standard operating procedure

Spot Checking of Location Beverage Stock on Hand and Consumption

Definition and Reasoning Behind Consumption Spot Checks

Consumption(Cons) is defined as opening stock(O), plus requisitions in to the location(R), less internal transfers out of the location(T), less closing stock(C); or Cons = O + (R – T) – C. This formula is used to gauge the physical number of a certain item’s use during a given period of time. Once this formula has been applied the resulting consumption is to be controlled against the Point of Sales(POS) sales register and reconciled accordingly.

The need for spot checks arises to identify and/or control negative factors such as over pouring, pilferage, serving of an item that has not been charged for, or incorrect stock counts.

Documentation

The following documentation will be required in order to complete the spot check:

Opening and closing stock counts Register of or actual requisitions into the location Register of or actual transfers out of the location POS sales register (Annexure A) Consumption reconciliation sheet (Annexure B)

It is vital to note that all documentation must be of the same time period.

Standard Operating ProcedureDescription Spot Checking of Location

Beverage Stock on Hand and Consumption.

Date last modified March 2012Signed General Manager

Signed Financial Controller

Procedure

1. Randomly select at least ten items from various categories from the sales index. However, try to avoid items that are sold as cocktails or as ingredients in various beverages.

2. Plan the spot check in order to allow you to physically verify the opening and closing stock counts

3. Complete the Consumption Reconciliation spread sheet using the details on the documentation

4. Report all variances to the Assistant Financial Controller, Food & Beverage Manager and Restaurant/Bar Manager along with supporting documentation.

Standard Operating Procedure

REF :5.1.3.7

Description Counting of Operating Equipment

Date last modified March 2012Signed General Manager


The following is a summary of the process to be adhered to when counting and processing Operating Equipment :

All operating equipment is reported below the GOP line on the USAH report Operating Equipment stock values are not listed on the Trial Balance, the book value is reflected

as the original purchase value less the accrued value of the depreciation Operating Equipment stock takes must take place at least once per annum (as per ECOMAN) Internal policy dictates that quarterly Operating Equipment counts are conducted The count is subjected to the same SOP that normal inventory counts are subjected to in terms

of the process to be followed Once completed, all Operating Equipment is listed on the manual reconciliation sheet, which will

contain the item details, original purchasing price, quantity, location and stock value Once the reconciliation sheet has been completed, the Cost Controller will forward the

document to the FC / AFC FC / AFC will then review the stock values and will compare them to the book value currently on

hand for reasonability.

1. Recipes are forwarded to the Cost Controller2. The recipe is costed by the Cost Controller3. The Cost Controller forwards the costing and change control form and the suggested selling

price to the Chef/F&B Manager.4. Chef/F&B Manager signs off the suggested selling price, menu descriptor and routing.5. Chef/F&B Manager returns the signed costing and change control to the Cost Controller.6. Cost Controller now adds the new sales items to the Micros Database Control sheet and

generates a new product code.7. Cost Controller now adds the new sales item on Micros8. Cost Controller files the change control in the Micros change control file.

1. Access to the Beverage store and Consumable Store is restricted to authorised personnel.2. This includes the GM, the FC, the Purchasing Manager and the Storekeeper.3. The Stores are to be closed and locked, and the keys signed in at Security.4. A Key register must be kept at security, and the keys must be signed in/out.

Cost Control ICQ 5.1

Standard Operating ProcedureDescription Micros POS – New ItemsDate last modified March 2012Signed General Manager


Standard Operating ProcedureDescription Access to Beverage &

Consumable StoreroomsDate last modified March 2012Signed General Manager


1. The chef is to identify someone within his team to maintain that the fridge temperatures are checked at least once a day.

2. This document needs to be filed in the Chef’s office, and to be accessible for audit purposes.3. All menus including Banqueting must be calculated periodically to take into account inflation

regarding cost prices. The Executive Chef is responsible for all costings of all menus. The Chef is to inform the FC of any or all changes in any menu costing as soon as possible.

