Forensic Accounting Experts Help Restauranteurs Tally Their Tabs
Calculations of economic losses, business valuations, wage and hour claims, and more for the food service industry
The last few years have been hard on the restaurant industry, which operates on notoriously narrow profit margins in the best of times. Business interruptions, staffing shortages, supply chain disruption, and inflation have all taken their toll. So, whether you are an independent owner/operator, a franchisee, or the CEO of a major chain, you’re under pressure to minimize the losses you can control and recover the maximum amount if you are entitled to compensation. At North American Forensic Accounting PC, our team of certified experts provides a range of services for businesses in the food and beverage industry, their attorneys, and their insurers. We perform calculations of lost profits and business valuations. We conduct effective investigations of fraud and embezzlement. We also appear as expert witnesses in support of litigation. We have the knowledge, experience, and tools to get at the truth behind the numbers, so our clients can fairly resolve their legal and financial issues.
Lost profit calculations for your restaurant’s business interruption insurance claim
Restaurants are vulnerable to interruptions due to fires, storms, power outages, government lockdowns and other insurable events. But restaurants are also unique among businesses that suffer interruptions for a number of reasons. Their inventory is highly perishable, so little can be salvaged from even a short closure. Earnings can fluctuate wildly according to seasons and other outside forces. And there is the issue of payments being made in cash. These circumstances combine to frustrate even trained professionals who try to assess exactly how much business would have been done if not for the interrupting incident. The result is often a vague, unsubstantiated claim that holds little hope of timely approval. Fortunately, the forensic experts at NAFA are adept at forensic accounting to reconstruct a picture of business as usual. From there, we can apply various factors that tend to impact the food and beverage industry, such as seasonality, consumer habits, inflation, and wider economic trends, to present a calculation of lost profits. Our services help speed approval of claims, so you can get back to business.
Thorough investigations into fraud in the food and beverage industry
There’s an old joke about two restauranteurs meeting for lunch. The owner of the place where they’re eating says, “I’m sorry to hear your diner burned down.” To which his guest answers, “Sh! It’s tomorrow.” While the majority of restauranteurs are honest and conscientious, the industry as a whole has a fraud problem. In some instances, the house cheats its workers and/or patrons, in other cases workers and patrons steal from the house. Common restaurant fraud schemes includes:
- Embezzlement by employees
- Wrongly voided transactions
- Food and liquor theft
- Insurance fraud
- Tax fraud
- Wage and hour violations
NAFA is comprised of experts in fraud investigation, who can spot patterns of misconduct and provide the evidence necessary to remedy the problem.
Quality business valuations for restaurants
Restaurants are frequently the subject of transactions or litigation, during which the interested parties need to know the true value of the enterprise. Reasons for a business valuation include:
- Sale or purchase
- Applying for credit
- Attracting investors
- Business succession planning
Restaurants pose peculiar challenges in valuation due to less tangible factors, such as market conditions, industry trends, location, and reputation. For example, a stand-alone restaurant might be closely associated with its founder/owner/operator. Will customer loyalty survive a change in management? Or, a franchise location that is well run and profitable might suddenly come under a cloud due to scandals within the parent company. NAFA has forensic experts with decades of experience in business valuation. We provide detailed and reliable assessments that consider the full range of pertinent factors affecting a restaurant’s prospects for future success.
Litigation support for restaurants and their parent companies
Restaurants often find themselves in the center of litigation, related to:
- Personal injury, such as slip-and-fall and food poisoning claims
- Alcohol-related liability
- Employment law disputes, such as discrimination and wage and hour conflicts
- Partnership or shareholder disputes
Such litigation generally requires assessments of damages, as well as reliable business valuation. Our forensic experts have the knowledge, tools, and resources to tackle even the most complex tasks, such as wage and hour class actions against restaurant chains. We provide detailed reports, and can appear as expert witnesses giving clear, cogent testimony on all pertinent financial matters.
Contact North American Forensic Accounting PC for restaurant industry services
North American Forensic Accounting PC assists restaurant owners, parent corporations, attorneys, and insurance companies throughout the United States on a variety of crucial matters. Our services include damage calculations, business valuation, fraud detection, and litigation support. To learn more, call us at 347-286-4860 or contact one of our offices online to schedule an appointment. Headquartered in Harrisburg, PA, NAFA serves clients throughout the United States, including in Philadelphia, Pittsburgh, New York City, Atlanta, Charlotte, Miami, and the Tampa Bay Area.