8655.0 - Cafes, Restaurants and Catering Services, Australia, 2006-07 Quality Declaration 
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 28/04/2008   
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Available seating

This item refers to the number of seats available for use by patrons in the normal operation of a cafe or restaurant.

BYO cafes and restaurants

BYO cafes and restaurants are those where the proprietor holds a current BYO licence allowing consumption of alcohol brought onto the premises but not bought on the premises.Casual employees

This item refers to employees who are not entitled to take paid leave.

Computer software expensed

Computer software expensed is the cost of computer software that has been fully charged to profit as an expense in the current accounting period.Depreciation and amortisation

This item refers to regularly recurring financial charges made in the accounts to reflect that part of the value of the asset which may be regarded as having been used up in producing revenue in a particular accounting period. Depreciation generally refers to physical (tangible) non-current assets, and amortisation generally refers to intangible non-current assets. Electricity, gas and water charges

These charges relate to the consumption of electricity, gas and/or water during the normal operation of the business.


This item represents all employees on the payroll for the last pay period ending in June. Employees absent on paid or prepaid leave are included. Subcontractors and persons paid solely by commission without a retainer are excluded.

Employer contributions to superannuation funds

This item includes all employer contributions to superannuation schemes excluding contributions paid in lieu of wages and salaries (as part of a salary package).

Employment at end June

This item represents all working proprietors and partners, salaried directors and other employees on the payroll of the business during the last pay period ending in June. Permanent, temporary and casual employees and employees absent on paid or prepaid leave are included. Non-salaried directors, self-employed persons such as consultants and contractors, persons paid by commission only and volunteers are excluded.Franchise fees

This item includes payments made under licensing arrangements, withholding tax and advertising levies paid to the franchisor.

Fringe benefits tax

Fringe benefits tax is payable by employers when certain benefits in excess of normal wages or salaries (e.g. free or discounted goods or services) are received by their employees (or associates of employees) in connection with their employment.Income from other services

This item includes services income not associated with the sale of prepared food and beverages.

Industry value added (IVA)

IVA represents the value added by an industry to the intermediate inputs used by the industry. IVA is the measure of the contribution by businesses, in the selected industry, to gross domestic product. The derivation of IVA for market producers is as follows:

sales and service income

plus funding from federal, state and/or local government for operational costs

plus capital work done for own use

plus closing inventories

less opening inventories

less intermediate input expenses

less capitalised purchases

equals IVA.

Wage and salary expenses and most other labour costs are not taken into account in its calculation nor are most insurance premiums, interest expenses, depreciation or a number of lesser expenses including bad debts, computer software expensed and state gambling taxes.

Insurance premiums

Insurance premiums are expenses incurred by a business in respect of different types of insurance policies but excluding workers' compensation and compulsory third party motor vehicle insurance.

Interest expenses

These are outflows of funds related to the cost of borrowing money.

Interest income

This item represents income earned through the lending out of funds owned by the business.Labour costs

These include staff-related costs such as wages and salaries (including moneys paid directly through the payroll to freelancers without an ABN), fringe benefits tax and payroll tax, employer contributions to superannuation funds, workers' compensation premiums, provision expenses for employee entitlements, salary sacrifice paid on behalf of employees and employee share based payments and stock options expensed to the business. Capitalised wages and salaries are excluded.

Licensed and BYO cafes and restaurants

This item refers to cafes and restaurants where the proprietor holds both:
  • a current liquor licence allowing the sale of liquor for consumption on the premises and
  • a current BYO licence allowing consumption of alcohol brought onto but not bought on the premises.

Licensed cafes and restaurants

This item refers to cafes and restaurants where the proprietor holds a current liquor licence allowing the sale of liquor for consumption on the premises. It includes cafes and restaurants operating within a club or hotel where the liquor licence may be held by a licensee of either the restaurant, club or hotel.Main occupation

Main occupation refers to the activity on which a person working for the business spent the majority of his or her time during the last pay period ending in June.Operating profit before tax

This item is a measure of profit (or loss) during the reference period, taken before extraordinary items are brought to account and prior to the deduction of income tax and appropriations to owners (i.e. dividends paid, drawings). It is derived as:

total income

plus closing stocks

less total expenses

less opening stocks

equals operating profit before tax.

Operating profit before tax per seat

This item is the ratio of operating profit before tax to available seating. This item excludes catering businesses.

Operating profit margin

This represents the percentage of businesses' sales of goods and services which becomes profit after all operating expenses have been deducted. It is derived by expressing total operating profit before tax as a percentage of total sales of goods and services.

Other contract, subcontract and commission expenses

This item refers to payments to other businesses and self-employed persons for work done or sales made on a contract or commission basis and payments to persons paid by commission without retainer. It excludes contract payments specified elsewhere, such as payments to employment agencies for staff.

Other expenses

Includes all other operating expenses not listed as a separate expense item (e.g. security, cost of materials used in training, laundry/dry cleaning).