4. The Executive Chef is to submit all calculations of all menus to the FC.

1. A Micros Report is drawn on a daily basis and added to the Night Audit File.2. The micros Tips Report and the backup documentation is to be included in the Night Audit Pack.3. Once the Accounts department receives the Micros report, the Income Auditor captures the tips

(both cash and credit cards) on an Excel Spreadsheet. 4. The credit card tips must subjected to the credit card levy, and all tips must be included in the

employees taxable income.5. When payroll is due, this excel report is handed to the HR manager to ensure that all tips

received are paid out together with the employee’s salary.6. Currently, tips are being paid in arrears.

Standard Operating ProcedureDescription Cost Control – Menu

itemsDate last modified March 2012Signed General Manager


Standard Operating ProcedureDescription Cash And Credit Card

Tips Date last modified March 2012Signed General Manager


Cost Control ICQ 5.1.4.23

1. A list of all calls made from internal extensions will be drawn of the PABX system by the Admin Manager.

2. Excessive usage will be investigated and reasons must be provided by the individual concerned3. This is to control abuse of the telephone, and all circumstances where there is proof of abuse will

be addressed.4. Salary deductions will be enforced for the value of the personal usage.5. The telephone bills will be provided as a source document and the individual will be requested by

the Admin Manager to complete a salary deduction form, which will then be processed by Human Resources.

Cost Control ICQ 5.1.4

Standard Operating ProcedureDescription Cost Control –

Telephone RevenueDate last modified March 2012Signed General Manager


Standard Operating ProcedureDescription Cost Control Date last modified March 2012Signed General Manager


1. Materials Control is currently installed in the hotel as the inventory control system.2. The Super-user rights have been assigned to the financial Controller.3. The General Manager has viewing rights only.4. The Purchasing Manager is responsible for placing all inventory orders on the system, and

capturing of invoices.5. No orders are placed without the authorization of the General Manager. 6. All perishable goods received, after being checked by the storekeeper, are packed into the

appropriate storage areas.7. Perishable goods are issued out of stores on a FIFO basis, to ensure that no stock is kept longer

than their storage dates.8. All stock that is requested from stores for the staff canteen has to be signed off by the executive

chef.9. These requisitions are done through Materials Control, as no hand written requests will be

accepted.10. The chef maintains the food cost in the canteen, based on the transfers and the stock being

issued.11. The chef is to identify someone within his team to maintain that the fridge temperatures are

checked at least once a day.12. All transfers within the departments (other than stores) must be accurately documented and

authorized by the HOD’s.13. A sequentially numbered transfer book will be in circulation.14. These transfers will be documented in triplicate where the original is sent through to the

Purchasing Manager and the 1st copy remains with the outlet receiving the stock. 15. The Purchasing Manager will capture all transfers onto Materials Control.16. All spirits issued from the Beverage store can only be issued when empty bottles are returned.17. All full liquor bottles must be stamped with an identification mark when issued.18. The Store keeper and Purchasing Manager will ensure that this process is followed.19. Month end stock variances must be investigated, explained and approved by the HOD’s

concerned and the Financial Controller.20. All menus including Banqueting must be calculated periodically to take into account inflation

regarding cost prices. The Executive Chef is responsible for all costings of all menus. The Chef is to inform the FC of any or all changes in any menu costing as soon as possible.

21. The Executive Chef is to submit all calculations of all menus to the FC.22. In Conferencing the covers report must be compared to the function sheet and the final invoice.

This must be done by the Conference Manager upon completion of an event. This info must be handed to the Conference Coordinator.

23. All Managers checks (Entertainment Costs) must be authorized by the General Manager. 24. The food cost and beverage cost reconciliations are prepared on a monthly basis by the Admin

Manager. It is then distributed to all relevant parties concerned.

Standard Operating ProcedureDescription Receiving & Issuing of

Perishable stock according to FIFO

Date last modified March 2012 Signed General Manager

For distribution to:

General Manager Executive Assistant Manager Financial Controller Cost Controller F&B Manager & Executive Chef Receiving Clerk Store man Human Resources

PURPOSEFor the accurate storage of perishable goods.

Procedure

1. The receiving Clerk will be responsible for receiving all perishable goods. It is important to check that packaging is in order and that nothing is damaged or spoiled.

