9 Hotel Accounting Challenges Being Faced In Hospitality Industry

While Hotel Bookkeeping Systems are extremely powerful tools, they are only as good as the people interpreting them. Hotel accounting professionals must have a foundational understanding of hotel operations so they can properly discern data presented by Hotel Accounting Software reports. Managers who are not familiar with common processes will face challenges with identifying crucial Hotel Revenue Management information or being able to identify what questions to ask their teams in order to sift through mass amounts of data.

Below are 7 Hotel Accounting Challenges which you might encounter as a Hotel Accounting professional.

1. What’s my revenue?

Hotel software can be complicated to install and often requires that you integrate systems from various vendors, including the Hotel POS System, Hotel Front Office System, Hotel Property Management System, Hotel PMS Software and Hotel Guest Management Systems. This is why hotel accounting mistakes are made because it’s difficult to track different revenue streams especially with bookkeepers who specialize in areas outside of hotels which lack an appreciation for the accounting processes behind managing a hotel business. You might have purchased HMS but you need to factor in the time required for your employees to learn how to use it properly before realizing any benefits from using Hotel Bookkeeping Software.

2. Too many reports.

Hotel Accounting Software can generate hundreds of different reports for managers to sift through in order to pinpoint trends among all revenue streams especially when you factor in that most property management teams are dysfunctional with various departments operating autonomously without communicating with each other or acknowledging their impact on hotel numbers at large.  When your team is overwhelmed by data, it’s easy to miss opportunities which will never show up on Hotel Management Reports unless you’re aware of them when they happen since they only exist within an interval of time if productivity isn’t disrupted during that window of opportunity.   Hotel Accounting and Hotel Bookkeeping Software can generate reports that detail which departments are performing well and areas that could be improved for Hotel Management Efficiency.

3. What goes where?

Hotel property managers must understand common Hotel Revenue Cycle processes before they can make sense of Hotel Accounting Software reports. The major challenge with Hotel Bookkeeping is the amount of time it takes to input all transactions into the Hotel Property Management System manually and then compare them to what appears on Hotel Accounts Payable (AP), which requires the reconciliation process if the numbers don’t match up which wastes time if you’re logging hours on tasks that won’t result in accurate data or analysis. With an integrated Hotel Bookkeeping and Hotel Management system, reconciliations are done on Hotel Accounting software which speeds up the Hotel Bookkeeping process by having Hotel Property Management System data available on Hotel Accounting Software.  This also minimizes error rates since Hotel Accounting guys are not inputting dates, amounts and descriptions to Hotel Accounts Payable by themselves eliminating human error associated with manual data entry of financial transactions.

4. What’s my occupancy rate?

A major challenge Hotel Accounting professionals face is the fact that it’s difficult for department managers to convey their needs or concerns without first understanding their impact on hotel numbers and trends in revenue management. With an integrated Hotel property management and Hotel bookkeeping system, daily updates can be automatically generated so your team understands how they’re impacting performance metrics such as room rates, occupancy rates and revenue per available room. Hotel PMS Software generates Hotel Management Reports which flag opportunities for increased revenue so your Hotel Accounting department can drill down further to identify the source of those trends as well as how management is impacting Hotel Revenue Metrics.

5. How’s my budget?

With Hotel Accounting Software, you can generate Hotel Management Reports that compare Actual Numbers vs Budget numbers which will give you a clear picture of where your Hotel stands in terms of Income and Expenses without having to go through various spreadsheets because it’s already summarized on Hotel Billing Statements by month, quarter or year.  These comparisons can be done across departments such as Front Office compared to Food & Beverage compared to Housekeeping to make sense of Hotel Expenses and Hotel Income. Hotel Accounting Software also allows Hotel property managers to manage Hotel Budgets by generating Forecasts so your team can make adjustments to staffing, supply inventories or even banquet menus based on a predetermined Hotel Budget to flag issues before they become problems.

6. How’s my forecasting working out?

Hotel revenue forecasts allow you to create monthly reports that compare actuals vs budget numbers in order to track revenue performance & Hotel Management Reports which list opportunities for increased Hotel Revenue Metrics such as room rates, occupancy rates and revenue per available room depending on your metric of choice. With Hotel Bookkeeping software, it is possible to generate forecasts based on past performance with the choice between using either linear regression or exponential smoothing to project Hotel figures which allows Hotel Accounting professionals to generate Hotel Management reports that compare Actual Numbers vs Budget numbers.

7. Where have my guests been going?

Hotel property managers without a Hotel property management system might be at a loss when trying to understand where their guests are going after they check out because it requires manual data entry from guest folios into spreadsheets or other Hotel property management software before being able to generate Hotel Analytics Reports that track Revenue per available room by geographical location, price points and dates which will allow you to determine if there is a demand in a particular region or if your rates need upselling.  You can even use Software like MindSea Hotel Bookkeeping to drill down further by generating Guest Analytics Reports which show Hotel metrics by Hotel department such as average length of stay, night vs day stays and occupancy rates.

8. Who’s checking in?

Hotel Accounting Analysts using Hotel accounting software can generate Hotel Management Reports that compare Actual Numbers vs Budget numbers which will give you a clear picture of where your Hotel stands in terms of Income and Expenses without having to go through various spreadsheets because it’s already summarized on Hotel Billing Statements by month, quarter or year. With Nimble Hotel Bookkeeping software, it is possible to drill down further by generating Guest Analytics Reports which show Hotel metrics by Hotel department such as average length of stay, night vs day stays and occupancy rates.

9. How much did we make?

With integrated Hotel property management and Hotel bookkeeping software, Hotel property managers can generate Hotel Management reports that compare Actual Numbers vs Budget numbers which will give you a clear picture of where your Hotel stands in terms of Income and Expenses without having to go through various spreadsheets because it’s already summarized on Hotel Billing Statements by month, quarter or year. Hotel Accounting Software also allows Hotel property managers to manage Hotel Budgets by generating Forecasts so your team can make adjustments to staffing, supply inventories or even banquet menus based on a predetermined Hotel Budget to flag issues before they become problems.