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INTRODUCTION

ACCOUTNING PROCEDURE FOR TRAVEL AGENCY

MEANING OF ACCOUNTS:

Numerous transactions take place in business concerns every day. For


example, goods are sold to various customers every day, purchases are made
from suppliers, cash is paid to creditors and is received from debtors, expenses
are paid etc. All these transactions should be properly analyzed and recorded.
Again, the concept of double change in a business transaction is important to
keep in mind. To record these changes different accounts are maintained in the
ledger.

An account refers to assets, liabilities, income, expenses and equity, as


represented by individual ledger pages, to which changes in value are
chronologically recorded with debit and credit entries. These entries, referred to
as postings, become part of a book of final entry or ledger. Examples of
common financial accounts, accounts receivables, mortgages, loans, sales,
service, wages and payroll.

A chart of accounts provides a listing of all financial accounts used by


particular business, organization, or government agency. The system of
recording, verifying, and reporting such information is called accounting.
Practitioners of accounting are called accountants.

In most cases, accountants use generally accepted accounting principles


(GAAP)when preparing financial statements. GAAP is a set of standards related
to balance sheet identification, outstanding share measurements and other
accounting issues, and its standards are based on double-entry accounting, a
method which enters each expense or incoming revenue in two places on a
company's balance sheet.
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MEANING OF TRAVEL AGENCY:

A travel agency is a private retailer or public service that provides travel


and tourism related services to the public on behalf of suppliers such as
activities airlines, car rentals, cruise lines hotels, railways, travel insurance,
and package tours. In addition to dealing with ordinary tourists, most travel
agencies have a separate department devoted to making travel arrangements for
business travellers some travel agencies specialize in commercial and business
travel only.

FUNCTIONS OF TRAVEL AGENCY:

The function of tour operation department is to arrange the tours and promotion
work and these workes are performed by travel agent. The operation department
have the following functions to perform.

1) Answerisng the queries alongwith the suggested itenerary and tour cost.

2) Reciept of advance payment.

3) Booking of hotels, transport, guide etc.

4) Booking of air tickets (if any).

5) Reconfirmation of the above.

6) Payment of advances to the above.

7) Open a file,

8) Issuence of vouchers or exchange orders, usually three copies of exchange


orders are typed.

9) Reciept of confirmed vouchers.

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OBJECTIVES OF TRAVEL AGENCY:

 To Provide a high standard of services suitable for individuals seeking


relaxing, comfortable and memorable experiences in the hospitality.

 To Provide the tourist market with the quality personal

 To Produce expeditions and memories that would satisfy each and


every single of the customers.

 To Evaluate current cultural, economic, and social issues affecting the


tourism and travel industry.

ROLE OF TRAVEL AGENT:

 Arrange travel for business and vacation customers

 Determine customers' needs and preferences, such as schedules and costs

 Plan and arrange tour packages, excursions, and day trips

 Find fare and schedule information

 Calculate total travel costs

 Book reservations for travel, hotels, rental cars, and special events, such
as tours and excursions

 Describe trips to clients and give details on required documents, such as


passports and visas

 Give advice about local weather conditions, customs, and attractions

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 Make alternative booking arrangements if changes arise before or during
the trip

BENEFITS OF TRAVEL AGENCY

 It saves their time by making manual tasks and error correction


processes faster and responds well and faster to the industry
development.

 It helps agencies to grow in travel industry easily and get good profits
too.

 It provides unparalleled insight into profitability.

 It allows their customers to enjoy the great efficiency with error


correction process, increase productivity, enhance the ability of the
agency for managing changes.

 It reduces time through fast keyboard entry of transactions, full


integration and external transaction import routines.

 It features more on giving more time for managing your business


efficiently by lessening time needed for the production of standard
management reports.

 It helps travel site in the promotion of apartments, hotels, resorts, guest


houses and villas.

TRAVEL AGENT COMMISSION:

Travel agent charge surcharges and fees on the top of the price. Some
travel agents get paid on commission by hotels, resorts etc. Range of

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commission from 10% to 16%, depending upon the sales volume generated by
the individual travel agency.

