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Date: 8th June 2011

Venue: HDHQ, Gurgaon

Room sale

Food & Beverage sale at Bar, Restaurants, Banquets & InRoom Dining Minor Operating Department revenues Laundry

Business Centres
Internet & Telephone Spa, Health Clubs & Beauty Parlours

Miscellaneous through Scrap sales, Retention money recovery, Rental income, Staff Cafeteria sales, Incentive Income etc.


Cash collection INR / Foreign currency


Credit extensions Through Bill-To-Company / Credit Card swipe


Unit Finance Controller (UFC) Assistant Unit Finance Controller
In-Charge of maintaining Books of Accounts / Financials / Payables

Income & Credit Manager

In-Charge of Day to Day Operational Income Accounting & Credit Management from Receivables

Purchase Manager
In-Charge Units de-centralized Procurements and co-ordinating with HDHQ for centralized purchases

Food & Beverage Controller

In-Charge of Controls over Food & Beverage stocks and usage, costing and outlet stock management


FINTRAN: For maintaining the books of accounts of the Unit Superfast: For Generation of Financial Statements Trial Balance

CLS (Client Logistics System): For Front Office Operations

HIMS (Hotel Inventory Management System): For managing
the stores purchased and issued

POS (Point of Sale): Used in the Outlets for check generations

RAMCO: Salary & Wages Processing
SPINE: For Fixed Assets Register maintenance

INCOME FUNCTION: 1. Sale Reconciliation and Accounting 2. Discounts (Allowances) 3. Service Charges & Tips 4. Sheraton Fees Payments 5. Loyalty Programmes

6. Taxation
7. Day & Night Audits 8. MIS Reports & Others


i. ii. On a daily basis, Daily Closing Report is handed over by the Night Auditor to the Income Department. The Daily Closing Report contains inter-alia the following data:

Room Sale (Room-Category wise)

Food, Beverage & Tobacco Sale (Outlet wise) Minor Operating Department Revenues Discounts given by Front Office (Referred to as Front Office Allowance)

Taxes charged in the folios viz. Service Tax, VAT, Luxury Tax etc.
Tips and Service Charges Collections figures through Cash / Credit Cards

iii. On the basis of this, an excel sheet is updated daily for generating the total sale as on any given day. iv. At month-end, the consolidated sale figure of the month is sent to Finance Team (part of Payables Team) so as to create the monthly Sales Journal in FINTRAN.


Sale Journal passed in the books is as follows:

DR. Cash Sale
DR. Guest Ledger DR. City Ledger CR. Entertainment Tax

CR. Luxury Tax CR. Service Tax CR. Excise Duty

CR. Paid Outs

CR. Tips CR. Service Charges (Banquets Indoor/ Outdoor) CR. Room Sale CR. Food & Beverage Sale CR. Banquet Sale CR. Other Sales (from Minor Operating Departments)

(A) Front Office Allowances:
These allowances are passed by Front Office at the time of Guest Stay or Check-out. These are primarily on account of charges being waived off from a Guest Folio on account of Discounts, Service Recovery etc. These Allowances are posted into CLS by the Front Office as and when they are passed. After the Night Audit, the auditor hands over the Front Office Allowance vouchers and the Daily Charge Summary to Income Department Thereafter, Income Department Reconciles the Voucher with the Summary and plots the individual types of allowance in an excel

At month-end, the aggregate of the month is sent to Finance Team for posting the entry into FINTRAN

(B) Back Office Allowances:

These Allowances are passed by Back-Office at the time of Folio/Bill Checking process. These are passed primarily on account of Correction of Rates of Room, F&B, Discounts under various plans viz., ETVP etc., and other Back Office adjustments Back Office Allowance Vouchers are approved by the Income & Credit manager. In case the amount is more than Rs.10000, then a summary of such cases with reasons of allowance is sent to GM for approval.
On the basis of the vouchers, credit is passed on to individual City Ledger Accounts so as to reduce the receivables. The detail is also entered into an excel sheet as per the respective categories of allowance.

