Week 2 Hand-Outs

Look at some Vocabulary words that you will encounter along the lesson.
1. Reconcile- make (one account) consistent with another, especially by allowing transactions that have
just begun but not yet completed.
2. Balance- a condition in which different elements are equal or in the correct proportions.
3. Discrepancies- a lack of compatibility or similarity between two or more facts.
4. Back-up- one that serves as a substitute or support.
5. Deposit- a sum of money placed or kept in a bank account, usually to gain interest.
The following steps are common to the sequence of a night audit:
1. Complete outstanding postings
The auditor verifies that all voucher posting for revenue center transactions have been completed. The night
auditor may also need to record the not posted front office transactions.
2. Reconcile the room status discrepancies
The night auditor is responsible for ensuring that discrepancies
between the daily housekeeper’s report and the front office room
status system are reconciled before the end of the day.
3. Balance all departments
The posting to guest and non-guest accounts must equal the amount charged at revenue outlets for the front
office accounting system to be considered in balance.
4. Verify room rate
The report shows the rack rate for each room and the actual rate at which the room was sold, providing an
opportunity to analyze room revenue. If a room’s rack and actual rates do not agree, there are several factors
for the auditor to consider:
a. If the room is occupied by a member of a group or by a corporate rate customer is discounted rate
correct?
b. If there is only one guest in a room and the actual rate is approximately half the rack rate, is an
additional guest part of the reservation? If s/he is, did s/he register?
5. Verify no-show reservation
It is the responsibility of the night auditor to clear the reservation rack file and post charges to no-show
account. In posting no-show charges, it must be verified that the reservation was guaranteed and the guest
never arrived.
6. Post room rate and tax
The posting of room rates and tax to all guest folios typically begins at the end of the day. Direct posting of
room rate and tax at any time is one of the great advantage of a computerized system.
7. Prepare reports
The auditor is responsible for preparation of reports which indicates the status of front office activities, such
reports include:
a. Final Department Detail and Summary Report – is produced and filed with the source document for the
accounting department.
b. Daily Report of Operation – summarizes the day’s business and provides insight into revenue,
receivables, operating statistics and cash transactions related to the front office.
c. High Balance Report – identifies guests who are approaching an account credit limit. In a computerized
system, the computer may be programmed to produce a high balance report upon demand.
8. Deposit Cash
Often the night auditor is responsible for preparing cash deposit as a part of the audit process. Since account
and departmental balancing often involves cash transactions, cash deposits may depend on a successful audit.
If front office cash receipts have not yet been deposited, the auditor compares the posting with cash payment
and paid out (net cash receipts) with actual cash on hand.
9. Backup the system
This step applies only to computerized front office system. Since computer system eliminates the need for a
room rack, reservation card and a variety of other traditional front office forms and devices, the front office
becomes very dependent on the proper functions of the computer system. Back-up reports must be run in a
timely
manner to enable smooth operation of the hotel in the event of computer system failure.
10. Distribute report
Due to the sensitive nature of front office transactions, the night auditor must heed to deliver
appropriate report in a meaningful format and a timely manner. The distribution of reports is the final step in
the audit routine.
Departmental Balancing Sequence
1. Sort the vouchers according to their department.

2. Consider each department’s voucher.
a. Separate the correction voucher according to the departments they are to be applied.
b. Total the correction for each department.
3. After verifying each of the correction with the affected departments, total the correction voucher on
an adding machine. The correction tape must coincide with the correction figures on the shift report.
4. Consider the voucher again.
a. Run adding machine tapes on the rest of the voucher
b. While running tapes on the voucher, check the written figure at the bottom of the voucher against the
printed figure on the department detail report, as well as against the validated figure of the hotel’s validating
printer.
5. The vouchers should agree with the correcting figure of the departments. If the tapes do not agree
with either figure, check to find the error before proceeding.
a. Check to see that the date on the voucher is the current day’s date.
b. Check off each individual posting against the voucher until the error is found.
c. Post any correction or adjustment.
6. Print revised individual shift report after corrections and adjustments have been made. In any
operations made, all back up data should be packed for the accounting office.

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Look at some Vocabulary words that you will encounter along the lesson.

Departmental Balancing Sequence

1. Sort the vouchers according to their department.

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