Front Office Accounting: Basics of Hotel
Summary
TLDRThis EBG Bachelor video features Dr. Anguish and Vardar discussing the essentials of front office accounting in hospitality. They cover the significance of an effective accounting system in managing guest transactions, from pre-arrival to departure. Key topics include folio management, types of accounts, postings, vouchers, point-of-sale operations, ledgers, and the role of the visitor's tabular ledger in tracking daily sales and financial management.
Takeaways
- 🏢 Front Office Accounting is essential for managing hotel transactions involving guests and non-guests.
- 📊 It involves various stages including pre-arrival, arrival, occupancy, and departure to ensure accurate financial records.
- 💼 The system's effectiveness is crucial for collecting outstanding balances and depends on its usage and performance.
- 📋 Accounts folios, which are records of financial transactions, are maintained for guests and non-guests to track their financial activities with the hotel.
- 📊 T-accounts are used for summarizing financial data, with debits on one side and credits on the other, showing increases and decreases in account balances.
- 📑 Folio is a statement of all transactions affecting the balance of each individual account, including room charges, phone calls, and other services.
- 📄 Voucher systems are used for recording transactions made by guests, which are then posted in the guest folio for record-keeping.
- 📊 Point-of-Sale (POS) terminals ensure that all charges for goods and services are correctly posted to the guest folios.
- 📈 Ledgers, including guest and non-guest ledgers, are used to summarize accounts and are crucial for financial reporting like profit and loss accounts.
- 📊 The Visitor's Tabular Ledger (VTL) provides a daily summary of room sales, food sales, and other transactions, aiding in revenue analysis.
- 📅 Guest weekly bills are prepared to summarize a guest's account details and are used for settlement upon departure.
Q & A
What is the main topic of the video?
-The main topic of the video is 'Front Office Accounting', which is a module from tourism and hospitality focusing on the basics of hotel accounting.
What is the importance of front office accounting in a hotel?
-Front office accounting is crucial as it involves a set of procedures to monitor, record, and manage the transactions of guests and groups using the hotel's facilities and services. It ensures the collection of outstanding balances.
What are the stages involved in the guest cycle that an effective accounting system should perform?
-An effective accounting system should perform during various stages of the guest cycle, which include pre-arrival (gathering reservation data), arrival (checking room rates and discounts), occupancy (tracking guest transactions), and departure (ensuring payment for services).
What is a folio in the context of hotel accounting?
-A folio is a record-keeping device that stores information about guests' and non-guests' financial transactions. It resembles a T-account with charges on one side (debit) and payments on the other side (credit).
How does the balance in a T-account or folio get calculated?
-The balance in a T-account or folio is calculated by subtracting the total of the credit side from the total of the debit side.
What are the two types of accounts that the front office has to maintain?
-The front office has to maintain two types of accounts: guest accounts, which record financial transactions between the hotel and in-house guests, and non-guest accounts, which may be created for local business or former guests who did not settle their bills.
What is the purpose of a charge voucher in hotel accounting?
-A charge voucher is used when a guest receives goods and services from the hotel but does not pay for them immediately. It records the transaction and is signed by the guest, then sent to the front office for posting in the folio.
What is a point-of-sale (POS) in a hotel?
-A point-of-sale in a hotel is the location where guests purchase goods or services. It is any section of the hotel that collects revenue for its goods and services.
What is a ledger in hotel accounting?
-A ledger in hotel accounting is a book where account summaries of both resident and non-resident guests are entered. It aids in preparing the profit and loss account and balance sheet of a hotel.
What is a visitor's tabular ledger (VTL) and what does it represent?
-A visitor's tabular ledger (VTL) is a loose sheet form that records all guests' names, room numbers, and other details for one day. It represents the total daily sale of the hotel and is used for monthly, quarterly, and yearly sales analysis.
What is a guest weekly bill and when is it prepared?
-A guest weekly bill is prepared for each guest and is presented on checkout for settlement. It is opened immediately on check-in by the receptionist and contains details of the guest's stay, charges, and payments.
Outlines
🏨 Front Office Accounting Basics
The paragraph introduces the concept of front office accounting in the hospitality industry. It explains that this system is crucial for managing transactions involving guests and non-guests using hotel facilities. The system tracks financial activities from pre-arrival to departure, ensuring payments for services rendered. It also mentions the importance of effective accounting for revenue management and the shift from manual to automated systems to reduce errors and improve efficiency.
