Our hospitality accountant professionals can help you manage and grow your business, whether you’re a startup or an established firm. They can help you comply with regulations, set up and manage your tronc plan, enhance operations, and prepare your company for funding, growth, or sale.
At Pearl Lemon Accountants, our clients benefit from a broad variety of integrated hospitality accounting services and we serve as specialized hospitality accountants to restaurants, pubs, bars, caterers, hotels, conference sites, and fast food outlets.
You’ve undoubtedly heard all of this before if you’re the owner or manager of a hospitality business (a hotel or restaurant).
It’s not easy to run a hotel or restaurant. The challenges of running a successful hospitality business are vast and numerous, and that’s before you even consider trying to make a profit.
Given this fact, as well as the always-on nature of working in the industry, it’s evident that working with an accountant who specializes in the accounts of hoteliers and restaurateurs and other hospitality businesses has significant advantages. But sometimes perhaps they need to be pointed out.
You can’t run a business without a thorough understanding of your finances, and the hospitality sector is no exception. So much effort goes into developing the ideal image and guest experience, yet a strong financial foundation is what keeps those crucial components of hospitality management and success afloat. Up-to-date and precise accounting systems are the cornerstone of this foundation.
It’s crucial to look at the big picture of how proper accounting and financial management affects your hospitality business to appreciate how important accounting is:
Knowing how much money you have to spend depends on having a clear picture of your organization’s finances and cash flow. Cash flow reveals how much money comes in and goes out of your organization, which is important to know in real time, so you don’t overspend.
A monthly budget is essential for any business, but you can’t achieve it unless you keep detailed records of your expenses and income sources. In the hospitality industry, often a business has numerous different revenue sources – for example, a hotel may have guest rooms, a restaurant and a variety of paid amenities – that come along with their own expenses. Working with a hospitality accountant allows you to keep track of them all efficiently.
Financial records must be consistent in order to generate credible projections that may be used to plan future projects and expenditures. This is especially significant if you plan to open more sites for your hospitality business in the near future or expand your current operations.
Working with a hospitality accountant will offer you more than just ensuring that you are on top of your current finances, though. Our experts can help you determine the best way forward to achieve maximum financial growth, help you decide which of your income streams offer the best return and which may need to be tweaked, or dropped altogether in order for you to maximize the earning potential of each individual offering, and of the business as a whole.
Employees at any facility that welcomes guests are unquestionably important to the smooth operation of the business and the fulfillment of guest expectations. Paying your staff in full and on time is one of the most crucial components of keeping them happy. This can easily become a problem if your bookkeeping isn’t kept up to date.
For hospitality businesses in the UK, the tronc system can be particularly challenging to administer without the help of an accountant. Apart from the strange name, HMRC considers a tronc to be sound business practice, and it is strongly advised if you wish to respect the law (and who doesn’t?), as well as ensure that employees are adequately compensated through tips.
A solid tronc that is fair and equitable for everyone may help you attract and retain top staff, which is a huge win for your company at a time when hiring is very hard and great hospitality staff are very thin on the ground. However, to get things right you need to know what you are doing, or at least have a hospitality accountant who does.
HMRC is serious about tax compliance, and this is especially true when it comes to financial reporting and paying your small business taxes. However, if your hospitality accounting isn’t done properly, you can end up breaking both of these rules. What do we mean by that? Your financial records become erroneous when your bookkeeping and accounting are amiss, which has an impact on how your taxes are reported. If an audit is undertaken and the error is discovered, you may face serious fines.
We understand that when it comes to taxes, hospitality businesses face special challenges that are not a problem in any other business sector. VAT, for example, can be a nightmare to navigate in the hospitality industry. Is that food hot or cold? Is that beverage subject to VAT or not? Does it fall outside the course of catering standards? Do you know what those are?
Working with a specialist hospitality accountant will help ensure that you get VAT right, and that you give HMRC their share while never overcharging your customers or handing over too much of your own hard earned cash.
Not every accountant has the specialist knowledge needed to do the best possible job for clients in the hospitality industry, even if their basic skills and services are very solid. At Pearl Lemon Accountants, we can boast the ability to provide with a personal team of accountants who have years of proven expertise in the field specifically, and who clearly understand the special financial challenges you face as a hospitality business owner or manager on a daily basis.
Want to learn more about what working with Pearl Lemon Accountants as your hospitality account can do for your business?
Contact us today, we can't wait to talk to you!