2. It is important to check the Production date and expiry date. If none visible it has to be marked clearly by the receiving clerk to ensure that FIFO (First In First Out) is adhered to.

3. Once receiving of perishable items, they need to be stored in the appropriate Storage facilities according to the FIFO (First In First Out) basis. (Rotation of stock)

4. All issues from stores need to be issued according to the FIFO (First In First Out) basis.

ICQ: 5.2.2.1 to 5.2.2.9

1. All new bottles of Liquor received by the Receiving Clerk will receive a Park Inn Sticker/Label which clearly identifies it as property of the Hotel.

2. The bottles are then stored on the shelf in the beverage store3. The purpose of this Label is to ensure that all bottles in the Bar belong to the Hotel and that staff

can’t bring in their own.4. The Manager on Duty/ Restaurant & Events Manager will do daily checks to ensure that all

Liquor bottles in the bar have got the label and is visible.5. Empty bottles, before they are thrown away, should also be checked to verify that the label is

still visible.6. Sticker/Labels are only available from the Purchase Manager

Standard Operating ProcedureDescription Identification of Hotel

Liquor Date last modified March 2012Signed General Manager


Standard Operating ProcedureDescription Slow Moving & Obsolete

StockDate last modified March 2012Signed General Manager


General Manager Executive Assistant Manager Financial Controller Cost Controller F&B Manager & Executive Chef Human Resources

PURPOSETo adequately control the movement of slow moving and obsolete stock.

Procedure

The following are the steps taken for recording of slow moving and obsolete stock.

1. During month end the store man is responsible for creating a list of all slow moving and Obsolete stock.

2. This list is made available to the cost controller and the outlets/Chefs so as to promote the use of the stock once they have been identified.

3. All expired stock within the outlets requires a transfer slip for the return of the stock to stores, where it will be disposed of and written off on the Usage report on Material control. The expired stock transfer slips need to be sent to the cost controller/Purchaser so as to correctly right off the stock to the relevant wastage account.


REF:4.1.2.7,8,9

Description Recording of inventory sales from open bars


Procedure

The following are the steps taken for recording of revenue from open bars.

The barman and F&B Supervisor is to take stock on an official hotel stock sheet of all stock issued to the open and or satellite bar.

Once this is done it is to be presented to the guest for spot verification purposes and is to be recorded as an opening stock.

If no MICROS POS is available, then a standalone till is to be used to record any and all sales of stock.

Should extra stock be required an official requisition is to be used and the guest / organizer is to informed the additional stock is being added to the inventory.

Once the function has completed and all sales have been recorded, a detailed stock take is to be done in the presence of the guest / organizer.

Once the guest / organizer has signed off the stock take, the results have to be compared and verified to the “Z’ reading of the stand alone till, and verified by the organizer / guest.

Once this has been done a docket has to be raised on the hotel MICROS POS, and settled by the guest.

This POS has to be a visible sales display unit in the bar. The sales prices can also be verified on the price list / bar menu that has to be displayed in the

bar.


REF:4.1.2.10

Description Processing of complimentary drinks and house accounts.


The following is a summary of the process to be followed when processing complimentary sales items and house accounts.

Complimentary drinks are only too signed off by HOD’s or supervisory staff. All dockets need to be signed and a detailed description is to be included on the docket

for the reason of the comp. All dockets are to be posted to the Making It Right account.

House Accounts are assigned for :

Specific / Generic Hotel Expenses, eg 100% Guest Satisfaction, Meetings, DM Account Executive Management Accounts All House Accounts must be defined, listed and approved by the GM and FC Once approved, the Night Manager will open the House Account as a PM account All transactions generated for a specific account will be audited daily by the night audit team All transactions are collated by the Front Office Administrator on a daily basis. All details are

input in the House Account Control Sheet which details the individual transactions for each account.

