1. http://www.bized.co.uk Copyright 2005 – Biz/ed Financial Systems in Travel and Tourism BTEC Travel and Tourism

2. http://www.bized.co.uk Copyright 2005 – Biz/ed Introduction As with any business, those organisations in the travel and tourism industry need to manage their finances in order to: Receive payments Make payments Record financial activities Keep systems secure Handle currency conversions Make tax returns

3. http://www.bized.co.uk Copyright 2005 – Biz/ed Impact on business Some of these systems have a direct impact on the activities of the organisation, for example, in currency conversions: Ensuring that foreign currency payments and receipts are effectively managed Keeping up-to-date with exchange rate movements Anticipating demand for travel products and services based on exchange rate movements

4. http://www.bized.co.uk Copyright 2005 – Biz/ed Exchange rate movements Tour operators and travel agencies have experienced the effects of exchange rate movements in recent years in the following ways: The fall in value of the US $ compared to UK £ This has meant that a holiday or air ticket priced in US $ is less expensive today than a year ago If UK travellers want to visit the USA, they will have to use fewer UK £s to pay for a travel product or service that’s priced in US $ The Activity associated with this lesson contains more for you to do on this point

5. http://www.bized.co.uk Copyright 2005 – Biz/ed Political changes Large-scale political changes also have an impact on travel and tourism organisations’ financial systems: Enlargement of the European Union in 2004 from 15 to 25 members Causes demand for travel to these new member states to rise

6. http://www.bized.co.uk Copyright 2005 – Biz/ed Political changes Travel organisations may have targeted some of these new EU destinations For example, low-costs airlines have opened new routes to cities in the new member states But changes to the tax systems in some of these new EU states may have a negative impact on demand and supply of travel products and services