(C) Month-End Entry passed in FINTRAN for Allowances

DR. Sales Account (each category wise, viz. Room, F&B etc.) DR. Tax Account (Luxury Tax, Service Tax, VAT etc.) CR. City Ledger Account (Net VAT Liability Paid)


Following are the sources of Tips & Paid Outs Banquet Service Charges

Banquet Tips
Outlet Tips

(A) Banquet Service Charges

Banquets levy a Service Charge as a percentage of the rates (before taxes) charged to the guests, both for indoor and outdoor functions. This service charge is a compulsory charge recovered from the guest for the services by Banquet staff. Every day, Income Department updates a register with the service charges charged to the guest through the checks generated for all the functions held. This information is passed on to Payables team for onward distribution to the staff. The aggregate of the service charges are distributed with the salary of the staff in the following manner Banquet Staff 65% of the Service Charges Support & Admin Staff 35% of the Service Charges While the distribution to the Banquet staff takes place monthly, distribution to Support & Admin Staff takes place quarterly.

Entry Passed for accounting of Banquet Service Charges are as follows (i) At the time of Charging the Service Charge in the Banquet Check
DR. City Ledger CR. Service Charges

(ii) At the time of payment of Service Charges to the staff

(a) DR. Service Charges CR. Accounts Payable

(b) DR. Accounts Payable

CR. Bank Account CR. Tax Deducted at Source

(B) Banquet Tips

Whenever a Banquet Function takes place, the guest may tip the Banquet staff over and above the Service Charge levied through the Banquet Check. This tip may be received through cash or credit card payment from the guest Cash Tip is distributed by the Banquet In-charge amongst the Banquet Staff. For Tips received through credit card payment, Banquets send the checks issued to the guest where the tip amount is endorsed. This tip amount is recorded in a register and subsequently a Cash Folio is prepared which is encashed by the Banquet attendant and distributed to the Banquet Staff.

(C) Outlet Tips

Similar to the above, while the cash tips are kept by the recipients, tips received through credit cards are encashed by the Outlet In-charge through a Cash Folio and distributed amongst their staff.

Tips Accounting in Books is as follows:

At the time of receipt of the Tip at the function, City Ledger shows the Tip
amount under the name of credit card. Corresponding Tip Amount is shown as a separate Inflow.
Consequently, the entry in Back-end is as follows: DR. City Ledger Credit Card CR. Tips

This entry is transferred to FINTRAN at month-end. At the time of encashing the Cash Folio, following entry is passed in FINTRAN
DR. Tips CR. Cash / Contingent Fund

Hence, at Month-end, the Tips Account shows a NIL amount due, considering total encashment of the Cash Folio Vouchers.


Current License Agreement between ITC Limited & Sheraton International Inc., USA dated 15th May 2007 for a tenure of 10 years Also, ITC has entered into a Starwood Technology and Reservation Services (STARS) Agreement with Sheraton Fees Payments is as per the following: As per License Agreement
As per STARS Agreement As per Loyalty Programmes (covered subsequently with Loyalty Programmes)

Procedural Requirements inter-alia include Starwood Audits, Report on Estimated Gross Room Sales and Agreed Room Sales at the beginning of each calendar quarter and its corresponding fees payable, CA certified report showing Gross Room Sales and Agreed Room Sales at the end of each fiscal year etc.

(A) Fees as per License Agreement

Gross Room Revenue (GRR) and Agreed Room Revenue (ARR) is derived as per the procedure mentioned in the License Agreement Following Fees Computed

License Fees @ 3.5% of ARR

Sales & Marketing Fund Contribution Fees @ 1% of GRR Base Reservation Fee @ 0.6% of ARR

Room Booking Fee @ $10 per available room per month

Provision made in the books of the Unit on quarterly basis for the above fees Fees Certified by Statutory Auditors quarterly and certificate sent to HDHQ for Payment. Debit Note sent by HDHQ after payment on the basis of which the Provision is reversed