Other income

This includes net profit (loss) resulting from revaluation of assets in accordance with AEIFRS, net profit (loss) resulting from variations in foreign exchange rates, net profit (loss) on share trading, net profit (loss) on the sale of other assets and dividend income.

Other purchases

This item refers to purchases not listed separately. It may include purchases of crockery, glassware, tablecloths and cleaning materials.

Other sales of goods

This item refers to income earned from the sale of goods not included elsewhere. Such items may include cigarettes, confectionery and other finished goods for resale, excluding prepared food and beverages.

Other service income

This item refers to income such as contract or subcontract commissions, consultancy fees, corkage, management and administration service fees, subscriptions and membership fees and other service fees. Payments to other businesses (e.g. employment agencies) for staff

This item represents payments made to other businesses for the supply or recruitment of staff, such as employment agencies.

Payroll tax

Payroll tax is a tax levied by state and territory governments upon the amount of wages and salaries paid by a business.

Permanent full-time employees

This item refers to employees who work 35 hours per week or more and are entitled to paid leave.

Permanent part-time employees

This item refers to employees who work less than 35 hours per week and are entitled to paid leave.


Purchases are the cost of non-capitalised goods and services used in the production of the final output of a business. This item includes foodstuffs for use in preparing meals and takeaway food, liquor and other beverages, other goods for resale (merchandise), guest supplies and replacement items. It excludes contract, subcontract and commission expenses, capitalised purchases, and parts and fuel for motor vehicles.Rent, leasing and hiring expenses

Rent, leasing and hiring expenses are the costs for the rent, leasing (excluding finance leases) and hiring of vehicles, land, buildings, machinery, equipment and any other property from other businesses or individuals.

Rent, leasing and hiring income

Rent, leasing and hiring income is revenue derived from the renting, leasing or hiring of assets such as land, buildings, vehicles, machinery or equipment to other businesses or individuals.

Repair and maintenance expenses

Repair and maintenance expenses are costs associated with work undertaken on plant and machinery etc. to maintain normal business operations. It includes repair and maintenance of computer and communication software and hardware and off-road motor vehicles. It excludes repair and maintenance of on-road motor vehicles and wages and salaries of own employees.Salaried directors of incorporated businesses

Salaried directors of incorporated businesses are directors who received a wage or salary during the reference period. As such, salaried directors are considered to be employees of the business.

Salary sacrificed earnings, share based payments and stock options

Salary sacrificed earnings refers to an arrangement where employees agree to forego part of their pre-tax salary in return for benefits. It includes earnings sacrificed by employees in order to make superannuation contributions or for other employee benefits (e.g. motor vehicles, laptop computers). Share based payments and stock options are payments expensed to the business for the purpose of remunerating employees and are accrued during the 2006-07 reference period.

Sale of liquor and other beverages

This item includes income from provision of beer, wine, spirits, soft drinks and other beverages served with meals or sold on a takeaway basis.Takings from catering services

This item refers to income received from catering services. It excludes income from the provision of meals sold for consumption on the premises and takeaway food.

Takings from meals consumed on the premises

This item refers to income received from the provision of meals sold for consumption on the premises. It excludes income from catering services and takeaway food, as well as takings from beverages.

Takings from takeaway food

This item refers to income received from the provision of food sold for consumption off the premises, for example, food sold in takeaway packs or containers. It excludes income from catering services and the provision of meals sold for consumption on the premises.Unlicensed cafes and restaurants

This item refers to cafes and restaurants not licensed to sell or allow the consumption of alcohol on the premises.Wages and salaries

This item represents the gross wages and salaries (excluding capitalised wages and salaries) of all employees of the business. It includes severance, termination and redundancy payments, salaries and fees of directors and executives, retainers and commissions of persons who received a retainer, bonuses, and annual and other types of leave. Provision expenses for employee entitlements are also included (e.g. provisions for annual leave and leave bonus, long service leave, sick leave, and severance, termination and redundancy payments). Payments related to salary sacrifice and payments to self-employed persons such as consultants, contractors and persons paid solely by commission without a retainer are excluded. The drawings of working proprietors and partners are also excluded.

Workers' compensation premiums/costs

Workers’ compensation is a compulsory insurance cover taken out by all employers, except for self-insured workers, according to legislative schemes to cover employees suffering injury or disease in the course of, or arising out of, employment.

Working Holiday visa

A Working Holiday visa is available for people aged 18 to 30 years of age, entitling the holder to a working holiday of up to 12 months in Australia. This visa allows visitors to supplement the cost of a holiday through incidental employment.

Working proprietors and partners of unincorporated businesses

A working proprietor or partner of an unincorporated business operates his or her own business (a sole proprietorship), while a partner, along with one or more other partners, operates a partnership. Working proprietors and partners are:
  • the owners of their business
  • legally inseparable from the business entity
  • liable for any business debts that are incurred.

As such, working proprietors and working partners are not considered to be employees of their business.