Inventory Jump to next month

[Mahmoud_Mohsen1]

I see
how often do you run and settle the variances?
do you only use the journal entries using your total?
we run the inventory count 1/month and run the variance reconceliation using MS xapta since the POS is integrated into it
but I think your process is quite better if you have a reliable POS system

Thanks for your explanation

[ejjaadiargo]

@eko

We use separate POS systems for the restaurants we support like most competing accounting software (you will know them). We use android tablets with a windows local server (we have erratic internet) for all restaurant transactions, inventory management, etc. We use the POS statistics to know typical information about what sells well, item profit margins, daily sales per waiter, etc. as part of our analysis how the businesses perform daily. We use Manager for accounting and tax purposes. Indeed some automation would be helpful but to update figures from the totals we generate from the POS is not that much work.

Yes do you @eko use journal entries as a total for inventory or do you have antoher way?

[eko]

@ejjaadiargo

Yes do you @eko use journal entries as a total for inventory or do you have antoher way?

Let me explain what works for our supported restaurants:

1. They use a POS for all daily transactions, inventory management, etc.
2. They use Manager for accounting and do the following:

a) Import weekly bank statements and any restaurant receipts are routed using receipt rules mostly to Income and any restaurant payments when indicating food, beverages or other restaurant inventory items using payment rules to Manager Chart of Accounts self-created (thus NOT enabled inventory tab) Balance Sheet Assets → Inventory → a) Food, b) Beverages c) Other.

b) The POS as mentioned is used for daily assesments how the retaurant is doing, what sells well, who sells, what, variances, losses, sales totals, usage totals, wastage totals, etc. We created Food cost, beverage cost, other COG, wastage, etc accounts in P&L also and do weekly journal entries where for example we credit Food inventory and Debit Food Costs based on actual total for that week for Food Costs from the POS inventory.

We easily can check for discrepancies in what should be the value of inventory and of income from sales of inventory when comparing POS data with Manager (= bank statements).

Obviously discrepancies occur as a bank receipt or payment may be wrongly assigned to inventory or sales while they could have been other income or expenses (electricity, marketing, etc). So it is advised to initially increase the interval so you improve Managers’ receipts and payments rules. Within few months it works extremely well and discrepancies are few and can easily be addressed.

I would advise just to experiment with it. In essence we do weekly only 4 journal entries:

• Food → Food costs
• Beverages → Beverage costs
• Other cogs - Other cogs
• Total Wastage/loss of any (food, beverages, other) → Wastage/loss expenses.

Purchase invoices we manage from Manager and not the POS (we do not allow our businesses to sell on credit so no Sales invoices (is disabled in Manager). Manager is used to understand the overall picture of our business including what we own and owe.

[Mahmoud_Mohsen1]

Manager is pretty much on the side line
Thanks for sharing the process

[eko]

@Mahmoud_Mohsen1

Manager is pretty much on the side line

They are both important for what we do. Manager is used for accounting for which it was designed and for what we needed it for. It helps us to get insight in the financial performance of the business as a whole and to prepare for audits, VAT and tax submissions.

As mentioned the POS is better at the day-to-day operations and transactions, but not good enough for business accounting. despite some tweaking that one can do to let it do different things (I noticed a recent post where it was almost used as a Wordprocessor).