Subject
Year
: V0206 – Administrasi &
Operasional Kantor Depan
: 2009
The Night Audit
Week 9
Subject
• Importance of the night audit
• The process of night audit
• The daily flash report
• Reading the night audit
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Objectives:
On completion of this lesson, the students
will be able to:
- explain the importance of night audit,
process of night audit and reading the
night audit report
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Importance of Night Audit
• Night audit - the control process whereby the financial
activity of guests’ accounts are maintained and
balanced.
• The night audit will provide the necessary “objective
overview” to evaluate the hotel’s financial activity.
– Ability to monitor hotel revenues
– Effect of marketing plans on related goals
– Provides “day-to-day” monitoring, not just end of period
review
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Role of Night Auditor
• Duties of the night auditor.
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Checking in late check-ins
Checking out early check outs
Processing reservations
Performing the duties of security guard
Monitoring fire safety systems
Performing cashier duties for banquet functions
Acting as manager on duty
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The Night Audit Process
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Posting room and tax charges
Assembling guest charges and payments
Reconciling departmental financial activities
Reconciling the account receivable
Running the trial balance
Preparing the night audit report
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The Night Audit Process
• The night audit process
• The night audit process is a series of
financial checks and balances that
need to be performed on the various
departments and front office staff.
• The process to post room and tax charges.
• The process of assembling guest
charges and payments.
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The Night Audit Process
• The Night Audit Process
• Reconciling departmental financial activities.
– The importance of this process as a necessity to
insure that all posted guest charges and
reported departmental balance.
– The origin of departmental balances.
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The Night Audit Process
• Procedure to reconcile account receivable.
• City Ledger is an accounts receivable - a
collection of guest accounts of persons who are
not registered with the hotel
• Contents of accounts receivable:
» direct billings
» master credit card accounts (Visa,
MasterCard, JCB)
• Verification of these totals against departmental
totals
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The Night Audit Process
• Run trial balance
• The first step in determining if posted guest
charges and reported departmental charges
balance
• Importance of training front desk clerks in the
posting process
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The Night Audit Process
• Preparation of the night audit report
• The goal of preparing the night audit is to provide
financial feedback for an immediate opportunity for
managers to react and respond to variances as well
as accurate guest folios and accurate city ledger
folios.
• Importance of departmental totals
• Concept of bank deposit
• Concept of accounts receivable
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The Night Audit Process
• Cashier’s report – lists cashier activity of
cash and credit cards and PMS totals
• Manager’s Report is a listing of occupancy
statistics from the previous day, such as
occupancy percentage, yield percentage,
average daily rate, RevPAR, and number of
guests.
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The Night Audit Process
• Formulas for Balancing the night audit report.
• Guest Ledger
• City Ledger
• Bank Deposit
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Components of the Night Audit Report
• Columns titled actual, budget, and goal %
• Room and tax – this figure originates as a
total of posted daily guest room charges; it
is a cumulative total from the PMS room
total feature.
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Components of the Night Audit Report
• Total restaurant sales and sales tax – the origin
of this total is by meal period in the various food
outlets in the hotel. The dollar figure can be
verified against the daily sales reports with
accompanying cash register tapes or point-of-sale
audit trail tapes from each of the food outlets. The
corresponding tax total is obtained by the sales
tax figure on the daily sales reports
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Components of the Night Audit Report
• Tips for restaurant, room service, banquet,
and lounge employees – the origin of this
figure is service fees paid to food and beverage
employees. The dollar figure can be verified
against paid out slips (tips paid immediately to
service employees from the desk clerk’s cash
drawer) and room service guest checks and
credit card vouchers (charged tips).
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Components of the Night Audit Report
• Room service – the origin of this figure is a total of
sales by meal period for room service. The dollar
figure can be verified against the daily sales reports
with accompanying cash register tapes or point-ofsale audit trail tapes from the room service food
facility outlet. This figure is reported separately from
restaurant sales to reflect marketing and
merchandising campaigns.
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Components of the Night Audit Report
• Banquet sales – the origin of this figure is a total
of guest checks that tally the individual banquet
charges per meal category. The completeness of
the total reported can be checked against daily
function sheet. The dollar figure can be verified
against the daily sales report of the banquet
department. This figure is used to evaluate the
effectiveness of the food and beverage manager
in controlling relate expenses. It is also used to
evaluate the effectiveness of the director of
marketing and sales in generating business.
Finally it is used to indicate cash flow.
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Components of the Night Audit Report
• Banquet Bar and Total Lounge Sales – the
origin of this figure is from the point-of-sale cash
registers in these areas. The dollar figure can be
verified against the daily sales report and cash
register tapes or audit trail tapes. This figure is
used to determine how well cost control efforts
have been maintained in this department. It is
also used to determine the success of certain
marketing and merchandising campaigns.