ACCOUTNING FOR TOURISM AND TRAVEL:

All the divisions of travel agency are financed and controlled by this
division only. So this particular division is the backbone of the whole
organisation. All the financial informations are supplied by this department
when needed. This department shows the real financial position of the
organisation. Without adequate finance and control no travel agency could reach
to a successful end. The profit and loss assessment of capital is done under the
supervision of this division only.

Accounting is recognized as an information system and is designed to


communicate the right information to the internal as well as external users.
Accounting involves recording, classification and summarizing the accounting
information directed toward the determination of financial strength and
weakness of a travel agency. To manage a tour and travel agency profitably
demands accurate recording and preparation of financial statements. These are
essential in determining the true and fair status of the business and for making
strategic plan and decisions.

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COMPANY PROFILE

HISTORY OF THARAI AGENCY

Tharai Travel Agency is locally owned and operated by the Tharai


Groups, and has been serving in Chennai since 2010 providing safe and reliable
passenger transport for the benefit of their valuable passenger/customer. During
this time their business has grown steadily from 2 Vehicle to its present fleets
with offices both in Chennai/Salem. They feel proud in thanking their valuable
passenger/custmers for being part on our growth and achievement throughout.

The business covers regular omni passenger services covers South India
and school services and local charter services staff services from the following
areas Chennai , Kanchipuram , Chengalpattu , Thiruvallur Dist. And Nellore and
Chittor Dist., Andhra Pradesh. They have AC, Non AC, air condition air
suspension and luxury vehicles.

Vehicles used on our passenger services are of the most modern , state of
the art technology available today and have a comprehensive range of features
including large panoramic windows, air conditioning, GPS monitoring.
Electronically controlled air bag suspension ensures a smooth ad comfortable
rode for our passengers. They have a wide range of vehicles to suit the size and
demands of any group.

In order to fulfil their commitment to their customers and minimising any


inconvenience their workshop ensures their fleet of vehicle is maintained by

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diligently pursuing a vehicle preventive maintenance program to ensure
reliability and safety of the higher standard.

Tharai Travels service recognition that our most valuable assets is our
staff. Their business objectives cannot be achieved without the effort of all
employees. They take pride in the professional manner and attitude of staff.
They endeavour to ensure each staff member has sufficient training to
confidently fulfil their role within the organisation. Most drivers hold 3 to 5
years of services in their Transport and Distribution.

They are incredibly proud of their 9 year history in Chennai and South
India. Our success is both dependent upon & based upon understanding their
community and customer needs. Tharai travels service goal is to maintain the
transportation needs of their customer with the highest level of service.

Tharai group is welly known in finance and pharma industries for past
three decade now tharai travels also crossing the decade with same goodwill and
happy customer. The partners all are professionals and enginnering graduates so
we adopt and implement the customer need and happiness.

Company name Tharai Travel Agency


Company category Company limited by shares
Company category Non-government company
Class of company Private
Date of incorporate 06 november 2010
Age of company 9 years
Activity Activity of travel agency.
Directors Tamil Selvan , Kumaravel , Raja Ganapathy

VISION

Tharai Tour & Travels is a renowned brand in the bus operating industry.
their vision is to give a new face to the bus industry. Since their inception

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passenger comfort was their top priority. They have frequently added luxury
buses to their huge fleet of buses. The only thing they focus on is that the
comfort quotient of their passengers should never be compromised. They have
always tried their best to push their limits in order to develop their travel
experience.

MISSION
Their mission is to constantly exceed customer expectations by providing
luxurious facilities with comprehensive efforts and affordable pricing. They
believe that honesty is the foundation of their company and commitment.

LIVE BUS TRACKING

They have integrated this great technology of live bus tracking in almost
all of theirbuses. This helps the passengers to be informed about the live
position of the bus, thus helping them in planning their commute to the bus
stand. It also prevents the unwanted stress of missing or waiting for the bus in
case of delays.

