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Check out procedure
1.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Guest Charges, Payment, and Check-out COMPILED BY, MR. SUNIL KUMAR LECTURER,
2.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Guest charges can include: Guest room charges Taxes related to the sale of guest rooms Guest-initiated room telephone charges Food and beverage and other product/services purchases charged to the guest’s room Charges for any other goods and services directly interfaced with the PMS
3.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Generally Accepted Accounting Principles (GAAPs): Standards and procedures that have been adopted by those responsible for preparing business financial statements for the purpose of ensuring uniformity. Accounting: The process of summarizing and reporting financial transactions. Bookkeeping: The process of initially recording financial transactions.
4.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Assets: Items owned by a business including cash on hand, money in checking or other accounts, money owed to the business, inventories, property, equipment, and furnishings. Liabilities: Debts owed by a business. Owner’s Equity: What remains after subtracting what the business owes others (its liabilities) from what the business owns (its assets).
5.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Uniform System of Accounts for the Lodging Industry (USALI): A standard set of accounting procedures used to record a hotel’s financial transactions and condition.
6.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Account: A device used to show increases or decreases in the asset, liability, or owner’s equity sections of the fundamental accounting equation. Because of their shape, accountants refer to these as “T” accounts.
7.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Accounts Receivable (AR): Money owed to a hotel. Accounts Payable (AP): Money owed by a hotel. Retained Earnings: Profits earned but not paid (disbursed) to the business owners.
8.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Double Entry Accounting: A system of recording financial transactions in a way that maintains the equality of the fundamental accounting equation: Assets = Liabilities + Owner’s Equity
9.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Debit: An accounting transaction that records a change on the left side of a “T” account in an asset, liability, or owner’s equity account. Credit: An accounting transaction that records a change on the right side of a “T” account in an asset, liability, or owner’s equity account.
10.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Front Office Accounting System: The automated and/or manual data collection and reporting system that summarizes and documents the financial activities of a front office.
11.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Guest Ledger: The set of accounts used to record charges to and payments from the hotel’s registered guests. City Ledger: The set of accounts used to record charges to and payments from the hotel’s non- registered guests. General Ledger: The primary ledger that contains all of a hotel’s accounts and that is used to create its income (profit and loss) statement.
12.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Adjusting accounts can be necessary as a result of: Posting Errors Hotel-related problems Guest-related problems Total Monthly Allowances and Adjustments = Total Room Room Allowance and Adjustment % Revenue
13.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Back Office Accounting: The process of summarizing and documenting the financial activities and condition of the entire hotel. Controller: The individual (or department) in a hotel responsible for maintaining the back office accounting system.
14.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Settlement (Account): The collection of a payment for an outstanding account balance. Settlement may involve the guest paying cash or charging the account balance to a valid payment card or another hotel-approved account. House Account: An account whose entries are assessed to another hotel entity.
15.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Payment card processing: 1. Initiation Address Verification Service (AVS): A company that, for a fee, allows access to its database of current addresses. 2. Authorization Chargeback: Payment card charges disallowed (reversed) when a cardholder successfully protests the legitimacy of the charge or because the hotel made an error in processing it. 3. Completion of transaction 4. Receipt of funds
16.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Establishing credit limits: Block (Funds): The amount by which a card’s available credit (if a credit card) or balance (if a debit card) is reduced; also called a “hold.” Monitoring credit limits
17.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Departure List: A report, by name and room number, of all guests scheduled to leave the hotel on a specific date. Late Check-out: An arrangement that allows a guest scheduled to leave the hotel to maintain access to his/her room after the standard check-out time.
18.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Bucket Check: Industry jargon for a systematic examination of guests’ folios to ensure the accuracy of guest information. Bucket checks typically include rate verification, credit monitoring, and confirmation of departure date and guest room assignment.
19.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Check-out fundamentals: Creation of departure list Confirmation of guest identity Quality of stay inquiry Property exchange Final data entry/posting of charges Guest folio inspection Processing guest payment Future reservation inquiry Filing documentation Revision of room status
20.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Account settlement methods: Cash and check Payment card Direct bill Combined settlement No-show billing
21.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Check-out variations: Late check-out charges Express Check-out: Any number of methods of guest-initiated check-out that do not require guests to be physically present at the hotel’s front desk for folio payment. Unpaid accounts: SOF: Short for “Signature on File”; refers to a signature obtained from a guest at check-in.
22.
Woods et al.,
Professional Front Office Management © 2007 Pearson Education, Upper Saddle River, NJ 07458. All Rights Reserved. Other check-out challenges: Room damage assessments Group allowance strategies Post check-out complaint adjustments
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