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Components of the Night Audit Report
• Room Rental – this figure originates from
meeting and function room rentals. The night
auditor can verify the completeness of total
rentals by cross-referencing the function sheet
listings. The dollar figure is verified against the
room rental departmental daily report. This figure
is used to determine if room rentals have been
maximized during slow banquet sales by the
marketing and sales department.
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Components of the Night Audit Report
• Valet – this figure must be closely monitored
because the hotel pays cash to the off-premises
dry cleaner of laundry service when clothing is
returned. This total represents costs plus markup posted to guest folios from transfers. The
dollar figure can be verified against the valet or
dry cleaning/laundry journal.
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Components of the Night Audit Report
• Telephone Charges – the origin of this figure is
from telephone charges reported for local and long
distance telephone calls that have been posted to
the guest account through the PMS interface with
the call accounting system. The dollar figure can be
verified against the telephone charges printout
received through the call accounting system. This
figure allows management to determine the
profitability of this service.
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Components of the Night Audit Report
• Gift Shop Sales and Tax – the origin of this
figure represents sales and tax from this
department. The dollar figure can be verified
from the gift shop daily sales report and cash
register tapes or point-of-sale audit tapes.
Management uses this information to examine
profitability of this area and to predict cash flow.
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Components of the Night Audit Report
• Vending – the origin of this figure is from sales
from various vending machines in the hotel. The
dollar figure can be verified from the departmental
vending daily report. Management compares
inventory usage with cash collected to monitor
the integrity of cash collection and reporting
activities.
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Components of the Night Audit Report
• Spa – the origin of this figure is sales posted to
guest folios and cash sales in that department.
The dollar figure can be verified from the
departmental spa daily report and vouchers
posted to the guest folios. Management needs
this information to examine profitability of this
area, to predict cash flow, and to determine the
effectiveness of marketing and merchandising
campaigns.
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Components of the Night Audit Report
• Parking – the origin of this figure comes from
sales received in cash, business checks, debit
cards, credit cards, and transfers for guest
parking. The dollar figure can be verified from
departmental parking garage daily report and
transfer slips posted to guest folios, parking
tickets, cash register tapes, and monthly parking
permit renewals that accompany the daily report.
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Components of the Night Audit Report
• Total Revenue and Total Write-offs – these
figures represent all the cash and charge
transactions for the day that reflect all the
previously reported figures. Management will
compare the actual and budgeted figures to
determine how well operations have met
financial goals.
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Components of the Night Audit Report
• Cash Sales and Accounts Receivable Balance
• Explain the Total Cash Sales figure.
• Explain the Today’s Outstd A/R figure.
• Explain the Total Revenue figure.
• Explain the Yesterday’s Outstd A/R figure
• Explain TOTAL OUTSTD A/R
• Explain CREDIT CARD REC’D A/R figure
• Explain Cash Rec’d A/R
• Explain Bal A/R
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Components of the Night Audit Report
• Credit Cards and Cash Applied to Accounts
Receivable – these figures represent payments
that have been received for application toward
outstanding accounts receivable (credit card
companies, direct billing accounts, and city ledger
accounts). Management monitors this figure to
determine cash flow.
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Components of the Night Audit Report
• Analysis of Accounts Receivable – These
figures are maintained to determine the source
of the account receivable. Various sources will
allow the controller to monitor cash flow. The
controller will be able to determine the effects of
various discount rates on the profit and loss
statement. The controller will also use this
information to age accounts
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Components of the Night Audit Report
• Bank Deposit and Amount Transferred to
Accounts Receivable – The total bank deposit figure
represents cash, Visa, MasterCard, and JCB. The
analysis of bank deposit provides sources of bank
deposit (cash sales, credit cards and cash from
accounts receivable). The total bank deposit figure
must match the total cash sales plus the cash
received and applied to outstanding accounts
receivable (cash received on accounts receivable
minus total paid-outs). The total of actual cash and
credit card payments received (from the cashier’s
report) will match the total bank deposit figure. The
amount transferred to accounts figure will match
today’s outstanding accounts receivable (today’s
outstanding accounts receivable).
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Components of the Night Audit Report
• Cashier’s Report – This figure provides a cumulative
total of the cash, credit card vouchers, and checks from
credit card companies (from outstanding accounts
receivable). This is the amount of cash the desk clerk or
cashier is responsible to produce in the deposit. It
provides differences between actual and machine total.
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Operating Statistics
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Operating Statistics – these figures provide a quick summary
of the activities of the day and the succession meeting financial
budget targets. Management will be able to take quick action
to catch unprofitable trends.
