Sample Essay on Financial Controls in Food and Beverage Operations


In this report, I will evaluate what I will do as I organize an end of term party that my colleagues and I intend to have together with our spouses and children. In relation to what I have done this far, the said party will be held in a local community pub that I have contracted to offer services to us. However, I will be organizing everything in the party except doing the cooking and serving food and beverages. The serving staff shall purchase all the ingredients and materials that I will select for the party and do the cooking. On the other hand, guests will serve food and beverages for themselves. The number of guests that I expect to have in the party is sixty. Fifty of these guests are adults and ten of them are children. Of these guests ten of them are vegetarians while four of them are diabetic. My intention is to make the party enjoyable and memorable. Accordingly, I will do all my best to prepare an appropriate menu that will meet the needs and preferences of all the guests that will be in the party. This report highlights the various financial controls that I will utilize to ensure the party does not exceed a budget of £1,000.

Financial statements

The proposed party has a budget of £1,000. Accordingly, I will make a budget that does not exceed this amount of money. At this point, I will evaluate the financial statements that I will use to control my budget. These financial statements will be somewhat similar to the ones used in hospitality establishments. However, I will make some adjustments because our party will not be geared towards making profit. The first financial statement that I will use as I organize the party will be the balance sheet. Unlike a balance sheet used in hospitality establishments, mine will only indicate the contributions that my colleagues and I will make towards the party. The one used in hospitality establishments and other business ventures usually includes assets, equities and liabilities (Harris 2010, p. 4). Ours will be a reflection of this because the contribution that we shall make towards the party shall be on a lighter note the asset for the party. For business ventures, assets dictate what is done or not done. Accordingly, the money that we shall contribute towards the party shall dictate our expenses and what we shall have in the party (Dopson & Hayes 2010, p. 17).

The second financial statement that I will use as I organize the party shall be somewhat like an income statement. The only difference with the one used in business ventures will be that mine shall not include profits and losses. Instead, it will only include the money we shall contribute towards the party and expected expenses. This notwithstanding, the said statement will be critical because it will reflect the success that I will have made at the end of the party. In other words, it will indicate how well or how bad I will have spent the money. The third statement that I will use as I organize the party to control my budget will be the cash flow statement. This statement will indicate the way I will spend the money from the moment I obtain it from my colleagues until the end of the party. In a nutshell, it will indicate the flow of money throughout the process that I will be organizing the party. In business ventures, this financial statement provides information that relate to the way money is received and spent (Weygandt et al. 2005, p. 23). I will use this statement for the same reason. The fourth and the last financial statement that I will use as I organize the party will be the equity statement. Although in real sense there will be no equity at the end of the party, it will be necessary for me to have a statement that will account for the money that might remain at the end of the party. In profit making businesses, this statement provides an overview of the earnings business make. In our case, it will reflect the way I will have spent the money.

Cost and pricing processes

By definition, cost controls are mechanisms used to regulate cost. These mechanisms guard against excessive costs by setting uppermost cost limits. In business, cost controls are usually important because they set the levels that costs should not exceed. At the same time, they control prices as well as other business activities. Mostly, a cost control process never ends because some costs keep on changing. In spite of this fact, cost control measures vary from one event or business to the other. This variation usually depends on the scope and nature of event and business operations. This notwithstanding, one has to account for revenues properly. In addition, one has to set costs within tolerable limits. Some costs are fixed thereby they do not change. Other costs vary thereby they keep on change (Brotherton 2012, p. 132). Notwithstanding possible variations, some costs even though they vary, they do not change considerably. Therefore, it is usually necessary to establish some cost control measures in business ventures and in other events dealing with money.