CUSTOMER SUPPORT

To render the best service they strive to provide the best customer
support. they have an attentive customer support team to which the passengers
can report any issues regarding the journey. This team addresses all the issues of
the passengers and comes out with a solution in the shortest possible time. This
creates a warm feeling in the customers thus pushing them to be their regular
customers.

GREAT COMFORT

Once a passenger boards the bus he will be surprised by the inner


comfort of the bus. The buses have all the latest amenities like WiFi, charging
point, water bottle and central TV. The seats are really very comfortable and

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create a feeling of a cosy bedroom. We have almost all the luxury brand buses in
our fleet. Their luxurious fleet includes Mercedes Benz Multi-axle buses, Volvo
Multi-axle buses, and Scania Multi-axle comfort buses. These buses help in
smoothening the journey. Their motto to change the perception of bus travel
makes us enhance our luxury levels regularly.

SAFETY

Safety is one of the most important criteria we look for while planning a
bus route. They have the best drivers who completely understand the
importance of safety and follow all the safety rules.

REGULAR OFFERS

Tharai Tour & Travels strive to maintain the most reasonable rates in the
market. This also makes our passengers happy and thus we further give them
discount offers on a regular basis to enhance their happiness.

FEATURES OF THARAI TRAVELS

 Online bus ticket booking

 Return bus tickets

 Online payment

 Customer support

EMPLOYEE AND EDUCATIONAL TRANSPORTATION

Tharai Travels the very process of transportation becomes so easy. Starting from
the home and reaching out to the workplace and the round trio vice-versa
becomes easy at a step. The end to end solution for employee transportation is
here with us. Not just transportation alone , Tharai travels provides an end to
end solution for employee transportation it includes,

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 Routing

 Employee Bus Usage Record

 Tracking

 Billing Reporting

SAFETY COMPLIANCES

 GPS fitted vehicle for real time monitoring

 Statutory compliance and regular vehicle inspiration

 Safety being a key factor for women employees

 Constantly auditing its performance on time limits.

 Monthly training by in house trainers

 Vision checkup for drivers.

OPERATION MODULES

 Per kilometre basis per trip per head basis

 Customized monthly rentals daily vehicle rentals.

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JOB PROFILE

ACCOUTING PROCESS

The basic objective of accounting is to ascertain the profitability and


finance position of a travel agency operation. These records help you keep track
of your agency's performance and are necessary for preparing your tax return.
The most important accounting procedures for a travel agency are the cash flow
statement, the general ledger and the income statement.

CASH FLOW MANAGEMENT:


One of the most basic goals of your accounting procedures is to keep
track of your agency's cash flow. While running a travel agency with multiple
daily transactions, it can be easy to lose track of your sales and your incoming
payments. Through the use of your accounting software, you can keep track of
your company's net cash flow from sales and expenses. This keeps track of the
cash management of your business and helps identify any financial problems.
Make sure that your agents post all business transactions in your accounting
records.

GENARAL LEDGER:

Another accounting tool for a travel agency is the general ledger. The
general ledger gives an overview of your company's current position. This
ledger keeps track of your agency's assets, everything your company owns and
what it owes. The accounting impact of all business transactions should be
recorded on your general ledger through your accounting software. Most

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businesses update their ledgers daily or weekly. It is crucial to update your
general ledger regularly so you can keep track of your agency's financial status.

RECOGNISING REVENUE:

An important accounting procedure for any business is the process of


revenue recognition. This principle establishes when a business has officially
earned revenue and can declare the earnings on its accounting statements and
for taxes. A travel agency, as a service industry, must use the cash method for
recognizing revenue. Your agency must recognize revenue as earned as soon as
a payment is received. It does not matter when you complete your service to the
customer, as soon as you receive payment, you must recognize the payment as
revenue.

