By Analytix Editorial Team
Avoiding hotel accounting and bookkeeping errors is as much a function of practicing diligence and consistency as it is about competent, even-keeled staff managing it. While no business can claim to have 100% error-free accounting, working to prevent errors from happening is critical. It is also more cost-effective to prevent mistakes from happening in the first place, rather than correcting them later.
Having competent staff to manage your hotel accounting and bookkeeping is crucial because client service is a vital element across all functions of the hotel business. Any accounting mistake that involves a customer may take longer to resolve than one that does not. The chances of errors increase directly, given the high volumes of reservations, cancellations, food, and beverage requests generated directly from guests. If the hotel staff is not competent enough, even technical matters could escalate, eventually influencing the business negatively and causing loss in terms of finances and reputation.
Ensure Staff Is on the Same Page
Training staff in technical matters related to accounting and bookkeeping and providing them consistent support is one way to ensure relatively error-free accounting and bookkeeping for a hotel business. However, both of these can get demanding for a business poised for growth, especially when most in-house resources are focused on that growth and nothing else. Setting aside even a minuscule proportion of time or resources for training purposes may prove to be difficult for a business that is rapidly growing. This is especially true for accounting and bookkeeping, where daily tasks cannot afford to be overlooked.
What are the different ways in which to avoid hotel accounting and bookkeeping errors?
Ensuring consistency is easier when the basics are followed. As a first step, ensuring paperwork is complete, entries are recorded consistently, and categorization of income and expenses is carried out correctly, can boost chances of error-free accounting.
There are tasks within accounting and bookkeeping that must be performed regularly or on a daily basis. Other tasks, such as creating new vendor lists, statement reconciliation, inventories for hotel supplies food and beverage merchandise, are critical functions that can help the accounting function to operate smoothly but do not need to be performed daily.
Following a budget is a useful way of ensuring that the hotel’s operating expenses are reduced. A budget also restricts overspending and helps staff align with financial goals and ground realities. More importantly, creating a budget allows everybody involved to understand the financial limitations of the business and help realize long-term goals and short-term objectives. Needless to say, budgeting is also a part of classic accounting practices that should not be overlooked.
Bookkeeping is all about recording transactions correctly. Data entry is a big part of bookkeeping and includes essentials such as bank reconciliations and reconciliations between accounts payable and receivable. This means tracking vendor and customer invoices and receipts.
Data entry is a function prone to errors and must be reviewed periodically to make corrections in the numbers and ensure accurate records for all transactions.
Back-ups are non-negotiable to avoid errors in hotel accounting and bookkeeping. However, backed-up data needs further attention and should be checked for errors and potential corrections, as well. Discovering errors during times when there is trouble may render the back-ups useless, compounding the challenge faced by the business in times of crisis.
Time is of essence for the owner of a growing business. Outsourcing critical tasks, such as statement reconciliations and tax filing can help a business ensure accuracy and reliability in financial records. Outsourcing to professional accountants can also help hotel businesses save money in terms of ensuring applicable tax exemptions and higher regulatory compliance, in addition to benefiting from money saved in working with error-free records.
For the owner of the business, there is the added advantage of investing the time thus freed up to pursue business building activities.
Looking for Help? Do Not Miss This
If you are looking for help with a growing hotel business, remember that accounting services are best carried out by professionals. Look around for an outsourcing provider who can work alongside you to serve your business goals better and to work with you to help enhance profitability. There is no “one-shoe-fits-all” formula. Depending on the business size and hotel property type, geographical location, and services provided, an outsourcing vendor should be able to design and customize effective solutions
Analytix Solutions is a single source provider of business solutions to startups and small to mid-size businesses that are positioned for growth. Call us at 781.503.9002 or email us email@example.com to learn more about how our customized and scalable solutions, including Insight360 solutions designed for hotels, can help your business manage challenges better.