control
– Waste logging
– Theft prevention
– Expiration tracking
- **Purchasing Procedures**
– Vendor comparison
– Order scheduling
– Quality control
– Price negotiation
– Emergency supply planning
Labor Cost Control
- **Scheduling Optimization**
– Sales-to-labor ratios
– Peak hour staffing
– Overtime monitoring
– Seasonal adjustments
– Training periods
- **Payroll Management**
– Time tracking systems
– Tip reporting
– Benefit calculations
– Tax withholding
– ROE processing
Financial Metrics to Monitor
Daily Metrics
– Sales by category
– Labor cost percentage
– Food cost percentage
– Average check size
– Covers served
Weekly Metrics
– Prime cost calculation
– Inventory turnover
– Labor efficiency
– Cash flow position
– Vendor payments
Monthly Metrics
– Occupancy costs
– Marketing ROI
– Utility expenses
– Maintenance costs
– Overall profitability
Toronto-Specific Considerations
Local Regulations
- **Licensing Requirements**
– DineSafe compliance
– Liquor licensing
– Patio permits
– Music licensing
– Waste management
- **Labor Laws**
– Minimum wage requirements
– Break regulations
– Overtime rules
– Holiday pay
– Tip pooling policies
Tax Compliance
Sales Tax Management
- **HST Considerations**
– Collection procedures
– Filing requirements
– Input tax credits
– Meal comping impact
– Gift card treatment
- **Income Tax Planning**
– Expense categorization
– Capital cost allowance
– Tax credit eligibility
– Installment payments
– Record keeping
Cash Management
Daily Procedures
- **Cash Handling**
– Till float management
– Cash counting procedures
– Safe protocols
– Bank deposits
– Reconciliation process
- **Payment Processing**
– Credit card settlements
– Digital payment handling
– Gift card tracking
– Tip distribution
– Void management
Cost Analysis
Menu Engineering
- **Item Profitability**
– Food cost calculation
– Labor cost allocation
– Overhead attribution
– Pricing strategy
– Margin analysis
- **Menu Mix Analysis**
– Stars (high profit, high volume)
– Puzzles (high profit, low volume)
– Workhorses (low profit, high volume)
– Dogs (low profit, low volume)
Technology Implementation
Essential Systems
- **Accounting Software**
– POS integration
– Payroll processing
– Inventory management
– Financial reporting
– Budget tracking
- **Operations Software**
– Scheduling systems
– Reservation management
– Online ordering
– Delivery integration
– Customer relationship management
Financial Planning
Budgeting Process
- **Revenue Forecasting**
– Seasonal variations
– Special events
– Economic factors
– Competition analysis
– Growth projections
- **Expense Planning**
– Fixed costs
– Variable costs
– Capital expenditures
– Maintenance reserves
– Marketing budget
Risk Management
Key Areas
- **Insurance Coverage**
– Property insurance
– Liability coverage
– Business interruption
– Employee bonding
– Liquor liability
- **Internal Controls**
– Cash handling procedures
– Inventory controls
– Purchase authorizations
– Account reconciliations
– Audit trails
Growth Management
Expansion Planning
- **Financial Requirements**
– Capital needs
– Funding sources
– Cash flow projections
– Break-even analysis
– ROI calculations
- **Operational Scaling**
– System capacity
– Staff requirements
– Supply chain management
– Location analysis
– Market research
BBS Accounting’s Restaurant Services
Setup Support
– System implementation
– Process development
– Staff training
– Compliance setup
– Control establishment
Ongoing Services
– Monthly bookkeeping
– Financial analysis
– Tax planning
– Advisory services
– Audit support
Action Steps
- **Immediate Implementation**
– Review current systems
– Identify gaps
– Establish procedures
– Train staff
– Monitor results
- **Regular Maintenance**
– Daily reconciliations
– Weekly reviews
– Monthly analysis
– Quarterly planning
– Annual assessment
Contact BBS Accounting today for specialized restaurant accounting services. Our expertise in Toronto’s restaurant industry will help you optimize your financial operations and improve profitability.
*This guide is provided for informational purposes only and should not be considered as financial or tax advice. Consult with qualified professionals for advice specific to your situation.*