All dockets must be signed by an appropriate agent that is authorized to complete the transaction

House Account Control Sheet is balanced to the PMS during month end to ensure that all transactions have been recorded

Once reconciled, the VAT amount on the House Accounts are calculated. The VAT amount is then deducted from the VAT output account in the form of a journal entry All transactions are then reduced to the agreed cost percentage for food & beverage Food & Beverage adjustments are then made to the cost of sales accounts in the form of journal

entries

Standard Operating

ProcedureDescription Physical Stock-taking of

all OE & Linen twice a year



General Manager Executive Assistant Manager Financial Controller Cost Controller F&B Manager & Executive Chef Receiving Clerk Store man Human Resources

PURPOSETo be aware of all stock levels and keeping track of possible theft and Breakage/Usage.

Procedure

1. Operating Equipment (OE) will be counted at least twice a year in June and December.2. Each Head of Department will be responsible for his department.3. Stock sheets will be returned to the stock controller/Purchaser, signed on each page by at least

two persons, to verify that the figures given are correct and accurate.4. Breakages or obsolete stock will be returned to the stores once a transfer sheet has been

authorized by the Head of Department and the General Manager.5. The stock controller/Purchaser will then write off the stock on the Usage report on Materials

control.Cost Control ICQ 5.1.4.15

Standard Operating ProcedureDescription Cost Control – House

AccountsDate last modified March 2012Signed General Manager


1. All Managers checks (Entertainment Costs) must be authorized by the General Manager. 2. Any charges rung up on Micros POS for in-house use, must be documented and handed in by the

relevant HOD to the General Manager for approval.3. Reasons must be provided.4. Once these charges are approved, they will be posted by the Admin manager to the correct

accounts on Sage Pastel Evolution.5. These charges will be incorporated into the monthly food and beverage reconciliations.

Standard Operating ProcedureDescription Inventory Requests from

StoresDate last modified March 2012Signed General Manager


1. A requisitions needs to be created in Materials Control for all items requested out of stores, correct to the warehouse the item is stored in.

2. Requisitions made by hand need to be filled in, in their entirety and ruled off after the last item is requested.

3. All requisitions must include a preferred date and time, the outlet/department would like to receive the stock, on the requisition.

4. Requisitions need to be made with careful attention to the unit size and quantity of items being requested.

5. All beverage items requested must be requested according to the outlets bar par levels.6. Before the Storeman issues any item from stores he must be presented with a requisition signed

by the Department Head and Cost Controller.7. All requisitions need to be handed to, and received from, the Storeman within the time frame

stipulated for issuing and receiving of stock. 8. No item may be added to a requisition in pen. An additional requisition must be completed in

Material Control.9. When receiving the items from the Storeman, the department employee and Storeman must

check the items received, together, according to the requisition and sign the requisition as evidence of that.

10. No employee outside of the Purchasing department, unless authorised, may be in any store.11. All full liquor bottles that leave the store to be sold in the outlets will have the hotels branded

sticker placed on them.12. Once the items have been received, the receiver must sign the requisition, that all is in order.13. Once items requested are removed from the stores, the maintaining and control of the items

becomes the responsibility of the outlet/department.14. Stock not taken by the department at the agreed time will be cancelled and returned back to

stores and a new requisition will have to be completed for the following day.15. All requisitions received by purchasing must be processed with immediate effect.

From: Ibe, Perpetual Sent: 20/03/2012 2:08 PMTo: Adetoro, DavidCc: Olagunju, AyoolaSubject: SOP

A. Inventory Control/Cost Control1. Spot Checking of Location Beverage Stock on Hand and Consumption2. Counting of Operating Equipment3. Micros POS – New Items4. Cost Control – Menu items5. Cash And Credit Card Tips6. Cost Control – Telephone Revenue7. Cost Control8. Month End Inventory Stock Count Procedures9. Slow Moving & Obsolete Stock10. Recording of inventory sales from open bars11. Access to Beverage & Consumable Storerooms12. Cost Control – House Accounts13. Inventory Requests from Stores14. Receiving & Issuing of Perishable stock according to FIFO15. Identification of Hotel Liquor16. Processing of complimentary drinks and house accounts17. Physical Stock-taking of all OE & Linen twice a year

standard operating procedure

Documents

suggested selling price

guest organizer

menus including banqueting

full liquor bottles

location beverage stock

operating equipment

financial controller

slow moving