Confirm All POS Sales Are Recorded

Start with the POS. Confirm that every day in the accounting period has been posted and that sales categories are mapped correctly.

Review items such as:

• Food sales
• Beer, wine and liquor sales
• Sales tax
• Discounts
• Comps
• Refunds
• Gift cards
• Tips
• Service charges

If the POS itself is producing unreliable reporting, our restaurant POS consulting focuses on correcting those upstream configuration and reporting problems.

Reconcile Credit-Card Deposits

POS sales usually do not equal the deposits hitting the bank because merchant processors deduct or separate items such as fees, refunds, tips or adjustments.

Every settlement should be traceable from:

POS → merchant processor → clearing account → bank deposit.

Unexplained balances left in a merchant or POS clearing account are a warning that something has not been fully reconciled.

Reconcile the Bank Accounts

Every operating bank account should be reconciled through the final day of the month.

Look specifically for:

• Duplicate transactions
• Missing deposits
• Outstanding checks
• Bank fees
• ACH withdrawals
• Loan payments
• Owner contributions or distributions
• Unidentified transactions

A bank reconciliation should not simply be forced to zero. Every difference should have an explanation.

Reconcile Restaurant Cash

Cash deserves its own reconciliation because cash sales can move through drawers, tip payouts, drops, safes and bank deposits before reaching the bank.

Review:

• Starting drawer balances
• Cash sales
• Cash tips and payouts
• Cash drops
• Ending drawer counts
• Over/short
• Deposits

If those movements aren’t consistently documented, stronger restaurant cash and tip controls can make each shift traceable from the starting drawer through the final deposit.

Review Accounts Payable and Vendor Bills

Confirm that vendor bills belonging to the month have actually been entered.

Missing invoices can make one month appear artificially profitable and push the expense into the following period.

Review major vendors including:

• Food distributors
• Alcohol distributors
• Utilities
• Rent
• Insurance
• Repairs
• Professional services
• Recurring subscriptions

Record Ending Inventory

Purchases are not automatically the same as cost of goods sold.

To calculate restaurant COGS correctly, use:

That means your physical inventory count affects the P&L directly.

Our restaurant inventory and COGS controls connect purchasing, physical inventory, waste and sales so food and beverage cost is based on actual usage rather than purchases alone.

Review Payroll and Labor

Confirm that payroll expense, payroll taxes, employee deductions and payroll liabilities are recorded correctly.

Then compare labor with sales.

Review:

• Total labor dollars
• Labor percentage
• Regular hours
• Overtime
• Employer payroll taxes
• Payroll liabilities
• Tip-related balances

Our restaurant payroll and labor controls help connect schedules, hours, payroll and sales so labor can be managed operationally instead of discovered after the month is over.

Review the Balance Sheet

This is one of the most commonly skipped steps in restaurant bookkeeping.

Don’t review only the P&L.

Look at balance-sheet accounts including:

• Cash
• POS or merchant clearing accounts
• Accounts receivable
• Inventory
• Accounts payable
• Sales tax payable
• Payroll liabilities
• Tips payable
• Loans
• Credit cards
• Owner equity

Ask a simple question about every material balance:

Does this number make sense?

If nobody can explain what an account represents, investigate it before closing the period.

Review the Restaurant P&L

Once the underlying accounts are reconciled, review the profit and loss statement.

Look at both dollars and percentages.

• Total sales
• Food sales
• Beverage sales
• Food COGS
• Beverage COGS
• Gross profit
• Labor
• Prime cost
• Operating expenses
• Operating profit

The question isn’t simply whether the restaurant made money.

The better question is:

Why did profit change?

Compare Results With Prior Periods

One month by itself provides limited information.

Compare current performance with:

• Prior month
• Same month last year
• Year-to-date results
• Budget
• Restaurant targets

This makes changes in food cost, labor, sales and expenses easier to identify.