INCOME STATEMENT:

The last accounting procedure for running a travel agency is the


maintenance of an income statement. The income statement records your total
income and expenses to calculate your net profit over a period of time. The
income statement serves a similar purpose as the cash flow statement. While the
cash flow statement only keeps track of cash, the income statement measures
the profits of your business. When you start your agency, the cash flow
statement is more important as you get the handle of your company's daily cash
flow. In the long-run, your income statement is more important as it gives a
better description of your company's total profitability.

RECEIPTS:

A receipt is a written acknowledgment that something of value has been


transferred from one party to another. In addition to the receipts consumers
typically receive from vendors and service providers, receipts are also issued in

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business-to-business dealings, stock market transactions and also in tourism.
receipts are a document that represents proof of a financial transaction. Receipts
are also necessary for tax purposes as proof of certain expenses.

In addition to showing ownership, receipts are important for other


reasons. For instance, many retailers insist that a customer must show a receipt
to exchange or return items while others demand that a receipt—generally issued
within a certain timeframe—be produced for product warranty purposes.
Receipts can also be important for taxes because the IRS requires documentation
of certain expenses.

The Internal Revenue Service (IRS) suggests that the following types of
receipts if generated, be retained by small businesses:

 Cash register tape receipts

 Credit card receipts and statements

 Invoices

 Petty cash slips for small cash payments

Pay Roll Journal

In this journal, a travel agency maintains the record of salaries and other
benefits (financial) given to its employs like the number of employees on the
payroll, total salaries, insurance premiums, compensations, housing facilities,
medical facilities and other benefits to the employees.

Practically, the total from each journal is compiled monthly and posted to the
general ledger. In this ledger, all types of the account are maintained/transferred
from the various individual journals to provide ready information for the
preparation of the financial statements.

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The IATA ledger is known as ‘Chief Book of Accounts’ and is the destination
point of entries made in the journals or sub-journals. It is used to balance the
accounts of the travel agency. In accounting, ‘Balance Account’ means
continuous and consistent check and verification of the accuracy of a travel
agency’s accounting system.
OBJECTIVES:
 Identification of travel agencies revenue sources.

 Determination of total sales (cash and credit).

 Determination of total commission earned by the travel agency.

 Find out the total amount owned to IATA.

 Evaluate the performance of each travel agency ( which is recognized by


IATA).

The procedure of posting IATA Ledger is very simple and easy to understand.
Today, almost every travel agency is using Electronic Data Processing System
(EDP) to maintain an up-to-date record of each cash as well as credit card
transactions.

PROCEDURE:

 Enter the date, items, and invoice number.

 Enter the gross amount of cash and credit-card transaction.

 Calculate the commission and enter in the agency commission column.

 Subtract the commission form the gross sale and enter the result in the
Net Amount column.

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 If any amount is due then record it in the due column.

JOB EXPERIENCE

The internship at Tharai Tours & Travels gave me the ability to understand the
performance of various departments & the working culture of the company. The
internship has given me a better understanding of skills and set where career
may take me. It gave me the opportunity to gain an experience and knowledge
of interacting with the employees and customers of the company.

The internship gave me an opportunity to gain valuable work experience. The


environment was quite relaxed. Yet it taught as an intern how to behave in
workplace. Simply working in the office and getting used to everything here has
definitely prepared for whatever the next position maybe. The everyday events
has taught me more about team work and how people can come together to get
things done. The division of the company where I have been the intern manages
the company’s accounting procedures. So as an intern, It was a pleasant
experience and really a knowledgeable time spent during the business hours.

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CONCLUSION

All auditing information is established as an essential mean for the exact


management of any business economic resources. Accounting moves in a
greater scope of management philosophy and of practical application, and adds
up value, offering at the same time a systematic scientific approach on the
assessment and the improvement of the effectiveness of the hotel businesses.
Within the framework of modern business world, the role of accounting
procedure is catalytic since it is regarded as a source from which core abilities
are subsequently transformed into competitive advantages. From the above it is
clear, that accounting is catalytic to the location of the weaknesses in
management, to the prevention and the suppression of unexpected events and
finally imposes accounting as a priceless support in the hotel business
management efforts.

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