SITXFIN004A (S6523) Manage Finances within Budgets

SITXFIN005A (S6524) Prepare & Monitor Budgets

The Uniform System of Accounts

What is the uniform system of accounts?

The uniform system of accounts was developed in 1925 by the Hotels Association of
New York. Since then, it has been adopted by many hospitality organisations, both in the
United States and in other countries as well. The system sets out the categories to be used
for various expenses (such as linen, glassware, and so on), and its great advantage is that
it allows standards and comparisons among properties and the calculation of industry
averages in areas such as payroll costs.
The uniform system lists virtually all the different types of receipts and disbursements
that come about in the course of operating a hospitality business. It then facilitates the
compilation of summary reportsone such summary report being called a balance sheet
and another an income statement. The collection of all the different types of receipts
and disbursements is referred to as the chart of accounts. These accounts can be either
debit or credit.
We have been conditioned to believe that a credit is a good thing, because a credit
balance at our bank or shop means that we have funds in hand, whereas a debit must be
bad, because then we are in the red and owe money. In fact, debit simply refers to an
entry on the left hand side of the ledger, or book of accounts, and a credit is an entry on
the right, and every transaction must have both a debit and a credit side.
See Figure 8.1 (pages 21215) for an example of a large restaurants chart of accounts
that conforms to the uniform system. It is subdivided into categories, and indicates
whether those categories are usually debit or credit.
The uniform system of accounts

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Chart of Accounts
Element Category Account Name Number
ASSETS current assets petty cash 111
1XX numbers cash cash floats 112
(usually debit cash at bank 113
balances except accounts receivable customers 121
where noted) employees 122
other 123
provision for doubtful debts 124
(credit)
inventories food 131
beverages 132
other 1 33
prepaid expenses insurance 141
licences 142
other 143
non-current assets
fixed assets furniture and fittings 151
F & F depreciation (credit) 152
plant and equipment 153
P & E depreciation (credit) 154
leasehold improvements 155
leasehold amortisation (credit) 1 56
Other assets goodwill 161
goodwill amortisation (credit) 162

LIABILITIES Current Liabilities accounts payable 211

2XX numbers GST tax payable 212
(usually credit accrued wages 221
balances except accrued rent 222
where noted) accrued interest 223
reserve accrued utilities 224
deposits in advance 231
current portion of long-term 241
debt
Long Term bank loan 251
Liabilities other 252

OWNERS EQUITY shareholding ordinary shares 311

3XX numbers share premium 312
(usually credit retained earnings 313
balances

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SALES food
4XX numbers beverages
(always credit retained earnings
balances)
COST OF SALES cost of salesfood
5XX numbers cost of salesbeverages
(always debit
balances)
OTHER INCOME cash discounts
6XX numbers commissions
(always credit miscellaneous
balances)
CONTROLLABLE wages (direct costs) food-service wages 711
COSTS food-preparation wages 712
7XX numbers cleaning wages 713
(usually debits bartending wages 714

employee benefits public holidays 721

and overheads annual leave & leave
loading 722
superannuation 724
employee meals 725
employee beverages 726
workers comp insurance 727
other 728

other direct costs tableware (<$200) 731

kitchen utensils (<$200) 732
other kitchen requisites 733
linen 734
paper supplies 735
uniforms 736
menus and beverage lists 737
decorations 738
laundry 739
pest control 740
delivery expenses 741
licences 742

entertainment musicians 751

professional entertainers 752
audio rental 753
royalties 754
agents fees 755

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 meals 756
marketing marketing salaries 761
marketing wage
overheads (incl. insurance) 762
advertising 763
public relations 764
complimentary
meals/beverages 765
printing/preparation 766
travel 767

administrative costs administrative wages

salaries (non-management) 771
administrative wage
overheads (incl. workers
comp. insurance) 772
stationery/printing 773
postage & courier 774
telephone & email 775
travel 776
insurance 777
bank charges 778
cash short or over 780
bad or doubtful debts 781
general insurance 782
repairs & maintenance
(equipment) 783
repairs & maintenance
(other) 784
utilities electricity 791
gas 792
water 793
garbage removal 794
FIXED COSTS occupancy costs rent 811
8XX numbers council service rates 812
(usually debits) interest overdraft interest 821
long-term loan interest 822
depreciation and furniture & fixtures 831
amortisation plant & equipment 832
leasehold 833
goodwill 834
other management salaries 841
management benefits 842
legal fees & charges 843
miscellaneous 844

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TAXES income taxes 850
850 numbers GST 851
(usually debit or
zero)
CONTRA customer contras 911
ACCOUNTS employee contras 912
9XX numbers general suspense 999
(debits or credits;
must be zero at the
end of the
accounting period)

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