APRIL 2016 - Hotel Accounting
French Duncan has a long history of providing expert, specialist services to the hospitality sector, and to hotels and group of hotels in particular. Many leading hotels now contract out non-core services such as housekeeping, leisure and spa facilities and even their food and beverage operation, preferring to focus on the core business of maximising profitability on the sale of rooms through the use of real time Revenue Management to increase occupancy and rate. The availability of real time information is critical to this allowing operators to change strategy quickly and effectively.
Can accounting be real time?
For many years accounting and financial information has been historic in nature – results for the month are presented in a spreadsheet perhaps 7 or 10 days after the month end. Whilst the importance of accurate financial information is critical, the time delay in its availability limits the opportunity to take decisive, corrective action. At French Duncan we believe that these days are in the past and that real time financial information can be available to decision makers whenever and wherever they want it.
Cloud Accounting facilitates integration of the daily financial information received from the hotel’s Property Management System providing up to date information on a daily and cumulative basis. Using CrunchBoards (to see previous blog - click here) this information can be presented graphically providing a snapshot of the individual hotel or group of hotels’ performance. This will allow the operator to quickly establish any areas of concern and to take the appropriate corrective action. These dashboards will not only provide information on the previous day’s trading but will provide a real time update of Business on the Books, highlighting gaps and allowing online booking channels to be opened or updated. This is a powerful combination of information – present and future. Some examples of the type of boards which can be provided every day are shown below.
So the answer to the question is Yes – hotel accounting can be real time!
Can accounting be contracted out – in the same way as other services?
Hotel accounting is a specialised area and requires sector expertise. Often the availability of specialist in-house accounting can be problematic. Just as an experienced room attendant is required to provide high quality housekeeping services, an experienced hotel accountant can bring a different dimension to the accounting services provided to owners and operators. There is no need to employ such an individual – either accountant or room attendant.
The features and benefits of a top quality hotel accounting service can be summarised as follows:-
• Automation – income, banking and purchase ledger should all be automated, eliminating the time consuming and expensive issue of manual data entry
• Uniform System of Accounts for Lodgings Industry – management accounts must be presented in this industry standard format
• Dashboards – real time income and KPI statistics should be available daily
• Fully managed accounts payable – incorporating Bacs payments and supplier statement reconciliations to ensure accuracy, completeness and efficiency
• VAT management – there are industry specific VAT issues such as VAT on deposits received which must be adhered to
• Detailed monthly accounts pack with full analysis in graphic format – very often financial information is being presented to non-financial managers and it must therefore be presented in easily understandable detail
• Scheduled timetable – consistently adhered to
• Cash Flow Forecasting/Internal Audit/Additional Reporting
• Online services – allowing owners and operators to view their accounting data in real time
• Real time dashboards – what happened yesterday (not last month)
• Frees up valuable management time to focus on key business drivers – not book-keeping and administration
• Flexibility – whether expanding or contracting the service adapts to changing needs without cost of hiring or firing!
• Financial – cost savings in salaries, software costs, training, absence cover, cost of office space
• Protection from cost of legislative changes – Living Wage/Holiday Pay/Auto Enrolment Pension Costs
• Sector expertise
All of this is provided in a hotel accounting service provided by French Duncan. So, again the answer to the question is Yes – Accounting can be contracted out.
The final question which owners and operators should be asking of themselves and their teams is – Am I receiving and benefitting from an expert accounting service as set out above.
If you would like more information or would like to discuss please click here to send an email Ian Bremner.
EXAMPLE DAILY CRUNCHBOARDS REPORTS