(B) Fees as per STARS Agreement

Following Reservation Booking Fees computed For Bookings through Starnet - $2.65 per booking For Bookings through GDS $5.50 per booking For Bookings through CCC - $5.60 per booking Provision made in the books of the Unit on monthly basis for the above fees Fees Certified by Statutory Auditors quarterly and certificate sent to HDHQ for Payment. Debit Note sent by HDHQ after payment on the basis of which the quarters aggregate Provision is reversed

Taxation applicability on Sheraton Fees paid:

Type of Fees License Fees Sales & Marketing Fund Contribution Base Reservation Fees SPG Fees (for Loyalty Programmes ) Reservation Fees Fees for Room

Service Tax

Income Tax deducted at Source

Note: The above Taxes related to the Sheraton Fees are transferred by way of Debit Notes from HDHQ

Hotels have various Guest Loyalty Programmes which are managed by HDHQ or Starwood. Some of them are as follows:
1. 2. 3. WelcomAward Member accumulates points on the basis of
stay at the Participating properties

WelcomLink Member accumulates points on the basis of

materialised stays booked by them

Frequent Flier Jet Miles & Kingfisher Miles - Member

accumulates points on the basis of stay at the Participating properties

Schemes handled by ITC-HDHQ

4. 5.

Culinary Plus Members get discounts on Food & Beverage

consumed at Restaurants

Starwood Preferred Guests (SPG) Programmes - Member

accumulates points on the basis of stay at the Participating properties

Scheme handled by Starwood

Note: Forthcoming Slides on Loyalty Programmes exclude Culinary Plus. The Discounts under Culinary Plus Scheme are borne by the Unit.

How Loyalty Programmes work?

When a member stays, or books a stay which materialises (in case of
WelcomLink) at the Participating properties, then the points are credited to the person based on the Revenue generated by the Guest. These points can be redeemed against various redemption options such as free nights and dining vouchers at any participating properties, Airline miles, gift vouchers, Sodexo Passes etc. Further, some schemes allow members to directly redeem the points at the time of settlement of their Folios and checks by debiting the proportionate number of points from their accumulated balance. In the entire process, the Unit managing the scheme recovers a percentage of the eligible revenue of the participating properties as contribution towards meeting the marketing expenditures such as designing, printing & postage cost of brochures, membership cards, account statements etc.

WelcomeLink, WelcomAward, Jet Miles and Kingfisher Miles Revenue updation (Points Earning):
Whenever a Reservation is received from a WelcomLink/ WelcomAward/ Jet Miles/ Kingfisher Miles member, the membership number is captured in CLS. On a daily basis, the WelcomLink/ WelcomAward/ Jet Miles/ Kingfisher Miles Materialisation Report is updated in CLS such that it gets seamlessly transmitted to the centrally operated Content Management System (CMS) so as to centrally credit points to the respective members by HDHQ In case of any discrepancy, for e.g., where a member has directly advised HDHQ that no points have been credited to his / her account for a materialised stay, then a Discrepancy report is generated in CMS containing the details of this stay. This report is then extracted and the revenue details are uploaded into CMS after confirming the stay through the internal records. For a WelcomLink member, the Room Revenue (before Taxes) are uploaded, and for others, Room, F&B and incidental revenues are uploaded so as to credit the points to the member centrally by HDHQ.

SPG Programme Revenue updation (Points Earning):

Whenever a Reservation is received from an SPG programme member, the membership number is captured in CLS. On a daily basis, a Frequent Stay Materialisation report for the SPG Guests is retrieved by the Income Department from the CLS Against each such materialised stay, the eligible charges are computed which are Room, Food & Beverage, Telephone and Laundry charges (all excl. taxes post discounts). Then the eligible charges are uploaded and submitted in the SPG Website each folio wise.