📊 Understanding Guest and Non-Guest Accounts
This section delves into the specifics of guest and non-guest accounts. Guest accounts track financial transactions during a stay, while non-guest accounts handle charges for local business or incompletely settled accounts. It discusses the process of creating these accounts, the types of transactions recorded, and the procedures for payments and adjustments. The paragraph also introduces folios, which are detailed records of transactions affecting account balances, and the different types of folios used in hotel operations.
📄 Types of Postings and Vouchers
The paragraph explains the two main types of transactions posted to guest accounts: debits and credits. Debits include charges for services like rooms, restaurants, and telephone, while credits account for payments and adjustments. It also discusses various types of vouchers used in hotel operations, such as charge vouchers, correction vouchers, allowance vouchers, transfer vouchers, and paid-out vouchers, each serving a specific purpose in recording and managing transactions.
🛒 Point-of-Sale and Ledgers
This section describes the point-of-sale (POS) as the location where guests purchase goods or services, emphasizing the front office's role in ensuring these charges are accurately posted to guest folios. It also explains the concept of ledgers, which are books that summarize account information for both guests and non-guests. The paragraph distinguishes between guest ledgers, which track individual guest transactions, and non-guest ledgers, which handle accounts not settled at checkout or held by local businesses.
📈 Accounting Systems and Guest Weekly Bills
The final paragraph discusses different accounting systems used in hotels, ranging from manual to fully automated, each with its advantages and disadvantages. It highlights the importance of an effective accounting system in managing guest transactions and ensuring revenue. The paragraph also introduces the concept of a guest weekly bill, detailing its preparation and contents, which include guest information, services used, charges, and payment details. It emphasizes the importance of accurate record-keeping for efficient financial management.
Mindmap
Keywords
💡Front Office Accounting
💡Folios
💡Point of Sales (POS)
💡Accounting Systems
💡Vouchers
💡Guest Ledger
💡Non-Guest Accounts
💡Debit and Credit Entries
💡Visitors Tabular Ledger (VTL)
💡Weekly Bill
💡Pre-Arrival Stage
Highlights
Front Office Accounting is essential for managing hotel transactions.
The system tracks guest and non-guest transactions using accounts folios.
Effective accounting is crucial for collecting outstanding balances.
Pre-arrival stage involves gathering reservation and deposit data.
At guest arrival, room rates and applicable discounts are recorded.
Occupancy stage tracks guest transactions for billing.
Departure stage ensures payment for services used.
Accounts are maintained for each guest and non-guest for financial tracking.
T-accounts are used for accumulating and summarizing financial data.
Automation has reduced the manual use of T-accounts in modern hotels.
Journal forms are used in non-automated systems for recording transactions.
Automated systems list charges and payments in a single column with signs indicating balance changes.
Two types of accounts: guest accounts and non-guest accounts.
Folios are statements of all transactions affecting account balances.
Invoices in hotels serve as proof of payment for services.
Types of folios include guest folios, master folios, non-guest, and employee folios.
Postings to guest accounts are either debit or credit entries.
Vouchers document transactions and support charge recordings.
Point-of-sale terminals ensure charges are posted to the correct guest folios.
Ledgers summarize accounts of resident and non-resident guests.
Guest ledgers track financial transactions and account balances.
City ledgers handle non-guest accounts and are used for collections.
Accounting systems can be manual, semi-automated, or fully automated.
Visitors Tabular Ledger (VTL) provides a daily summary of hotel sales.
Guest weekly bills are prepared for结算 upon departure.
