1. Front Office Accounting
Unit - III
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2. Heritage Institute of Hotel & Tourism
Introduction
The term Front Office Accounting from Hotel point of view means knowledge of what is to be received from the Guest and what is to be paid to the Guest. To have an update information of the same it is important that at all during the Guest Cycle an efficient system is used.
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3. Various Front Office Ratios
House Count:
(Total No of Guest stays in a particular time.)
1. Previous night House Count + Arrivals – Departures Or
2.Single Rooms + 2 X (Double Rooms) + Extra Beds
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4. Various Front Office Ratios
Room Count:
Total No of Rooms occupied in a particular day
Total No of Available Rooms – No of Vacant Rooms Or
Total No of Rooms Occupied Previous Night + No of new Arrivals – No of Departures.
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5. Various Front Office Ratios
Occupancy Percentage:
Relationship of the no of Room sold to the no of Room available for sale. This measures the success of the sales department.
No of Room sold
X 100
No of available for Sale
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6. Various Front Office Ratios
Multiple Occupancy Percentage:
No of Room Sold with 2 persons or more occupying each Room is called Multiple Occupancy.
House Count – No of Room sold
X No of Room sold
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7. Various Front Office Ratios
House Count
X 100
No of Room sold
Average no of Guest per Room ( AGR)
Room Count
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8. Various Front Office Ratios
Single Occupancy Percentage:
No of rooms occupied by one person is called Single occupancy.
House Count
X 100
No of Room Sold Or
2 X (No of Rooms Sold) – House Count
X 100
No of Rooms Sold
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9. Various Front Office Ratios
Bed Occupancy Percentage:
(Guest Occupancy or Sleeper Occupancy)
No of Bed sold
X 100
No of Bed available for sale
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10. Various Front Office Ratios
Average Room Rate or Daily Rate (ARR/ ADR):
Total Room Revenue
Total no of Rooms Sold
Rev Per: (Revenue Per available Room):
Total Room Revenue
Total Rooms Available for Sale
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11. Various Front Office Ratios
Average Revenue Per Guest (ARPG / ARG):
Total Room Revenue
House Count
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12. Various Front Office Ratios
No Show Percentage:
This is the percentage of those Guest who did not arrive in spite of having Confirmed Reservation.
No of (DNA) Did Not Arrive Guest
X 100
No of Confirmed Reservation Guest
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13. Front Office Accounting
Also called as Guest Accounting system and it is an essential process to monitor and chart the financial transaction of Resident and Non-Resident Guest.
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14. Heritage Institute of Hotel & Tourism
Objectives and Aims
The main objectives of Front Office Accounting Process is to ensure that all financial transaction maid by the Guest are recorded and settled in Guest account and are monitored, controlled and Audited time to time to avoid any discrepancy, loss of Revenue and possible disputes with the Guest. Further its objectives is to collect payment for all Guest transactions.
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15. Types of accounts maintained by Front Office Cashier
Resident Guest account.
City accounts.
Management accounts.
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16. Types of Financial Transactions
Accounts Receivable.
Accounts Payable.
Cash Transaction.
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17. Basics of Keeping Accounts
Debit and Credit :
Dr.
Cr..
Dr.
Cr.
Rs. 750
Rs. 750
Debit Rs. 750
Credit Rs. 750
Balance

18. Types of postings or transactions for a guest
Account Receivable transaction (Debit items)
Room charges
Restaurant or food and beverage bills
Telephones
Laundry
Account payable Transaction (Credit Items)
Prepayments
Payment for part of the bills
Payment for final bill.

19. Functions of Front Office Account system
Creation and Maintenance of guest folio.
Tracking financial transaction of the guest.
Maintain an accurate and current records of all guest transactions.
Monitoring credit limit of the guest.
Provide management information on departmental revenue.
Maintaining effective control over cash and credit transactions.
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20. Heritage Institute of Hotel & Tourism
LEDGER
Guest Ledger: A ledger that contains all detail of financial transactions between a hotel and a resident guest. It is also known as Bill Folio Transient Ledger or Guest Ledger.
Categories of Folios:
1. Guest Folio
2. Master Folio or Pay Master (PM)
3. Non Resident Folio
4. Employee folio
5. Split Folio
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21. City Ledger
City Ledger : A ledger that contains the collective accounts of all non-resident individuals/agencies to whom hotel provide the credit facility.
Credit always follow a contract with company or agencies who is availing the credit facility.
The settlement of credit bills always follow credit note, voucher, VPO, SPO, and Billing letter (BTC).

22. Presentation and Settlement Of Bill
Check out request is received at FO/Bell desk.
Bell boy fills up the departure errand card.
Bell boy transfers the luggage to lobby.
FO sends DNS to respective departments.
FO cashier updates the guest folios.
Guest arrives at front desk and handover key.
Cashier wishes the guest.
Cashier prints out the room bill.
Guest reviews the bill.

23. Presentation and Settlement Of Bill
Re-check for the mode of payment.
Settlement of the bill by Cash, Credit Card, VCHR, BTC.
Fill the feedback form and say good bye.
The front desk makes the gate pass.
The front desk clears the bill slot for the guest checked out.
The Front Office updates the Arrival/Departure register.

24. Paid Out
It is a process by which Front Office cashier provide money to the guest or on behalf of the guest to someone else.
Kinds of Paid Outs:
1.Cash paid out
2. Paid out at check out
3. VPO / Other paid outs.
4. Advanced to Concessionaire

25. House Bank
Some of money given to Front Office cashier for daily operations such as:
Foreign Encashment
Paid Outs
Petty Cash
This is also called as Float Money.

26. House Bank
Overage
Shortage
Par
Turning
Due Bank
Refunding Due Bank

27. Front Office Accounting Cycle
Follow-up on Bad Debts,
Late charges
Assigning rate & tariffs
Checking methods
Of payments
Front Office Accounting Cycle
Settlement of
Master folios by
Company
Establishing
Credit limit
Creation of accounts
Verifying
Accounts
To co
After Departure
Pre Arrival & Arrival
Creating
folio
Settlements of
accounts
Posting of
Cr/charges
On Departure
During Stay
Audit
Monitoring
Credits
Maintenance of accounts
Settlement of
Guest folio
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28. BIBLIOGRAPHY
Textbook of Hotel Front Office Management & Operations by Manoj Kumar Yadav.
Check-in Check-out Managing Hotel Operations by Gary K. Vallen and Jorome J.Vallen.
Managing Front office Operations byMichael L Kasavana Phd,Richard M.Brooks.
Hotel Front Office Training Manual by Suvradeep Gaurang Ghosh.