The Front Office Audit 7

Mini-Case Study: “No Confidence in the Numbers at the Playa del Mar
Resort”
Chris Ballard is the general manager of the Playa del Mar Resort. The resort has 400 rooms and is located on a half
mile of some of the finest beach in the state. In addition, the resort has tennis, golf, a swimming pool, and many
other recreational activities. During the peak season, the resort enjoys an occupancy of over 80 percent. During the
low season, the resort operates at about 40 percent occupancy. Therefore, it is essential that costs be minimized at all
times and revenues be maximized during the peak season. The resort has a semi-automated front desk that uses
electronic posting machines.
When Chris became general manager about a month ago, he recognized that the front office had a problem.
Every two out of three days, he was receiving incorrect front office audit reports, especially when it came to account
balances. In essence, Chris had no confidence that the front office audit was in balance. In addition, department
managers were telling Chris that the revenues they were posting in their point-of-sale equipment did not always
seem to be credited to their revenue centers on the proper days. This was especially true in banquets, where master
account postings might be a day late. Because of this, Chris was also concerned that occupancy and room status
information may not be correct either. This could affect revenues.
You have just joined the hotel as Controller and the front office audit staff reports to you. Chris has asked you
to develop a plan to ensure that front office audit is always in balance and that revenues and occupancy are being
reported correctly.

Discussion Questions
1. What are the typical causes of being out of balance, and where should you look to identify these problems?

2. What are the causes of departmental totals being out of balance?

3. Develop a step-by-step front office audit task list that will address the issues identified by Chris and ensure the
audit is always in balance, revenues are being posted promptly, and management reporting is accurate.

Case Number: 3329CB

The following industry experts helped generate and develop this case: Richard M. Brooks, CHA, Vice President,
TWE Group; and Michael L. Kasavana, NAMA Professor in Hospitality Business, The School of Hospitality
Business, Michigan State University, East Lansing, Michigan.
This case also appears in Case Studies in Lodging Management (Lansing, Michigan: the American Hotel &
Lodging Educational Institute, 1998).