Transcripts
[Music]
welcome to EBG bachelor this is doctor
anguish and Vardar
from department of tourism and hotel
management Kurukshetra musty crook
Chaitra today I'll be taking about
module from tourism and hospitality
front office operations and management
and the model is front office accounting
basics of hotel accounting in this
chapter we'll be learning various
aspects related to accountancy such as
front office accounting accounts folios
vultures Point of Sales Ledger's
accounting systems Visitors tabular
ledger guests weekly bill and understand
important forms and formats used in
accounting basics of photo accounting a
front office accounting system is a set
of procedures used to prepare maintained
monitor record the transactions of
guests and groups and other non guests
using the hotel facilities and services
the front office ability to collect
outstanding balances depends upon the
usage and performance of the accounting
system followed by hotels and if a
effective accounting system consists of
performed during various stages of
guests cycle at the pre-arrival stage a
guest accounting system gathers data
related to reservations guarantee and
any advance deposits at the time of
guests arrival the accounting system
looks for room rates assigned and the
Texas discounts applicable at the
registration during the occupancy stage
the transaction of the guests are
tracked and posted to the folios lastly
at the departure stage guests accounting
system ensures payment for facilities
and services available the financial
transaction of CD guests or non guest
accounts may also be proceeded as but
the parameters of front office
accounting it helps in promoting local
business the non guest accounts also
include a
of former guests who did not settle
their respective bills whereas the
responsibility of collecting non guest
accounts shits from front office cashier
accounting division a front of a system
generally creates and maintains and
accounting record for each guest and non
guest account track and record financial
transactions throughout the guests cycle
and ensuring control over cash and
non-cash transactions front office
accounting when it comes to accounts an
account is a system of accumulating and
summarizing financial data on a form or
a sheet of computerized system it
contains and stores the various business
transactions held during various stages
of guests stay in the hotel front of
accounts are record-keeping devices to
store information about guests and non
guests financial transactions an account
is written form resembles letter T and
is called a t account with charges on
one side which means the debit part and
the payment on the other side which
means the credit part of the account in
present times the growing use of
automation in front office has
diminished the use of T accounts on the
left-hand side of the T charges are
posted which shows increase in the
account balance and the payments are
posted on right hand side denoting
decreases in the account balance the
account balance is calculated by
subtracting right side total from the
left side total of the t account front
office documents typical journal form in
non automated or semi-automated
record-keeping system a journal contains
following information description of
charges that is the debit part payment
that is the credit part and the balances
if any in fully automated system charges
and payments may be listed in a single
column the minus and the plus signs will
indicate
the decrease or increase in the account
front office has to maintain and take
care of two types of accounts number one
guest account it is the record of
financial transactions between hotel and
in-house guests such accounts are
created at the time of guests guaranteed
reservation or add the registration of
the guests in the hotel during the stay
the front office looks for any
transactions held by guests and post the
same in guest folio the payments of the
accounts is gently taken at the checkout
stage of the guests but in some cases a
guest may be requested to make partial
or full payment during any time of
guests cycle it may be seen when a guest
crosses house limit set by the hotel for
every individual guests the other type
of account is non guest account in order
to promote local business and corporate
business hotel might extend charge
privilege to such guest groups and for
non guest accounts may be created non
guest accounts may be formed even for
those guests who do not settle their
accounts completely hence changing their
status from guests to non guests the non
guest accounts are generally billed
monthly by the hotel accounting section
the other part of accounting is folios a
folio is a statement of all transactions
affecting the balance of each individual
account it lists the debits and the
credits of your charges for example room
charge phone calls
many of our laundry services room
service valet flourish shop spa extra
the invoice in hotel is no different
than a invoice for any other goods or
services it is simply proof of how much
against have paid it is gently opened at
the time of reservation or once the
guest registers with the hotel at
chicken at settlement the guest folio is
to be returned to zero balance by any
mode of payment the process of recording
transactions on folio are termed as
postings
now types of folios first type of folio
is guest for you it is an account
assigned to a single hotel guest
all transactions between the hotel and
the guest are recorded into the guest
folio other is master folio it is an
account assigned to more than one guest
or guest rooms usually for groups that
is travel agents or company the other is
non guest or semi folio it is a Hotel
folio that contains records of a walk-in
guests or non gas business or agencies
with charge privileges non guests also
include persons utilizing facilities
like spa health club pool extra the
other is employee folio it has an
account assigned to hotel employees with
charge privilege all transactions
between the hotel and the employee are
being saved into this folio types of
postings there are two types of
transactions that are posted to the
guest account they are debit and credit
entries most importantly the debit items
include room charges restaurant charges
coffee shop charges bar charges
telephone charges laundry used for hotel
facilities etc example health club
business center and transportation
credit entries include pre payments
payment for part of the bill during
state payment for final settlement
amendments to the bill next part is
voucher these are documents that have
