Dukan ka kharcha kaise likhen: how to keep a shop expense register

What is a shop expense register?

A shop expense register is a list of every payment the shop makes to keep running (rent, bijli, gas, salaries, transport, packing, repairs), written on the day it is paid, with the date, the type of expense, the amount and how it was paid. It does not include the stock you buy to sell or money you take home. At the end of the month it shows exactly what it cost to keep the shop open.

It sits beside the other books a shop keeps: the sales or cash-up for money coming in, the khata for udhaar, and the supplier book for what you owe the distributor. If you are setting those up too, /blog/shop-hisab-kaise-kare covers the daily hisab.

What goes in the register, and what doesn't?

Only the shop's running costs go in. Stock bought for resale goes in the purchase or supplier book, money taken home is the owner's drawing, and a staff advance is a loan to the employee. Put any of these in the expense register and the shop looks more expensive to run than it is, and the month's profit looks smaller.

• In: rent, bijli, gas, water, salaries and wages, phone and internet, shoppers and packing, rickshaw or loader charges, repairs, cleaning, generator fuel, market or association fees.
• Out: a committee (savings circle) instalment. That is your savings.
• Out: stock bought for resale. That is a purchase.
• Out: money taken for the house. Ghar ka kharcha comes out of profit.
• Out: an advance to a worker. It is owed back, and only becomes salary when you deduct it.
• Out: paying back a loan's principal. The debt goes down, but it is not a running cost.

How do you write one expense entry?

Each entry needs five things: the date, a category, the amount, how it was paid, and a short note such as the bill number or who was paid. Write it the same day the money goes out. An expense left until the evening is often forgotten, and one left until the end of the month almost always is.

1. 1Date: the day the money went out, not the day the bill arrived.
2. 2Category, from a short fixed list: Rent, Bijli, Gas, Salary, Transport, Packing, Repairs, Other.
3. 3Amount: the exact rupees paid.
4. 4Paid by: cash from the drawer, cash from your pocket, JazzCash or Easypaisa, or bank.
5. 5Note: the bill or reference number, or who was paid ("loader, Monday delivery").

Keep the categories few and the same every month. Eight categories that never change tell you more than thirty that drift: "bijli", "electricity" and "WAPDA" in three different months can't be added up.

How do you handle rent, bijli and salary that come once a month?

Write each monthly bill in the register on the day you pay it, for the full amount. Don't split it across days in the register. If you want a daily figure for working out the day's profit, divide the month's total by the days the shop is open. You work that out from the register; it is not an entry in it.

Keep the paper bill, or a photo of it, with the entry. The bijli bill, the rent receipt and the salary record prove the number in the register, and they are the first thing anyone checking your books will ask for.

Is a staff advance an expense?

No. An advance is money the worker owes the shop until it is taken back from the salary. Write it in a separate advance list with the worker's name, the date and the amount. On salary day, pay the salary less the advance and record the full salary as the expense. The advance is then cleared and counted only once.

If you record the advance as an expense and then the full salary as well, that month's expenses are too high by the amount of the advance. If the worker leaves without paying it back, write it off as an expense then, once, with a note.

Should expenses be paid from the drawer?

Small daily costs often are, and that is fine as long as each one is written down when the cash leaves the drawer. Otherwise the evening cash-up comes out short and you can't find why. Larger bills such as rent, salaries and the bijli bill are better paid from a separate float or the bank, so the drawer stays a record of sales.

Keep a slip in the drawer for every rupee taken out, with the amount and what it was for. At closing, the slips go into the register and the drawer balances.

How do you check the register at month end?

Add up each category for the month and put the totals next to last month's. Most leaks show up as one category slowly growing (transport, repairs or "other") rather than as one big payment. Then take the month's total expenses off the month's gross profit to see what the shop earned.

• Which category grew, and can you name the reason?
• How much went under "Other"? If it is large, it needs its own category.
• Do salaries in the register match what you paid, advances included?
• Is every bill you paid this month in the register, with its paper?

Can software keep the register, and who doesn't need it?

Software helps when it is where you already record sales, because then expenses and sales come together into a profit figure without a second book. It does not help if nobody enters the expense on the day it is paid. A small shop with a handful of bills a month, run by one person who writes everything down, can keep this register on one notebook page or a spreadsheet. /blog/excel-vs-pos-software-pakistan compares the two.

In NexusTill, the Expenses screen is on every plan, Starter included. Each expense is saved with a category, the amount, the date, how it was paid and a short note, and, if the shop has more than one branch, which branch spent it. Pick a category or a date range and the screen shows how many expenses there were, their total and the average, for the rows on the list.

On Growth, the analytics view takes the expenses you record off the gross profit from your sales, so the month's net figure is ready without a calculator. On Scale, with double-entry accounting, expenses post to the books on their own. The limit is that the figures are only as complete as the entries. An expense paid from your pocket and never entered is invisible to any software.

See what each plan includes on /pricing, and try it on your own shop for 7 days. No card is needed, and nothing is charged when the trial ends.

Written by NexusTill Team.