Hello,
I've been taken on to do the books for a new, small pub in town.
My question is regarding the takings and sales. I think I might be getting myself in a muddle and want to make sure I'm doing the right thing.
I've been putting sales for the pub as wet and dry (they do food too), adding them as invoices for the date concerned. The owner doesn't bank money straight away - he uses the till money to pay wages and also pay most, but not all, of his suppliers.
The problem I'm having is if the sales are on as invoices and what he banks I'm using to try to allocate to them - but as he is paying suppliers with till cash there will always be a shortfall on the invoices and several won't be paid fully.
I have an excel sheet where I input the till receipts amounts for cash and card takings and the float but I can't see how to get out of the muddle I'm getting in with regards to what is on the accounting software package for the sales invoices.
I'm sure it's a simple solution, but I think I've thought about it so much I can't see the bigger picture!
Please advise, thanks, allovera
Forget the invoicing - you dont need it! Might be easier to unravel via credit notes once you read the info below.
Open another Bank account and call it cash till or cash register or some such.
Say you take £500 on Monday, of which £200 is for dry sales and £300 for wet then enter it as direct into the cash till 'bank' record, but put £200 to your dry sales income code, the rest to the wet sales income.
Tuesday you take the same, but this time the chef needed some bits and the staff spent £50 getting foodstuff for him and £10 on stamps for the office.
So put £500 through the cash till as you did on Monday, but then make payments from the cash till for the food and stamps (again coded to the correct category, but this time as an expense category).
Your cash balance on the cash till account will balance with the amount of cash you have PLUS your card receipts.
When the boss pays in some of the cash to the bank - transfer the exact amount from the cash till to the Bank using the transfer function. Same with the card receipts which will show up on the Bank account a few days after you have taken them - just do the exact amounts as they appear on the Bank statements (you can check these are correct by totting up the totals from the customer card receipts and your card providers reports. (you may need to add a few days worth together at weekends, eg Friday, Sat and Sunday and maybe even Monday- depends on card provider as to how long they take)
Might be an idea to get the staff to fill in daily takings sheets, which they then perhaps fill in the expenditure on or whatever has been spent (eg wages) plus staple their small receipts to it, till receipts etc, so you can check for accuracy as there will be occasions you will have missing receipts (drum it into them how important they are) and sometimes till differences. I would set up a cost code for till differences as you will have shortfalls or even extras that you may need to key when you do the takings.
Don't forget when you allocate the amount to the sales and expenses codes to allocate the right VAT code dependent on what has been sold. Take great care on this with the sale of food.
Job done.
HTH
edited to sort typos.
-- Edited by Cheshire on Sunday 6th of November 2016 08:42:19 PM
__________________
Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
Thank you, that is all so helpful! I knew I was going about it wrong but couldn't see my way out!
A couple of questions from what you've said.. the pub is charging standard vat on all food and drinks, can I ask why I would have to be careful on this one? Also, the landlord does keep a daily takings (hand written cash book) but he is so unreliable and bad at maths I've been unable to use it. The amounts of sales for the day are so far out compared to the till receipts I'm a but unsure about where to start with it. At the moment I'm just adding it to an excel sheet along with the floats and any unders/overs (I'll now start adding these into the accounting software as you suggested).
By the way, I'm afraid I accidentally deleted my other post in the group if you were wondering where it went! Don't think I can get it back either! I really do appreciate your help
Lol on the other post, I went back to read your response and wondered where it had gone.
Just a quick one for now, as it's the final of my best fix for the week.....Poldark, so anything I don't cover now I will come back to later.
I mentioned the VAT only because broadly cold takeaway food isn't subject to standard rate. I know most pubs don't do takeaways, but a few (small numbers probably) do, to help ends meet. So if they sold a pizza as takeaway it would be standard rates, but a salad would not.
__________________
Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
Hi again Might be worth just getting him to do all but the adding up or trusting the job to a member of staff who he trusts. Keep the system as simple as possible. But might be worth reminding him that HMRC love investigating cash based businesses and the more they find incorrect the more they look, as well as the fact that you can't keep his VAT and tax bill down (legally) unless he keeps reciepts for all his spend and accounts for everything properly. Usually focuses their minds.
__________________
Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
or trusting the job to a member of staff who he trusts. Keep the system as simple as possible. But might be worth reminding him that HMRC love investigating cash based businesses and the more they find incorrect the more they look, as well as the fact that you can't keep his VAT and tax bill down (legally) unless he keeps reciepts for all his spend and accounts for everything properly. Usually focuses their minds.