Accounting of Points earned by members and credited by HDHQ / Starwood:

(A) WelcomLink/ WelcomAward/ Jet Miles/ Kingfisher Miles
Direct Marketing Cell at HDHQ co-ordinates these loyalty programs. For the same, it recovers 5% of the eligible revenue generated by the members from the participating properties. This 5% is partly credited to members account and partly kept as contribution for meeting marketing expenses by HDHQ.
(i) Hotels pass the following entry every month-end for providing the above
DR. Sales Account CR. City Ledger Account (5% of Eligible Revenue)

(ii) When HDHQ subsequently sends the debit note for the same
DR. City Ledger Account
CR. HDHQ Trading Account

(B) SPG Programmes

For this programme, 5% of the Eligible Revenues is required to be paid to Starwood for crediting points to the members accounts. Invoice is sent to the units by Starwood which is sent to HDHQ for payment. HDHQ pays on behalf of all units and sends debit notes to the individual properties for the amounts.

In case the Invoice Amount is more than the amount uploaded, for e.g., when a member has directly advised Starwood that no points have been credited to his / her account for a materialised stay, then the same is mentioned in the months Invoice. This is reconciled with Internal records to verify the correctness of extra claims. (i) Hotels pass the following entry every month-end for providing the above
DR. Sales Account CR. Provision for Expenses - SPG (5% of Eligible Revenue)

(ii) When HDHQ subsequently sends the debit note after the payments
DR. Provision for SPG CR. HDHQ Trading Account

Redemption of Points:
The points earned by members can be redeemed in the following ways Gift vouchers (WelcomAward / WelcomLink) Complimentary Vouchers (WelcomAward / WelcomLink) Settlement of Room charges (SPG Members) Treatment of the above are as follows

Type of Redemption Treatment Gift Vouchers Recovered from HDHQ Complimentary Vouchers Allowanced Off / Borne by the Unit Settlement of Room Charges Recovered from Starwood

Accounting of Points Redeemed

1. Gift Vouchers Amount recovered from HDHQ
When a Guest presents a Gift Voucher, the Settlement in System is booked under a separate City Ledger Code in the name of WelcomAward /WelcomLink. A) Entry Passed for the sale is as below:
DR. City Ledger WelcomAward / WelcomLink CR. Sale

B) Entry Passed when a Debit Note is raised on HDHQ for recovery

DR. HDHQ Trading Account
CR. City Ledger WelcomAward / WelcomLink


Complimentary Vouchers Allowanced Off / Borne by the Unit

When a Guest presents a Complimentary Voucher, the Settlement in System is booked under a Miscellaneous Transfer (MT) Code under City Ledger Account. The same is subsequently borne by the Unit by passing a Back Office Allowance for debiting Sale and crediting MT City Ledger Account.


Settlement of Room charges Recovered from Starwood

When a SPG member wants to redeem his points in return for a stay at a participating property, then Starwood offers him SPG Awards as per the points redeemed in the form of Free Nights, Discount on stay rate, part settlement through points etc.

Units process the Award Redemptions through SPG Link on a frequent basis
On logging into the SPG Link, it displays the various SPG Guests who have redeemed the Awards in a selected date range. The list is verified through Check-out folios of each of the SPG guests and the verified entries are redeemed by ticking the corresponding check-boxes. For the amount equivalent to the award redeemed by the member, Starwood reimburses the value on category of room basis netting off the invoice sent for the 5% SPG Fees for crediting membership fees. HDHQ pays the net amount to Starwood and sends a Net Debit Note to the units

Entries passed are as below

Point of Entry At the time of Sale When Net Debit Note received from HDHQ (5% SPG Fees - Redemption Amt.) Treatment DR. City Ledger SPG CR. Sale DR. HDHQ Trading A/c CR. City Ledger SPG

Procedural Requirements:
Every Quarter, Unit gets the net payables to Starwood (net of 5% SPG Fees and Award Redemption) certified by a Chartered Accountant. The certificate is on the basis of verification of internal records of the hotel and the invoice received from Starwood. This certificate is sent to HDHQ to make the payments After payment as per the certification, HDHQ sends a Debit note for the Net Amount paid.