In most cases, cost control mechanisms dictate the pricing mechanisms. They set acceptable costs and consequently the price for individual units of items to be purchased. In reality, one has to set costs within tolerable limits and account for revenues efficiently. In order to control cost, I will ensure that there will be no wastes. In this respect, I will budget only for expected guests. In addition, I will identify the specific food items for the party and determine their prices. The pub staffs that will be purchasing these items will not change those prices. If anything, those prices may either go down or remain as they will be on the list I will develop because they will be the current prices in the market (Guilding 2007, p. 157). In order to minimize waste and stick to my budget, I will use the following template when pricing and purchasing the food items for the party. See the appendix for more details.

Item no. Item Units Price per unit Total price/cost
Purchasing process

Normally, operations in food and beverages ventures more often than not follow a process of input, process, and output model. This model involves purchasing inputs, processing them and serving them to guests or customers. The inputs in this case are the ingredients and materials used to prepare food and beverages. The process, on the other hand, involves purchasing, storing and cooking among other activities that are necessary in preparing foods and beverages. Finally, output involves serving foods and beverages that are cooked to customers or guests (Davis et al. 2013, p. 162). All these activities involve purchasing process in one way or the other. The purchasing process may be defined as the process that involves searching, selecting, purchasing, receipting and storing materials and ingredients used in preparing food and beverages. Based on this definition, a person that is involved in purchasing food items should also be involved in receiving, storing as well as issuing those items to the person that finally cooks them (Davis et al. 2013, p. 163).

Basically, the purchasing process involves developing the necessary purchase specifications, selecting supplier or the method to be used in the purchase process and finally purchasing the right items without altering the purchase specifications. After the purchasing process is over, then there is the issue of receiving the items that have been purchased or supplied as the case might be. On confirming that the right items have been purchased or supplied, then the items in question are stored until the cooking time comes when issuing takes place. Preparation, cooking and serving follow thereafter. In one way or the other, the purchasing process is part of the control cycle (Davis et al. 2013, p. 163).

Given that I will be the one organizing the party, then I will control the purchasing process. This will not only ensure that the right food items will be purchased, but it will also ensure the party will operate within the budget of £1,000. As a result, I will be the one that determines the food ingredients and beverages to be bought as well as ensure that all of these ingredients and beverages are bought as I will direct. In this case, the serving staffs will only be part of the purchasing process, but they will not influence the purchasing process in any way. In other words, even if serving staffs will be involved in the purchasing process, I will be involved in almost every stage of the purchasing process. For this reason, I will determine the ingredients to be bought, their units and prices. In spite of this, I will not be involved in issuing ingredients even if I will confirm that the right ones will be bought. The purchasing process will either be through cash and carry or through supplier (Davis et al. 2013, p. 169). However, this will depend on convenience of the method that will be preferred by the pub staffs.

 Food and beverage menu

The most important aspect in developing food and beverage menu for any event or hospitality establishment is to understand the needs and preferences for the expected guests or customers. This helps one to include the right dishes on the menu. On the other hand, although there are different types of menus, it is always imperative for one to understand the type of menu that suits best a particular event or establishment. This helps in developing a proper  menu. This notwithstanding, every menu should focus its attention on nutritional value of its dishes (Ojugo 2010, p. 38). This helps in exempting junky food from menus.

Number Dishes Beverages Starter Fruits
1 Brown and white rice Soft drinks Dessert/sweets Oranges
2 Brown and white chapatti Bottled water Mango juice Bananas
3 Vegetables Milk   Melons
4 Steamed chicken     Apples
5 Fried fish     Pawpaw
6 Beef stew      
7 Potatoes      
8 Peas      
9 Beans      
10 Steamed cabbage      
11 Pasta      

Recipes justifications

Looking at the guests that I expect to have in the party, it is clear that there will be about four groups of them and that each group will have specific needs and preferences. These groups of guests will include children, diabetic guests, vegetarians and adults. Based on the information I have, I need to develop an exciting option for about ten children that will be attending the party. I also need to cater for he needs of four diabetic guests that I do not know whether they are type 1 or type 2 as well as ten vegetarians. Once again, I do not know whether the vegetarians that will be attending the party take animal products or they do not take animal-related products at all. Finally, I need to cater for unspecified needs of about thirty-six adults.

