Front office management I

Using the Telephone

• 
  The nature of telephone activity in the hotel industry
  
• 
  The need for developing telephone skills
  
• 
  Developing telephone skills
  

Accounting Fundamentals

Module I

Front Office (Accounting)

Need for accounting system at Front Office -
To monitor and chart all the transactions that take place between the hotel and others i.e. resident guests, companies, agencies, non-resident guests etc.

ACCOUNTING FUNDAMENTALS

The functions of Front Office Accounting System are:

1. 
   To create and maintain an accurate accounting record for each guest/ non-guest account.
   
2. 
   To track financial transactions throughout the guest cycle.
   
3. 
   To ensure internal control over cash & non-cash transactions.
   
4. 
   To record settlement for all goods & services provided.
   

Note : Guest means Resident guest and Non-guests means Non-resident guest, conferences, former guest unpaid.

Guest and non guest account

In Front Office, accounts are segregated into two categories.

1. 
   Guest Account – is a record of financial transactions that occur between a guest and the hotel. Created - a. during registration, b. when reservations are guaranteed.
   
   • 
     Front Office is completely responsible for it during guest occupancy.
     
   • 
     Updated on a daily basis.
     
   • 
     Settlement - a. on guest checkout,
     
2. 
   when the account exceeds credit limit.
   

b. Non-guest Account - Between a non-guest and the hotel. Also called as House accounts/ City accounts
Accounts of guests failing to settle their bills on departure are also included in this (besides those of non-residents like companies, agencies, groups or individuals with credit privileges)
Collection & billing is the responsibility of Accounts Department! Credit (Control) Department. Billed on monthly basis.

Paid Out Voucher / Visitors Paid Out (V.P.O.)
Paid out voucher are cash payments made on behalf of a guest or the management for only external services rendered to them. Some of these expenses are usually the taxi charges, porter charges, emergency medical expenses, ticket confirmation charges, tips etc. These payments are made from box maintained at the cashier’s desk. These are preauthorized by the hotel on behalf of the guest. The amount paid out is charged to the guest folio & collected from the guest at the time of checkout when the guest clears his entire stay bill.
Procedure to make VPO

1. 
   Confirm the name, room nos and identify the guests.
   
2. 
   Find out the details of service for which the paid out is being made.
   
3. 
   Fill in the details in the paid out voucher. Every voucher is serially numbered to maintain control.
   
4. 
   Get the voucher authorized by the lobby manager.
   
5. 
   Get the guest sign the voucher in acknowledgement.
   
6. 
   Make the payment in cash to the guest.
   
7. 
   Fill in the details in ‘paid out’ of the front office cashier’s report.
   

Miscellaneous Charge Voucher
Guest miscellaneous charges include the following:

1. 
   Shoe Shine
   
2. 
   Laundry
   
3. 
   Health Club
   
4. 
   Barber Shop
   
5. 
   Beauty Saloon
   
6. 
   Pastry Shop
   
7. 
   Other banqueting charges
   
8. 
   Postal Charges
   
9. 
   Secretarial Service charges
   
10. 
    Any other charges to be realized from a guest for service rendered on the guest.
    
11. 
    Baby sitting service
    
12. 
    Safe deposit charges
    
13. 
    Left luggage charges
    

Allowances
The allowance is a type of credit posting which are given to the guest during the stay, or sometimes on departure, and can be either for an over-charge or as a form of compensation.



Advance
Advance deposit and prepayment are particularly important in the resorts hotels where the guest may book a substantial length of time ahead. The system varies slightly from one hotel to another but usually involved the following tasks.

1. 
   A receipt is made out and sent to the client.
   
2. 
   The amount of the deposit is recorded in the diary.
   
3. 
   The deposit is recorded in the advance deposit ledger.
   
4. 
   On arrival (or departure) the guest account is credited.
   

Advance deposits made with a computerized accounting system usually record the deposit in the Advance deposit account, and when the guest checks in, the bill is opened with a credit balance of the amount of the advance deposit. Once the credit is exhausted, the bill carries on showing a ordinary balance.

Discounts
Discounts are a percentage of charge off from a rack rate offered to an individual or institution in view of volume of business anticipated and as a public relation gesture.
These are subject to revision on mutually agreed terms between parties, therefore the F.O. staff must check the discount rate from the management and keep an updated information with them.
Discounting is normally not given in peak periods. It is only used in extremely low periods. There is a belief that some revenue is better than no revenue.
When the revenue lessens e.g during war or natural calamities then the hotel offers more discounts in order to gain more revenues.