Various Taxation Statutes applicable to the hotels is as follows 1. Service Tax

2. Luxury Tax (State Specific provisions)

3. State Value Added Tax (VAT) (State Specific provisions) 4. Excise Duty 5. Delhi Entertainment Tax (State Specific provisions)*

* Not Covered in the forthcoming slides as specific to Delhi. At ITC-Maurya, Entertainment Tax is being levied on tickets sold for entry into Dublin.

Service Tax
Service Tax is levied and paid on accrual basis on the following services
1. 2. 3. 4. 5. 6. 7. 8. 9. Rent-A-Cab Services For Hotels Cars used by the Guests Mandap Keeper Indoor Banquet Services Short Term Accomodation Rooms Renting of Immovable Properties Shop Rents Internet Food & Beverage A.C. Restaurants Dry Cleaning Beauty Parlour and Health Club & Fitness For Beauty Parlour, Spa and Gym Banking & Other Financial Institution Service On Incentive by Thomas Cook

10. Business Auxilliary Service At Maurya for Tower Club usage 11. Sponsorship Service 12. Goods Transport Agency For freight paid 13. Advertising Space or Time For Show Window Rental 14. Membership for Clubs Earlier charged on Culinary Plus Memberships

Computation of Service Tax at the Unit is as follows:

Service Tax charged from guests on Room, F&B, MOD Services Total Allowances passed for Service Tax Service Tax on others - Immovable Property Income, Sponsorship, GTA etc. Service Tax adjustment for Tax paid in previous month for advances received for Banquets/ Spa etc. Service Tax Payable on Advances collected in the month for Banquets / Spa etc. Total Output Service Tax Input Service Tax Credit Service Tax Liability Payable

Less: Add:


Add: = Less: =

Luxury Tax
Provisions of Luxury Tax Act & Rules are state specific At ITC Maurya, Luxury Tax is paid on Accrual basis on the Rack Rates of the room occupied Computation of the Taxable Turnover is as follows:

Total Room Turnover of the Hotel (On the basis of Rack Rate in case of ITC Maurya) Exempt Turnover Less: (viz., Rooms occupied by Diplomats etc.) = Net Turnover Liable to Tax

Provisions of VAT Act & Rules are state specific VAT (as applicable in ITC Maurya) is payable on the following sale Food & Beverage Sale at Outlets, Banquets, In-room
Staff Cafeteria & Bakery Sale
Scrap Sale, Sale to employees of discarded hotel items etc.

Computation of monthly Output VAT Payable is as follows:

Output VAT charged to Guests (Aggregate of the VAT levied on the F&B Sale as in the Daily Closing Reports of the month) Back-Office & Front-Office Allowances for VAT during the month Output VAT on other sales (Viz., Staff Cafeteria, Staff Bakery, Scrap, Sale to Employees etc.) Total Output VAT Payable Total VAT Input Credit VAT Liability Payable

Less: Add:

= Less: =

Input VAT Credit is computed as below:

Opening Input Credit Carried Forward from last month Input Credit availed in the month (from Purchases of VAT-levied Raw Materials etc. during the month) Proportionate VAT reversed on EDM Sale during the month VAT Input Credit to be carried forward to the next month (based on the VAT on Closing Stock) Input Credit available during the month

Add: Less: Less: =

Entry Passed for VAT is as below:

DR. Input Credit (Closing Input Credit) DR. Raw Material Consumption (VAT on EDM reversal) DR. VAT Payable Account (VAT Output Liability) CR. Bank Account CR. Input Credit CR. Input Credit (Net VAT Liability Paid) (Input Credit on Purchases) (Opening Input Credit)

Excise Duty
Excise Duty is payable on the Bakery Items and handled by F&B Controls.
Excisable Bakery Items are sold/offered to Guests at following areas
Confectionery Shop Restaurants either menu-based or in buffet Staff Bakery Banquets & other complimentaries (viz., Chocolates as a part of rooming etc.)