details of transactions made by guests
from various point of sales in hotels
like room service restaurant extra the
water is sent to front office for
posting in the guest folio and record
keeping virtuous act as a supporting
document of the transactions happen
between the hotel and the guest a
voucher also acts as a proof that a
transaction has taken place in the hotel
charged vouchers correction vouchers
allowance Watchers
transfer vouchers and paid out vouchers
are examples of voters made and made at
front-office
most automated systems require only
futures are the terminals interfaced
with property management system are
capable of electronically transmitting
transactions information directly to
electronic folios first charge voucher
the guest receives goods and services
from the hotel but does not pay for them
immediately known as deferred payment
transaction wherever the transaction
occurs same has to be communicated to
front office for posting in folio and
the same is recorded on a charge voucher
duly signed by the guest the charge
voucher is also called as an account
receivable voucher next is correction
vouchers it is an error found in a guest
folio an account correction transaction
corrects the same it has to be carefully
done on the same date of the business
day an account correction can either
increase or decrease an account balance
example if a charge is wrongly posted as
higher than the actual rate it can be
corrected on the same day after entering
the details of correction in a
correction voucher next is allowance
watcher and allowance watcher requires
management approval they are generally
of two types one type of allowance is a
compensation given to a guest for poor
service or dissatisfaction related to
goods or services etc the other type of
allowance is a correction to a posting
error on an existing account after the
close of business the allowances given
must be documented with the use of an
allowance watcher another is transfer
voucher a transfer voucher is used when
the account balance or account entry is
transferred or shifted from one folio to
another folio an account transfer may
also occur when a guest checks out by
paying through credit mode the guest
outstanding account balance is
transferred from a guest account to a
non guest account through the use of a
transfer voucher
next is paid out voges or visitor's paid
out a guest may sometimes request
services which are not available in
hotels in such cases the hotel will
arrange those services from outside the
organization the staff will arrange and
pay for these services and notify
reception or kasher of the charges to be
added to the guests folio it is cash
paid out by the hotel on behalf of the
guests petty payments like take Sofia
cinema tickets purchase from outside
hotel posted estra are made by the front
desk a visitor's paid out voucher is
issued on guests name and his signature
is collected and the amount is debited
in the guests folio next important part
in front of the counting is
point-of-sales the term point-of-sale
denotes the location at which guests
purchases goods or services in hotel
property any section of a hotel
collecting revenue for its goods and
services is considered as point of sale
the responsibility of front office is to
ensure that all charge purchases at
these points are posted to proper guests
folios guests operated device like
minibar in room vending are even
considered as point-of-sale and the
transaction hell is posted in folio and
in case of fully automated system the
charges gets directly posted to the
individual folio of the guests the
automated system helps in reducing the
time and may be more accurate to post
the services with minimum errors the
hotel offers various goods and services
are different locations in the hotel and
require proper posting and documentation
of sales transactions point-of-sale must
provide some basic information when
posting in a charge through a remote
terminal or submitting a voucher or
transaction number the amount charged
room number name of the point-of-sale
like room service health club extra
description of charge like beer massage
extra
the signature of the guests and the
employees identity submitting the charge
posting through an automated terminal
only requires the guests signature on
the voucher or sales slip in case of any
dispute regarding the transaction posted
next important part in accounting is
Ledger's a ledger is a book in which the
account summary of both resident and
non-resident guests are entered the
front office ledger is a collection of
front office account folios they are the
power of accounts receivable ledger and
account receivable ledger represents
money owned to the hotel moreover this
ledger aids in preparing the profit and
loss account and balance sheet of a
hotel front office accounting system
separates accounts receivable ledger in
two groups the guest ledger and the non
guest ledger when it comes to a guest
ledger a guest ledger is a type of
ledger that has the accounts of all the
guests staying in a hotel or guests who
have sent advance deposit all financial
transactions made by a guest are
recorded on to guests folio open at the
time of registration to assist tracking
guests account balances this ledger is
also known as translate or room ledger
guests who make appropriate credit
arrangements at registration may be
extended privileged to charge purchase
to their individual account folios
guests may also pay against their
outstanding balance at any time during
occupancy guests financial transactions
are recorded in guest ledger accounts to
track guest account balances some of the
accounts of the resident guests may be
settled by their company travel agency
or airline company nexus city ledger the
city ledger is also known as the non
guest ledger and it is the collection of
non guest accounts if a guest account is
not settled by
guest info in full at checkout the
guests folio balance is transferred from
the guest ledger to the city ledger in
the accounting division for collection
post departure of the guest City ledger
could also include accounts held by
local business people using hotel
facilities and services for
entertainment or business meetings
guests who walk out of the hotel without
settling the outstanding balance guests
who have sent pre payments to the
guarantee they are booking but have not
arrived or checked in
even a skippers outstanding balance is
transferred to city ledger with the hope
that the amount may come through another
important part is accounting system the
format's of guests and non guests
