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Global Hospitality Accounting Common Practices Version 1.0

Global Hospitality Accounting Common Practice Project

How It All Started

HFTP having extended its reach internationally, recognised for some time that there was an industry need to provide some practical tools and guidance on global hotel accounting practices.   Such data is of interest to an ever widening user group including hotel finance and operating management, developers, owners, investors, asset managers, hospitality management students and teachers.

Conceived during 2011, the prime research and development objectives of the project are to:

  • show how hotels around the world prepare and format their management accounts, enable comparisons to be made between them, and explore their constituents
  • establish a searchable database to provide access to examples representing each country’s common practice
  • include the only currently published industry standard, the Uniform System
  • develop a global example that reflects the findings from the countries surveyed
  • enable the formats and structures of the selected hotel operating statements and their departmental schedules to be displayed
  • build a comprehensive list of all items identified that hotels include in their Revenue, Cost of Sales, Payroll and Other Expenses, that can be tracked into which accounts, and departments they are allocated
  • provide examples of ratios and statistics used by hotels, and standards applied by benchmarking companies

How the Research is Carried Out

For the initial database, full service hotels where named contacts have been identified are being contacted to request their participation.

Data samples comprise operating statements, charts of account, revenue and expense dictionaries, and explanations such as how revenue and capital items are distinguished.

Who is Collecting the Data

Hospitality management student teams from international and local universities, who are not accounting specialists, undertake the data collection.  These are hospitality management undergraduates and post graduates.  For some, the project work is part of their graded academic programme, and for others it is an extra-curricular task.  Where HFTP has established student chapters, members of these are invited to participate.

The students are provided with a valuable learning experience.  Where possible, this includes hotel visits so that they can meet financial managers and see something of how the finance function operates in a live environment.
Support is given to the student teams, apart from supervision by university representatives, by local professionals where available, and HFTP team members.

How is the Data Reviewed

Local (where available) experienced hospitality finance professionals review and select the country representative hotel for data input to the HFTP website.  This is cleansed so that the submitting hotels remain anonymous.   In countries where professional hospitality accounting associations exist, they provide suitable expertise.  HFTP is identifying alternative resources to validate data from other locations.

Data is only uploaded to the website when reviewed and validated.

Research in Progress

Data has so far been collected or is being processed from:
Europe Region - Netherlands, United Kingdom, and France
Asia Region - Hong Kong and Shanghai, China
Uniform System of Accounts for the Lodging Industry 10th and 11th editions
USFRC 7th edition:city clubs, country clubs, and CIRAs

Data in Progress:
South America - Columbia

The Finance Committee of the Education Institute of the American Hotel and Lodging Association has authorised HFTP to display the data from the Uniform System of Accounts for the Lodging Industry, 10th Revised Edition.  This will be updated to the 11th Edition when it is due for implementation.

Research for other countries will continue, and new data from the initial countries will be reviewed so that the data on the website will be periodically updated.

Under Development

Sections covering Operating Statistics and Benchmarking Metrics, and to illustrate Asset treatments are planned.