As excise is levied on production, Duty is paid on the basis of transfers out of Bakery (net of transfers back) to each of the above areas. The menu sale price is considered for excise duty irrespective of the price at which the sale takes place, the rates of duty being the following
Chocolates 10%

Other Bakery items like Cakes, pastries, muffins, waffles, doughnut etc. 5%
Home-made ice-creams & kulfi 1%

Thereafter, a Days Excise Invoice is prepared as per Excise Rule 11 At month-end, Duty is paid / advance duty adjusted and ER-I submitted

Checking Bills-On-Hold report and review the status and reasons Preparing the High Balance Report ( for in-house guests with due settlement above Rs.25000) and send further for circulation to Morning Meeting members for taking a decision on requesting part settlement from guests Comparison of Rates charges vis--vis the Rack rates. Where the rate charged in lower than Rack rate by 50% or more, a report of such cases with reasons of discounts is circulated to Front Office Manager and subsequently to GM for ratification Checking whether PAN is available for all the guests who have settled in cash for an amount more than Rs.25000 Reviewing the rate masters in CLS in regular intervals on the basis of CVGR agreements Checking whether approved complimentary forms are available for the complimentary rooms given Reviewing the Front Office Allowances passed

NIGHT AUDIT Room Revenue posting into In-house Guest Folios

Reports archiving in CLS Date change on Day-Closure in CLS

Sale Reconciliation by way of 3-way Balancing

Prepares the Guest Ledger Reconciliation of Opening and Closing Balances and hands it to the Income Department Submits reports Daily Closing Report, Credit Card Batch Closure report along with Charge slips, Folios of Guests Checked out during the day, Front Office Allowance Vouchers etc. to Income Department


1. Statutory Compliance Checklist 2. Permanent Account Number of Guests

3. Banquet Rates & Contributions

4. Travel House Paid Outs

Statutory Compliance Checklists

Areas of Compliance include the following: Finance Front Office Food & Beverage Human Resources Engineering The status of Legal Cases is also consolidated Required to be prepared monthly by consolidating the checklists of all functions. The same is sent to HDHQ through GM & UFC

Permanent Account Number of Guests

As per Income Tax Act, every person paying a hotel more than Rs.25000 requires to submit their Permanent Account Number (PAN) to the Hotel In turn, the hotel is required to submit this detail to the Income Tax Department every half year. While the primary responsibility to obtain the PAN is of the receiving department, Income Department further checks and collates the PAN of all the guests in the following area in case they have settled their transaction for more than Rs.25000. Front Office (collated by Day-Auditor) Outlets (collated by Income Department) Banquets (collated by Income Department) Alternatively, it is ensured that in case the PAN is not available, the credit card detail is available. Half yearly return is submitted by Income Department

Banquet Rates & Contributions

Banquets have a Rate Matrix approved by the Banquet Manager, F&B Manager, UFC and the GM. This matrix contains the approved rates to be charged for various options offered to the guests Income Department checks the rates charged at the Banquets vis--vis the approved Rate Matrix of the Banquets. In case the rate charged by the Banquets is lower than the approved Rate matrix, then a summary is prepared of the Function detail for the approval of the GM. Further, report is also prepared regarding contribution from each function considering the F&B cost estimated by F&B Controls for the day. It is to ensure that the Budgeted contribution is being met. A consolidated report for the month for the above is incorporated in the Monthly Finance Report Backs

Travel House Paid Outs

International Travel House (ITH) provides car hire services to the guests of the hotel through in-house desk located at the hotel
Guests may pay for the car hired through ITH at the time of check-out from the hotel through their folio. Front Office charges the amount in the guest folio at the time of receiving payment. This is shown as Travel House Paid Out in CLS, nature being onbehalf payment received. Income Department does a daily reconciliation between the entries in CLS and the daily invoice issued by ITH for the cars given to the guest. Payment is made to ITH for the reconciled figure through cheque. Entry is as follows
Point of Entry At the time of Charging the Paid-out in Guest Folio When Payment is made to ITH Entry DR. Guest Ledger CR. Travel House Paid Out DR. Travel House Paid Out CR. Bank Account