account folios may be different
depending upon the front office
record-keeping system the process of
guest accounting is operated either
manually that is non automated in which
in this operating system all the phase
involved in accounting process are
carried out by the staff guest folio in
a manual system contain a series of
column for listing individual debit and
credit entries accumulated during
occupancy at the end of business day
each column is totaled and the ending
balance is carried forward as the
opening folio balance of the following
day the entire system is prone to
emissions and computation errors another
drawback is handling and re handling of
numbers date this type of system is
useful for small hotels only where the
workload is not much another system is
mechanical system or semi automated
system this system is used by hotels
which are medium-sized or large but yet
don't have automatic machines like
computers usually they use a combination
of office machines clerical equipment
and manpower to operate these systems
guest transactions are printed
frequently on a machine posted folio the
information recorded for each turn
action includes the date Department or
reference number amount of the
transaction and new balance of the
account the folios outstanding balance
is the amount the guest owes to the
hotel or the amount the hotel owes the
guest in the event of credit balance at
settlement if the posting is done by a
mechanical equipment it does not retain
individual folio balances this means
that each accounts previous balance must
be re-entered each time an account
posting is made to the folio and next is
through computers that is fully
automated system in this system
comprises of computers and other
electronic devices located at every
point of sale and interfaced with the
main cashier at the front desk all tasks
done manually is easily done by
automatic machines whether it's posting
auditing correction of errors etc the
machines are fast and practically no
possibility of late charges necessary
steps such as sorting of vouchers
identification posting code and
reference code posting are automatically
carried out since computers are machines
operated by humans it is obvious that
the accuracy will depend upon the
software developed and the efficiency of
the staff operating next important part
in accounting is visitors tabular ledger
that is VTL a visitor's tabular ledger
is in a loose sheet form one vtl is
prepared for all the guests for one day
that mean all guests names room numbers
extra staying in the hotel are entered
in one visitors tabular ledger in case
all the names cannot be entered in one
visitor tabular ledger then one more
sheet can be added for the same day from
visitor tabular ledger
Hodel can know the total room sale food
sale breakfast sale extra for one day
the total sale shown by the VTL is the
total daily sale of the hotel at the end
of the day the VTL is sent to Accounts
Department account Department then finds
out Vee
we monthly quarterly yearly sale this
sale can be compared with the last year
sale or with the busted sale VTL has
also debit side and credit sides instead
of having left side as debit and right
side as credit the VTL z-- upper portion
is debit side and the lower portion is
credit side all the debit watches are
posted in the debit side of the visitor
tabular ledger in the respective columns
the credit vouchers are entered on the
credit side of the ledger all allowances
discounts cash deposits credit balance
carried forward are entered in the
credit side of the visitors tabular
ledger discount and allowance offered
must be duly authorized otherwise
cashier will be responsible to pay next
in next important part is guests weekly
bill guess weekly bill is prepared for
each guest and is presented on checkout
for settlement it is called a weekly
bill as for one week one bill is
prepared there is no hard and fast rule
that a bill has to be prepared for one
week
in case majority of guests in a hotel
stay for three days then one may adopt a
three day bill if a guest is beyond
three days then another bill is attached
the guests weekly bill is opened
immediately on chicken by the
receptionist the copy of this guests
registration card is stapled with a
weekly bill folio the gasher can refer
to guests signature on guests
registration card and compare his her
signature with the voucher if signature
tallies then the cash and debits the
watcher to guess account otherwise
he/she may send the bill back to the
outlet with a remark that the signature
does not tally all the weekly bills are
placed numerically in the vertical file
and it helps in taking out a particular
bill instantly the vouchers after
posting in the guest weekly bill should
be kept in the bills rack a guest weekly
bill generally contains details
jazz email room number name of the guest
nationality of the guests designation of
the guest office address emails
telephone number permanent addresses
date and time of arrival date and time
of departure type of room the number of
packs it had the rate allotted room
allotted plan billing instructions like
credit card the credit card number the
expiry date of credit card and the
person who are taking the booking it
even contains details of debit and
credit the allowances incurred in the
guest account the ledger details the
transfer voucher details and the balance
if any well to summarize the whole unit
during the state guesses offered various
facilities and services like room food
and beverage health club telephone extra
for each of these services the payment
is expected either at the time of
service rendered or on or after the
departure time in order to present the
final bill with all voters duly debited
a proper record of all the voters is
recorded in the guests folio and in
guests ledges the front office ability
to collect outstanding balances depends
upon the usage and performance of the
accounting system followed by the hotel
an effective accounting system consists
of performed during various stages of
guests cycle at the pre-arrival stage a
guest accounting system gathers data
related to a reservation guarantee and
any advance deposits are the time of
guests arrival the accounting system
looks for room rates assigned and the
Texas or discounts applicable are the
registration during the occupancy stage
the transactions of the guests are
tracked and posted to the folios lastly
at the departure stage guests accounting
system ensures payment for facilities
and services available for watching ABG
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