While developing the above menu, I have taken into considerations the needs and preferences for all these groups of guests. First, with regard to vegetarians, I have ensured that their food does not have meat or any animal related product. In fact, I have ensured that all types of food will be cooked and served separately. This will allow guests to select and serve food on their own from the serving tables. In this case, vegetarians will select their preferred dishes from all the dishes listed on the menu except meat and other animal related products. Second, with regard to diabetic guests, I have included food that is suitable for both type 1 and type 2. Such foods include brown rice, brown chapatti, steamed chicken, beans, and peas (Gordon-Davis & Van Rensburg 1998, p. 283).

Third, I have included food that is easy to chew for the children that will be attending the party. I have tried as much as possible to make this food exciting as well as nutritional. In addition, I have included starters that will be appetizers for the children as well as for other guests. Fourth, for the sake of the adults that do not have specified food preferences, I have liaised with my colleagues in determining the dishes that are on my proposed menu. Some of these dishes are the favorites for my colleagues together with their spouse. As a result, I expect the party to be enjoyable and memorable.  


This report highlights the process that I will follow to control cost as I organize an end of term party for my colleagues. In this report, I have indicated that I will develop a budget that will not exceed £1,000 that my colleagues and I will contribute towards the party. The first part of this report highlights the financial statements that I will utilize in ensuring that my budget does not exceed the proposed budget. These statements will be similar to the ones used in hospitality industry except that they will be slightly different. The second part of the report highlights the cost and pricing mechanisms that I will utilize. The most outstanding mechanism in this part of the report has been to set costs within tolerable limits and account for the way I will spend the money. The third part of the report highlights the purchasing process that I will follow once I set costs within tolerable limits. The fourth part highlights the menu for the party while the fifth part justifies the dishes on the menu.


Brother ton, B., 2012. Introduction to UK hospitality industry: a comparative approach. New York: Routledge.

Davis, B. et al., 2013. Food and beverage management. New York: Routledge.

Dopson, L., & Hayes, D., 2010. Food and beverage cost control. Hoboken, N.J., John Wiley & sons.

Gordon-Davis, L., & Van Rensburg, L., 1998. The hospitality industry handbook on nutrition and menu planning. Lansdowne, Juta.

Guilding, C., 2007. Financial management for hospitality decision makers. New York: Routledge.

Harris, P., 2010. Accounting and finance for the international hospitality industry. Taylor & Francis.

Ojugo, C., 2010. Practical food & beverage cost control. Clifton Park, NY, Delmar, Cengage Learning.

Weygandt, J. et al., 2005. Hospitality financial accounting. Hoboken, N.J., John Wiley & sons.

Item no. Item Units Price per unit (£) Total price/cost (£)
1. Onions 1 kilogram 20 per kg 20
2 White rice 5 kg 10 per kg 50
3 Brown rice 5 kg 10 per kg 50
4 White cooking flour 2 packet 10 per packet 20
5 Brown cooking flour 1 packet 10 per packet 10
6 Vegetables 50
7 Milk 10 liters 3 per liter 30
8 Mango juice 10 liters 5 per mango 50
9 Dessert/sweets 2 packets 2 per packet 10
10 Apples 20 pieces 1 per apple 20
11 Melons 5 pieces 5 per melon 25
12 Bananas 25 pieces 1 per banana 25
13 Oranges 10 pieces 2 per orange 20
14 Chicken 5 chicken 10 per chicken 50
15 Fish 5 fish 10 per fish 50
16 Potatoes 5 kg 2 per kg 10
17 Peas 5 kg 2 per kg 10
18 Beans 5 kg 2 per kg 10
19 Cabbage 2 cabbages 3 per cabbage 10
20 Pasta 70
21 Beef 5 kg 10 per kg 50
22 Bottled water and soft drinks 60 bottles 1 per bottle 60
23 Service charge 200
24 Miscellaneous 100
25 Total 1,000