CREDIT FUNCTION: 1. Bill Verifications and Dispatch 2. Follow-ups & Collections 3. Credit Card Transaction Reconciliation and Payments 4. Credit Card Charges 5. Travel Agent Commissions

6. Room Charge Recovery from Expedia, Starlink

7. No-show Recoveries 8. Advance Collection & Accounting 9. Related party Transactions 10. MIS & Others

Bill Verification & Dispatch

Auditing of bills checking for proper rates and taxes and give proper discounts. Credit Extensions are primarily given to Credit Cards, Airlines, Commercial Houses, Embassies, Banquet Guests, Shops, Travel Agents etc.

Follow-ups & Collections

Credit Card Transaction Reconciliation and Payments

Credit Card Charges

For the Credit Card Charges, HDHQ enters into arrangement with various banks to determine the credit card charge rates. Banks collect the credit card charges and Service Tax thereon at the time of paying the hotel for the credit card transaction values. When the Banks deduct the credit card charges at the time of making the payments, Credit Department passes a Back Office Allowance for the Credit Card Charges (excluding Service Tax). Allowance is bifurcated in the following proportion
Room Sale 60% Food Sale 30% Liquor Sale 8%

Others 2%

On the basis of this allowance, credit is passed into the City Ledger of the individual Banks so as to reduce the receivable.

After receiving the money from Bank for the net amount, only the Service Tax remains in the City Ledger Account which is adjusted cumulatively at month end.
At month-end, the aggregate allowance is used to charge as expense of Credit Card Charges Month-end Entry for Charging off Expensing is as follows
DR. Expenses Credit Card Charges CR. City Ledger Bank

Travel Agent Commissions

Room Charge Recovery from Expedia, Starlink

No-show Recoveries
As per

Advance Collection & Accounting

Hotels receive advance for the following
Banquets Advance as per Banquet Policy

Room Advance as per various Rate Plans / Part Settlement by in-house guests Beauty Parlour For Service Packages availed by Guests

These advances may be received in Cash/Credit Card Swipe/Cheque. (In case the Guest provides the credit card details, advance is recovered through EDC Machine at credit department.) Separate Receivables Account (referred to as D.B.Account) in CLS is maintained for each such type of advances. After the money is received from the party, Receipt is done in FINTRAN by Finance Team, on the basis of which a Credit Sheet is sent to Credit Team for passing on the credit to respective D.B.Accounts. For e.g., if a guest has paid an advance for Banquet Function booking, Credit will be given to D.B. Account Banquet Advances.

Thereafter, at the time of settlement of the final receivable from the guest, the credit from the common D.B. Account is transferred to the Guests D.B. Account.
Accounting Entries of Advance: (i) When the advance amount is received, entry passed in FINTRAN is as follows:
DR. Cash / Bank A/c CR. City Ledger Account (For the above, Credit is passed in CLS to City Ledger of the respective Advances)

(ii) When the sale has taken place and settlement of the check is done, no entry is passed in FINTRAN. However, Credit from City Ledger of Advances is transferred to the City Ledger of the guest.

Related party Transactions

MIS & Others 1. MIS on Indirect Foreign Exchange 2. Monthly reconciliation of Accounts and Accounts Receivable with Trial Balance. 3. Maintaining of Shop Agreements & processing License Fee

4. Internal Sale

MIS on Indirect Foreign Exchange

Hotel earns foreign exchange from Foreign Guests, Embassy payments, International Travel Agents, Airline companies etc Direct Foreign exchange is earned when a Guest makes payment directly to the Hotel in Foreign Currency. However, in case a Foreign Guest makes payment through Credit Card, or Foreign embassy makes payments, or Foreign Nationals who book through international travel agents etc., then the hotel earns foreign exchange indirectly. The report of Total Direct & Indirect Foreign exchange is collated every month to be reported in the Monthly Finance Report Back. While the Accounts Cashier controls the Direct Foreign Exchange earned, Credit Department oversees the MIS collation of Indirect Foreign Exchange earned.