There is a difference between the POS system and restaurant accounting software.

Many new restaurant owners understand the need to keep track of financial information. They understand that they need to use this information to make good decisions for their restaurants. However, getting the tools to gather financial information can be confusing and with the increase of integrated solutions it's getting harder to tell which software performs what function.

Years ago the line between different software packages was very visible. Managers bought accounting software for restaurants when they needed an accounting tool and they bought a basic cash register when they needed a sales order tool. Nowadays you practically can't buy one without getting the other.

During simpler times restaurant accountants would gather all of the information from the cash register at the end of the day. The accountants would count and very the money and sales order for the day. They would then manually enter all of this information into the restaurant accounting software. This method worked well enough, but it did have a few flaws:

(1) It was a time consuming task and unfortunately accountants don't work for free.

(2) Counting the money and verifying it left room for theft. This usually meant that restaurant managers helped the accountants count the money in order to ensure they weren't embezzling money.

(3) Manually counting and entering data leads to human errors. It is common knowledge in the information systems world that manual data entry is very prone to errors.

Technologists, with the invention of the Internet, started seeing a way for software systems to communicate with each other. It wasn't long before they applied their craft on the restaurant industry and pretty soon the cash register was able to communicate with the restaurant financial software. This eliminated the disadvantages of having a clerk manually count and enter the data into the software. It also created confusion about which software was doing what. Below is a list of common functions for both the cash register or point of sale (POS) system and the restaurant accounting system:

POS System Common Tasks:

• Takes Orders
• Calculates Change Due
• Tracks Food and Drink Items Sold
• Tracks Employee's Work Hours
• Reads and Authorizes Credit Cards
• Sends Information to Accountants and Chefs

Restaurant Accounting Software Common Tasks:

• Calculates Payroll (Using information from POS)
• Creates Historical Financial Reports (Statement of Cash Flows, Income Statement, BalanceSheet)
• Creates Financial Projections
• Budgeting
• Tracks all business expenses and revenues (Using information from POS and Purchasing)

A POS system sends a lot of information to the restaurant financial software, but it is definitely a different entity than the accounting software itself. Hopefully this article delineates between the two and will allow restaurant managers to purchase the software that their restaurants' need.