Hi all,
A potential client has approached me to take over from their current accountant. They have a pub/restaurant and are looking for the usual compliance services.
I have no existing clients in this area and so am looking for any advice, hints, pitfalls, or anything to consider before taking it further. Is a pub/restaurant much different to any other client wanting compliance services?
Many thanks!
Replies (9)
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In my experience they are to be avoided. Too many pitfalls for cash disappearing into unknown unaccountable holes. Lots of aggravation and clients who will not perform to accounting norms.
Sleep peacefully and walk away
A tad harsh from Bernard
I look after some decent pubs/restaurants and they can be very good clients if the books are kept to a standard.
The ones to be avoided ( I am assuming this is where Bernard's bad experience comes from) are the tied Pubco lease style operations. They usually have a very high rent and tenant is forced to buy overpriced through Pubco so at best the tenant can only make a wage for himself at worst they go bust within 6 months.
You need to check margins as these vary a lot from a village pub to a city centre venue. I would also recommend a good till system and an external stock taker if the turnover warrants it as they should easily pay for themselves by high lighting pilferage and wastage.
Other than that not much different to standard cash business
PM me if you want a chat.
Machine Games Duty
One you might not think about if they have gambling machines in the pub....
Tips
If you are looking after the payroll be sure of the tips system/policy. Not unknown for employer to control & share out the tips "outside" the payroll . He then becomes responsible for any tax/Nic that has not been properly declared by employees ~ especially likely from those who have ceased employment
AE
Also think about the implications of Auto Enrolment as pubs/restaurants typically pay weekly.
Potential Capital Allowances
If you want to earn some real brownie points then contact a capital allowances specialist to investigate whether there has been a previous claim for embedded fixtures within the property e.g. heating system, electrical systems, etc etc. Don't get fooled into thinking that a fixtures list within a purchase contract, which usually is just a list of "loose chattels", constitutes a full claim. In our experience, where a retrospective claim is possible, then 25% of the original purchase value could be claimable (if not more),
You could produce a hefty tax rebate for your potential client and save them a lot of tax going forward. Please PM me if we can be of assistance.
John - Curtis Plumstone Associates.
For your own peace of mind...
If there is a decent till system in place make sure you ask for a print at the end of each month which details the card/cash split. It's called the End of Day or Detailer Total report on most tills
Balance your cash banked/payroll (most get paid in cash)/petty cash etc to the till total and any cash missing is down to the director/owner unless there is any theft going on (which happens a lot unless you have cctv).
The ones I've worked with don't like it when you allocate any "missing" cash to them but soon get used to it. You'd be surprised how quickly they find those missing cash receipts as well!
It also covers you should the VAT come knocking because you have covered all the cash sales and your total sales each month should agree to the till report.
One thing to watch for sometimes is when staff press the wrong button and what should have been cash has been allocated as card. The way to find that is to check your card total on the till because the card/cash error will not show up on the till card report