How do I read a restaurant’s daily cash-out reports before buying?
Read them as a trail from the till to the bank. Each day’s report should show sales by type, tips, discounts, voids and payments, and the totals should match deposits and the books. Large or frequent voids, discounts and cash adjustments are what to question.
Ask for a run of daily reports covering busy and slow periods, not a hand-picked set. Learn the layout first: sales broken down by food, drink and other items, payment types, taxes collected, tips, and any voids or discounts. Ask the manager to walk through one day line by line so you understand how staff really close out.
Next, tie the reports to the money. Deposits in the bank statements should fit the cash and card totals, allowing for timing. Compare the report totals with the sales in the financial statements. Gaps are not proof of anything wrong, but each one needs an explanation. Your accountant can help you design the comparison.
Pay particular attention to cash. A business that takes a lot of cash is harder to verify, and an owner who says some income is not recorded is describing a problem for you, not a bonus. Reported sales are the only ones you can responsibly rely on. Finally, look for patterns: weekday and weekend swings, season changes, and busy shifts that show unusual voids. Ask who is allowed to void or discount and whether anyone reviews it. Tight controls make the numbers more trustworthy.
Key takeaways
- Ask for reports across busy and slow periods, and have the manager walk through one day.
- Tie report totals to bank deposits and the financial statements, and explain every gap.
- Question frequent voids, discounts and cash adjustments, and ask who approves them.
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Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentWhat are financial statements?
- 03Business Development Bank of CanadaGovernmentAccrual and cash-based accounting
- 04Business Development Bank of CanadaGovernmentWhat is Cash Flow
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