• Rooms Available – these are the number of rooms in
the hotel which were operable for sale; if a room was
out of order because of redecorating, plumbing, etc.,
then it is not to be included in this figure; sometimes
students think if a room was occupied by a stay-over, it
was not available for sale.
• Rooms sold, rooms Vacant, and Rooms Out-Of-Order
– these numbers are cross referenced by assessing
the housekeepers module
• Rooms Comp – this figure is reflected in the guest
registration card and folios.
• Occupancy Percentage– this figure is determined by
dividing the number of rooms sold by the number of
rooms available and then multiplying that figure by 100.
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Operating Statistics
• Double occupancy percentage – this figure is
determined by dividing the number of guest minus the
number of rooms sold by the number of rooms sold,
then multiplying that figure by 100.
• Yield Percentage – this figure is determined by
multiplying the number of rooms sold by ADR and
dividing that figure by the number of rooms available
times the rack rate and multiplying that figure by 100.
• RevPAR – this figure is determined by multiplying the
times occupancy percentage by the average daily rate.
• Room Income – this figure is obtained from the total
room rate postings.
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Operating Statistics
• Number of Guests – this figure corresponds to the
registration module.
• Average Daily Rate – this figure is computed by
dividing the room income by the number of rooms
sold.
• No-shows – this figure is complied by tallying the
number of reservations with a confirmed status that
did not show; guaranteed reservations are not
included in this figure.
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The Daily Flash Report
• Daily Flash Report – a management tool to keep
track of departmental totals.
• Room sales – review as major source of income
and provide most profit
• Departmental totals – such as food and beverage;
watch for income and corresponding effectiveness
of food and labor cost.
• Occupancy totals – feedback on marketing and
sales efforts
• Search for reasons for low occupancy
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Reading the Night Audit
• Room Sales – Budget vs. Actual to compare sales
efforts
• Restaurant Sales – Review individual meal periods
against goals
• Room Service – Review goal because it is a profit area
for hotel
• Banquet Sales – This assists with cash flow and needs
a careful watch
• Banquet Bar Sales – Provides additional income with
banquet sales
• Room Rental – This is a very profitable area to assist in
paying other non-incoming producing areas of the hotel
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Reading the Night Audit
• Lounge Sales – This area assists in attracting visitors
to a property
• Valet – This is a service to the guest and the fee
charged for handling is profit for the hotel
• Telephone – these fees helps to recover investment in
the telecommunication investment and profit for the
hotel
• Gift Shop – a percentage of the gross sales may be
returned to the hotel if this gift shop is outsourced to a
vendor
• Vending – a percentage of the gross sales may be
returned to the hotel if this service is outsourced
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Reading the Night Audit
• Spa – a percentage of the gross sales may be returned
to the hotel if the spa is outsourced to a vendor
• Parking – a percentage of the gross sales may be
returned to the hotel if the parking garage or lot is
outsourced to a vendor
• Total Paid-Outs – this figure should be low; not many
people are authorized to receive paid-outs from the
front desk staff.
• Total Discounts – this figure will provide feedback on
“satisfaction guarantees” that have been used
• Total Write-Offs – this figure provides feedback on
accounts that were uncollectable
• Total Paid-Out and Noncollect Sales – this is a figure
that combines both areas and should be closely
watched
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Reading the Night Audit
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Total Cash Sales – this figure represents all non-credit sales;
usually low; if it were high, it could mean a security problem
because guests haven’t established credit
Today’s Outstanding Accounts Receivable – total amount
charged to guests’ folios
Total Revenue – Total of all cash and charge sales for the day
Yesterday’s Outstanding Accounts Receivable – A large
number; represents a delay in receiving credit card payment
balances
Total Outstanding Accounts Receivable – Total of Today’s and
Yesterday’s Outstanding Accounts Receivable
Credit Card Received Accounts Receivable – how much
money was applied to credit card balances
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Reading the Night Audit
• Cash Received Accounts Receivable – Cash received
and applied to credit card balances
• Balance Accounts Receivable – Total of outstanding
accounts receivable (city ledger, direct bill, and credit
cards) Note: this figure must match Analysis of
Accounts Receivable
• Bank Deposit – Lists cash and credit card deposits.
Note: must match Credit Card Received Accounts
Receivable.
• Analysis of Bank Deposit – Provides overview of
sources of funds deposited
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Reading the Night Audit
• Cashier’s Report – verifies total of each cashier for
cash sales, credit card sales, and sales applied to
accounts receivable
• Analysis Cash Report – summary of cash sales, credit
card sales, and sales applied to accounts receivable
• Manager’s Report – overview of staff’s financial efforts
of the previous day (actual vs. budgeted figures)
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THANK YOU AND
HAVE A GOOD DAY
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