This Study Resource Was

1.
Explain how the following factors may assist in preparing financial and statistical reports
for a business:
The cash flow reports or the cash flow
a. Cash flow
statement is a financial statement that
summaries the amount of cash and cash
equivalents entering and leaving a
company. It measures how well a company
manages its cash position, the current
cash on hand; forecast when money is
expected to come into the businesses, and
when disbursements are due.
Covers Report is specific to restaurants and

b. Covers bars that record analyses the number of
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guests served in a service period, such as
dinner. This helps the Management in
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identifying areas which are not meeting the
budget and investigate the reasons for this.
o.
Food may be further broken down into
rs e entrée, main and dessert and beverage or
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further broken down as well. All this
information is used to determine the
average spend per customer for food and
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beverage.
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c. Expenditure Expenditure is the cost that is spent on the purchase or

growth of fixed assets. Expense affects the Profit and Loss
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statement of a company as they appear as costs incurred to

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earn revenue. Expenditure does not have any implication

on the financial statements and is not usually recorded.
Occupancy Reports provides a detailed
d. Occupancy rates
monthly overview of your availability,
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number of bookings, uncooked availability,

average occupancy and a few data points
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related to average revenue and actual

revenue. Hotel Reservations/Front Office
Management build these reports based on
the number of rooms booked each night, as
well as the number of guests. Low numbers
mean lower sales. These reports are very
important to the running of a hotel as
empty rooms impact on all other areas of
the establishment.
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To track the business growth, Sales reports are
e. Sales performance
important reports used by managers to
analyses the performance of each
department compared to the drafted
budget and identify any concerning areas to
take relevant action. Any underperforming
areas can be corrected before the situation
becomes risky. The different revenue
categories, including food, beverage,
rooms, gaming, conferencing, tour
bookings, massage and golf will be listed,
showing the actual revenue for the period
as well as the budget and the variance
between the two. Sales reports are
produced by each revenue-producing
department within a business.
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Stack report is maintained by each
f. Stock (inventory) level
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department, it could be the kitchen, cellar,
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or housekeeping. Stock reports contain the
o.
rs e closing stock level at the end of the period.
They are effective in indicating popular
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items with a high turnover, and items less
popular or slower moving.
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g. Staff costs Staff cost reports are used to evaluate staffing levels
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associated to revenue levels and budgets. In general, staff

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costs should be around 30% of income that means staff

costs are a percentage of revenue as well as the actual
dollar amount. Employing too many staff, or inefficiently in
the existing staff, projects in a staff cost exceeding the
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budget
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Variance reports highlight deviations from

h. Variances budget. Budgets are set at the start of the
year, based on expected revenue and
expenses. Each month the financial
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statements will be analyzed to show where

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any variances are occurring so that the

issue can be rectified, or at least explained
to the senior management team.
Wastage reports show how much stock is

i. Wastage
wasted each period. Each time an incorrect
beverage is made or a stock item goes off,
it must be recorded in the wastage report.
This report allows management to
determine the reason for variances between
income produced and stock used up. If more
stock is used up than could be accounted
for by the recorded sales, the wastage
reports should be checked to discover the
reason.
j. Yield  Cash on securities (financial assets that can be traded,

such as bonds, stocks etc) returned to owners of the
security.
 Cash returned is in the form of interest or dividends
calculated over a period of time.
k. Income  Not to be confused with sales, net income is the profit (or
loss) left once taxes and all other business obligations,
expenses and requirements have been paid (net profit =
sales – total costs).
 Calculated annually.
 Represented in income statements.
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 Shows profitability of the business.
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 Assists with future budgeting activities.
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l. Commercial account  Refers to transactions from and to the business’s financial
activity account/s.
o.
 Assists a business in determining profit and loss.
rs e
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 Assists with future budgeting activities.
m. Commission earnings  Relates to money paid to staff.
 Some staff may receive extra money on top of their wage
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salary if they meet specific targets (such as completion of

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tasks, meeting a target, selling a certain number of goods

or services).
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 Staff who receive commission will have a base rate of

pay.
 Can be paid as a percentage or a flat dollar amount.
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 Commissions must be considered (estimated) as part of

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budgeting processes.
n. Daily, weekly and  Provide information about transactions, including the
monthly transaction count for cash, credit card, EFTPOS, cheque and direct
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transfer sales.
reporting
 Alternatively, in an accounting system the transaction
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report may be used to show transactions related to specific

accounts.
 Used as part of monitoring processes to check trends in
sales and whether corrective actions need to be put in
place if sales are slow or have dropped with no prior trend
visible.
o. Department/area  Provides management with financial statistics for specific
performance departments or areas rather than the business as a whole
 Used for comparison purposes (for example, how is the
café performing in a venue/facility over the restaurant)
 Can be used to support budget planning for the specific
department.
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rs e
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aC s
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ed d
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1.

Covers Report is specific to restaurants and

c. Expenditure Expenditure is the cost that is spent on the purchase or

statement of a company as they appear as costs incurred to

earn revenue. Expenditure does not have any implication

number of bookings, uncooked availability,

related to average revenue and actual

associated to revenue levels and budgets. In general, staff

costs should be around 30% of income that means staff

Variance reports highlight deviations from

statements will be analyzed to show where

any variances are occurring so that the

Wastage reports show how much stock is

j. Yield  Cash on securities (financial assets that can be traded,

salary if they meet specific targets (such as completion of

tasks, meeting a target, selling a certain number of goods

 Staff who receive commission will have a base rate of

 Commissions must be considered (estimated) as part of

report may be used to show transactions related to specific

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