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Protecting Revenue

Protecting Revenue. 10. OH 9- 1. Learning Objectives After completing this chapter, you should be able to:. • Identify and explain the three parts of a revenue collection system. • List the external and internal threats to revenue security.

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Protecting Revenue

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  1. Protecting Revenue 10 OH 9-1

  2. Learning Objectives After completing this chapter, you should be able to: • Identify and explain the three parts of a revenue collection system. • List the external and internal threats to revenue security. • Explain the basic control standards to safeguard cash and credit card information. • Describe the four steps in the revenue security system. • Explain several ways to discourage theft by employees.

  3. Learning Objectives continued: After completing this chapter, you should be able to: • List two important areas affected by accounts payable. • Describe the steps in verifying the receipt of goods and services.

  4. Three Parts of a Revenue Collection System • Charging the Guest • Collecting Revenue • Protecting Cash Assets

  5. External Threats to Revenue Security • Cash • Open tab • Counterfeit currency • Credit Cards • Personal Checks

  6. Internal Threats to Revenue Security • Poor hiring practices • Ineffective internal controls • Lack of checks and balances

  7. Enhancing Revenue Security • Safeguarding On-Premise Cash • Monitor bank verification and check out sheets • Limit approval of voids and overrings • Assure generation of receipts • No person with access to accounting records handles cash • Change safe combinations when those with access leave employment • Conduct safe audits on an irregular basis

  8. Safeguarding On-Premise Cash Cash is kept in safe Cash is deposited daily Safeguarding Customer Payment Card Information PCI data security standard Enhancing Revenue Security

  9. The Four Step Revenue Security System

  10. Verifying Product Sales • Kitchen Issues • Guest Checks

  11. Verifying Guest Charges • Server Reports • Shift Reports

  12. Verifying Payment • Cash Control • Credit and Debit Card Payments • Coupons and Other Payment Forms • Employee meal discounts • Guest relations discounts • Marketing and promotional discounts • Police, firefighter, senior, military discounts • Comps

  13. Verifying Deposits • Cash • Payment with credit cards and debit cards

  14. Cash Audits • Cashier and Server Banks • Petty Cash

  15. Managing Accounts Payable • Pay invoices on a predetermined schedule established by business • Verify that all invoices paid are legitimate • Minimize the amount of time and expense in processing paperwork

  16. Verifying receipt of goods and services • Verify amounts due • Invoice payment

  17. Key Terms: Accounts payable The amount of money that an operation owes suppliers from which it has purchased goods, products, or services. Auditing A financial examination of an organization’s accounts. Card verification value (CVV) The three-digit code on the back of most credit cards. Collusion The working together of two or more employees for dishonest purposes. Counterfeit currency Money that is produced to resemble official legal currency closely enough that it may be confused for genuine currency. Extension The price of an item multiplied by the number of items being purchased. Fraud An intentional deception to cause a person to give up property or some lawful right.

  18. Key Terms continued: Guest relations discount A discount on a meal offered by a manager because the guest was not satisfied with the quality of the food or service. Merchant account A designated account where funds from guest credit card payments can be sent. Merchant services provider A company that facilitates the transaction between an operation and the card issuer, also known as clearing. Open tab A temporary guest charge account that allows guests to purchase and consume products before paying for them. Overcharging The act of charging more than the amount that should have been charged and collected. Payment Card Industry (PCI) A data security standard. A series of technology requirements for retailers and companies that process credit cards, which are designed to ensure the protection of cardholder data.

  19. Key Terms continued: Petty cash A small fund established to handle minor cash disbursements. Service charge A labor-related fee, added by the manager, to be paid by guests. Undercharging The act of charging less than the amount that should have been charged and collected.

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