Define location and entity before allocating costs
Locations and legal entities are different dimensions. One corporation may run several outlets; related corporations may share staff or buy centrally. We map both before setting up accounts, reporting codes and intercompany balances.
Each outlet uses the same closing timetable and core account categories. Local sales, direct costs and payroll are assigned from source records. Rent, head-office costs and shared purchasing use a documented basis that can be applied consistently rather than changed to improve a result.
Close the transfers as carefully as the sales
Inventory moved between outlets, shared supplier payments, gift cards redeemed elsewhere and staff working across sites all need a matching trail. The scope can include location reports, shared-cost schedules and reconciliation of intercompany accounts, with your accountant confirming accounting policies where necessary. A consolidated view should explain what has been eliminated and what remains outstanding.
Illustrative example: one stock purchase, two shops
A Toronto retailer buys stock centrally and sends a third of it to a Scarborough outlet. Recording the whole purchase against the central store makes the second outlet’s margin look better than it is. Delivery quantities and a consistent transfer record allow both site reports to reflect the stock each actually used or sold.
Questions about this work
Should each location have its own software file?
That depends on legal entities, reporting needs, access and software capabilities. We review the structure before recommending separate files.
Can you compare locations with different sizes?
Yes, but absolute profit is only one measure. Comparable ratios and documented shared-cost allocations help explain differences in opening hours, sales mix and scale.
Put this into practice
A practical next step
Bring the records you have.
We can identify missing information, agree on the scope and organize the next bookkeeping step.
Request a bookkeeping review